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AustonT wrote:

A Town Called Malus wrote:

AustonT wrote:

A Town Called Malus wrote:

Frazzled wrote:What was the supposed crime again?

Losing millions of public savings in get rich quick schemes and needing the government to put it back in out of loans which will eventually be repaid by taxes paid by the public whose money was lost in the first place?

Meanwhile the retards who actually lost the money take their enormous bonus for doing such a good job, stick it in an offshore account so they don't pay any tax on it and retire to somewhere nice and sunny.

At least that's what happened here in the UK. Pretty much the only consequence the "banksters" (as our tabloids like to call them) had to face was one of them losing his knighthood.

When did the banks lose ANYONE's savings?

When they needed the government to pour millions of pounds/dollars into them so that they could stay afloat? The banks leant peoples money in risky schemes, which if successful would result in big returns. They failed and the money leant was lost. Then the government has to come in and put it back through nationalisation or a loan to the banks, using public money from taxes or a loan, to ensure that it doesn't end up like it did in Iceland where all of their major banks collapsed.

That doesn't make any sense. You said they "lost millions of public savings and needing the government to put it back" Now in clarification you have made those two separate statements one and the same. The subprime lending market was and is a debacle, but to my knowledge no one's SAVINGS were lost by banks. Which is what I asked about: savings.

Where do you think the money leant to people for their subprime mortgage came from? Banks take peoples money and invest it in order to get a return, hence why they can offer interest on your money. When they actually evaluate the risks this works quite well. But what happened here is that they leant this money recklessly, looking for a quick return. Then the debtors defaulted, so the money was completely lost. If they didn't get the massive amount of money from the government to keep them afloat they would have collapsed completely (like what happened in Iceland) and all the people who had been saving with them would have found their money sucked into the warp.

That these people didn't is because the government had put the money back in, taking the debt on itself and, effectively, on the people whose money had been lost by careless and reckless banking. So peoples savings were lost by the banks, replaced by the government and the cost of the banks mistakes in the form of national debt is passed onto them.

Frazzled wrote:So yo're telling me retail customers were being sold CDS? What the feth are you smoking?

No, I'm telling you that once banks found out how profitable it was to bet against their customers, the idea permeated the market at every level of transaction. For example, there was a much greater demand for mortgage loans than there were qualified borrowers. And the CDS model needed bad loans to bet against. Lo and behold, the mortgage crisis happened. And here I thought Dick and Jane were just irresponsible good-for-nothings.

Manchu wrote:Do you seriously feel personally responsible for the financial models that ruined our economy? If so, then you ought to do something other than defend them.

I am. We're cleaning up on the wreckage of the European banks. $$$$$$$

Frazzled wrote:I am. We're cleaning up on the wreckage of the European banks.

It was JP Morgan and the other Wallstreet banks who made the damn mess in the first place.

Here is the real problem:

http://moneymorning.com/2011/10/12/derivatives-the-600-trillion-time-bomb-thats-set-to-explode/
October 12, 2011
"Derivatives played a crucial role in bringing down the global economy, so you would think that the world's top policymakers would have reined these things in by now - but they haven't.

Instead of attacking the problem, regulators have let it spiral out of control, and the result is a $600 trillion time bomb called the derivatives market. "

and its spiraled up to:
http://www.globalresearch.ca/index.php?context=va&aid=30944
May 20, 2012
"Top Derivatives Expert Estimates Size of the Global Derivatives Market at $1,200 Trillion Dollars … 20 Times Larger than the Global Economy"

so frazz, do you see anything wrong with gambling with more than 20 times the global economy is worth? Do you think we should enact some regulations to stop this practice and bring it under control? or do we just trust the bankers to fix the problem?

Manchu wrote:Head over to the side of town where the fallout from all this "not crime" has forced families into hunger and homelessness.

I'm confused, how did JP Morgan force familiesinto homelessness?

Did people who were responsibly paying their mortgages lose their house or something?

I think it's sufficient to say that some animals are more equal than others.

Nope. Derivtives are everything from forex to interest derviatives to commodity derivatives. Its so large because they frequently go out 5 - 10 - 15 years.

Want to know how much you're gong to pay for oil so you can configure your fixed costs for that electricty plant? You need a long term hedge.

Need to know how much you're going to pay for electricity for the long term so you can configure the costs for your manufacturing plant? Again you need a hedge.

It wasn't derivatives that sent the market a tizzy and locked up the financial system. Take the conspiracy goggles off.

