Posted on 10/02/2008 3:11:04 AM PDT by TigerLikesRooster
The fatal bankers fall
By John Gapper
Published: October 1 2008 18:45 | Last updated: October 1 2008 18:45
Bankers have never been popular, but Washingtons rejection of the $700bn bail-out for banks on Monday recalled the odium that attached to them in the Great Depression.
Americans rightly wonder why their taxes should be used to rescue bankers from their folly. In the 1930s, bankers were called banksters to rhyme with gangsters as a result of 1920s swindles such as the sale to small investors of Peruvian bonds that became worthless.
It is odd, as well as infuriating, that investment bankers managed to take the public for such an expensive ride again. Only 10 years ago, the author Ron Chernow declared the death of the banker, arguing that Wall Streets grip on the financial system was ebbing.
Yet here we are again this time with governments around the world opting to rescue banks rather than risk economic disaster.
At the risk of repeating Mr Chernows mistake, however, this crisis will truly kill the banker. By that, I mean it will end the reign of the investment banker as societys leading figure of wealth and influence, cutting a swath through the world and being deluged with money.
Does this make the rest of you (not the bankers, I mean) sad? No, I did not think so. I know plenty of likeable and ethical bankers, but as a general rule, they are in disrepute.
Wall Streets behaviour during the mortgage boom bears a nasty resemblance to that of Charles Mitchell, the head of National City Bank, which sold dodgy securities to Main Street in the 1920s. Mr Mitchell turned National Citys broking arm into a securitisation machine.
(Excerpt) Read more at ft.com ...
Ping!
Testing: How long will it take for someone here to blame McCain?
The fault of this current financial situation lies squarely on the shoulders of socialists in government and corporate socialists who stand straddle legged with one foot on solid ground and one foot in quicksand.
I’ll bite. So now under the 14th Amendment I should be able to go to Vegas and lose a bundle, the house the 401 K, everything, and then expect McCain to pass a law that bails me out, too. Right?
You won’t have to wait long. McCain voted for this disaster yesterday, what’s a conservative supposed to think? He refuses to go deal with this from an anti-corruption point of view and name names in the Dem party and Obama campaign- what’s a conservative supposed to think? He’s kept our pitbull ona short leash, surrounding her with Bush people who have NO CLUE how to get a message across to the nation- so what’s a conservative supposed to think!
There’s a legitimate reason to be unhappy with him right now.
McCain voted for the damn thing. It chock full of tax breaks/ear marks that he said he would stop immediately.
The straight talk express is a straight lie!
“Banksters would never had given out absurdly risky mortgages unless the US government threatened them with all their power.”
So true. Clinton’s known thug tactics worked well for him. Those tactics gained him Political achievement. He continued using those tactics upon gaining the Presidency. It was those tactics he used to get his way with the “Banksters”.
Clinton using the Carter era CRA as the foundation, and thuggery as his means assaulted the Mortgage Industry creating the debacle we have today.
http://findarticles.com/p/articles/mi_m1282/is_n25_v45/ai_14779796
After 5 bounced checks, it was a pleasure to evict his azz.
He was a hot shot bankster for 30 years, packaging mortgages. Attitude galore. A total a-hole.
I don't buy that excuse any more. Their dismay lasted only until they figured out they could securitize the loans, sell them off for big profits, and keep the origination fees. Once they had that structure in place they started making as many subprime loans as they could to whomever could possibly "qualify"; no income, no job, no legal status...none of it mattered. They found a way to turn a bushel of spoiled lemons (CRA) into a million gallons of toxic lemonade.
That's one of the reasons McCain hasn't been been able to hit Obama hard on his Fannie and Freddie ties - big Republican contributors exploited the situation, too.
As I said, some did in fact take advantage of this. There are also mortgage agencies that don’t lend funds but simply make money on connecting borrowers with lenders.
That said, there are many banks that run their businesses clean and safe and don’t like to take unnecessary risks. These banks found it increasingly difficult to conduct business along the sound lines of market and were coerced by the Clinton administration to ‘play the game.’
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