The Banker Who Said No

Forbes ^ | 2009-04-03

[rabscuttle385]

[rabscuttle385]

Beal has barely got a dime from the feds. A self-described "libertarian kind of guy," Beal believes the government helped create the credit crisis. Now he finds it "crazy" that bankers who acted irresponsibly are getting money and he's not. But he wants to exploit their recklessness to amass his own fortune.

Ping!

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[org.whodat]

He was correct, now if we could just roll back time and stop Bush and Paulson and the Tarp Rich Man Bailout BS Train.

[thefrankbaum]

Sounds like he understands things. Here's his prediction:

"Banks are on a prayer mission that somehow prices will come back and they won't have to face reality," Beal says. And that reality, according to Beal, is going to get a lot worse. "Unemployment is going over 10%, commercial real estate hasn't even begun collapsing and corporate credit defaults are just getting started," he says. His prediction: depression, without bread lines this time, thanks to the government safety net, but with equal cost to society.

Have fun!

[avenir]

Interesting man. These people fascinate me as I have no money or business savvy at all. It would be fun to sit in for a day and listen to the proposals and verdicts.

[Extremely Extreme Extremist]

Amazing story.

[Oldexpat]

All the indicators were there that we had a huge realestate bubble and irresponsible..idiotic..loans being made for many reasons. The bad loans haven’t stopped..the prices are just down. Eventually the loans and the real value of the underlying property must match.
The lack of a read “free market” for these assets is the problem..the govt, with their plan, is still trying to overvalue them.

[ovrtaxt]

Good businessman, no doubt. But if Beal’s organization practices fractional reserve banking, which I’m sure it does, he’s just another cog in a machine that must be dismantled.

He’s just another agent of inflation at the end of the day.

[April Lexington]

He’s just another agent of inflation at the end of the day.

Beal's a smart guy, no doubt. But, if we hit hyperinflation... those cheap loans will be a disaster unless he can adjust the rates. He's gambling that the economy stabilizes and people continue to make the loan payments. If the $15 million note he bought for $5 million defaults, he's toast. Worse, if the $15 million is repaid in hyper inflationary conditions, the value of the money will be substantially less than his board realizes. In all, though, I hope he succeeds!

[ovrtaxt]

If he’s making loans of any kind, he’s creating money and causing inflation.

Just the way fractional reserve banking works, that’s all.

[MSF BU]

This is a good example of why a subscription to Forbes is worth the price you pay.

[bamahead]

A self-described "libertarian kind of guy," Beal believes the government helped create the credit crisis. Now he finds it "crazy" that bankers who acted irresponsibly are getting money and he's not.



Libertarian ping! Click here to get added or here to be removed or post a message here!

[MissouriConservative]

The guy sounds like he knows what he’s doing when other don’t. How I wish more people were like him, including our supposedly intelligent leaders.

[Protect the Bill of Rights]

The sad part is that we almost did stop them. It failed the first vote in the House. When the second vote was taken, the yellow bellied Representatives gave Pelosi their balls.

More than sad, absolutely disgusting.

[traviskicks]

bump

[Species8472]

[randomhero97]

Thats awesome.

[PAR35]

If the $15 million note he bought for $5 million defaults, he's toast.

There's always the underlying collateral

I had wondered what was going on with him. He was a major player in the last downturn, bought the new Fina headquarters when they disappeared, started playing around with rockets, dropped that project, and then just faded out of sight.

http://en.wikipedia.org/wiki/Beal_Aerospace

[TenthAmendmentChampion]

From late 2005 to summer of 2006 I worked in correspondent lending at Washington Mutual. My boss was a brilliant man. He had worked in banks most of his life, and was in his sixties.

He told me he went to a meeting at WaMu where they discussed Alt-A and other subprime loans. He listend for a while and finally said, “These loans are crazy. They are going to blow up and ruin us.”

He was told, “You don’t understand these loans. Don’t poke your nose where it doesn’t belong.”

He told me this before everything went to heck. I respect him more than any boss I ever had.