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mortgage bro's (slight return) [Feb. 20th, 2009|01:46 pm]
The American Caliban
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[Current Mood |grumpy]

Finally pushed over the limit by this asshole (youtube video):

The talk radio mouths and the right-wing press have locked on to their version of the financial crash, and why foreclosed homeowners should not receive help.

The problem, they say, is that "political pressure" forced lenders to make bad loans to those who didn't deserve them qualify. Many of these people were clearly n... ni... ne... NE'ER-DO-WELLS. Everyone knows those people can't keep a mortage. If the government had let these experienced bankers use their own judgment, none of this would have happened. So we definitely don't want to spend money—OUR money—helping these people out any more!

The subprime and alt-A mortgages were largely written by people I saw daily over the last decade, our famous local "Mortgage Bros." These guys bought leads from cold-call telemarketers and sold refinancing to anything with a pulse, lying constantly about the risks. They upsold every potential loan, pushed the limit with interest-only ARM on subprime and alt-A garbage loans. They had no reason to care if the bank ever got the money or if their customers kept their houses. They used the system as it was presented.

The idea that these were stolid, cautious men in pinstriped suits, sworn to the fiduciary duties of their banks, who were somehow forced by dashiki'd oppressors in the Federal bureaucracy into giving money away to the NE'ER-DO-WELLS would be funny were it not such a repulsive lie.

Make no mistake. The financial industry made loans that could not be paid, knowing they were bad loans. They pushed those loans hard on their customers. And they knowingly mislead their customers into taking on impossible obligations. Thousands of these brokers committed criminal fraud.

If this was an attempt to redistribute wealth to the NE'ER-DO-WELLS, it backfired. The result was a lot of Harleys and speedboats and cocaine and blowjobs provided to the grinning, empty-souled asshole Fonzies of Orange County. If you don't want their customers to be saved from eviction, let's use the money to build them a very unpleasant jail.
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Comments:
[User Picture]From: eris_devotee
2009-02-20 09:57 pm (UTC)
Oh - don't forget about the real estate agents and the general contractors. Both of them knew they were selling at ridiculously inflated prices.
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[User Picture]From: microbie
2009-02-20 10:04 pm (UTC)

YEAH

Thank you for saying this.
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[User Picture]From: skepticle
2009-02-20 10:05 pm (UTC)
HULK SMASH
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[User Picture]From: substitute
2009-02-21 04:00 am (UTC)
I like that look on you.
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[User Picture]From: jamie_miller
2009-02-20 10:31 pm (UTC)
Every news story I have seen about families facing foreclosure has featured greedy white people who were unbelievably overpaid in ethically questionable industries. I'll never forget the one story about a power couple who both worked in the mortgage industry (oh the irony!) -- when the shit fell in on their heads they said they had to trade in their GIANT SUV for a lesser SUV, and they might have to move into a 3 bedroom house instead of their current 6 bedroom house (they have no kids). I spent hours and hours weeping for their plight. I can totally understand the right wing ignoring these people and focusing on the REALLY big problem of, uh, ne'er-do-wells receiving shitty mortgage loans.
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[User Picture]From: detcarguy
2009-02-22 08:05 am (UTC)
I really don't think there are any racial barriers for being greedy, or stupid, or driving GIANT SUVs. Unfortunately unethical greedy morons come in every flavor and on both sides of the mortgage transaction. It comes from a deep trend in society where people no longer have any manners, any concern for the people around them, and no thoughts of the impact of their behaviour on anyone but themselves. Just look how people drive if you need some proof! Or when was the last time anyone held a door open for you in a public place?
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[User Picture]From: tangaroa
2009-02-20 10:34 pm (UTC)
Somebody ran the numbers and found out that loans under the Community Reinvestment Act, which forced banks to lend to redlined neighbourhoods, fared much better than the market average.
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[User Picture]From: miss_geek
2009-02-20 10:58 pm (UTC)
I had a little debate this morning in a class that sounded very much like this post. I have to admit that it was at least a little fun to describe the typical "mortgage bro" to a class of bright eyed 20yr old econ & rhetoric majors.
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[User Picture]From: autodidactic
2009-02-20 11:28 pm (UTC)
I am 36 years old and I will never have a house. Everything I've seen seems like it would be a gigantic racket.
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[User Picture]From: torgo_x
2009-02-28 04:14 pm (UTC)

Racket

Owning a house (or rather, mortgaging one) is an investment.  But so are rare baseball cards.  But at least with rare baseball cards, you don't have all your eggs in one basket.

Also, a house is very illiquid and risky, and neither of those are happy-sounding words, given the current US economy.

Also: Pogs.

