STEVE EISMAN: SMART, LUCKY, ABRASIVE & NOW ONE OF THEM

I loved Michael Lewis’ book – The Big Short – about the 2008 Wall Street created global financial catastrophe, that is still impacting the little guys on Main Street eight years after it was supposedly resolved by Paulson, Bernanke and Obama. I even wrote an article about it called The Big Short: How Wall Street Destroyed Main Street. I also loved one of the main characters in the book – Frontpoint Partners hedge fund manager Steve Eisman – a foul mouthed, highly skeptical, open minded guy who figured out the fraudulent subprime mortgage scheme and shorted the crap out of the derivatives backing the fraud, making hundreds of millions in the process.

I had the opportunity to attend a 90 minute talk by Steve Eisman last night where he discussed the financial crisis, the response by the Fed and government, and the future for the financial industry. My perception of him, based on the book and movie, was he was a cantankerous asshole who didn’t care what anyone thought about him. My perception matched what I experienced. He was dropping f-bombs, insulting the institution hosting his talk, making fun of business school students (he graduated with a liberal arts degree) and dismissing any question he found to be stupid.

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He was very funny. You could tell immediately he was smart and very opinionated. He was confident in his area of expertise. His diagnosis of what happened leading up to the financial implosion was dead on. He correctly tied the entire debacle to ridiculous levels of leverage taken on by Wall Street banks, warped incentives for financial industry employees and rating agencies, and Federal Reserve regulators asleep at the wheel, convinced Wall Street could regulate itself. I think he was too easy on the people who knowingly committed fraud to buy houses they knew they couldn’t afford. He said they were lured into the fraud by the unscrupulous mortgage industry. It takes two to tango.

He described how the credit standards continued to descend as the Wall Street doomsday machine needed more product to convert into toxic derivative products, rated AAA by the greedy worthless rating agencies, so they could sell the weapons of mass destruction to unsuspecting pension funds, mutual funds, and little old ladies. He openly despised Alan Greenspan as the worst Fed Chairman in history and blames him for the lack of regulation leading up to the crisis.

The slimy mortgage originators offered teaser rates of 3% to migrant workers so they could purchase a $700,000 home with nothing down and no proof of income. After three years the rate would adjust to 9%. The underwriters rated the loans based on the 3%, not the 9%. The home occupier had to pay 4 or 5 basis up front to get the loan. Since they could never afford the 9%, they had to refinance and pay another 4 or 5 basis points. The same loan would get repackaged twice into derivatives, while the shysters made out like bandits.

“In Bakersfield, California, a Mexican strawberry picker with an income of $14,000 and no English was lent every penny he needed to buy a house for $724,000.”Michael Lewis, The Big Short

This subprime slime was the fuse destined to blow up the system, but it was the Wall Street leverage which created the nuclear bomb attached to the fuse. He described how the Wall Street banks were leveraged 10 to 1 in 2000. By 2007 they were leveraged 33 to 1. And most of the assets on their balance sheet were toxic debt slime. Eisman was a Wall Street guy and understood their mindset. When he would point out how stupid these decisions were, the Wall Street big swinging dicks would respond they made $50 million last year and he didn’t. They were smart because they were rich.

The arrogant pricks who ran Wall Street firms mistook their self pronounced brilliant results for leverage propelled fake profits. Levering up your firm with toxic un-payable debt made you look brilliant in the short term, but created a debt bomb destined to blow up the world. Greed, hubris, ignorance of the products they were creating, complete lack of risk management, and the immoral culture of Wall Street led to the worst financial crisis in world history. Eisman’s diagnosis of the causes was perfect.

In my opinion, his positive response to how Paulson, Bernanke and the Obama administration “solved” the crisis was disingenuous, proof he’s a Wall Street guy at heart, and not the defender of the little guy as described by Steve Carrell, who portrayed him in the movie:

“I think he [Eisman] seems himself as a defender of justice and righteousness, while at the same time being conflicted.”

