Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Mainstream Politics and Economics -- Ignore unavailable to you. Want to Upgrade?

To: Bearcatbob who wrote (474)	9/2/2011 11:59:44 AM
From: koan	Read Replies (1) \| Respond to of 85487

I will work with you BCB by giving you the facts. Do you know what actuallly froze the credit markets overnight in 2008? It was the fact the banks realized they had no idea what their collateral was. So there was no mark to market and the banks stopped loaning to each other (overnight) and the libor went to 4. Why? The big investment banks bundled all the sub prime debt and other debt into large bundles having no idea exactly what was actually in there. The Moodys and Standard and Poors, gave this sub prime stuff a triple AAA rating. The big investment banks then sold the sub prime and liar loans around the world. Our rating agencies had marked it triple AAA knowing it was sub prime (lack f regulation). That is fraud BCB! And large investors worldwide believed it was triple AAA. Why wouldn't they. Then to make mattesr worse one large arm of AIG had sold trillions of credit default swaps (CDS). They sold multiple swaps on the same property. When the real estate market imploded they cold not pay off. This is why Paulson got on his knees and begged Nancy Pelosi for the 182 billion for AIG and 700 billion TARP bail out no questions asked. AIG really used this money as a pass through authority to funnel money to folks like goldman Sachs (got 8 billion) and other banks and investors around the world. <<Now Charles try to work with me on this one. Let us assume (and this is a reach) - but let's assume that the management and protectors of Fannie Mae were motivated by caring for the less fortunate amongst us. Given this motivation they created an environment where made that should never have been made. That included buying the bad loans from liar banks - in effect facilitating the whole process. Now we have a ruined housing market and ruined people. The root of this was (if we are charitable) "destructive caring".