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No, it was caused almost entirely by fraud. If not for people within 'the banks' knowingly rating these mortgages as a ludicrously good buy, etc, there wouldn't

by wnight 14y ago

No, it was caused almost entirely by fraud. If not for people within 'the banks' knowingly rating these mortgages as a ludicrously good buy, etc, there wouldn't be a banking crisis. There are even further systematic abuses that should see thousands jailed, such as deceptive marketing and intentional misrepresentation of clients. None of this would have been self-sustaining without all the coverups.

damoncali 14y ago
The scale of the market is so huge that you would have to believe that the entire finance industry is composed of idiots for that to be true. These securities are not rocket science. They were sub prime mortgages that had a certain historical default rate. People ignored those rates all over the place and levered up. That is not fraud. That is greed. Did fraud make it worse? Probably, but you can debate how much since people were willingly taking these risks anyway. We all knew it would end, and that it might end dramatically. But we didn't know how or when that would happen, or how bad it could get.
tsotha 14y ago
>There are even further systematic abuses that should see thousands jailed, such as deceptive marketing and intentional misrepresentation of clients. I'm okay with that as long as all the homeowners who lied about their financial situation go to jail as well. How many thousands of otherwise ordinary people made false statements on loan applications?
- wnight 14y ago
  Oh, so you aren't okay with charging a single uber-fraudster until all the little guys are safely put away. That's handy. While I agree that the little guys committed crimes too the bankers were ALSO in a position of power AND have a duty to protect their clients AND engaged in an on-going conspiracy to commit fraud. I'd be pissed if someone tried to cheat me on EBay, I'd be livid if I discovered my banker had intentionally been giving me bad advice because he profited on every dollar I lost. The difference in scale between these things is so monumental that it makes your comment seem absurd.

by wnight 14y ago

damoncali 14y ago

The scale of the market is so huge that you would have to believe that the entire finance industry is composed of idiots for that to be true. These securities are not rocket science. They were sub prime mortgages that had a certain historical default rate. People ignored those rates all over the place and levered up. That is not fraud. That is greed. Did fraud make it worse? Probably, but you can debate how much since people were willingly taking these risks anyway. We all knew it would end, and that it might end dramatically. But we didn't know how or when that would happen, or how bad it could get.

tsotha 14y ago

>There are even further systematic abuses that should see thousands jailed, such as deceptive marketing and intentional misrepresentation of clients. I'm okay with that as long as all the homeowners who lied about their financial situation go to jail as well. How many thousands of otherwise ordinary people made false statements on loan applications?

wnight 14y ago
Oh, so you aren't okay with charging a single uber-fraudster until all the little guys are safely put away. That's handy. While I agree that the little guys committed crimes too the bankers were ALSO in a position of power AND have a duty to protect their clients AND engaged in an on-going conspiracy to commit fraud. I'd be pissed if someone tried to cheat me on EBay, I'd be livid if I discovered my banker had intentionally been giving me bad advice because he profited on every dollar I lost. The difference in scale between these things is so monumental that it makes your comment seem absurd.