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Friday, October 15, 2010

Rampant fraud at every step and Wall Street shrugs it off

Those evil homeowners made us do it. They forced us to sell them those sub-price mortgages they couldn't afford. They forced us to throw all underwriting standards out the window. They forced us to tell them not to worry, to tell them that by the time their mortgage payments reset and tripled their house would be worth 25% more so they could refinance or sell it for a profit and buy an even bigger house.

They forced us to sell the mortgages and then forced the investment banks to create derivatites abd leverage them 30 times. Then they forced us to hide just how crappy the investment were so that we wouldn't be stuck with them. No one could have predicted what would happen and now that there houses are less than their mortgages and they can't make their payments they're forcing us to cut corners and abandon the legal process so we can get their houses back.

It's tough being a banker, nobody likes us and we're being blamed for this whole mess. All we have is our bonuses. Those delinquent homeowners should learn a thing ot two about personal responsibility and stop whining and blaming us. Personal responsibility is for other people. We were just doing what bankers do....making money.

If that sounds a little over the top read this...the Wall Street shrug.

"The first thing that needs to happen, I think, is to get these people out of their homes," a man wearing a bespoke blue-striped shirt, a Herm├ęs tie patterned with elephants and Ferragamo loafers said recently. "Correct! I'll explain," the veteran member of a bank restructuring and advisory team said.

But Wall Street does not sympathize. "You had people putting zero down to get massive houses they couldn't afford to be in," he said Monday morning, "but now they want to stay. And the government wants to let them stay, because they're voters." A few hours later, the Goldman Sachs arm Litton Loan Servicing said it had suspended certain foreclosure proceedings, too. "Talk about a financial scandal," a Wall Street Journal editorial this weekend joked. "A consumer borrows money to buy a house, doesn't make the mortgage payments and then loses the house in foreclosure—only to learn that the wrong guy at the bank signed the foreclosure paperwork. Can you imagine?"

The banks and mortgage companies committed fraud every step of the way most of them have yet to pay the price. That might all be changing as the layers of the onion are slowly peeled away.

Watch Elliot Spitzer on the new smoking gun, 'How Wall Street shafted Main Street." on CNN. I wrote about it earlier here.

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