Tuesday, June 7, 2011

Quelle Surprise! Banks are Concerned About Mortgage Slowdown « naked capitalism

It is no surprise that mortgage bankers are whining again about the low numbers of new originations.  For some reason they think that a glut of buyers will be coming out of the wood work to save the banking industry from explaining their part in ruining the housing market.  The collusion of government and banker has succeeded in a few things and none of them have created demand for new originated mortgages.  The low interest rates is not beginning to solve the housing problem and until the banks own up to their part in the decimation of the economy, most people will gladly wait before they jump into the buying mode again.  It is hard to believe that the current administration is willing to bow down to the banking industry for their entire term.  They have tried to get the economy back on track so the banks could get away with egregious criminal behavior while doing nothing to protect the American home owner from getting screwed for years. 

Naked capitalism has another article documenting the arrogance and hubris of the mortgage and banking industry today.  The total denial of responsibility is as apparent as ever. 

It seems not to have occurred to the banking industry that relying people to be fools on an ongoing, large scale basis is not a viable business model. Investors have come to realize a bit late in the game that private label securitizations were structured so as to be far too favorable to the originators and servicers: too little disclosure, too many abuses, too little accountability, combined with impediments to seeking redress in court. Borrowers feel every bit as stung between deteriorating housing markets, foreclosure malfeasance, and doubts over chain of title.

It isn’t simply that banks have been slow to ‘fess up and clean up; instead, they’ve kicked and screamed at every possible reform measure, from pro investor reforms such as a very good FDIC proposal that got watered down to nothingness and a weak 5% risk retention rule (which Dean Baker estimates will add all of 0.13% to the yield on a mortgage) to pretty much anything that would help borrowers. And that’s before we get to widespread evidence of incompetence (continuing stories of foreclosing on people who don’t have mortgages is the tip of the iceberg) and fraud.

Quelle Surprise! Banks are Concerned About Mortgage Slowdown « naked capitalism

 Make big money in penny stocks today

No comments:

Post a Comment

your feedback and opinions welcome.