dorifto240 Posted July 17, 2010 Report Share Posted July 17, 2010 http://www.nytimes.com/2010/07/16/business/16goldman.html?_r=1&th&emc=thTo sum it all up: One of the key companies that caused the Great Recession, is being allowed to settle out of court for a pathetically small amount.How wonderful is this? Their actions have lead to people losing their jobs, homes, families... Greece is embroiled in protests and austerity, and we have the largest national debt in the history of the world; and it can all be traced back to a few businesses and organizations: And it includes Goldman Sachs.Fun side fact: Goldman Sachs informed Moody's and Standard & Poor's on how to rate the derivatives they were selling. Which is why even at the end, all the really shitty derivative packages were still being labeled as AAA.Ridiculous. Obama got elected on change and hope, and it looks like things are shaping up to be just as shitty as always. Quote Link to comment Share on other sites More sharing options...
SAMBUSA Posted July 17, 2010 Report Share Posted July 17, 2010 :moarfear: Quote Link to comment Share on other sites More sharing options...
DAC Posted July 17, 2010 Report Share Posted July 17, 2010 Goldman was the middleman. The Abacus deal in the article was arranged among institutional investors, the smallest of which kicked in $175 million. It wasn't granny that got duped with that one. If you put $175 million into something and you don't do your due diligence, your a dumbass. Period.That's the lesson. Do the homework. Read the financials. If it sounds too good to be true... well you know.. Quote Link to comment Share on other sites More sharing options...
dorifto240 Posted July 17, 2010 Author Report Share Posted July 17, 2010 Goldman was the middleman. The Abacus deal in the article was arranged among institutional investors, the smallest of which kicked in $175 million. It wasn't granny that got duped with that one. If you put $175 million into something and you don't do your due diligence, your a dumbass. Period.That's the lesson. Do the homework. Read the financials. If it sounds too good to be true... well you know..True, but what they were selling (and what they were allowing a few to short against) were peoples mortgages.Yes these institutions should have performed due diligence, however: trading and selling a large part of a persons life? There's something not right about that.And I don't get the moar reference... sorry Quote Link to comment Share on other sites More sharing options...
fusion Posted July 17, 2010 Report Share Posted July 17, 2010 ... however: trading and selling a large part of a persons life? There's something not right about that.It's property(investment, loan, whatever) plain and simple. Loans and these types of things get sold, traded and bought all the time and always have.Don't take a loan you can't afford. Quote Link to comment Share on other sites More sharing options...
shittygsxr Posted July 17, 2010 Report Share Posted July 17, 2010 True, but what they were selling (and what they were allowing a few to short against) were peoples mortgages.Yes these institutions should have performed due diligence, however: trading and selling a large part of a persons life? There's something not right about that.And I don't get the moar reference... sorrythey bet that americans were dumb and the bet right. The bubble was going to burst sooner or later. As always sooner is better Quote Link to comment Share on other sites More sharing options...
dorifto240 Posted July 17, 2010 Author Report Share Posted July 17, 2010 Don't take a loan you can't afford.That's a bit difficult when the banks themselves were telling people they could afford the loan. Quote Link to comment Share on other sites More sharing options...
ReconRat Posted July 17, 2010 Report Share Posted July 17, 2010 Well, it would be nice of a bank performed a service. But instead it's more of a "method of parting you with your money". So don't think a bank is doing you any favors, they never are. Quote Link to comment Share on other sites More sharing options...
dorifto240 Posted July 17, 2010 Author Report Share Posted July 17, 2010 Well, it would be nice of a bank performed a service. But instead it's more of a "method of parting you with your money". So don't think a bank is doing you any favors, they never are.Wish I knew that when I was 18... Damn student loans Quote Link to comment Share on other sites More sharing options...
ironbuttwannabe Posted July 17, 2010 Report Share Posted July 17, 2010 Yeah and now the banks are soo tight they don't want to loan big money to people that can afford it:violin: Quote Link to comment Share on other sites More sharing options...
DAC Posted July 18, 2010 Report Share Posted July 18, 2010 That's a bit difficult when the banks themselves were telling people they could afford the loan.In '87 when I took out my first mortgage, the banks were giving me numbers they said I could "afford" based on their "ratios". But I knew there was no way the monthly payment they quoted was in my budget.Those jokers get paid for deal flow. Always think about what the guy on the other side of the desk wants. It's intimidating, I know, but ask questions and do some math and decide what makes sense for YOU. Quote Link to comment Share on other sites More sharing options...
dorifto240 Posted July 18, 2010 Author Report Share Posted July 18, 2010 In '87 when I took out my first mortgage, the banks were giving me numbers they said I could "afford" based on their "ratios". But I knew there was no way the monthly payment they quoted was in my budget.Those jokers get paid for deal flow. Always think about what the guy on the other side of the desk wants. It's intimidating, I know, but ask questions and do some math and decide what makes sense for YOU.True, but unfortunately many people have bought into the marketing image that banks can be trusted. Yes it's "buyer beware" but the only time that's ever used to justify an action; is when some is doing something borderline illegal or immoral. We should ask questions, but if the "experts" are working to hide the truth, then what's an average, less enlightened person to do.The whole thing is just wrong. It's not illegal, but it's still wrong. Quote Link to comment Share on other sites More sharing options...
