Banks Got Bailed Out, We Got Sold Out

by BooMan
Wed Nov 30th, 2011 at 11:50:17 PM EST

We all know the story to one degree or another. The financial sector set up a system that encouraged mortgage initiators to prefer subprime loans to prime loans. They stopped asking for any documentation proving an ability to pay back home loans. They sought out unsavvy borrowers and steered them to riskier loans because they got bigger bonuses that way. The garbage loans were packaged up into derivatives and given deceptively high credit ratings. Then those derivatives were sold to unwitting customers who lost tons of money when they went bad. Meanwhile, the big banks bet against their own financial products even as they marketed them as safe investments. When the house of cards fell, the government had no choice but to save the banks because our economy can't function without a banking system. Then the bankers took the money and paid themselves big bonuses while millions lost their jobs, their homes, and their retirement security.

There are a few bankers who are honest about what happened.