Filed under: Industry, Market Matters, Allstate Corp (ALL), Bank of America (BAC), Wells Fargo (WFC), Federal Reserve, Financial Crisis
Let’s go back to the financial crisis and the practices that brought this country to its knees. Banks developed a fancy scheme whereby they absolved themselves of all risk from the loans they made. They simply wrapped them up in a bundle and sold them to someone else. What they were doing is essentially packaging and reselling “junk.”
When the news of how bad things were became known, the markets froze and collapsed. No one knew who had which securities, and if they did, they didn’t know their true value.
Continue reading Banks Lobby Against Risk Retention on the Loans They Make
Banks Lobby Against Risk Retention on the Loans They Make originally appeared on BloggingStocks on Sat, 02 Apr 2011 11:40:00 EST. Please see our terms for use of feeds.
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