Wednesday, January 21, 2009
"first, late-stage receivables securitizations were a criminal fraud perpetrated by the investment banks in conjunction with mortgage lenders. tavakoli asserts there was no confusion on wall street and investment banks were not at all duped by rating agencies--indeed, they knowingly exploited the conflicted interests and moral weakness of those agencies to sell trillions of loss-making loans onto unsophisticated investors. they did so in an effort to pass off investment bank losses while collecting fees on the packaging and distribution of those losses. ... nail not only their bankrupt leadership but these outfits themselves to a tree and light it on fire. i'll more than gladly accept permanently lower growth as the price paid for the modest semblance of moral rectitude, culpability and worthiness that might ensure that 'banker' is not merely another euphemism for 'parasite'," gaius marius (gm), 9 January 2009 at: http://declineandfallofwesterncivilization.blogspot.com/2009/01/start-with-indictments.html.
gm has a link to a 6-minute interview with Janet Tavakoli (JT) of Chicago who says things like "there were no black swans, but black barts". See it. She's wonderful! I love you JT! JT is as critical of investment bankers (IB) who sold MBSs and CDOs as I've been. JT contends IBs knowingly packaged garbage which they sold to investors. The scheme was something akin to what I call a "secured debt, unsecured debt swap" prior to bankruptcy of an insolvent company. gm is more hostile to the IBs, than me. Imagine, he wants them burned at the stake. I'll settle for their merely visiting GSG's CNC guillotine! Chop, chop! For an explanation of what's going on see: