Matt Taibbi: One Last Note on Mike Bloomberg

[marmar]

from Rolling Stone:



I’m getting a number of letters, mainly from conservatives and libertarians, who seem to think that my response to Mike Bloomberg's "It's not the banks' fault" rant means I "don’t believe in personal responsibility."

Apparently, people feel that by explaining how the banks profited from tfhe explosion of subprime home loans, I’m somehow letting the ordinary homeowner who over-borrowed off the hook.

But the question was never, Do ordinary homeowners share any blame for the crisis? The question, as implicitly posed by Bloomberg, was, Is it true that the banks had NO blame for the crisis?

....(snip)....

But the main driving factor was the simple fact that banks were able to make trillions of dollars selling defective products. You take away that simple market-driven reality, there's no bubble and no crash, no matter what people like Michael Bloomberg say. No one is insisting that they take the whole rap -- but don't insult us by trying to say they shouldn't take any at all. ......(more)

The complete piece is at: http://www.rollingstone.com/politics/blogs/taibblog/one-last-note-on-michael-bloomberg-20111105#ixzz1cyofkk6G

[WillyT]

1. K & R !!!

:kick:

[PDJane]

2. Thank you Matt Taibbi.

And more the banks than the homeowners, frankly, thanks to manipulation of things like assessments.

[democracy1st]

3. ty KNR

[JVS]

4. K&R

[DirkGently]

5. "But for" banks' subprime / CDO greed, the collapse WOULD NOT have occurred. Period.

Not only do banks carry blame, they carry the vast bulk of the blame. Blaming borrowers for signing their b.s. loans in their b.s. market is like the burglar blaming you for not locking your door.

[progressoid]

6. Rec.

[CarmanK]

7. HOMEOWNERS were suckers for the MTG BANK COns!

People were told not to worry about starting mtg pmts. that would get too high. They were told that they could start out with the ARMS that would put them into the houses and then could refinance after a few years when the ARMS were raised. They were conned into believing that their incomes would go up each year ad that their investment in the houses would then allow them to refin. I heard a lot of the stories, and the home owners were gullible and hopeful, but they did not steer this ship of deception, the mtg banks did . The brokers did, the investment bankers did .

[EC]

9. + 1000

I saw a lot of this. I was in insurance then and everytime someone would re-fi, it was at 125% equity. They really believed it when the loan companies or banks told them that the home values would always go up and they would gain equity again in a few years (over the 125%)anyway.


On edit: Of course I couldn't keep my big mouth shut and told them they were being foolish that EVERYTHING eventually depreciates and a 125% loan was crazy, especially on a ARM. Most of them were so desparate from lack of wages going up and everything else having price increases, all they wanted to do was keep up and figured things would get better, if only they could get that better job with bennies or get caught up on the bills or if only....

[fasttense]

10. You hit the nail on the head Carmank.

It was one giant scam or con. The con involved the government, the banks, the Wall Street traders and their victims were everywhere.

Have you ever noticed how fond a conman is about blaming his victims? How often have you heard that it is the mark's greed that leads to the swindle? If not for the greed of the victim, the con would never be successful. But the truth is many, many cons involve no greed at all. Many cons are designed to appeal to the victim's sympathies and concern for his fellow man. Con men have to ridicule and degrade their marks, if only in their own minds, because they know they are at fault. The conman is at fault for the swindle, not the mark, not the greed of the mark and not the person who ends up being swindled.

You can easily make out who the cons are by who ends up with the other person's money.

[Kaleko]

14. This con is so gigantic, it also includes ALL of the major media and has brought Europe to the brink

of collapse.



Like fasttense said, follow the money and you will know who are the victims and the perpetrators.

[Dont call me Shirley]

23. Your expalnation is exactly correct. Thanks for clarifying victim/con so well.

[Puget Progressive]

24. Indeed, Bernie Madoff infamously said

that he had no sympathy for the people he swindled as it was "their" fault. He also said - "F**k them." What a reprehensible individual.

[marmar]

15. Indeed.

nt

[redqueen]

8. K&R

[Hotler]

11. k&r n/t

[phantom power]

12. I think Taibbi is being too kind -- A bank's job is to properly assess loan risk...

And they failed, massively, at their job.

In fact, even that is being way too kind -- it's been established for a long time that banks fucking pressured customers into bad, high-risk loans. They lied to customers, and backed up their lies with the veneer of authority.

Customers share very very little blame for this, compared to banks.

[yodermon]

13. I have $20 million. You have $200. You want to borrow my money. Who has the power & responsibility

in the relationship? At the end of the day you cannot force me to loan you the money, I have to make that decision. IT'S MY FUCKING MONEY.

That's why the rightwing narrative always shifts to "Fannie made me do it" or "the CRA made me do it" or some such whining bullshit.

