Tuesday, November 11, 2008

The End of Wall Street's Boom?

Over at Portfolio.com. Found at Steve Sailer's Blog:

...Long Beach Financial was moving money out the door as fast as it could, few questions asked, in loans built to self-destruct. It specialized in asking home­owners with bad credit and no proof of income to put no money down and defer interest payments for as long as possible. In Bakersfield, California, a Mexican strawberry picker with an income of $14,000 and no English was lent every penny he needed to buy a house for $720,000....

...Moses actually flew down to Miami and wandered around neighborhoods built with subprime loans to see how bad things were. “He’d call me and say, ‘Oh my God, this is a calamity here,’ ” recalls Eisman. All that was required for the BBB bonds to go to zero was for the default rate on the underlying loans to reach 14 percent. Eisman thought that, in certain sections of the country, it would go far, far higher....

...But he couldn’t figure out exactly how the rating agencies justified turning BBB loans into AAA-rated bonds. “I didn’t understand how they were turning all this garbage into gold,” he says. He brought some of the bond people from Goldman Sachs, Lehman Brothers, and UBS over for a visit. “We always asked the same question,” says Eisman. “Where are the rating agencies in all of this? And I’d always get the same reaction. It was a smirk.” He called Standard & Poor’s and asked what would happen to default rates if real estate prices fell. The man at S&P couldn’t say; its model for home prices had no ability to accept a negative number. “They were just assuming home prices would keep going up,” Eisman says...

...“With all due respect, sir,” Daniel told the C.E.O. deferentially as they left the meeting, “you’re delusional.” This wasn’t Fitch or even S&P. This was Moody’s, the aristocrats of the rating business, 20 percent owned by Warren Buffett. And the company’s C.E.O. was being told he was either a fool or a crook by one Vincent Daniel, from Queens....

2 comments:

Andrea Murrhteyn said...

Hi Frank,

Hey Great Article; thanks for pointing it out! I setup a mirror copy -- caveat: including my Major Manuel commentary (;-)!) -- at Wall $treet $lavery Exchanges are Helium Accounting Ponzi Schemes (Defining $lavery Exchange Ponzi Eugenics for the Feebleminded: The End of Wall St.)

Quoted 'Frankly Moscow ID' as one of the Armigideon Recce Sources! Thanks!!!

Lara

Thomas James Revere said...

Frank,

[Note to Frank & M-Cubed Readers of Comments!!: Sit down and pour yourself a whisky first!! ;-); felt like a Major Manuel chat with monotooth moron! ;-)]

I wonder how many of Planet Earth citizens who read this article stop and wonder:

1. Don't the Attorney Generals of every single state (or other countries Stock Exchanges), particularly NY State KNOW ABOUT THE LEVEL OF FRAUD GOING ON? Why aren't the Attorney Generals prosecuting these CEO's and Managers and putting them behind prison bars? I mean if these CEO's are so addicted to 'risk', they should be sending copies of all their trades, which don't tell me they don't know they are breaking the SEC laws, left right and center; CC'd to the SEC, shouldn't they?

2. Don't the FBI and SEC investigate this stuff, or do they know this is going on? Why arn't the SEC and FBI indicting these guys?

3. Is the CIA's job, really to track crazy boxcutter mad muslim jihad 'terrorists'? (Obviously they never read: Confessions of an Economic HitMan, Fletcher Prouty's SECRET TEAM, or seen how Collateral Vincent works!)

4. The CIA actually publicly admitted -- THE MSM DIDN'T TELL MANY PEOPLE -- that what they do is to put it bluntly: act as Nazi Stormtroopers, or Al Capone blackmail and 'break your kneecaps' or 'give you a pair of cement slippers' thugs, for the Fortune 500 corporations? (They 'promised' me some cement slippers once; I'm still waiting!! I even called the White House, to tell the WH, to tell the CIA and FBI, I'd have donuts waiting for them when they brought me my cement slippers. The WH NSC Press Office lady laughed, and said she would tell them)

5. If there is any citizen on Planet Earth who actually thinks any of this MASSSIVE CORRUPTION WILL CHANGE, WITHOUT CHANGING HOW POLITICIANS ARE ELECTED, BY CORPORATIONS AND FOR CORPORATIONS; THEN I HAVE A WONDERFUL FREE GIFT VOUCHER FOR YOU, YOU DON'T EVEN NEED TO BUY IT; I WILL GIVE IT TO YOU FREE!!!, FROM MY AREA 51 AND PLANET JUPITER 'CEMENT SLIPPERS' BUDDIES:

I'LL CALL IT THE G.W. BURNING CHEYENNE WYOMING BUSH TRIP FOR TWO, CUCUMBER SANDWICHES INCLUDED.

FREE UFO RETURN TRIP FOR TWO TO YOUR OWN PLANET, WHERE YOU CAN BE ADAM AND EVE, AND THE ALIENS CAN ERASE ALL YOUR 'EARTH' MEMORY, AND THEY CAN START THEIR NEW 'HUMANITY' BREEDING PROJECT, TO SEE HOW YOUR VANITY SEED WILL END UP, USING YOUR BRAINS.... TO CREATE A PLANET GREEDY FOR:

(I) VALUING AND PRIORITIZING LIBERTY, RESPONSIBILITY, HONOUR AND HONESTY; OR

(II) GREEDY FOR SLAVERY TO "RELIGIOUS" CORPORATIONS GREED FOR YOUR $$$$$ AND BLIND STUPIDITY BELIEF IN THEIR INFALLIBILITY; NOT TO MENTION THEIR FANTASY 'PROPHECIES' OF MESSIAH'S AND SAVIOURS, AND GREEDY TO KEEP YOU STEEPED IN INSECURITY, AVOIDING RESPONSIBILITY, BLAME, HATE, REVENGE, AND SLAVE AND CANNON FODDER BREEDING, AS THEIR DEBT AND LABOUR SLAVES AND SOLDIERS...