In the movie he was portrayed as the moral compass. After hearing his praise for the awesome job Paulson did by saving the criminal Wall Street banks with taxpayer money, I think the justice and righteousness stuff is overdone. Earlier in his talk he said banks existed to “fuck you” – his exact words. Then later he says we had to save them or the world would have ended. He spun the same old narrative that if you didn’t save AIG, Goldman, GE, and the rest of the corrupt Wall Street cabal, unemployment would have been 30% instead of the 10% it eventually reached. I guess he believes the BLS bullshit that unemployment is currently 4.7%.

Other smart people, not beholden to Wall Street (he works for Neuberger Berman), argue that we could have had an orderly liquidation of the Wall Street banks that took too much risk and levered themselves 33 to 1. The people on Main Street didn’t lever themselves 33 to 1, but we got to bail them out. Rewarding failure encourages more failure. There were over 8,000 banks in the US and it was only 10 or 20 who almost destroyed the world. They should have paid the price for their criminality and recklessness. Their executives should have gone to jail. Not one did.

I began to realize Eisman is a liberal Democrat when he enthusiastically praised Elizabeth Warren as a champion of the people and how Dodd Frank has completely reined in the Wall Street banks. He positively gushed about his friend Daniel Tarullo, the Fed’s chairman of the Federal Financial Institutions Examination Council. He expounded on how tough he has been on the Wall Street banks and has gotten them under control. Meanwhile, they continue to pay billions in fines for their criminal acts and Michael Lewis’ other bestseller – Flashboys – documents the continued rigging of markets and criminality on Wall Street.

His defense of Wall Street as it’s constituted today reminded me of the Upton Sinclair quote:

“It is difficult to get a man to understand something, when his salary depends on his not understanding it.” 

He is a creature of Wall Street who depends on their good graces for his continued income. He wouldn’t even name Bill Miller as the idiot mutual fund manger who bought Bear Stearns as it was about to go under, because his compliance manager said he shouldn’t do so. It was at this point I realized he wasn’t some prescient sage who understands the markets better than the average schmuck. He got lucky. It wasn’t even his idea to short the subprime market derivatives. Greg Lippman from Deutsche Bank sold the idea to him in February 2006. He just acted on the advice.

His dismissal of overturning the Glass Steagall Act as a cause, Fannie & Freddie’s role in the crisis, and the fact this was a calculated control fraud deserving of prison sentences for hundreds of Wall Street executives, changed my view of the man in a matter of minutes. I find liberal minded people like himself are sometimes excellent at diagnosing problems, but their solutions either exacerbate the problem or ignore the real problem.

He said nothing about how Bernanke & Geithner’s threats to the FASB, resulting in the suspension of mark to market accounting, marked the exact bottom of the market. From that point onward, the Wall Street banks, along with Fannie and Freddie, could value their assets at whatever they wanted – mark to fantasy. Amazingly, the banks and the insolvent mortgage companies immediately started reporting billions of fake profits. Loan loss reserves were relieved, while Fannie & Freddie made billions in fake payments to the Treasury, artificially decreasing annual deficits.

Eisman, the man of the people, said nothing about how real median household income is lower today than it was at the height of the crisis, while Wall Street bonus pools are at record highs. He said nothing about senior citizens who used to count on 5% money market returns to scrape by now getting .25% because the Fed used ZIRP to save the Wall Street banks. Eisman is an extremely rich Wall Streeter. He wouldn’t know how to find Main Street, even with a GPS. He was surely blindsided by the deplorables, outside his NYC bubble, electing Trump as a reaction to the screwjob they received from Wall Street, the Fed and the Obama administration.

His laid back view of the Wall Street banks and how great their balance sheets are, with leverage of only 11 to 1, completely ignores the fact the Fed bought $3.6 trillion of their toxic debt at one hundred cents on the dollar, and the Obama administration took on $10 trillion of national debt to give the economy the appearance of recovery – while the majority are still experiencing a recession, except for Eisman’s Wall Street cronies. He had no problem with Wall Street hedge funds buying up all the foreclosed homes, driving prices higher to fix Wall Street balance sheets, and renting them back to the poor people he pretends to care about.

