• Government Sues Biggest U.S. Banks Over Mortgage-Backed Investments
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FOX Government Sues Biggest U.S. Banks Over Mortgage-Backed Investments September 02, 2011 [release]In a sweeping move that opens a new front on the housing crisis, the U.S. government on Friday sued 17 financial firms, including the largest U.S. banks, for selling Fannie Mae and Freddie Mac billions of dollars worth of mortgage-backed securities that turned toxic when the housing market collapsed. Among the 17 targeted by the lawsuits were Bank of America Corp., Citigroup Inc., JP Morgan Chase & Co., Goldman Sachs. The lawsuits were filed Friday by the Federal Housing Finance Agency which oversees Fannie and Freddie, the two agencies that buy mortgages loans and mortgage securities issued by the lenders. The total price tag for the securities bought by Fannie and Freddie affected by the lawsuits: $196 billion. The government didn't provide a dollar amount of how much it seeks in damages. It said that it wants to have the purchases of the securities canceled, be compensated for lost principal and interest payments as well as attorney fees and costs. The lawsuits allege the financial firms broke federal and state laws with the sales. Home mortgage-backed securities were risky investments that collapsed after the real-estate bust and helped fuel the financial crisis in late 2008. But with so much blame to go around for that crisis, why is the administration going after the banks? "Remember why Willy Sutton used to hold up the banks? Because that's where the money was," said David John, a senior research fellow in retirement security and financial institutions at the Heritage Foundation. "So what they're looking to do right now is to recover a certain amount of the losses," he told Fox News. But John warned all the pressure on the banks could make lending even tighter, which would prolong the housing crisis and make the recovery a steeper climb. "We are in perilous economic waters at this point," he said. "You're adding another level of insecurity to the banking sector -- that's just going to make people even more nervous." In the lawsuits that were filed in federal or state court in New York and the federal court in Connecticut, the government said the securities were sold with registration statements and prospectuses that "contained materially false or misleading statements and omissions." The Federal agency said the banks and mortgage lenders also falsely represented that the mortgage loans in the securities complied with underwriting guidelines and standards. They also included representations "that significantly overstated the ability of the borrower to repay their mortgage loans." The 17 institutions are Ally Financial Inc., formerly known GMAC LLC, Bank of America Corp., Barclays Bank PLC, Citigroup Inc., Countrywide Financial Corp., Credit Suisse Holdings Inc., Deutsche Bank AG, First Horizon National Corp., General Electric Co., Goldman Sachs & Co., HSBC North America Holdings Inc., JPMorgan Chase & Co., Merrill Lynch & Co. and its unit First Franklin Financial Corp., Morgan Stanley, Nomura Holding America Inc., The Royal Bank of Scotland Group PLC, and Societe Generale.[/release] Source: [url]http://www.foxnews.com/politics/2011/09/02/government-sues-biggest-us-banks-over-mortgage-backed-investments[/url] What in the world? Didn't the federal government force the banks to make these loans in the first place?
man this is TOTALLY gonna help the economy. Lets SUE the people... who hold our money! Genius!
FUCKING FINALLY. I love it when big important people / companies are held accountable for their actions. [editline]3rd September 2011[/editline] Also typical Glaber thread.
[QUOTE=MightyMax;32087375]man this is TOTALLY gonna help the economy. Lets SUE the people... who hold our money! Genius![/QUOTE] They'll get the money they owe to the banks, FROM the banks, without owing it back! [IMG]http://i.imgur.com/Cl3RH.gif[/IMG]
[QUOTE=Glaber;32087355] What in the world? Didn't the federal government force the banks to make these loans in the first place?[/QUOTE] uh no [editline]3rd September 2011[/editline] they way I'm reading it the government is suing over the toxic assets that eventually lead to economic breakdown
Good. Fuck Freddie Mac and Bank of America. They foreclosed on my house and three others in my neighbor hood for a crash grab.
why can't banks operate without trying to fuck you sideways it's ridiculous. and in america you cannot go without a debit card.
[QUOTE=Glaber;32087355]What in the world? Didn't the federal government force the banks to make these loans in the first place?[/QUOTE] They aren't suing them for providing the mortgages in the first place, they're suing them for spending the money the banks assumed they were going to get, despite the mortgages being risky. This is partially the fault of S&P, whom rated mortgage securities as far less risky than they really were. However, some of the mortgages that were provided were done so at such high values for homes in a market where values had been rising seemingly indefinitely that any reasonable financial organization should've seen this coming. The same sort of thing happened with internet companies a decade ago, and has happened many times before. When these bubbles collapse, the market tends to recover fairly well as the still-successful business now have a huge market to expand into, and relatively cheap labor from all the people in the industry who are no longer employed. Banking is very different, as the sheer amount of start-up capital needed acts as an almost impenetrable barrier for small competition. This puts a large amount of responsibility on the industry as a whole to protect itself from the well-known phenomenon of bubble collapse, and is directly why they are being held responsible for this failure.
we bailed them out, now we're taking it back. (yes I did read the article, just wanted to say that.)
