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Blowing the Whistle on the Mortgage Bubble

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Re: Blowing the Whistle on the Mortgage Bubble

#51

Post by deveac »

davidw wrote: post #48
deveac wrote: post #39

Earlier quoted context omitted.

>"The problem of socialism is that at one point you run out of other people's money". And that's where we're arriving now. Ugh. I try my best not to be snarky on here, but here is the wiki explaining what socialism is: http://en.wikipedia.org/wiki/Socialism Don't worry, you don't have to read past the first sentence to reveal your complete and utter misunderstanding of the term. The trend, over the years, has been ov…

> PolySci 101. It ain't that difficult. Do I really need to GTFY on HN? Best just to flag all political articles and rid them from the site, as they pretty much inevitably end up with discussions like this.

I'm sort of embarrassed that I even replied to it.

Edit: The comment I mean. OP's article isn't overtly political in any way. It was incredibly interesting. Even just for the insight regarding the mechanisms of QA on a purely physical level. I never imagined underwriters jetting around the nation, going into box filled hotel rooms to get busy underwriting. Learn something new every day.

Re: Blowing the Whistle on the Mortgage Bubble

#52

Post by [deleted] »

davidw wrote: post #48
deveac wrote: post #39

Earlier quoted context omitted.

>"The problem of socialism is that at one point you run out of other people's money". And that's where we're arriving now. Ugh. I try my best not to be snarky on here, but here is the wiki explaining what socialism is: http://en.wikipedia.org/wiki/Socialism Don't worry, you don't have to read past the first sentence to reveal your complete and utter misunderstanding of the term. The trend, over the years, has been ov…

> PolySci 101. It ain't that difficult. Do I really need to GTFY on HN? Best just to flag all political articles and rid them from the site, as they pretty much inevitably end up with discussions like this.

[deleted]

Re: Blowing the Whistle on the Mortgage Bubble

#53

Post by rthomas6 »

BenoitEssiambre wrote: post #40
martinced wrote: post #15

"industry insiders were ringing the alarm bells" Just as today many economists are ringing the alarm bells: the governments public debt issues (both in U.S., Japan and many countries in the Eurozone) are going to end up very badly. Many central banks (including in the U.S.) have basically become bad banks. Anyone holding medium and long-term public government debt (like many insurance products) are basically bankrupt…

"governments are going to default.", "we live in a socialist world bent on confiscating savings (at the benefit of the state) using inflation" These are contradictory. Governments don't have to default if they inflate their debt away. Also, money is just pieces of paper or a number in a computer. You shouldn't keep most of your savings in money. Cash is just an agreed upon number meant to help with short term transac…

I think OP might feel better if they knew about inflation protected securities.

Re: Blowing the Whistle on the Mortgage Bubble

#54

Post by brown9-2 »

niggler wrote: post #28
spot wrote: post #22

Earlier quoted context omitted.

"that's where we're arriving now" you know, years ago the deficit scolds said the US would turn into Greece "within two years". they were wrong. they said inflation would spike. they were wrong. and here you go doing the same thing again. the US will never default on its debt. period. it's the law. they will just use inflation to pay it if they have to. more likely the economy will return to growth and a combination…

> inflation would spike Inflation did spike but what happened was that the definition was redefined in a deceptive way. Look at cereal prices and volumes. Prices have spiked and the containers/volumes have shrunk, but that's not taken into account under measures that exclude food prices. Energy prices have spiked. Gold prices have been running for more than 12 years. It's not to say we are seeing hyperinflation, but…

When people say that CPI doesn't show true inflation, what measure do they prefer to use instead?

Re: Blowing the Whistle on the Mortgage Bubble

#55

Post by Irregardless »

My reaction while reading most of this was "Why didn't any of you try harder to let someone know? Why didn't you email everyone? Why didn't you call all the people you emailed? Wasn't there ANYONE important who would listen!?"

After reading the whole thing, I was a little shocked to realize the answer is "No, there was no one important who would listen." The accountant who essentially documented the impending collapse of Citigroup in less than 2 pages was interviewed by the SEC and then never heard from them again. Then there's this guy:

> The congressional responses were, “Thank you for your letter, and thank you for your interest.” And, “We’ll look into this,” basically.

> I also wrote letters to just about every television journalist, and network journalist that I could get my hands on. Sent as e-mail with attachments and never received any response. [I wrote to] CNN and Fox News. ABC News, NBC News, CBS. My daughter was working at that time with one of the network affiliates in Phoenix, and she knew how upset I was about this whole thing. So she put me in contact with their consumer reporter, who does the consumer complaints and that sort of thing. He came out to my house and interviewed me for about 45 minutes. And I gave him documentation, and tried to as best I could to explain the situation to someone that was basically ignorant of the mortgage industry. Never heard another word. …

> During the mortgage meltdown, [Fox News host] Bill O’Reilly was having a temper tantrum on his show where he was going off about, “Why didn’t I hear about this? Why didn’t somebody tell me about all this that was going on?” And I almost threw my shoe through the television set. Ask my wife — I was screaming and yelling, “I did try to let you know.” ‘Cause he had been one of the ones that I had sent e-mails and attachments with all of this stuff. …

What the hell are these people supposed to do? Start posting their warnings all over the internet and hope it goes viral? What are the chances that would work vs. the chances they'd all be dismissed as conspiracy theorist crackpots?