No mention from Steve about why the economy requires emergency level interest rates, nine years after the crisis. He seems sanguine about a $20 trillion national debt, where normalization of interest rates would blow up the world again. He thinks the US banking industry is the safest it has ever been in history. Isn’t it funny that he did an interview a few weeks ago revealing he is long the banking industry? He is just talking his book, just like every other Wall Street chameleon.

Even though stock valuations are at highs only seen in 1929, 2000, and 2007, Eisman sees no stock market bubble. He expects stocks to go higher due to Trump’s tax cuts and deregulation plans. Even though home prices are nearing 2005 levels again, he sees no real estate bubble. He sees no subprime auto loan bubble. He sees no student loan bubble – he said it’s the government’s problem, as if the government gets their money from someone other than the people. He doesn’t care about the debt bubble, because he’s an equity guy. This type of vision might explain why his hedge fund venture after Frontpoint – Emrys Partners – went under in two years.

My experience of seeing Steve Eisman in person was a letdown. I expected some sort of visionary superhero and I got an abrasive, myopic, captured Wall Street guy, parroting the Wall Street line that all is well, the future is bright, debt doesn’t matter, and stocks always go higher. I left the venue wondering whether I have the bad case of cognitive dissonance and can’t see how great things are, or whether Steve has the bad case of cognitive dissonance. I guess time will tell.

There are two things I learned.

  1. Its better to be lucky than smart.
  2. Wall Street will never change.

“What are the odds that people will make smart decisions about money if they don’t need to make smart decisions–if they can get rich making dumb decisions? The incentives on Wall Street were all wrong; they’re still all wrong.”Michael Lewis, The Big Short

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nkit
nkit

Sounds as if his “moral compass” – if he even has one – always points South, like every other swingin-dick, crooked bastard on Wall Street. Justice and righteousness? He probably couldn’t spell either one. Looking for someone with a moral compass on Wall Street is like looking for an America-loving Muslim incarcerated at Gitmo.

Retired
Retired

This whole deal is like a financial version of Oscar Wilde’s story “The picture of Dorian Gray”
In this financial version the Dorian Gray economy goes on & on as though it was a perpetual motion machine.Never ageing; and never slowing,a veritable Wall Street money machine that never loses.
All this while the society around it grows weaker & ever more decrepit,just like the picture on the wall!
Then one day the youthful,never aging,Dorian Gray goes crazy & carves up the picture of himself on the wall.
At this point Dorian falls on the floor old haggard & dead.The picture on the wall reverts to it’s original youthful visage.

On the surface,the banks & financial markets look like treasure chests waiting to be looted by a select few.But underneath all of this the wealth is mostly I.O.U.’s & other intangible paper assets that are not really wealth,just markers & tokens of wealth.When the great correction soon arrives,these markers & tokens,will revert to what they really are,Just tokens & markers of wealth that can’t be cashed in because the tangible wealth they supposedly are markers for doesn’t exist!
Like Dorian Gray & his picture,in the end the markers & the tangible wealth they represent will revert back to the condition that they should have been in the real world!
The big problem they have is that when the F.I.R.E.Industry finally cleans out their prey,they will also destroy the consumer base & when the consumer base disappears all of the leveraged wealth will die in a sea of financial deflation!

i forget
i forget

“Little guy” compulsion to have “big guy” defenders does lg, good & hard, every time. Whether lg likes that, or not, must be what he’s for, his raison detre, because always has it been thus. As said, 22tango.

Skin must be in the game. Somebody’s skin. The bg tactic & strategy is to use lg’s skin. That, btw, is the raison detre of “government.” It’s a skinning blade. & runners & runnees “replicant” over & over & ∞. Roy coulda’ snuffed Deckard, for just a momentary satisfaction, but the 22tango table remains set, blades one side, bled the other.