[QUOTE=thisispain;32089574]why can't banks operate without trying to fuck you sideways it's ridiculous.[/QUOTE] Because banks create less added value than prostitution (actually, zero), while they need to profit somehow to pay the massive salaries their management takes.
[media]http://www.youtube.com/watch?v=dsm51aOCHiE[/media] This is my exact reaction to this.
kill all bankers....
[QUOTE=thisispain;32089574]why can't banks operate without trying to fuck you sideways it's ridiculous. and in america you cannot go without a [B]credit[/B] card.[/QUOTE] Fixed, and I'm going to try to just stick with my debit card.
Everything is done with a debit card where I live :v:
Am I the only one in America that doesn't have a debit card, let alone a credit card?
This current economic crisis is a good piece of evidence and a good argument against de-regulation, which is the real cause of the housing bubble collapse. Just sayin'. Also, typical Glaber thread.
Typical Glaber Thread. We need a slogo with a box with that motto written on it. Anyways, banks were retarded with squandering their money away.
[QUOTE=CabooseRvB;32092968]Typical Glaber Thread. We need a slogo with a box with that motto written on it. Anyways, banks were retarded with squandering their money away.[/QUOTE] They've already got a logo for that: [img]http://veracitystew.com/wp-content/uploads/2010/03/foxnews-300x287.jpg[/img]
[QUOTE=Emperor Scorpious II;32092862]Am I the only one in America that doesn't have a debit card, let alone a credit card?[/QUOTE] There's nothing wrong with Debit Cards because its at least tangible cash. Credit cards on the other hand should go burn in Hell.
[QUOTE=Swilly;32095009]There's nothing wrong with Debit Cards because its at least tangible cash. Credit cards on the other hand should go burn in Hell.[/QUOTE] Credit cards can be handy if used properly. A friend of mine has a grandmother who only uses hers if she has a bill that's due and she doesn't have the cash on-hand to pay it right away, then she pays it off as soon as she gets the money to do so. However, considering how credit cards work I don't get why people think it's a good idea to take out what is essentially a small loan to pay for a loaf of bread, a bottle of KY and a case of Mr. Pib when they could afford to pay for it out-right.
[QUOTE=Emperor Scorpious II;32092862]Am I the only one in America that doesn't have a debit card, let alone a credit card?[/QUOTE] how on earth you pay for things i don't know
[QUOTE=thisispain;32089574]why can't banks operate without trying to fuck you sideways it's ridiculous. and in america you cannot go without a debit card.[/QUOTE][QUOTE=thisispain;32099678]how on earth you pay for things i don't know[/QUOTE]I don't have a bank account and I haven't had one for a long, long time. I deal in cash.
[QUOTE=JumpinJackFlash;32100892]I don't have a bank account and I haven't had one for a long, long time. I deal in cash.[/QUOTE] i can't pay any of my bills with cash
[QUOTE=thisispain;32100908]i can't pay any of my bills with cash[/QUOTE]Wow, where the hell do you live? I've never ever encountered that before, and if prompted for a reason why I don't use a check or debit card, I just say "I don't trust banks, if you want the bill paid you'll have to make due with cash."
[QUOTE=JumpinJackFlash;32100945]Wow, where the hell do you live? I've never ever encountered that before, and if prompted for a reason why I don't use a check or debit card, I just say "I don't trust banks, if you want the bill paid you'll have to make due with cash."[/QUOTE] that's... interesting
[QUOTE=JumpinJackFlash;32100945]Wow, where the hell do you live? I've never ever encountered that before, and if prompted for a reason why I don't use a check or debit card, I just say "I don't trust banks, if you want the bill paid you'll have to make due with cash."[/QUOTE] san francisco bay area? i don't see how i would pay my internet using cash, that's not very feasible.
[QUOTE=thisispain;32101039]san francisco bay area? i don't see how i would pay my internet using cash, that's not very feasible.[/QUOTE]I pay mine, I go to the office and pay my bill right along with all my other bills when I do my monthly shopping. 60+ miles of driving there and back, eight traffic lights and I'm done. It's a bit easier for me, I think. I suppose for you to do what I do it wouldn't work.
Most people don't bother driving 60 miles just to pay their bills when you know... they could just write a check or do a direct deposit online via their checking account. Which by the way works exactly like having cash, except you don't have to have the cash on you at all times. Join a local credit union and save yourself the time and gas it takes to pay your monthly bills by getting a debit card (which again, works exactly like cash - there is no credit, you just spend whatever money you put into said account).
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