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1 researchok  Tue, Nov 22, 2011 1:38:33am

Terrific article. Needs to be mandatory reading.

This excerpt struck me:

Over the years, as lending standards fell lower, mortgage origination volumes rose higher. Subprime and other risky loans took a steadily larger share and this flood of money into mortgages helped launch the housing bubble.

I warned way back in 1993 that trying to achieve equal outcomes for people with good credit and a good down payment and people with bad credit and little or no down payment was destined to cause grief and serious financial harm.

Wall Street predators were going to come out ahead, no matter what.

2 FemNaziBitch  Tue, Nov 22, 2011 1:51:39am

One thing I think is interesting is that the total subprime mortgage default rate isn’t horribly horrible —it’s the should have known better buyer-ARM’s and interest-only in the prime market that were risky and not rated as such.

I have to find the article that shows that to give you a reference. It’s posted somewhere here.

Prime borrowers who bought too much of a house because they thought they could play the game too! —basically.

Greed from the bottom-up and the top-down.

3 researchok  Tue, Nov 22, 2011 1:56:11am

re: #2 ggt

Greed from the bottom-up and the top-down.

No truer words.

4 (I Stand By What I Said Whatever It Was)  Tue, Nov 22, 2011 10:03:50pm

The actual link is [Link: mindovermarket.blogspot.com…]

5 (I Stand By What I Said Whatever It Was)  Tue, Nov 22, 2011 10:39:33pm
6 FemNaziBitch  Tue, Nov 22, 2011 10:54:11pm

re: #4 000G

The actual link is [Link: mindovermarket.blogspot.com…]

How is that different than my link?

7 (I Stand By What I Said Whatever It Was)  Tue, Nov 22, 2011 11:09:16pm

re: #6 ggt

How is that different than my link?

Your link links to the blog itself: [Link: mindovermarket.blogspot.com…]
My link links to the blog entry you cite: [Link: mindovermarket.blogspot.com…]

You have a sort of habit of providing faulty links, btw. Better double-check them to make sure your readers get sent where you want them to. Just friendly advice.

8 (I Stand By What I Said Whatever It Was)  Wed, Nov 23, 2011 4:49:17am

Not that this is anything new, but reading it in concise paragraphs still boggles the mind:

In an outcome James Bond villain Goldfinger would love, Wall Street was creating a flow of funds into the mortgage industry in search of bad credits.

Subprime mortgage originator Bill Dallas of Ownit opened a window into this world when he said Wall Street was paying him more to do a loan with poor underwriting than one with good underwriting.

Merrill Lynch and Citigroup were the kings of CDOs and bear much of the blame for the crisis.

Merrill’s chairman Stanley O’Neil made $91 million in 2006 while turbocharging the CDO business. A year later, Merrill had to take an $8.3 billion write-down and O’Neal was fired, walking away with another $151 million.

At Citigroup, it was Robert Rubin who talked chairman Chuck Prince into diving headlong into the CDO business. Citigroup hid the toxic assets it was creating in structured investment vehicles or SIVs off its balance sheet and in black boxes on its balance sheet.

In the first and second quarter of 2007, the company concealed the existence of $50 billion in subprime assets in its audited SEC filings.

Even though top officials are required to personally sign accounting statements and be held personally liable, the SEC did not investigate Prince or Rubin. The case was settled with minor fines to lower-level officials.

9 (I Stand By What I Said Whatever It Was)  Wed, Nov 23, 2011 5:21:09am

Another pretty crucial part:

Black Box Casino is a story about the one half of the world of banking that is shadow banking. It is the story of how huge swaths of that shadow banking and financial activity moved into black boxes.

Black boxes are financial institutions and vehicles with no transparency. You can’t see inside and know what bad assets might be hidden there. I discovered through my work, that some of these black boxes housed financial casinos where fast money and high stakes were the norm.

Black boxes can also conceal fraud. We would learn only after its failure, for example, that Lehman Brothers filed public disclosures that hid massive manipulation of accounting.

Mortgage bonds became attractive to market players who wanted to bet for or against them using credit default swaps.

Leading up to the crisis, more than $20 trillion in bets were made on credit assets not owned by those making the bets.