1. “Thought, however unintelligible it may be, seems as much a function of organ as bile of liver. This view should teach one profound humility, no one deserves credit for anything. Nor ought one to blame others.” ~ Charles Darwin, in his private notes all too often, luck is recast as something that can be taken for credit – then collateralized.

2. Not just wall st. human condition has been in extraordinary rendition from getgo.

Iska Waran
Iska Waran

I may fully agree with you. Or not. It’s hard to tell.

i forget
i forget

Iska…lol…Telling it hard, so to speak, is for this writer’s pleasure. Running stuff thru a Flesch-Kincaid algo, etc, takes all the fun out. Besides, it only adds insult to injury since the idea of convincing someone of something is another of those collateralized credit default swaps. Nobody can teach anybody anything, after all, as per Galileo. It’s there, or it ain’t. In between those extremes is good for a body exercise – may as well enjoy it, I think…or I am.

Uncola

Roy never snuffed out Deckard because, in the last moments of consciousness, he realized the most valuable commodity on Earth is life; even Deckard’s.

People like Eismen may also one day realize they won and lost playing the wrong game. Or not. Either way, Jim Morrison was right. No one here gets out alive.

i forget
i forget

Or Roy snuffed Deck’s penchant for snuffing replicants. & the intersomething couple lived happily ever after. Think a similar beating would shine a different kind of light on I’s a man?

https://www.youtube.com/watch?v=P2fBXpub9U4

As for going thru that door, jm mighta’ meant that getting out’s the main thing. He did push hard for it.

JIMSKI
JIMSKI

Every time I watch that movie I buy more ammo.

Coincidence ?

CCRider
CCRider

Coincidentally I learned 2 things from this article:
1. No one in ‘authority’ is going to stop this. Not Trump and, most certainly, not those bought and paid for politician cocksuckers in Washington.
2. It will last until the American people somehow rise up against this shit or the whole shit show collapses.

If you haven’t seen THE BIG SHORT at least twice you flunked Patriot Civics 101.

Gayle

I think I will watch it for a third time tonight.

DC Sunsets

Venezuelans aren’t rising up against a government that is creating widespread famine.

When do you think Americans will rise up? When their iPhone’s battery won’t hold a charge? When “The Voice” goes on hiatus? When “Dance with the Celebrities” is cancelled?

When Kim Kardashian’s butt can’t get into an Escalade?

Nothing will change until the horses have bolted from the barn and the barn has BURNED TO THE F-ING GROUND.

No one needs to tell us: Plan Accordingly.

slorter
slorter

We live in a neoconservative global financial world! It is where the market dominates above Government who rubber stamp the dictates of the market place!

The neocons Keep wages low, or debt pressure high, meaning workers will be less likely to complain or make demands. As workers struggle to provide their families with all the temptations that a capitalist society offers, they become far less likely to risk their employment, and less able to improve their situation.

At bottom, neocons believe in a social hierarchy of “haves” and “have nots”. They have taken this corrosive social vision and dressed it up with a “respectable” sounding ideology which all boils down to the cheap labour they depend on to make their fortunes. The larger the labour supply, the cheaper it is. The more desperately you need a job, the cheaper you’ll work, and the more power those “corporate lords” have over you.

The ugly truth is that cheap-labour neocons just don’t like working people. They don’t like “bottom up” prosperity, and the reason for it is very simple. “Corporate lords” have a harder time kicking them around. Once you understand this about the cheap-labour neoconservatives, the real motivation for their policies makes perfect sense. Remember, they believe in social hierarchy and privilege, so the only prosperity they want is limited to them. They want to see absolutely nothing that benefits those who work for an hourly wage.

Fred Hayek
Fred Hayek

The ugly truth is that team blue doesn’t like working people either. They’re not dependent enough.

