Banks--- Betting on the recovery Message Board

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Non-Tech : Banks--- Betting on the recovery

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10:02 AM EST

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To: Road Walker who wrote (769)	4/13/2010 8:31:09 PM
From: tejek	Read Replies (1) of 1428

.....too much attention has been placed on the creative financial derivatives that Wall Street brewed up and not enough on the 'old fashioned' games that were played with the buying and selling of housing Yeah but one enabled the other. Not necessarily. All residential loans are sold in packages to their second tier lenders like FRE or FNM. that wasn't a new concept. So no matter how good FRE's or FNM's DD was, they would not catch something like an appraiser fudging on an appraisal. One would have to know real estate conditions in every neighborhood in every local market. I don't think that's a reasonable expectation. FRE and FNM had to depend on the competency and honesty of local banks. And I think there are other areas of the application that banks could have played with and not got caught. After all, banks decided to be 'aggressive' in ways they have never done previously. I am sure it took people at FRE and FNM by surprise.

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