Part I There’s always been more than one way to screw over employees, but The Mortgage Fraud Employee Benefit Program is destined for the Hall of Fame, involving as it does overpriced real estate, exorbitant flips, inflated employee income statements, forged signatures, suspect underwriters, and several innocent employees now legally liable for huge bank loans.
Oh, and the punch line: At least one bank is still willing to write loans for the company owners, who are currently under investigation by the FBI and the IRS.
Part II This comment was left by Calculated Risk reader MS, who sees in the continued “credit worthiness” of the criminally suspect owners the continuing downfall of America.
The deflationist argument would perhaps have some credence if not for the sheer stupidity of Americans. Deflation can only occur when only intelligent people have access to capital (see US in 1930s prior to rabble having power to elect politicians based on lapel pins and bread and circuses and 1990s Japan. America's political power is more comparable to Zimbabwe's political power - not in power because of their merit/intelligence.)
Reading that last paragraph of the article [ie, the continued credit worthiness of the owners] demonstrates said American stupidity.
I believe that consumers will continue to purchase plasma televisions and inflated 500K homes on 27K/year incomes as long as banks continue to lend. With the federal government doing everything in its power to keep banks lending to prop bubbles in residential RE/commercial RE/FIRE economy/debt creation in general combined with American stupidity, the monetization of all debt will be occurring at some time between 2010 and 2018.
This hyperinflation will be preceded by a period of severe inflation that we are just now beginning to experience. Just think about all the measures Bernanke has taken to keep institutions solvent when the poop hasn't even hit the fan yet.
Meanwhile you Americans don't realize your standard of living has decreased because it has happened so gradually. Did you know what an assembly line worker prior to the 70s recession could buy on his salary (with no wife working) without taking out much debt? House with a 5-15 year mortgage with 20% down, pay for 2-3 children to go to college, yearly vacation, new gizmos that were state-of-art at the time, staying in the hospital overnight without insurance, dental visits without insurance, doctor visits without insurance, food and energy used up less of his real income.
Conversely have you ever seen Japan or Dubai or Switzerland or Germany? Their societies are about 5-10 years ahead of you in terms of technology. Soon joining them will be Brazil, China and India as well as Litter Tiger economies. I'm sure you have plenty of statistics to tell me that Americans have a higher PPP [purchasing power parity] and such, but I prefer to believe my lying eyes.
Wealth is the means of production and you don't have that anymore. Even in emerging tech such as solar, the start ups AND production are in Germany, Japan, China and even Abu Dhabi. Americans are also very primitive and superstitious (See: stem cell research and creationist theory)
Soon your professors and intellectuals will flee (See Harvard Medical School in Dubai) and you won't even have that edge anymore.
Repub Ratfvckery Open Thread: “This Is Why We Need Voter ID Laws!” - NBC NEWS EXCLUSIVE: Possible Russian trolls try to register for Texas Democratic conventionhttps://t.co/pqcXoIIhib pic.twitter.com/xrWFbs2DFe — Meet the Pr...