As for social hierarchy, it was loyal team blue player Eric Holder who explicitly put forth the doctrine that bankers are a caste apart from and above normal americans.

Looking for salvation in the team blue versus team red game is like playing the Robert Shaw role in a playhouse version of The Sting and expecting to win in the end.

i forget
i forget

Not to mention Melville Ahab’d to the ptsd max Quint character Shaw played in “Jaws.” Teams are what sharks feed on. Call me Ishmael if you want to, but I ain’t getting on that boat.

robt
robt

1984 Election was when the Democrats became the [true?] Blue and the Republicans became the ‘Reds’, the designation previously associated with the Dems, for good reason.
I still can’t get used to that. It seemed like the networks somehow all ‘decided’ at once to change the colors.

TC
TC

Loyalty to the tribe trumps loyalty to the country, and even loyalty to the truth.

DC Sunsets

No one ever confronts the question:

How can a dollar borrowed, creating a debt and funding a purchase at the same time, become two dollars worth of wealth, one counted as GDP, the other as an Accounts Receivable?

Is Accounts Receivable an asset? Is it still an asset if it depends entirely on a vast network, a vast game of dominoes, where if one fails, all fail?

50 years of make-believe money, including 35 years of bond bull market, built castles in the sky and we ALL moved our lives into them.

PS: The banking system has been insolvent for decades. If the debt system goes Boom, banks will be DOA. They’ve loaned out more than 100% of all deposits. When the Fed changed the rules to let banks sweep checking accounts into their savings accounts overnight it was an open admission that they were capital impaired.

“In the most common form of sweeping, funds in bank customers’ retail checking accounts are shifted overnight into savings accounts exempt from reserve requirements and then returned to customers’ checking accounts the next business day. Largely as a result of this practice, today only 30 percent of banks are bound by a reserve balance requirement”
https://www.newyorkfed.org/research/epr/02v08n1/0205benn/0205benn.html

So no, if the game had been broken up and all the bad debts resolved in 2009, depositors would have been wiped out, as would most corporations whose “cash” is just other firms’ bonds for the most part.

Allen depends on Bob’s IOU’s to him for his wealth. Bob depends on Carl’s IOU’s to him. Carl depends on Don’s IOU’s to him. Don depends on Eddie’s IOU’s to him and Eddie is a deadbeat crack head who can’t cover his debt even with a gun to his head. You can’t get blood from a turnip. Boom, boom, boom, boom, boom BOOM!

Gator
Gator

This is essentially what happens when you substitute debt for money, and your currency is loaned into existence.

Gayle

Admin
Thanks for sharing your experience, which I found most interesting but not particularly surprising. I think Mr. Eisman is the one suffering from cognitive dissonance because he lives in a space that toys with reality on a consistent basis. Some day, the true nature of the way the universe operates will assert itself in a way that Mr. Eisman and his buddies will find truly painful. Meanwhile, party on.

DC Sunsets

It’s a big game of chicken.

In hindsight, had any of us in 2003 simply started buying SPX futures on the maximum overnight margin a broker would allow, adding positions at max until monthly MACD crossed down (at which time exiting the market), and then when monthly MACD turned up in summer of 2009 do the same thing, exiting when it turned down at the beginning of 2015, we’d be able to buy our own island.

It’s a vast game of chicken, that’s all. He who stays makes more money, until he stays one day too long. That point has not yet been reached.

starfcker
starfcker

No one could ever accuse you of not having your eyes wide open there, Quinn. “I find liberal minded people like himself are sometimes excellent at diagnosing problems, but their solutions either exacerbate the problem or ignore the real problem.” Uh, yes. Exactly

Uncola

He sounds like another unredeemable false prophet worshipping at the altar of Mammon and leading the people astray. A dead end. A bounced check. An expired coupon. Good for nothing.

If he didn’t know of a certain blogger sitting in the audience, he probably will soon once this piece goes viral.

