Yes. Why else would this administration do it?
Putting frauds behind bars is always good for the economy.
The federal government is suing the banks for selling freddie and fannie misrepresented securities. Is this going to cost the banks anything? I think not. Were the banks forced to make bad loans? To an extent ,yes. Did the rating companies have to commit fraud rating these tranches? No. Could this suit diminish salaries and bonus’? No. If the banks could exert enough influence to be recapitalized to the tune of many trillions, could they have also declined those loans? Of course. Could this have been all planned? I do not know but the banks and the managers therein have more control (money) than ever.
Just to be clear, is the government doing the suing is the same government that has legislated, cajoled, threatened, and twisted arms to make the banks extend loans to marginally, if at all, qualified borrowers ever since the CRA of 1977? I think it may be.
Sure - the same way Ken Starr’s investigation of Bill Clinton weakened the Presidency.
It seems a pointless Kabuki dance about a time when the industry was heavily in flux due to governmental pressure. A saner administration would seek to make reforms, not play pointless games to try to get the legal and media pundits du jour to declare that the kettle is blacker than the pot.
At most favorable to the government, it looks like the government is trying to say “you banks gave an overly rosy report about the situation we were pushing you into.” It’s like the girl who shot her mother and father, then pleaded that the court should have mercy upon her as an orphan.
What is this kind of suit going to do to those of us with legitimate mortgages with these companies? That’s what I want to know.
We’re not underwater, and although we had gotten behind because of my husband being out of work for nearly 3 years, but we’ve gotten that all straightened out without going the government bailout route and are now back where we are supposed to be, without our home worth more than what we owe on it.
Andrew Cuomo: CRA Should be Abused to Force Banks to Give Risky Loans
http://www.youtube.com/watch?v=PFlYmLAMbrw
So what impact might this type of video/transcript have if numerous statements by Govt types like this exist?