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BlogsDo You Have a CLUE ?Tarped Again

Posted almost 15 years ago

Tarped Again

Ok, I’m officially confused. Last week, I read that FHFA (Federal Housing Finance Agency), on behalf of Fannie & Freddie are suing 17 Banks/Lenders, 268 +/.- ,various individuals and corporate players for misrepresenting individual prospectuses of RMBS when they were issued. ( felix salmon, reuters)  Alright, anyone with Economics 101 knows there were some “ due diligence glitches “ with the issue of MBS. Not defending the TBTF’s and Primary Dealers, where was the due diligence on the part of the bond holders ?

 

So, what kind of bucks are we talking about?? Well, one of the TBTF’s may have an exposure of around $15.5 BILLION or MORE that we don’t know about. You can apply your own metrics too see what WE face.

 

My BIG QUESTION is WHY NOW?  

I’ve read that the statute of limitations may run out soon on the alleged crimes. If that’s it then OK, I understand.

 

 

Here’s where I’m confused; we, as a nation HAD to pass TARP or the world would end. So, the taxpayer bails out the Banks/Lenders. Now, the same government that told us stories of Armageddon sues the same folks we bailed out?

 

Who gets hurt in this deal? Will the taxpayer have to bail out the same Banks/Lenders after the Lawsuit? Looks like we may get TARPED AGAIN.  

Comments (3)

  1. Gerald- the banks aren't lending because of the Schizophrenic government policies. First, they get bailed out,now,the same government sues them.The same government allows the banks to borrow at almost 0%.Then, encourages them to buy government debt.A nice profit for the banks at NO risk. Make no mistake,the TBTF's are calling the shots.What's the government going to do? If you don't lend we're going to shut you down... we can't write the check. Sad state we're in.

    Mike Morrison, almost 15 years ago


  2. I don't think this lawsuit is about causing these banks or lenders to fail only to bail them out again, I think it's about exerting pressure on these guys in a tight economic market to do the things necessary (lending money) to get this economy started again. It's troubling to see the record profits in an industry that was bailed out only years ago and the players of this industry as a whole are not doing what is necessary (lending) to get this economy going again.

    Gerald Green, almost 15 years ago


  3. Hey Mike,I remember hearing something on one of the financial shows about TARP. i'M NEW AT THIS. would mind explaing what a TARP is in laymens term please? It would be greatly appreciated!!!!!!!!

    Uryss Mitchell, almost 15 years ago