It's easy to think "If I were in any of their positions, I would've gotten the entire country's attention", but it seems people at every level are determined to be ignorant as long as it's profitable.

Re: Blowing the Whistle on the Mortgage Bubble

#56

Post by brown9-2 »

Nursie wrote: post #18
jstalin wrote: post #12

Our system is strictly based on confidence at this point. Fiat currency, fractional reserve banking, massive leverage, and more systemic debt than the world has ever seen all rely on the fact that big banks are essentially untouchable. We'll never see prosecutions of big banks or their principles. It would break the entire system.

Isn't the system, and the whole concept of money in general, all entirely a confidence game?

Yes, nothing has changed here. Economies are always based on trust and confidence.

Re: Blowing the Whistle on the Mortgage Bubble

#57

Post by logn »

davidw wrote: post #48
deveac wrote: post #39

Earlier quoted context omitted.

>"The problem of socialism is that at one point you run out of other people's money". And that's where we're arriving now. Ugh. I try my best not to be snarky on here, but here is the wiki explaining what socialism is: http://en.wikipedia.org/wiki/Socialism Don't worry, you don't have to read past the first sentence to reveal your complete and utter misunderstanding of the term. The trend, over the years, has been ov…

> PolySci 101. It ain't that difficult. Do I really need to GTFY on HN? Best just to flag all political articles and rid them from the site, as they pretty much inevitably end up with discussions like this.

But at the same time we vote up articles complaining that we as engineers should stop making cat video websites and focus on important problems. We flock to advice blogs to find good startup ideas that solve people's problems. This article is food for thought IMO. I'll take a 15 page article detailing inefficiencies/fraud in banks (of which many of us are employed in IT) over a 3 paragraph blog summarizing an 8 paragraph blog on weak typing.

Re: Blowing the Whistle on the Mortgage Bubble

#58

Post by digitalengineer »

mseebach wrote: post #46
gizmo wrote: post #37

Earlier quoted context omitted.

You're correct that the debt will continue to go up after 10 years if there are absolutely no cuts and no revenue increases. But 10 years is plenty time to bring the budget in line with GDP growth, and after the depression is behind us there should be bi-partisan interest in reducing the deficit. I'll be very surprised if the US deficit is over 80% of GDP in 10 years. The comment by Krugman about Republicans wanting…

Krugman is as "somewhat hyperbolic" as the GP. In fact, the GP qualifies his theories with "I think", Krugman states them as fact.

Just curious: Does the debt number include unfunded liabilities for social security, medicare, etc?

Re: Blowing the Whistle on the Mortgage Bubble

#59

Post by arethuza »

Irregardless wrote: post #55

My reaction while reading most of this was "Why didn't any of you try harder to let someone know? Why didn't you email everyone? Why didn't you call all the people you emailed? Wasn't there ANYONE important who would listen!?" After reading the whole thing, I was a little shocked to realize the answer is "No, there was no one important who would listen." The accountant who essentially documented the impending collaps…

Here is what you would face in a UK bank if you tried to warn anyone:

"When I tried to resolve the previous difficulties with Jo Dawson [HBOS group risk director 2004-2005 who eventually replaced Moore], she leant over the table – she stood up – pointed at me and said 'I'm warning you. Don't you make an effin' enemy out of me'," he said."

http://www.guardian.co.uk/business/2012/oct/30/hbos-whistleb...

Re: Blowing the Whistle on the Mortgage Bubble

#60

Post by rauljara »

snowwrestler wrote: post #47
rauljara wrote: post #7

Earlier quoted context omitted.

That is largely what Frontline does. They sometimes break original stories, but a lot of what they do is building on other people's reporting and compiling the information in a clear and organized fashion. Then they add interviews for depth and insight. They don't try to be breaking news. They try to be comprehensive. I'm a big fan. They aren't perfect (who is), but they take reporting and informing very seriously, a…

I love to watch Frontline, but as they've reported on areas where I know a bit more, it's become obvious how often they trade on outrage rather than detailed information. For example, in order to really report on why prosecutions did not happen, you would think they would take some time to explain how federal law defines certain crimes. But, they never did that at all--instead they ask people for a sort of gut reacti…

My biggest problem with them is that they often feel like prosecutors building a case. They lay out their arguments and pile on supporting evidence with what feels like the intent of proving things beyond a reasonable doubt. And I'm often convinced, but I never really feel like I get the defense attorney's cross-examination.

That said, it's really obvious how much work and thought goes into these. If you compare anything of this complexity against perfection, it will always come up short. But I don't know of another news show that consistently hits the level of quality that Frontline does.

Honest question: Does anyone have any suggestions for reporting they think is in the same league? I'd love to check it out.

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