Frazzled wrote:The problem is you're shooting your arrow at the wrong target. However, since you labelled all finance and insurance guys (er Wall Street in your joyous Occupymyass parlance) as AlQaeda you've just attacked everything from car insurance salesmen to bank tellers arguing with you about what really happened is kind of pointless.

Yeah, clearly it was the bank tellers who came up with, systematized, and directed a market worth trillions of dollars. Clearly, that is exactly what I mean.

Frazzled wrote:Nope. Derivtives are everything from forex to interest derviatives to commodity derivatives. Its so large because they frequently go out 5 - 10 - 15 years.

Want to know how much you're gong to pay for oil so you can configure your fixed costs for that electricty plant? You need a long term hedge.

Need to know how much you're going to pay for electricity for the long term so you can configure the costs for your manufacturing plant? Again you need a hedge.

It wasn't derivatives that sent the market a tizzy and locked up the financial system. Take the conspiracy goggles off.

wow, just wow, let me guess, you're a manager for one of these banks aren't you.

biccat wrote:I think it's sufficient to say that some animals are more equal than others.

I think it's sufficient to say that some minds are less willing or able to correlate their contents than others.

Manchu wrote:

biccat wrote:I think it's sufficient to say that some animals are more equal than others.

I think it's sufficient to say that some minds are less willing or able to correlate their contents than others.

Yes, that's my point.

All animals are equal. Some animals are more equal than others.

biccat wrote:

Manchu wrote:

biccat wrote:I think it's sufficient to say that some animals are more equal than others.

I think it's sufficient to say that some minds are less willing or able to correlate their contents than others.

Yes, that's my point.

Not even your particular brand of sarcasm stretches quite that far.

Manchu wrote:

Frazzled wrote:The problem is you're shooting your arrow at the wrong target. However, since you labelled all finance and insurance guys (er Wall Street in your joyous Occupymyass parlance) as AlQaeda you've just attacked everything from car insurance salesmen to bank tellers arguing with you about what really happened is kind of pointless.

Yeah, clearly it was the bank tellers who came up with, systematized, and directed a market worth trillions of dollars. Clearly, that is exactly what I mean.

Under criminal racqueteering they're all part of the evil criminal organization. Again thanks for calling us all terrorists. Really appreciate that. As someone who's entire institution wasn't involved in derivatives or mortgage backed securities (Canada superior all others inferior) and am now having fun with the Europeans I especially appreciate it.

By the way, its especially choice as we had stuff in the towers and I knew people in them that didn't come out. So you too would be in order but that would be rude.


Automatically Appended Next Post:

sirlynchmob wrote:

Frazzled wrote:Nope. Derivtives are everything from forex to interest derviatives to commodity derivatives. Its so large because they frequently go out 5 - 10 - 15 years.

Want to know how much you're gong to pay for oil so you can configure your fixed costs for that electricty plant? You need a long term hedge.

Need to know how much you're going to pay for electricity for the long term so you can configure the costs for your manufacturing plant? Again you need a hedge.

It wasn't derivatives that sent the market a tizzy and locked up the financial system. Take the conspiracy goggles off.

wow, just wow, let me guess, you're a manager for one of these banks aren't you.

Bank manager wow that takes me back. I remember working in a branch.
I remember being a teller joking to a client about her new job at "the toy store" not realizing that it was a strip joint just around the corner. Oops...

Wow its 2.30 this worse than Al Qaeda banker is outta here for the long weekend YEEE HAAAAA!

Frazzled wrote:So you too would be in order but that would be rude.

That's the hardest I've ever seen anyone try to spin something. I'm sure you make a comfortable living as a banker Frazz but Rush would pay you a mint to write lines like that for him.

Manchu wrote:

biccat wrote:

Manchu wrote:

biccat wrote:I think it's sufficient to say that some animals are more equal than others.

I think it's sufficient to say that some minds are less willing or able to correlate their contents than others.

Yes, that's my point.

Not even your particular brand of sarcasm stretches quite that far.

Au contraire.

Hypothetically, and this is just an intellectual exercise, imagine if a small group of people decided to run an operation that was open to public participation, but somehow public participation was limited. You had to open an account or something. You gave them $X and they invested it with others to get access to large investments with good returns.

The group of people didn't really care what you did with your account, for the most part, so long as you followed some basic rules. You couldn't take out money or trade at certain times, you had to notify the group if you wanted your money directed towards specific ends, and you couldn't put borrowed money in your account, pretty easy-to-follow rules.

