Just watched it and I must say if 50% of the stuff they say was going on happened holy crap the banks were frauds being supported by our government. We should still be pissed off they got a bailout.

I partially blamed the government for loosening mortgage restrictions to low income buyers. The government wanted more people to own homes and they had to loosen the requirements to get riskier people to buy them. As a safety net the government provided banks with Fannie Mae and Freddie Mac.

The banks really screwed up offering mortgage backed funds that held crappy mortgages and hid everything under AAA rated bonds.

Lol, yep...




CDO's and CMO's are still around today. Its those debt backed derivative products that got us into that mess.

Barney Fwankand company pushed the banks into sub prime lending that led to the 2008 collapse.

I really need to watch the movie, but it wasn't that those loans were shit per se, it was that the banks were using them as if they are Tier 1 capital. Some banks knew this, others did not. At the end of the day, there wasn't enough money to go around in order to cover all of those loans which had credit default swaps backing them.

Along with Greenspan and Clinton.

Thanks.

I was going to watch it but now that I know it represents the liberal version of what happened (i.e. it was all the fault of the big banks) I don't need to see it.

Maybe someday someone will make a movie about how the big banks took on a lot of toxic assets for the federal government...the same government that is still persecuting the big banks for their alleged transgressions during the crisis.

Their approach was that it was everyone's fault, not just the big banks, imo

which is as close to the truth as you are going to get.

The ratings agencies had something to do with this as well.

My desk used to be next to the trading floor and I always saw the bloomberg screens, it was definitely a wild time back then.  market opens and is already down 3-400 points.  VIX was insane.  crazy times.  I made some money investing in stocks just because EVERYONES stock price was down no matter what.  

the HBO movie "Too big to fail" was really interesting as well.

This.

 

Just saw it. Fuck those two sleazebag realtors lol.

Unless you're are forced to lend to unqualified people, you have to be a complete retard to lend to a person that cannot pay their monthly phone bill.



 

Government forced the banks to lend to poor people. Banks have computers models that predict the chance they will get back their investments. One of my friend is a bank lender. All he does is enter the person information and what comes back is approved or denied. He doesn't make any decisions.


A lot of these liberal movies never ever mention the banks were forced to give out money to very very poor people. The chance they pay back to the bank is zero percentage. Both Bush and Clinton are to be blamed by inflating the housing bubble and social engineering.

CRA ----Community Reinvestment Act...aka a body of rules that "encourages" banks to lend to low-moderate income people.  course compliance of the CRA act is taken into account when reviewing/approving mergers/acquisitions and approving new bank branches.

His "bank" must not be lending their own money.

I love that fact they stopped the movie and  used a hot actress in a bathtub to explain the pivotal point of the movie...pure genius

Believe it or not there are a large number of people with good to excellent credit rating. These are the people that banks lend to.

Just watched the movie (enjoyed it), but it made me remember when I was first stationed in California in 2002-2005.

I worked with E4's and E5's who were getting loans on 500k-750k homes and condos and couldn't wrap my head around how in the hell that was possible or prudent.

Crazy times, but there was no shortage of dreamers lined up to gamble on the housing market (regardless of the loan terms).

It did touch on every point but I felt it was light on the criticism of the government's regulatory responsibility.  The fact that banks could create mortgage backed securities with shitty loans, get them rated AAA, and survive the scrutiny of regulators is a massive failure of our government and they gave it about 2 minutes of screen time a the Caesar's Palace pool scene.  Frankly, it's the pivotal failure in my mind as this same thing will almost certainly happen again and again as long as the government is asleep at the wheel when it comes to one of their few legitimate roles in a market economy to enforce transparency and root out fraud.

Blaming the banks and consumers is a ridiculous notion the more you think about what you are actually dealing with.  Neither banks nor consumers are a single coordinated entity.  For every bank that gets a conscience and bows out of dodgy derivatives there will be another five to take their place.  For every consumer that declines to take on ridiculous debt loads and live within their means there will be five hundred more to take their place.  The Federal Government on the other hand is a single entity and if they don't fulfill their regulatory role in a market economy, nobody will.

The fallacy of blaming banks and consumers is what is leading people to the wrong conclusion that the only way to fix these kinds of problems is to get the government involved in outcomes and thus we get guys like Obama and Bernie riding to power on the message that capitalism is broken rather than our government is broken.  

I really enjoyed the movie but it failed in that aspect.

The subprime loan was only part of the problem.  Per Nomi Prins, the MBS based on them was ten times greater.  The banks leveraged the debt and exacerbated the harm.

If anyone is interested, a 2011 lecture (at Vanderbilt) by Michael Burry.