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From: switchstatement
2009-02-20 11:36 pm (UTC)
my history teacher watches bill o'reilly and then comes to class and regurgitates a lot of what he heard on the show. several times he's given a speech about how the "economic crises," was manufactured by democrats because, "they are socialists and think everyone should own their own house, even if they can't afford it. and now they want all of US [uh, all the wealthy college students, i guess] to pay for the poor people's homes."

he also told us that the conspiratorial democratic socialists knew their Everyone Gets His Own Football economic policies would damage the economy, but that they wanted that to happen so that they could, "socialize all traditionally strong money-making industries and re-distribute the wealth further."
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[User Picture]From: miss_geek
2009-02-21 02:31 am (UTC)
i have a rhetoric professor that does exactly the opposite. he watches all the liberal commentary and then comes and tries to explain to the rich kids in school how it's the fault of their republican parents. it's good fun. today he blamed the mortgage crisis on the war, and he made some pretty interesting points.
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[User Picture]From: perich
2009-02-21 12:19 am (UTC)

well, okay

Replace "I object to bailing out NE'ER DO WELL's mortgages" with "I object to bailing out shitty mortgage broker's bad choices."
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[User Picture]From: substitute
2009-02-21 01:38 am (UTC)

Re: well, okay

agreed. i doubt any of this financial hemorrhage will have much effect on who gets evicted; it's another series of golden parachutes for people who deserve golden showers.

but blaming the borrowers for bad loans... such transparent and nauseating demagoguery! ecch!
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[User Picture]From: feisty_robot
2009-02-21 01:37 am (UTC)
I agree with you. HOWEVER:

Make no mistake. The financial industry made loans that could not be paid, knowing they were bad loans. They pushed those loans hard on their customers. And they knowingly mislead their customers into taking on impossible obligations. Thousands of these brokers committed criminal fraud.

is not quite true. One of, or maybe THE, prominent causes of Our New Depression was that normal, greedy individuals were packaging financial instruments in entirely legal ways that ended up making it harder for the buyers to really understand the risk. It was, to borrow a metaphor, like playing hot potato with sealed box. What's inside? Nobody knows, but as long as you can pass it on, you're safe. When people started defaulting on bad loans, and all the leverage birds came home to roost, it became obvious that inside some of these boxes were piles of shit, or bombs, but by then it was too late. In many ways, it is a textbook case of why regulators should make transactions they don't understand illegal, and deregulate later, rather than Greenspan's idea of allowing everything that wasn't provably awful.
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[User Picture]From: substitute
2009-02-21 03:59 am (UTC)
Right. The part I referred to was the original fraudulent mortgage selling. The second part, with the assignment of risk to friendly elves and the obfuscatory math, was also extremely great. It's a totally killer mashup of the Savings & Loan Fraud of the 80s with the LTCM collapse of the 90s... taken to the NEXT LEVEL!
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[User Picture]From: pilarcruz
2009-02-21 02:31 am (UTC)
This rant is A+
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[User Picture]From: kafkateer
2009-02-21 06:17 am (UTC)
OH YES IT IS. and now i'm kind of smitten with you mr substitute
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[User Picture]From: mcfnord
2009-02-21 03:28 am (UTC)
Oh yes, it's truly time to tell those fucks to stfu. Just cuz he finished Atlas Shrugged does not make him some genius.


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[User Picture]From: detcarguy
2009-02-22 07:35 am (UTC)

Stupid people need to finally take responsibility!!!

It takes two to tango. Yes there are greedy bankers and financiers who packaged risky mortgages. But there are also the greedy buyers (of all races, creeds and demographics) who whipped the house prices into a frenzy by flipping property at absurd profits. Once that price train stopped, these greedy people who had to have their status expensive home with 110% mortgage on a price (not value), are now crying that they can't afford it. Well, if you are stupid enough to buy a house where the payments are a huge chunk of your income, then you get to reap the rewards of your greed.
It didn't have to be that way. When we bought our home, we bought with common sense toward our budgeting of payments. We declined to spend what the mortgage companies said we "qualified for" and bought a house that cost HALF of that! We improved our home a little every year as we could afford it and refinanced from a 30 to a 10 year mortgage. The long term result is that we will own our home in less then 5 years from now. We were not greedy, didn't care about a status address and bought in a quiet inner suburban city, where city goverment runs in the black and keeps property taxes low and services high (without corruption).
I have no sympathy for selfish greedy short-sighted people who didn't use any common sense. Who now want to blame everyone else but themselves for trapping themselves into an over valued house they CHOSE to buy and knew they couldn't afford if they couldn't keep flipping it. No one made them make bad stupid choices!
Oh yeah, I like the way the republicans (before W left office) gave their banker buddies billions of our money (with no strings attached, unlike the auto industry assistance)to pay themselves millions in salary(plus bonuses) and finance more bank mergers/buy-outs of each other. I don't see any of this money helping their customers or the economy!
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[User Picture]From: substitute
2009-02-22 07:39 am (UTC)

Re: Stupid people need to finally take responsibility!!!

Idiots will always apply for credit they can't handle. This is usually solved by an advanced technique called "not lending them any money." They stopped doing that.

Sure, when said idiots can't pay off their stuff, the inevitable happens. And they found a way for all of us to pay that disaster off, since they'd stolen all the money and the idiots didn't have any.

Pretending that this is somehow the fault of the idiots is ridiculous. No one has to lend money to someone who can't pay it back.
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