IS THE BANK BAILOUT FAIR?

Details of the forthcoming book – McKenty Live: The Lines Are Still Blazing – will be released soon. In the meantime, to whet the appetite, here is a posting from the early days of the blog, just after the great crash of 2008:

Exchange

Is the bank bailout fair?

It seems the answer is in the question. Notice it says bail out for the banks that caused the problem in the first place. It says nothing about a bailout for homeowners who are financially strapped by faulty mortgages.

As I understand it, this is the situation in broad terms.

The banks are on the hook for billions and billions of dollars of mortgage paper. For the last couple of years, in a reckless spree (that saw the bank’s senior offices gains hundreds of millions of dollars in salaries, bonuses and golden parachutes) the banks gave mortgages to hundreds of millions of people who had no assets, no jobs and for all the banks knew were raving alcoholics. The reason these poor people gobbled up these mortgages was that they thought the value of their new homes would go up. (And if they had we…

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