I’ve said it before, I’ll say it again: I love the smell of napalm and schadenfreude in the morning.

Michael Keane
Michael Keane

Michael Lewis’s “The Big Short”, only tells part of the story.

Visit Rockwell P. Ludden’s, brief, while excellent: http://www.capecodtimes.com/article/20150221/OPINION/150229876

In hedge fund operations “market makers” define the market. In other words, they define a cause and basis for “speculation”; “successful” or otherwise; there are always, at least, two positions to take on any financial adventure.

In the current, on-going Scam of mortgage Fraud, REMICs that are empty- devoid of any “mortgages”- define 1200 Trillion Dollars owed to insurance products (“derivatives- cds, cdos and synthetic cdos; also called “Swaps”) that are taken against “Mortgage-Backed-Securities”, that have no “Mortgages” in them.

These “Special Purpose Vehicles”, these “REMIC Trusts”, these “pools of loans”, all share the same description, while each define, the same thing, an empty, “shell company”.

There are no “Mortgage Loans” in these phony, “Mortgage-Backed-Securities”.

To gain deeper insight into how Eric Holder’s, law firm, “Covington-Burling”, created the first “shell company , “the MERS”, read page 116, of Professor Christopher L. Peterson’s,

http://scholarship.law.wm.edu/cgi/viewcontent.cgi?article=3399&context=wmlr

While the balance of his article is a primer that describes the frauds to come.

The “REMICs- Real Estate Mortgage Investment Conduits” are better described as “REMIFs- Real Estate Monopolized Insurance frauds”; “Insurance Swaps- cds, cdos, synthetic cdos”, taken by wholly-fraudulent claimants, against wholly-fraudulent, “Trusts” that are completely devoid of ANY ASSETS!

There are NO “Mortgages” in the “Mortgage-Backed- Securities”.

The criminals are placing “Insurance Swaps” on “Assets” that don’t belong to them and were never, in fact, the “corpus”, or “RES” (ASSESTs) to ANY REMIC, in the first place.

“Nemo Dat”.

Shooting fish in a barrel is not successful “Speculation”, while instead, an “insider trade”.

The “market makers” to these phony, empty, “Trust” mechanisms, employ forgery (robo-signing), fraud (counterfeit title- digitized copies of mortgage “Notes”: LPS, Black Knight, etc.) and “dual-tracking (fraud in the inducement: promising a modification -Obama’s HAMP and HARP Nonsense- while simultaneously moving forward with a foreclosure that is based on any number of frauds).

The “foreclosure notice (once hapless homeowners listened to mortgage bankers that told them to skip payments, in order to qualify for Obama’s HAMP and HARP Nonsense)”, acts as a “Market-Made”.

The mortgage bankers created a “market” by telling homeowners to skip 90 days, in order to qualify for the promised “modification”.

For the homeowner, once in the mix, a foreclosure, under these circumstances, becomes a foregone conclusion… did I mention “Insider Trading”?

The SCAM, listed above, is simply, “Securities” and “Insurance Fraud” and it is given a “nod” and a “wink” by the Court System, that indemnifies these criminal behaviors, because the amounts owed (1200 Trillion Dollars), to these criminal behaviors, are considered a “Systemic Risk”…

A “Systemic RisK”?… to the wholly-fraudulent, hyper-inflationary, bubble, … that has now and forever, allowed the criminals to pervert and destroy “The American Dream”?

In the absence of Constitutional Remedy…

Indeed.

The REMICs are empty: “Securities Fraud”; now, REMIFs of “Insurance Fraud”.

The heart of America’s Economy is broken and sold to unconscionable Greed, while given to a bubble, presently poised to destroy world markets, once the Brexit pops and the hyper-inflationary, “Federal Reserve Dollar”; now cyclonic-whirli-gig; destined to the fate of Icarus, comes crashing to earth…

So much for the American Freedom…

Except: there is time to awaken, while, in fact, the criminal imposters, presently manipulating the intentionally-mislabeled, “Federal Reserve”, have destroyed themselves… NOT, THE AMERICAN PEOPLE.

