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I worked at a bank before, throughout and after the 2008 financial crisis. That bank wouldn't have dared to give a broke and jobless person a loan, not a penny.
by Kenji 10y ago
I worked at a bank before, throughout and after the 2008 financial crisis. That bank wouldn't have dared to give a broke and jobless person a loan, not a penny. Unless there are good reasons to assume it can be paid back, like securities in the form of a house or shares.
- grzm 10y agoI know of banks that wouldn't have approved loans like that, either. However, some banks did, and made money doing so. Many banks don't keep the loans they approve on their own books.
- Kenji 10y agoMany banks don't keep the loans they approve on their own books. That is dirty, dirty business. Giving out loans that will never be paid back, bundling them up and selling an opaque package full of risks. They said that was a big part of what started the crisis. I'm glad I wasn't part of that.
- grzm 10y agoYup. I completely agree. And there were a lot of steps in the chain. As I understand it, it wasn't the issuing banks that were doing the bundling: they just sold the loans to other financial service companies. Given the amount of money and the fact that a lot of them effectively got away with it, from their point of view it was good business. This is an example of situations where I see arguments along the lines of "it was legal, so it wasn't wrong". Grr...