Are you confused about mortgages? Good. At least you know you are confused. The world economy has collapsed. Much of the world lays the blame for the collapse at the feet of greedy Americans. While this is patently unfair (who’s not happy to sell us crap?), it is true that three American parties do share the blame. The first two are those who bought homes they couldn’t afford and those who gave them mortgages. But the Federal Reserve Bank should carry most of the blame.While surfing I found this international view of point on this blog about geld lenen zonder bkr toetsing.
The Federal Reserve increased the amount a bank could loan relative to the amount the bank holds in deposits. It is hard to argue that the increase to a 30-1 ratio was simple idiocy. When Jon Stewart repeatedly asked Jim Cramer, “Who thought a 30-1 leverage was a good idea?” he was referring to the Federal Reserve upping the deposit-to-loan ratio to 30-1 for American banks. The answer to who did it, Jon, is: The Federal Reserve Bank. And they should pay. Congress must rescind the Bank’s charter and replace it with a central bank controlled by the Treasury Department.
Mortgage brokers tried selling a subprime mortgage to any prospect that had a pulse. Millions who trusted their financial advisors had no idea there money was getting tied up in mortgages to unqualified people.
These shaky mortgages were then bundled and sold to financial firms as ‘asset backed paper,’ the now infamous ‘toxic assets’ we, the taxpayer, are buying from the banks. Question: What is another word for a toxic asset? Answer: A liability. The government is effectively using your money to buy these liabilities named toxic assets.
And lastly are the people who bought homes they couldn’t afford, and then started whining that they didn’t know they had an adjustable rate mortgage. I know that’s harsh, but it is the truth. Does that sound pessimistic? Good, because if you are not pessimistic now, you are a fool.
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