DID THEY READ THEIR OWN REPORTING?:

U.S. reportedly will sue big banks over mortgage securities: Among more than a dozen targets are Bank of America, JPMorgan Chase, Goldman Sachs and Deutsche Bank, the New York Times says. They are accused of misrepresenting the quality of mortgages they packaged and sold during the housing bubble. (Reuters, September 1, 2011)

The agency that oversees U.S. mortgage markets is preparing to file suit against more than a dozen big banks, accusing them of misrepresenting the quality of mortgages they packaged and sold during the housing bubble, the New York Times reported Thursday. [...]

The practice of subprime lending, wherein mortgage brokers lowered their standards to entice homebuyers to take out large mortgages to buy more expensive homes than they could afford, was a root cause of the mortgage market implosion.

To the contrary, as the story suggests, the root cause was that banks disguised subprime loans as prime in order to be able to sell them to investors more easily.

Posted by oj at September 2, 2011 7:08 AM
Tweet   

Follow @brothersjudd