Root Causes

Our children pay the high price of financial folly

Written by Timothy Blake on November 06, 2007 under Archives, Economic Impact, Editorial, Government Positions, Investors, Job Losses, Lenders, Mortgage Insurance, Opinion, Root Causes

President Clinton repealed the Glass-Steagall Act which had prevented the coupling of investment banking and lending. Following President Clinton, George W. Bush proved to be very pro-business, but at a high cost to the average consumer. Intelligent Americans realized consumer spending and risky lending practices would come with a very high price. The full impact was not felt by baby-boomers and those age 50 and over. Our children will pay the high price of folly for a long time.

Asia Times Puts HSBC at Forefront of Subprime Crisis

Written by Timothy Blake on October 22, 2007 under Archives, Economic Impact, International, Outside the U.S., Root Causes

On October 23rd Asia Times Online said:

For the third time since March, we are in the midst of a significant market selloff, a sharp and painful expansion of what the markets call “risk aversion”.

Federal Reserve Knew of Serious Subprime Problems In 2006

Written by Leatherneck on August 29, 2007 under Analysis, Archives, Government Positions, Quotable Quotes, Root Causes

This may come as a shocking revelation to many of our readers. The Federal Reserve, and specifically the Federal Reserve Bank of Boston, already had data about subprime mortages. That data did not look good at all. Executives from specific lenders were called to testify before the Senate Committee on Banking, Housing, and Urban Affairs on March 22, 2007. While we might not be able to trust the executive spin this shocking data from the Fed is real:

Why HSBC Hopes the World Does Not Put 2 and 2 Together

Written by Leatherneck on August 27, 2007 under Analysis, Archives, Economic Impact, Editorial, Foreclosure, Government Positions, International, Investors, Job Losses, Lenders, Opinion, Outside the U.S., Root Causes

Why did the subprime money pipeline shut down? And which bank was buying mortgages from brokers and lenders? HSBC of course. Subprime and second mortgages were to HSBC like Household International was to predatory lending – an easy ride to profits. Or so they thought. Second mortgages? Sorry, but HSBC has little or no security interest when a home goes to foreclosure.

A Guide to Subprime or ‘How to ruin your country’s economy too’

Written by Leatherneck on August 21, 2007 under Archives, Definitions, Economic Impact, International, Lawsuits, Mortgage Fraud, Root Causes

Economists in any country in the world – except the United States – should study the “interest only” loan. It is imperative so your economy doesn’t get hurt in the future. Just consider the United States as a training ground. We all saw the ripple effect around the world. If your country’s stock market lost $80 million in one day, or if your country’s central bank pumped billions of dollars into your economy, your economists should study the interest-only scam so you can prevent it.

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