Everything you need to know about the bailouts
Originally posted 2009-03-22 20:41:56 -0500. Bumped by carol.
in 2 short paragraphs. A relatively long post for Atrios. Wheeeeeeeeeeeeee!
What's The Goal?
Others have made this point in various ways, but if the goal is to bail out the banksters and keep the existing too big to fail financial order in place with the same cast of characters in charge, then all of this sounds like a cunning plan.
If the goal was really to get banks lending again they'd be funneling large sums of money to healthy (mostly smaller) financial institutions who actually made sensible choices over the last few years.
Meanwhile a fire sale is going on:
Lenders have become so overwhelmed by the foreclosure crisis that they are starting to unload properties in bulk to investor groups at steep discounts.
Investors then flip the properties for a profit without necessarily improving the home.
For example, a unit of Citigroup, the troubled financial giant, sold a foreclosure in Temecula to an Arizona investment firm for $139,000 when comparable homes in the area were selling for $240,000 to $260,000.
The firm listed the home for $249,000, received multiple offers and the property has entered escrow, said Amber Schlieder, the real estate agent who handled the listing.
Citi left a 100 grand on the table. This looks like a great way to abuse the taxpayer even more.
I want to know who they are all selling in bulk to.
So it may come as a surprise that a dozen former top Countrywide executives now stand to make millions from the home mortgage mess.
Stanford L. Kurland, Countrywide's former president, and his team have been buying up delinquent home mortgages that the government took over from other failed banks, sometimes for pennies on the dollar. They get a piece of what they can collect.
"It has been very successful - very strong," John Lawrence, the company's head of loan servicing, told Mr. Kurland one recent morning in a glass-walled boardroom here at PennyMac's spacious headquarters, opened last year in the same Los Angeles suburb where Countrywide once flourished.
The Treasury has shown a willingness to recklessly toss all of our futures away to keep these "Too Big Failures" operating in their self-entitled comfort zone.
What incentive do the banks have to sell these properties for as much as they can when they can sell them in bulk at a loss to their buddies' companies (or even their own companies) so they can turn a profit on them and doing this knowing the failure bankers can ship off all of the bills for the losses to us? Think about it.
If Geithner were handing these trillions to the smaller more responsible bankers some of us little people would be able to buy these cheap houses...
But this way the elite get to keep all of the assets in their greedy hands and have us pay for their gambling addiction failures too. And then they will turn a profit on selling us these properties AGAIN.
“While some critics are distressed that Mr. Kurland and his team are back in business, the executives say that PennyMac’s operations serve as a model for how the government, working with banks, can help stabilize the housing market and lead the nation out of the recession. “It is very important to the entire team here to be part of a solution,” Mr. Kurland said
Important for Whom? You, maybe, but not me.
I am thinking predatory lenders should already be in jail and that this is a model for more financial disaster for taxpayers. I smell smoke and all I see are bulk fire sales and a bunch of greedy arsonists standing around with their gasoline soaked hands in our pockets...
And, so far, the elite are achieving their goal of bailing out themselves with our money. And they have even found more ways to profit from their own failure. While we foot the bills.