No shit! Well it's not a bad system for all those who collected their fat bonuses and then left others to clean up the mess. Civil cases are popping up faster than wack-a-mole and yet we don't hear a peep from the government regarding prosecutions for all the fraud that was taking place. Why is that you might ask yourself: and the answer appears to be that the U.S. government is fundamentally corrupt at its very core. The proof: the absolute inaction to hold anyone accountable. It's just that simple. They are above the law. Their lobbyists get their cronies elected to do their bidding in congress—and it is very effective as we can see![W]hen you have a system where you pay someone for originating mortgages simply on volume and nothing happens to them if the credit quality is bad, and nothing happens to them if the borrower is fraudulent on his loan application, and nothing happens to him if the appraisal’s fraudulent, then that’s probably not a very smart system.
In an AIG lawsuit against Bank of America, AIG said that BOA's "representations regarding the underwriting processes, underwriting quality, loan selection, credit enhancements, use of exceptions and alternative documentation programs, and ratings were all untrue. The mortgage loans underlying AIG’s certificates did not comply with the underwriting standards the Offering Materials described because those standards were systemically ignored. In their roles as both originators and as acquirers of the loans, Defendants ignored borrowers’ actual repayment ability and the value and adequacy of
mortgaged property used as collateral. Systematic, bulk exceptions to underwriting standards were granted without consideration of any compensating factors." These lawsuits will likely get settled but where is the government? Where are the regulators? Utter silence or some superficial jaw-boning would be the only way to characterize our government's response. That response, or lack of, is criminal itself.
And worst of all, the fraudsters have proven that they can get a away with this criminal behavior. It will happen again and again until there is real reform—something like what ended the last gilded age—real substantial regulation that worked for 70 years until the anti-government Republican gutted all regulations as out-dated. Well those "out-dated" regulations prevented the very things that they allowed to happen. Surprised? That's corruption and it's at the core of the U.S. government and it will probably only get worse until the divide between the top and the rest is too much and must be stopped before the whole system just implodes on itself. I'm betting implosion, 15-20 years out. Hope I'm wrong, but this level of corruption seems to just perpetuate itself to absurdity. Watch Fox news for a bit for example after example of this absurdity!