Then the number of public members grows too large for the small group to run. So they appoint managers to oversee individual members. We'll call them traders. The traders oversee member accounts. They direct funds according to member wishes and help the people running the organization decide how to invest money.

But instead of simply being disinterested employees, the traders decide to invest their money with the operation. They don't just invest their money disinterestedly, they make arrangements with friends to trade before the market opens. They create outside companies, get them approved for investments, borrow based on client funds, and then reinvest that money back into their accounts. All sorts of nasty shenanigans.

Oh, and lets suppose, again just as a mental exercise, that several of the investors did the same thing the traders were doing and the traders kicked them out of the investment.

Now does my "particular brand of sarcasm stretche[] quite that far"?

I wish your understanding of banking reflected reality. Just like I wish "It's A Wonderful Life" reflected reality.

Manchu wrote:I wish you understanding of banking reflected reality. Just like I wish "It's A Wonderful Life" reflected reality.

To quote what someone said upthread:

Manchu wrote:I think it's sufficient to say that some minds are less willing or able to correlate their contents than others.

I encourage you to learn more about this subject, biccat.

This is as good as any a place to start: http://fcic.law.stanford.edu/report

And you said Obama didn't do anything about Wall Street.

biccat wrote:And you said Obama didn't do anything about Wall Street.

I did forget to mention commissioning a damning report and then doing nothing about it, didn't I? Thanks for reminding me.

Manchu wrote:

biccat wrote:And you said Obama didn't do anything about Wall Street.

I did forget to mention commissioning a damning report and then doing nothing about it, didn't I? Thanks for reminding me.

You did forget.

That's OK. You also forgot Dodd-Frank, "the most comprehensive financial regulatory overhaul since the Great Depression," until I reminded you.

Anything else you forgot in making your broad claim that Obama didn't do anything? Like stress tests?

biccat wrote:

Manchu wrote:

biccat wrote:And you said Obama didn't do anything about Wall Street.

I did forget to mention commissioning a damning report and then doing nothing about it, didn't I? Thanks for reminding me.

You did forget.

That's OK. You also forgot Dodd-Frank, "the most comprehensive financial regulatory overhaul since the Great Depression," until I reminded you.

Anything else you forgot in making your broad claim that Obama didn't do anything? Like stress tests?

it also failed to do anything about the derivatives market.

Frazzled wrote:

A Town Called Malus wrote:

Frazzled wrote:What was the supposed crime again?

Losing millions of Americans savings in get rich quick schemes and needing the government to put it back in out of loans which will eventually be repaid by taxes paid by the Americans whose money was lost in the first place?

What get rich quick schemes?

One of the biggies was mortgage bavked securities.

Mortgages used to be a get rich slow scheme, lend money to qualified applicants get it back with interest over 30 years.

But when banks were deregulated they found a way to get rich fast off of them. They would sell bonds backed by the income of these mortgages. That way you get your, iney now, not 30 years from now.

But that created an incentive to issue as many mortgages as they could whether or not the borrowers were qualified. So people with insufficient income were steered towards loans they could not pay back but banks didn't care because they would resell the loan and get their cash now.

Impacts-prople getting loans they could not repay, often under fraudulent terms, and then foreclosed

Infusion of cheap money drove up housing prices and remts for all of us

Banks sold securities they privately knew were junk but publically held up as AAA rated

And thats for staters.

Looks like AP did some fact-checking on this claim.

The White House is aggressively pushing the idea that, contrary to widespread belief, President Barack Obama is tightfisted with taxpayer dollars. To back it up, the administration cites a media report that claims federal spending is rising at the slowest pace since the Eisenhower years.

"Federal spending since I took office has risen at the slowest pace of any president in almost 60 years," Obama said at a campaign rally Thursday in Des Moines, Iowa.

The problem with that rosy claim is that the Wall Street bailout is part of the calculation. The bailout ballooned the 2009 budget just before Obama took office, making Obama's 2010 results look smaller in comparison. And as almost $150 billion of the bailout was paid back during Obama's watch, the analysis counted them as government spending cuts.

It also assumes Obama had less of a role setting the budget for 2009 than he really did.

Also, the Washington Post's fact checker gave the story "Three Pinocchios" representing "Significant factual error and/or obvious contradictions." Which is generous.

Bromsy wrote:If only our political leaders were as enlightened as us.

Haha.