subprime

The Alberton Papers Vol VII, #VI
By Dick Darne 10-13-08
"Quite a crowd, this frosty morning" said Johnny, as he poured a cup of think-tank elixir. "What’s happening?"
"Professor Sven is back, to enlighten us on the financial crisis" said Bill.
"Bank heist is a more apt description" added Todd. "Let’s get a seat and get started."
"Ah, wunnerful morning to you all. You all are wondering why I called this meeting, eh. Well we’re going to explain the sub-prime situation first," said the Professor. "Then if we have time we’ll properly assign the blame."
"But we have heard the blame put on people at the bottom, at least that’s what some of the ‘experts’ say," said Johnny.
"Ah yes, that’s what we are conditioned to believe from an early age, whereas a long memory and a study of history tells us otherwise, the blame usually belongs up, not down. But let me tell you a little story I gleaned from reading a little stick-figure cartoon called ‘the sub-prime primer’.( http://www.businesspundit.com/sub-prime/ if you want to read it directly.) Let’s follow a loan that never should have been made, as it is greased along by greed and deregulation, to today’s mess."
"A man walks into the mortgage brokers office and is quite up front about not having any down payment or ability to make the payment, but wants to buy a house. The broker, apparently only concerned with his commission, ignores all the principles of good banking and grants the loan, which will raise the interest rate later. After a whole bunch of crappy loans pile up, the broker sells them to the ‘smart guys on Wall Street’ where after they pile up there, they rename them and sell them to really smart investors who work their financial wizardry on them, with a lot of lubrication from lax rules and lackadaisical enforcement. The whole pile of crap is now renamed and ownership transferred to an offshore ‘shell company’. The story now goes to one of the buyers, the Norwegian Village Retirement Fund, who finds it’s investments going sour and a $^%**&@~ you attitude from these really smart wall street guys. Most of their actions, while morally rotten, are mostly legal thanks to de-regulation and repeal of the Glass-Steagal act."
"But I heard that was repealed by Clinton, a Democrat" said Bill.
"Signed by, and a party to, but let’s not forget who has effectively controlled Congress for many years now and even longer figuring in the ‘blue dogs’. Any attempt to lay all the blame at the feet of the least of us is laughable, except so many people get their news from extremely biased and inaccurate sources that they actually believe it." added the good Professor. "A big chunk of our Government is up to their eyeballs in this mess, let’s take a break and when we return, we’ll properly assign blame."
Who will they be? Your friends and neighbors, your own dear mother? Your elected officials? Maybe us? Stay tuned for the next thrilling episode of the Alberton Papers. Sharpen your pitchforks! Save your rotten fruits and veggies!. Be sure you are registered to vote! Exercise your cognitive powers! dd