Clearly this means we need less government oversight!

10 FemNaziBitch  Wed, Nov 23, 2011 8:40:46am

re: #7 000G

Your link links to the blog itself: [Link: mindovermarket.blogspot.com…]
My link links to the blog entry you cite: [Link: mindovermarket.blogspot.com…]

You have a sort of habit of providing faulty links, btw. Better double-check them to make sure your readers get sent where you want them to. Just friendly advice.

All I can tell you is I highlight the information and hit the LGF pages Bookmarklet on my tool bar. THe link you provided takes me to the same place my link takes me. You are the only person who seems to have a problem with my links.

11 (I Stand By What I Said Whatever It Was)  Wed, Nov 23, 2011 8:48:10am

re: #10 ggt

THe link you provided takes me to the same place my link takes me.

No, it doesn’t. It may look to you that way since the blog post you cite is the latest post on that blog. Eventually with time going by and new posts appearing, your link won’t be taking anyone to the text you are citing anymore. So you basically make future readers look for the original blog entry instead of linking it directly.

You are the only person who seems to have a problem with my links.

Look: The problem is not subjective. It’s not “because of me”. It just is, your link is faulty. Maybe you don’t get it because the LGF script automatically parses plain hyperlinks to only show the domain. Let me show you another way:

Your link: http://mindovermarket.blogspot.com/ (goes to the blog itself, will be outdated if and when blog gets updated)
My link: http://mindovermarket.blogspot.com/2011/11/black-box-casino-reveals-mad-max.html (goes directly to the blog entry “Black Box Casino Reveals Mad Max Follies of Crisis” that you cite).

12 (I Stand By What I Said Whatever It Was)  Wed, Nov 23, 2011 8:49:48am

Here is another post on that blog:

http://mindovermarket.blogspot.com/2011/04/embrace-of-junk-bonds.html

In April of this year, this would have been the front page post on that blog. Do you understand that?

When I link that very same blog post directly, it looks like this:

[Link: mindovermarket.blogspot.com…]

See? Just the domain name again.

13 Lord Baron Viscount Duke Earl Count Planckton  Wed, Nov 23, 2011 8:50:27am

re: #10 ggt

000G is correct. Your link is wrong.

14 FemNaziBitch  Wed, Nov 23, 2011 9:03:34am

I highlight the text from the page I am on and hit the LGF bookmarket on my toolbar.

How can I do it better?

15 CuriousLurker  Wed, Nov 23, 2011 9:04:04am

Ditto what Sergey said, ggt—000G is correct for the reasons she stated.

The title of any newspaper article or blog post is usually a link to the permanent URL for the article. If you’ve ever seen the term “permalink” on a blog, it refers to that permanent URL, which is always longer than just the domain name.

The easiest way to avoid the problem is to always click on the title of the article or blog post, then go ahead and create your Page from the resulting URL.

16 CuriousLurker  Wed, Nov 23, 2011 9:04:38am

re: #14 ggt

See my #15 above.

17 FemNaziBitch  Wed, Nov 23, 2011 9:04:44am

re: #15 CuriousLurker

Ditto what Sergey said, ggt—000G is correct for the reasons she stated.

The title of any newspaper article or blog post is usually a link to the permanent URL for the article. If you’ve ever seen the term “permalink” on a blog, it refers to that permanent URL, which is always longer than just the domain name.

The easiest way to avoid the problem is to always click on the title of the article or blog post, then go ahead and create your Page from the resulting URL.

ah! helpful information is nice.

Thank you.

18 Lord Baron Viscount Duke Earl Count Planckton  Wed, Nov 23, 2011 9:05:45am

re: #15 CuriousLurker

000G is correct for the reasons she stated.

(he ;)

19 CuriousLurker  Wed, Nov 23, 2011 9:06:52am

re: #18 Sergey Romanov

(he ;)

Heh, I keep forgetting. The avatar always throws me off. Sorry, 000G!

20 (I Stand By What I Said Whatever It Was)  Wed, Nov 23, 2011 9:09:22am

That’s fine. I don’t take being taken for a female as an insult.


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