The Fed Just Acknowledged Its Too Big To Jail Policy

a reply to: Phage

A business decision made for the convenience of owning something you could not afford outright, in your case a home.

a reply to: AlaskanDad

A business decision made for the convenience of owning something you could not afford outright, in your case a home.

A business decision which provides for current positive cash flow and I expect to provide a net profit should I sell.

A business decision which, without the availability of mortgage loans, would not have been an option.

My mortgage loan is a part of my investments. My property is valuable and is gaining value.

a reply to: AlaskanDad

Personally - I think all C level executives and all members of boards should be held personally responsible for the actions of the company's they 'control'. Just as a small business person is held personally responsible for the action's of their company and employees.

I think there are valid exceptions but they would be the exception not the rule.

There are loopholes that basically beg to be taken advantage of much of the time, and these are known and exploited. But sometimes there is outright breaking of the law, but neither of these are high on the FED's priority list, because why clean up a system if it is not broken? And by "not broken" I mean financially benefiting all those in power at the FED, or other parts of the government. Oh wait, the FED is not a part of the government, go figure.

originally posted by: Phage


We are talking about loans. A loan is not an investment.

You may be talking about loans - but we are not. The thread is about wether or not people want to see the architects of the crash - bankers - punished for their crimes.

a reply to: FyreByrd

You may be talking about loans - but we are not.

My response was to someone who was.


What crimes, specifically?
Can allegations of money laundering be proven? If so, yes, prosecute. It's been done.
Allegations of manipulating interest rates, well, that's a bit trickier but yes, go after them if you can pin it on someone.
Ethical violations like marketing silly mortgages to gullible people? That's bad but not illegal.
Illegal foreclosures? Sure if you can pin it on someone. Go for it.

originally posted by: LoneGunMan
a reply to: Phage

That money should have been used to bail out the American peoples homes who were shafted by the banks. Then those people would have pumped money back into the economy instead of renting from investors that are ripping them off. What kind of person thinks like you?

Now that would have helped everybody - even the banks.

a reply to: FyreByrd

Now that would have helped everybody - even the banks.

How? Who would have replaced the lost capital? The government just gives people money? Where did that money come from?

But I thought we weren't talking about loans.

originally posted by: Phage
a reply to: FyreByrd

Now that would have helped everybody - even the banks.

How? Who would have replaced the lost capital? The government just gives people money? Where did that money come from?

But I thought we weren't talking about loans.

So how come it's ok for the federal reserve to issue currency to both banks and the government at interest, and then for the government to bail out some of those banks on the taxpayers dime, only to pay back money to the federal reserve and other banks that it owes debt to?

How is that fair to the taxpayer and how is that not "free money"? Someone is getting screwed, and it isn't the banks.

a reply to: DeadSeraph

How is that fair to the taxpayer and how is that not "free money"?

Who said anything about fair? As much as it sucks, as trite as it is "life is not fair."

Here's a homework assignment:
1) How much was the total "bailout?"
2) How much was held in homeowner mortgages?
3) Was the bailout greater than, equal to, or less than the amount held in homeowner mortgages?
4) If the bailout was less than homeowner mortgages how would it be distributed? "Fairly." So that everyone would be happy?

a reply to: Phage

Here's a homework assignment:

I have enough homework as it is right now, thankyou.

1) How much was the total "bailout?"

That seems to be up for debate. I've seen figures as high as 7 trillion. What do your figures say?

2) How much was held in homeowner mortgages?

What does that have to do with anything?

3) Was the bailout greater than, equal to, or less than the amount held in homeowner mortgages?

See above.

4) If the bailout was less than homeowner mortgages how would it be distributed? "Fairly." So that everyone would be happy?

I don't recall anyone being bailed out when their homes were foreclosed, so again, what does this have to do with the price of tea in china?

a reply to: Phage

for the record, if there is something that I don't know that you do, you could stop being an asshole about it and just spell it out for me. In the meantime, it just seems like you're being an asshole.

a reply to: Phage

I see nothing wrong with an interest bearing loan. On occasion in the past, I have needed to borrow money from family a member. Mostly small amounts, a couple larger amounts. I repay the loans including any and all fees to get the money to me. On the larger loans, I set the conditions of repayment including an extra amount over the borrowed amount. I feel it's only fair and everyone is happy. I have also loaned money to other family members and friends but have never asked for anything repaid than the actual loaned amount. Some loans get paid back, some don't. I learned to never loan any money that I needed to have repaid, and once a person doesn't pay me back, I don't loan to them again, ever.

