Found a superb book on the meltdown and fraud of banks

[dixiegrrrrl]

The best books about the economy read like a novel, in plain english.

Michael Lewis does it very well, and I just found another well written book:
"A Colossal Failure of Common Sense: The Inside Story of the Collapse of Lehman Brothers is a 2009 non-fiction book written by Lawrence G. McDonald and Patrick Robinson which chronicles the events leading up to the fall of Lehman Brothers."

Actually much more, it also gives a history and description of the mortgage and bank fraud from the beginning.

highly recommend this.

edited to add:
here is an excerpt, to show the writing style:

But as the year 2004 drew to a close, there was a brand-new culture in real
estate. The mortgage broker was no longer the lender, because he was about to
unload the whole package, one thousand mortgages at a time, to Lehman
Brothers or Merrill Lynch for the now-well-established parceling-out process,
masterminded by the ratings agencies, Fitch, Moody’s, and S&P. So the
brokerage house did not care what happened after that, because they no longer
had their own capital on the line. And those bodybuilder salesmen, those affable
Californians, were free to run amok among lower-middle-income earners and
sell them anything they darned pleased. There were no standards, no
consequences, no responsibilities, and no recriminations. Because, and I stress
this once more, nobody cared. There was no need. The brokerage firms could
sell any and every mortgage they wrote, sell it on to Lehman Brothers or Merrill
Lynch, or any other major U.S. bank, on faraway Wall Street.
No team of salesmen ever had a more liberal, freewheeling brief. Just sign up
the prospect, write his mortgage, and collect your commission. Needless to say,
this heaven-sent career path attracted literally thousands of a certain type of
salesman. One of the biggest of the California brokerage houses, New Century,
a corporation with many, many direct lines to our mortgage-backed securities
trading floor, staffed 222 branch offices coast to coast and used a network of
47,000 mortgage brokers, many of whom worked in their “satellite offices”—
that is, their apartments or cars. Those salesmen were applying deceptive, high-
pressure tactics to people who never even realized they needed a mortgage,
never mind a refinance, or a reverse mortgage, or a no-documentation
mortgage, or an adjustable-rate mortgage, or a balloon mortgage, or a cash-
back mortgage, or an easy-money mortgage, as advertised by the more ruthless
of the breed on local gospel radio stations. There was a whole new language
evolving, creating selling strategies that had never been heard of before. What
the hell’s a balloon mortgage? What do you mean, an easy-money mortgage?
Don’t ask, for Christ’s sake—they’ll try to sell you one.

[banned from Kos]

1. Where is the "fraud"?

Same shit goes on with car financing. I agree that what they did was unethical though.

[dixiegrrrrl]

3. The fraud is discussed thru out the book,

the excerpt I posted was, as I said, to show the writing style and tone.

[banned from Kos]

4. please link of quote just one instance of fraud? just one!

I am not convinced.

[Fuddnik]

5. Go buy a book.

Buy a lot of books.

[dixiegrrrrl]

7. I read the book and am recommending it to anyone who might be interested.

you clearly are not interested.
If you want to pick an argument, read the book and argue with the author.
EOM

[Fuddnik]

2. You mention Michael Lewis, so I assume you read "The Big Short".

Fraud on a massive scale. The chapters on the Mortgage Brokers convention in Vegas were particularly interesting.

[westerebus]

6. Thanks n/t

[dixiegrrrrl]

8. You are most welcome.

[progree]

9. But but but, I thought the Community Reinvestment Act forced banks to lend to poor people

And then Clinton really upped the pressure, and by the time poor George (W. Bush) took office, the momentum was so great, and the Democrats in Congress so obstinant, that George, despite such characteristically manly efforts with his umm, Ownership Society, was unable to stop it before it was too late.

But but but, your excerpt doesn't make it sound like the banks / lenders were dragged kicking and screaming into making more loans (the "CRA made us do it" theory). Sounds like if there was any pressure, it was on ordinary people to get these loans, especially subprime loans for people who qualified for lower-cost regular loans.

G.W. Bush in a speech on October 15, 2002:

"you don't have to have a lousy home for first-time home buyers. If you put your mind to it, the first-time home buyer, the low-income home buyer can have just as nice a house as anybody else."