These Securities and Insurance Frauds, define inter-bank, zero-sum-game, criminal adventures, where there must, in fact, be a winner and a loser.

The fact the criminals have listed themselves claimants to 20 X the combined GDP of every country on the planet (1200 Trillion Dollars) is yet, more of the same; another, criminal prank courtesy of the adolescent mind in residence to Wall Street, where daddy’s money castrates the law, so long as sonny-boy is described in thrall to “Affluenza”…

Enough, already.

Article One, Section Eight, explains: “Congress shall have power… To provide for the punishment of counterfeiting securities and the current coin of the United States…”

The criminals have counterfeit over 1200 Trillion Dollars and the “American Coin” is about to fall on its head.

What are We The People waiting for?

These criminal Filth must be routed out and punished. The “Sovereignty” of our nation demands it and the souls of the victims, the world over, demand retribution.

~ Michael Keane 3/17/17

GMAC Note and Mortgage Discharged: https://livinglies.wordpress.com/tag/gmac-mortgage/

Securitization Fail:

Levitin on the Dire Implications of “Securitization Fail”

https://livinglies.wordpress.com/2011/01/31/adam-levitin-the-big-fail-securitization-never-occurred/

https://cloudedtitlesblog.files.wordpress.com/2016/12/charlies-wallshein_securitization-fail-part-one-001.pdf

Anon
Anon

And, all of that would be great IF we had the rule of law. We don’t. We have NOT, and DO NOT. You have to simply become wise to the scams, and NOT get involved in them. If you cannot avoid them, either because of a Government gun up your nose, or forced because of debts unresolved to these crooks, then approach it with your eyes open, and contingency plans in place. Understand that you are IN HELL, and the Devil IS in charge, when you are dealing with ANY of these people OR the Government writ large. Period. Everything else is simply feel good crap and propaganda.
I was caught up in some of this mortgage shit back in the day. The usual “experts” were blathering about missing payments etc. to “qualify” for HAMP, HARP in the second round of F&*^% You home “owner”. The real kicker is when the banker scum would tell people that if they wanted to save their home, you had to pay them a sum of many thousands of dollars to “get caught up” and “qualify”. Then shortly afterwards, they would begin foreclosure proceedings and when asked (if you could even reach the piece of manure) the response would be “I’m sorry, you didn’t qualify”, oh, and then they had all of your financial information (recall, that was the other condition of HARP, HAMP etc. is you had to send them all of your financial info) so they could then sue you and know where to come after your funds once they got the judgement. This is a perfect case of the evil scum taking advantage of the unwise and poor TWICE. You don’t negotiate with financial terrorists! Period. I remember telling friends that were given “offers” from these asshats to simply walk away, and give them nothing. Leave the keys on the counter. They had already given up their house the minute they signed on the dotted line for the sub slime mortgage. Everything afterwards was just the lube job before the big screw.

starfcker
starfcker

Anon, I’ve made the case before about the perils of giving the banks a look at your books, and the evil they will do with that information.

Mike Fuller
Mike Fuller

Thanks for cutting through the wall street expert bullshit and tellin it like it is. Sure is easy when the profits are flowing to predict more of the same, sorta like that permanently high plateau the smartest guy in 1929 predicted.

Admin +1
Wall Street Asshole 0

Dennis Roe
Dennis Roe

Instead of making useful productive things, we now make smug rich douchebags..

GilbertS
GilbertS

I loved reading The Big Short and Boomerang, and I watched The Big Short. The problem is, they both just made me really mad.
I think Steve Eisman did an amazing job of predicting the crisis, but when you realize he was one of the slimy dudes selling that shit in 2000, it changes your perspective. Only after he sold the shit to people did he figure out it was bad and what it was going to lead to. It’s hard to have that Defender of Everyman cape when you were in on the business, too.
It’s a shame to hear he’s probably just a douche. Perhaps he’s just a broken clock and it was his time?