There has to be compensation to the financial institutions on the loaned money or else there wouldn't be any lenders, that's a no brainer. How else would they pay their overhead and make a profit? No profit, no loans. No financial institution forces a person to borrow money and it's USUALLY due to our own greed that we seek loans in the first place. I don't know the statistics on consumer debt but home loan interest rates usually fall in the single digit range. Consumer debt on everything else can be much higher. Banks have to recover from bad loans, and bad investments.

Consumers need to control their own greed. Also, house debt and consumer debt should be considered different issues. The problem with many FI/banks is they could lower their rates and still make a good profit, giving the borrowers a break but they don't.

And then there's the responsible borrower (???) who falls on hard times through no fault of their own. Borrowing comes at a risk. It's a gamble that you'll come out of it clean as a whistle. Borrowers don't take that into consideration when they accept loans. They assume everything will be smooth sailing with no issues. They think they're financially invincible. Then events change and all of a sudden, they're in hot water. The once wonderful banks who loaned them all that money are now the evil sharks, wanting their money back. The audacity of it all!

a reply to: DeadSeraph

I don't recall anyone being bailed out when their homes were foreclosed, so again, what does this have to do with the price of tea in china?

It has to do with the question of bailing out the banks or those whose mortgages they held. It would have cost far more to do the later and the prospects of recovering the bailout money would have been far less.

a reply to: DeadSeraph

In the meantime, it just seems like you're being an asshole.

Sorry. I may tend to take the Socratic route sometimes. I'm not trying to be an ass, I'm trying to stimulate thought.

originally posted by: Phage
a reply to: DeadSeraph

In the meantime, it just seems like you're being an asshole.

Sorry. I may tend to take the Socratic route sometimes. I'm not trying to be an ass, I'm trying to stimulate thought.

I have the same problem. Apology accepted.

You stated this:

It has to do with the question of bailing out the banks or those whose mortgages they held. It would have cost far more to do the later and the prospects of recovering the bailout money would have been far less.

correct me if I'm wrong, but wasn't the financial crisis and the subsequent bailouts much more complex than an issue of mortgages? Admittedly, I am not very educated on the inner workings of financial institutions, but from what I gathered based on my limited understanding, the crash was more based on predatory lending practices as well as trading in faulty debts. I still don't understand why you feel the taxpayer should be on the hook for that, or how any of this isn't criminal.

If I've misunderstood your position, please clarify.

but wasn't the financial crisis and the subsequent bailouts much more complex than an issue of mortgages?

a reply to: DeadSeraph
Somewhat, but it was the collapse of bad mortgage debt which precipitated it. Too many loans made to people who would never be able to make good on them.

People were jumping on low payments (variable rate, interest only) loans and there was not due diligence on the part of lenders to qualify borrowers. Unethical no doubt. Not illegal. But, as I said, the first time I heard about that sort of loan I couldn't understand why anyone would go for one, other than in a quick "flip" situation.

Even an idiot knows when hes being screwed.....
Being super intelligent must preclude that sense.......
IDK you mortgage details (nor care to) but why doesn't the bank give you equal interest on your loan to them? Again ....YOUR BANK ACCOUNT.....
Because they collect interest on their mortgage.....
Usery is as usery does...pity there aren't more smart people who can figure that out......

a reply to: Phage

Somewhat, but it was the collapse of bad mortgage debt which precipitated it. Too many loans made to people who would never be able to make good on them.

I understand that portion of the problem. I think where I am getting a bit confused is that I remember hearing something about banks then trading on those bad loans, and also betting on them or against them. Essentially taking what was widely known to be negative capital, and making money off of it anyways. Am I misinformed?

a reply to: DeadSeraph
Nope. You're exactly correct. But if the loans had been viable there would not have been any problem. It was a common practice long before the crash. I had a couple of mortgages sold. I had nothing to do with it and all it meant to me was writing my check to a different bank.