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If Johnny Jumps Off a Cliff Would You Follow?

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October 27, 2008 – Comments (2)

In the banking industry the answer is yes.  Banking got really stupid and it is as if they started competing to see who could jump off the highest cliff.

Seems as if even cash rich Gulf States are having a banking financial crisis.

They all did the stupid securitization of debt thing and massive leverage, all around the world, and they all just gave the money out without considering the obvious, ability to repay...

2 Comments – Post Your Own

#1) On October 27, 2008 at 2:58 AM, dwot (45.58) wrote:

Look at the mortgage reset graph and tell me how anyone can possibly think we've hit a bottom...

And they know they have to deal with this...  It wouldn't surpise me that by the time this works it way through the system they will have used their capital just covering losses.

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#2) On October 28, 2008 at 3:57 PM, lenri (71.72) wrote:

ouch dw. The Alt-As are going to change all debt structure in the future...for awhile...having been in the mortgage industry for a number of years I can attest to the ongoing stupidity of the lenders. When this mess is finally cleaned up they will already be planning their next get-rich-quick scam to perpetrate on the illiterate consumer.

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