What caused the financial crises of 2009? What role did Banks play? ANY?
Many millions of Home buyers played a key role.
Mortgage lenders played a role.
Retail Banks played a role.
Investment Banks played a role.
Mortgage Originators played a role.
Home Appraisers played a role.
Credit Rating Agencies played a role.
Gov Regulators played a role.
Fannie/Freddie and the Fed played a role.
Barney Franks played a role via banking regulation and the CRA.
And when the smoke cleared.
Many millions of Home buyers lost the houses they bought (or spent the supposed equity in) but couldn't actually afford as in the decade before the bubble burst the price of the typical American house increased by 124%, which is why now 23% of U.S. homes are now worth less than their mortgage.
The largest Mortgage lenders went under, like Countrywide as did wholesale lenders like Ameriquest.
Retail Banks that played a major role went under, like WAMU and Wachovia.
Investment Banks that played a major role went under like Bear Sterns, Merrill Lynch and Lehman Brothers.
Mortgage Originators played a role and many thousands are now gone (there were nearly 60,000 during the peak).
Home Appraisers played a role as they consistently over valued homes with drive by appraisals. As far as I can tell, they have not paid significantly for their role in the crisis.
Credit Rating Agencies played a KEY role as they significantly underestimated the risk in the Mortgage products. Indeed the Financial Crisis Inquiry Commission reported in January 2011 that: "The three credit rating agencies were key enablers of the financial meltdown. The mortgage-related securities at the heart of the crisis could not have been marketed and sold without their seal of approval". As far as I can tell, they have not paid significantly for their role in the crisis.
Gov Regulators played a role via lack of regulation, particularly of complex mortgage backed securities and dumb moves like repealing of the G/S act etc.
Fannie/Freddie and the Fed played a role and the SEC has recently charged former Fannie and Freddie execs with misleading investors about risks of subprime-mortgage loans.
Franks played a minor role and will not run for re-election.
http://en.wikipedia.org/wiki/Subprime_mortgage_crisis
Oh yeah, I forgot, you still think Cortzine is innocent of any and all wrong doing and hey, so he pilfered people's private accounts, something that's never been done ever - f*ck em.
Nope.
I said I don't know if Corzine was responsible or not.
You are just focusing on him cause he is the CEO, not because you have any idea about how the money was lost.
Why might he be innocent?
Jon Corzine didn't need MF Global.
As a former chairman of Goldman Sachs, a former U.S. senator, and the former New Jersey governor, Corzine had an impressive resume that could have opened any number of doors for him -- most of them plenty lucrative and not terribly challenging on a day-to-day basis. Corzine was also already a very wealthy fellow. He had enough to spend roughly $100 million financing his political ambitions and according to OpenSecrets.org, he was the third-richest senator in 2005, with a net worth that may have been as much as $250 million.
To reiterate, if Jon Corzine's path had never crossed MF Global's -- heck, if Corzine was never a CEO, chairman, or other key executive anywhere ever again -- the 64-year-old would have likely lived out the rest of his days very comfortably.
http://www.fool.com/investing/general/2011/12/30/this-is-when-to-worry-about-your-ceo.aspx
Michael said:
Yeah, you'll never agree the Bankers ever did anything wrong or illegal because they will never be prosecuted.
Not everything that is wrong is also illegal.
For instance, making a bad investment decision, that leads to losing lots of investor's money might be the wrong thing to do, there is nothing illegal about it.
You need to separate the two concepts.
I think anyone, including Corzine, who did anything illegal should be charged and tried and if convicted pay for their crime.
At the same time I don't think people should be sent to jail because they made bad investment decisions, you know, like the millions of people who had lost their house in a foreclosure.
Arthur