Cheech Posted July 19, 2010 Report Share Posted July 19, 2010 True, but unfortunately many people have bought into the marketing image that banks can be trusted. Yes it's "buyer beware" but the only time that's ever used to justify an action; is when some is doing something borderline illegal or immoral. No. You are spending multiple hundreds of thousands of dollars of your money over a considerable length of your lifespan. Leaving that to some "marketing image" or a warm fuzzy feeling that these guys are experts WITHOUT DOING DUE DILIGENCE is cheating no one but yourself. It took me about 2 hours to do a full budget when I was first buying my house, and I was told in passing that I qualified for about 50K over what my budget allowed.We should ask questions, but if the "experts" are working to hide the truth, then what's an average, less enlightened person to do.ASK MORE QUESTIONS, or find someone else. No one's chaining them to one mortgage lender. Quote Link to comment Share on other sites More sharing options...
Disclaimer Posted July 19, 2010 Report Share Posted July 19, 2010 The bank told me I could afford a house 3x the price of the one I bought. I still bought the one I knew I could afford if either my wife or I lost our job. We lived on one income for more than a year. It looks like the economy is heading for another downturn' date=' so I expect to be doing it again. Not really a problem.. because I didn't listen to some fat cat behind a desk. I listened to my brain, my budget and common sense. I don't feel sorry for anyone that had to sell their house because they bit off more than they could chew. You don't get to make reckless decisions and then have me bail you out for doing so....well, apparently you do, but I didn't vote for that kind of change. (either time, justin)[/quote']I agree with you (and Cheech). I also bought a house well within my means to meet my future financial goals. But, that's not really the "change" we're talking about. I don't have any sympathy for people that bit off more than they can chew, but OTOH I think it's just as sad that bank prey on these idiots and then want bailouts when the loans go belly-up.But, the "change" is coming -- new financial regulations dictate that the originator of the loan has to keep a minimum 5% interest in the loan -- so no more packaging up toxic loans and completely selling them off as AAA rated. You make the loan, you still have to have a dog in that fight. IMHO, 5% is still too low, but better than 0%. Quote Link to comment Share on other sites More sharing options...
ironbuttwannabe Posted July 19, 2010 Report Share Posted July 19, 2010 But, the "change" is coming -- new financial regulations dictate that the originator of the loan has to keep a minimum 5% interest in the loan -- so no more packaging up toxic loans and completely selling them off as AAA rated. You make the loan, you still have to have a dog in that fight. IMHO, 5% is still too low, but better than 0%. I haven't bought a house yet, but have taken a few loans. One that is not completely final yet. But I think that 5% is plenty high. They are not going to give loans out now if they can't get their money back. Our loan has taken over 2 months and still not a definate answer when we will get the money. I don't know why it is taking so long because our assets completely cover the loan about 3 times and we have nearly 35% of the cash in the bank. It doesn't get a whole lot better than that. But I think 5-6% is plenty when you should be able to get your money back. Quote Link to comment Share on other sites More sharing options...
swingset Posted July 20, 2010 Report Share Posted July 20, 2010 That's a bit difficult when the banks themselves were telling people they could afford the loan.lol.Are you kidding? If you make $45k a year and someone tells you you can afford a $300,000 house, are you stupid enough to believe that?Worse, are you stupid enough to take an ARM loan to get into it?It's not like this is secret information, it's common sense stuff that every consumer advocate and financial writer have been crowing about for the last 20 years.Only a dipshit signs a loan beyond his means.This is not anyone's fault but the consumer. Ignorant consumers allow for corruption, enable greed and predatory loans. Without them, the housing boom wouldn't have had fuel to inflate, or go boom. Quote Link to comment Share on other sites More sharing options...
tyler524 Posted July 20, 2010 Report Share Posted July 20, 2010 They had approved me for about twice what I could truly afford and be comfortable and enjoy life. That was after shit hit the fan last April but I locked in at like 4 1/4% for 30yrs so I'm not complaining one bit considering I ended up basically stealing my house for over 20K less than what is was worth in the down market and about 60k less than it was 4 years ago. Quote Link to comment Share on other sites More sharing options...
jeremygsxr Posted July 20, 2010 Report Share Posted July 20, 2010 The bank told me I could afford a house 3x the price of the one I bought. I still bought the one I knew I could afford if either my wife or I lost our job. We lived on one income for more than a year. It looks like the economy is heading for another downturn' date=' so I expect to be doing it again. Not really a problem.. because I didn't listen to some fat cat behind a desk. I listened to [b']my brain, my budget and common sense. I don't feel sorry for anyone that had to sell their house because they bit off more than they could chew. You don't get to make reckless decisions and then have me bail you out for doing so....well, apparently you do, but I didn't vote for that kind of change. (either time, justin) He meant to say "my wife" Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.