[dodger501]

16. Try discussing this with wingnuts

If you have ever had the misfortune of discussing the financial/housing crisis with a "Libertarian" and even many conservatives, you will immediately get a lecture on:

- Barney Frank
- CRA
- Stupid, unqualified mortgage borrowers
- Fannie & Freddie

I know this for a fact, from personal experience.
Even, for the sake of argument, if it's true that Barney Frank forced these innocent lamb financial institutions to loan to unqualified borrowers, what ensued is what was really the problem
And: Fannie & Freddie do not originate mortgage loans! The problem with this, and many other disputes, is that libertarians/conservatives view this stuff as left versus right, liberal versus conservative. They perceive that only liberals think what the banks did was bad and they would rather stick a hot poker up their orifice than agree with a goddamned liberal on anything, so . . .The size of the slice of the Blame Pie for those 4 entities above is razor thin

[russspeakeasy]

17. Thanks, Matt. Keep up the good work.

[valerief]

18. I love Mr. T.! nt

[mother earth]

19. Nobody tells it like it is like Matt. I love Matt Taibbi!!! K & R

[bluestateboomer]

20. Very Clear Explanation.

Easy to read.:fistbump:

[blackspade]

21. +1000

[saras]

22. It's the bank's job, not mine, to tell me what kind of loan I can afford. That's their JOB.

I did the diligent homeowner thing. I went and talked to a few of the people who were universally acknowledged as the experts in their field - bank loan officers. They have the expertise to evaluate the economy, and my earnings, and the future value of the house, and make sane recommendations.

How the hell am I supposed to do that? If I didn't want to go back to college and study finance, I'd hire experts. I did. The bankers. I did what they told me to.

So, aside from trusting capitalists in the first place, what did I do wrong?

[DeSwiss]

25. K&R n/t

[truedelphi]

26. Please be sure and stay away from planes and

be very careful, Matt. Wish I could say we have your back, but we can't say that.

The last person I knew who spoke this eloquently about the sins of the Elite, and the needs of the Middle Class, was one Paul Wellstone.

[chervilant]

27. Well, now...

Granted, we have all bellied up to the hedonism trough. There IS some personal responsibility for buying the Capitalist 'wealth carrot meme' without question. However, the catastrophic economic reordering we're witnessing is more directly the responsibility of the vile corporate megalomaniacs who own and control the vast majority of this planet's resources. Their hedonism has repercussions exponentially more damaging than any greedy act of any individual member of the Hoi Polloi.

Having been in the mortgage industry for years (I left because I refused to sell sub-primes), I can assure you that most individual home buyers are NOT savvy about reading the massive contracts that the lenders and title companies have created lo these many years.

In fact, banks KNOW that most borrowers are financially illiterate (moreover, better than 40% of this nation's adult population is functionally illiterate), and they USE this information when developing their clever and effective marketing strategies. Then, they deliberately market to gullible individuals whose life experiences within capitalism have molded them into perfect little consuming machines (and, isn't it so much easier to blame these poor, pathetic individuals?).

Furthermore, I challenge you to find me a single title officer who adjures their home buyers to 'take your time and read every page of this 80+ page contract, especially the fine print...we'll wait for you to finish...' I have attended countless closings where the title officer pre-flagged every space where initials or signatures were required and moved fluidly from post-it flag to post-it flag, as clients signed their lives away into thirty-year servitude. After all, a twenty-minute closing means much more business by the end of each day...

I am certain that the big lenders are using their well honed marketing strategies to determine how best to hit us with their disgusting "deficiency judgments" (their latest grasping for ever more money) even as our global economy grinds to a halt. (I believe this will be a Pyhrric victory for those vile hedonists.)

Be that as it may, I encourage ALL of those who seek to blame anyone but the bankers and other fraudsters, consider this:

(actually, this should be of concern to everyone watching with bated breath as the global economy teeters on the brink of catastrophic reordering)

{Born} once again warned about the danger of Dark Markets, now grown to $680 trillion of notional value, according to the Bank for International Settlements -- "more than 10 times the amount of the gross national product of all the countries in the world."

(emphasis mine; the quote references Brooksley Born)

Does anyone out there TRULY believe that our global economy has the combined resources to cover this ginormous financial Black Hole, created by an incredibly small number of hedonistic corporate megalomaniacs?! Even the most math-challenged average human being can see that these 'derivatives' and 'CDOs' and other high-risk investment instruments are literally worthless...

I encourage everyone to stop wasting time and energy blaming members of the hoi polloi for the crimes and malfeasance of an infinitesimally small percentage of hedonistic Corporate Megalomaniacs. We will need to help each other get through the economic disaster we're facing.

[JDPriestly]

28. The banks were in a position to hire risk management people to advise them

on the likely risks of the mortgages.

If the risk managers had done their jobs, we would never have had this crisis.

That is because it was really obvious that housing prices had skyrocketed while wages were stagnant. That is sure tip-off that the buyers were getting in over their heads. My neighbor and I saw this fact. Why couldn't the bankers?