Wed 15 Aug 2007
When EVERYONE Profits from Evil: FRAUD
Posted by RichSlick under Evil Profits
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A lot of people are concerned about the subprime mess and global markets seem to be panicking about the whole “bad home loans” fiasco but let’s face reality here, everyone has been profiting from the Fraud.
Let’s take a look at the big profiteers from the housing fraud scam scheme.
1. President Bush - Yup, that’s right the President and politicians benefited from the housing fraud. I distinctly remember Bush bragging about how 70% home ownership was his doing because of the wonderful economy he single handedly created during his tenure as prez during 2001-2004.
“Thanks to being the most productive workforce in America, and I might say, thanks to good policies, this economy is strong and it’s getting stronger,” Bush told supporters.
Noting that 68 percent of Americans own their own homes, Bush said, “Home sales were the highest ever recently. That’s exciting news for the country.” -May 5, 2004
2. The Realtors scored big with commissions and loan kickbacks. Who cares if numbers were fudged a little, a 6% commission on 200k means 12k in commissions.
3. Loan Brokers scored big with commissions and fees on mortgage loans.
4. Banks scored big with more fees and selling bundled loans (e.g. CDO’s, ABS’s) to investors.
5. Investors initially scored big with year over year returns above 20% when the ponzi scheme was building up.
6. Workers scored big with abundance of jobs, bonuses, raises. Even the illegal immigrants scored big with all the construction work!
I could go on but I think you get the point of who’s been profiting from evil: EVERYONE. It’s usually like that with almost anything evil; a few initially profit, more join the club then the whole thing comes tumbling down when it reaches critical mass: EVERYONE.
Here’s a hint for everyone…As the current administration comes to an end, which industries’ profits will start to slow down to a crawl? Which industries profits will drop like a rock if Democrats are elected to the Executive office? Which ones will shoot up?
I’m working on the modifications on my ETF-Cashinator as you read this to take advantage of the potential changes. A few will profit initially, more will graze on the field then by the time EVERYONE is on the stampede, I will have moved on to greener pastures. I’ll keep you posted.











August 15th, 2007 at 1:43 pm
Someone always profited when someone else goes in debt.
For a lender to get $12K, a borrower has to go in debt for $12K. Money is debt. For you to have money someone has to pay the price.
The most people are profiting from this are landlords. The number of people that lost there home has to go somewhere to rent!
A good friend of mine started shorting housing futures and made a couple of small $1K profits.
Instead of whining, excerise your mind and think how can you profit.
Opportunities are always endless no matter how the economy is.
August 15th, 2007 at 3:07 pm
For a lender to get $12K, a borrower has to go in debt for $12K. Money is debt. For you to have money someone has to pay the price.
This was true under the gold standard but under the magic of fractional reserve banking
http://en.wikipedia.org/wiki/Fractional-reserve_banking
a bank can lend out $1000 for every $100 deposited into it’s account. So if I were to deposit 12k, you could (in theory) borrow 120k of that amount (assuming you’re credit worthy).
This is the situation we find ourselves in now. Banks don’t want to lend out that 120k to anyone which is why Jumbo loans are now at 8% and lending standards have tightened so much.
This is also why there is world wide panic right: no one willing to lend and no one willing to buy those debt instruments.
But I agree, there is plenty of money to be made in this market. UNG is doing pretty good for me and I’ll make another $400 this Friday if I get called on my options. Over the last two weeks, it’ll be $1600 profit for clicking a mouse a few times