Millions of Americans lost their jobs, houses, savings, and more when the housing market collapsed under the weight of mortgages that should never have been approved, let alone bundled and converted into worthless, toxic securities. And yet, no senior Wall Street bank executives were ever charged with a crime. Now one U.S. congressman is asking to look at the FBI files to find out why. [More]
Back in January 2010, seeking o learn more about the mortgage-backed securities that helped destroy the global economy, the staff of National Public Radio’s Planet Money podcast pooled their money and bought part of a mortgage-backed bond. “Toxie” lasted only a few more months, earning $449 for her owners before so few mortgage payments were coming in that she “died.” Or at least stopped earning money.
One might think that with the collapse of the housing market and the global economy, realtors and banks might have some idea how to handle a short sale transaction. A short sale, after all, is when a homeowner sells their home for less than they owe on the mortgage in order to avoid foreclosure. Frank writes that he would like very much to move into the house he signed a contract to buy back in November, but the seller’s realtor forgot to submit documents to the seller’s bank, leaving the house vacant to be vandalized and deteriorate for months on end.
As part of an attempt to make up a budget shortfall, New York State is holding a huge fundraiser. No, not a bake sale: starting in April 2010, the state is forcing all car and tractor-trailer owners in the state to buy new license plates when they renew their registrations. And not just any license plates. Ugly license plates.
Due to the record number of bank failures this year, the FDIC is low on funds. Instead of borrowing from the Treasury as they did in the early ’90s savings and loan crisis, regulators have a new idea: asking banks for a bailout.
Former Merrill Lynch CEO John Thain is famous for, among other things, spending $1.2 million to redecorate his office as the company was going down in flames. For some reason, Thain’s shopping spree of $87,000 area rugs, a $18,000 desk, and a $35,000 chest of drawers didn’t go over well.
Remember those banks that the federal government bailed out because they were “too big to fail?” Well…after mergers and bank takeovers (some encouraged by the government) those banks bailed out because they were “too big to fail” now are much bigger. JP Morgan Chase and Bank of America combined now control more than 20% of all bank deposits in the United States.
Given how many banks have failed and been taken over by the FDIC this year (84, including three yesterday), it’s not one bit surprising that the FDIC isn’t doing too well, funds-wise. It’s down to $22 billion, the lowest the failed bank fund has been since the savings and loan crisis of the early ’90s, when it needed to borrow money from the Treasury Department to keep going.
Big news! AIG, poster child of the economic meltdown, has reported a profit. The company says it had a net income for the second quarter of $1.8 billion, which is much better than in 2008 when it lost $5.8 billion. So, how much did we-the-people get for our investment? $1.5 billion.
Hey, remember the TARP program? If banks are now paying back TARP funds, then what happened to those toxic assets? Are they sitting in a canyon in Wyoming for the next 10,000 years? Not exactly.
A hush fell over the AIG conference room on the day that their Worst Company in America 2009 trophy was unveiled. The eyes of every executive in the room sparkled with just a bit of pride. “Well done, everyone,” said the man at the head of the table. “But we mustn’t rest on our gilded-feces laurels. It’s time to begin our work for next year’s competition.”