Madras
Madras

The arsonist that makes the 911 call.

TPC
TPC

I don’t rely on other people to solve my problems. In fact, I don’t think its ever happened in my life. If I didn’t take immediate action to fix an issue, it didn’t get fixed.

Ipso facto, TPC2024, because you deserve better than the lesser of two evils.

Pl'n'l
Pl'n'l

Steve Eisman as Wall Street Apparatchik exposed. Next up, The Donald, who has surrounded himself with Goldman types. Another big shot golden boy who couldn’t find Main Street with a GPS.
Buyers remorse sets in, in little bits and pieces.

Garrison
Garrison

I’m not sure why you’re surprised that he is a wall street douche bag. If your bet is that everything is going to shit, you need it to go to shit a little bit. If all the banks went down, who is going to pay on the short? The games must go on.

EL Coyote
EL Coyote

Was it Fitzgerald who said the rich are not like you and me? I can’t imagine what it’s like but it must be all-consuming to live for gain as it is living for sex.

The story of Tiger Woods, like the story of an unknown man who traded his family for a life of depravity, convinced me that sex can become an addiction where every move, every thought is oriented to that end.

Making money has to be the same thing; it transcends conscience and morality, winning beomes the only measure of right or wrong.

BL
BL

Eisman is a joo, what did you expect? Reading through the thread, I see one after another condemning Wall Street YET these same commentors praised Trump for loading his cabinet with these scumbags declaring them to be “the people who know how to get things done”. YOU can’t have it both ways.

Personally, I no longer play in the rigged casino and I sure don’t put money into anything run by the tribe.

Fred Hayek
Fred Hayek

Do you have any actual examples of people praising Trump for loading his cabinet with Goldman scumbags? Not saying it’s unfortunate that he doesn’t think he’s got any alternative but actually praising him for bringing those people aboard. I’m skeptical.

BL
BL

Fred- You must not read here on a regulah basis. Praising Goldman Sachs appointees is a guaranteed response with the Trumpeteers. That scripted answer started the first week of Trump’s presidency when he announced Munchkin as Treas. Secretary.

Ed
Ed

Oy, so he’s a joo. He’s a smart boy. Nevah pays retail. You could loin sometink from such a smart boy, already.

unit472
unit472

Guys like Eisman, Paulson and Michael Berry may have been clever enough to profit from a problem many saw coming- incredibly law lending standards fueling a bubble in housing prices- but since ‘shorting’ housing was not practical only those with the know how and were in a position to trade credit default swaps could exploit the insight. It wasn’t ‘genius’ it was being in the right place at the right time.

Were these guys true ‘geniuses’, having made their fortunes, they might care to tell us where they think the next shoe will drop. Nothing has really been fixed. Excessive debt and leverage is still threatening the financial system. Could be CMBS or muni bonds that will be the trigger for the next collapse. Someone has it figured out but like Eisman then they are keeping their mouths shut now until their trade pays off THEN they will brag about how ‘smart’ they were.

Fred Hayek
Fred Hayek

I think Michael Burry is a very different guy from Eisman and certainly Paulson.

Suzanna
Suzanna

Thanks Admin,
You did a great job in outlining your experience.

What we learn is that illegal financial transactions can
turn into fabulous profit, for “self-regulators” and no
ROL. So many people of all stripes gained financially via
Wall Street banker fraud (mortgages) from flippers to
middlemen, to small municipalities gaining in taxes.

Men, primarily, measure their success in the amount of $
they make. And, they’ll go to great lengths to gain status.
Is that going to change? The war mongers destroy entire
weaker nations to gain control over the resources.

Read F. William Engdahl’s book, you won’t be sorry because
much of what we see today is explained.

EL Coyote
EL Coyote

Suzie, I did a refinance back then. The loan guy inflated my income and I called him back to correct the figures. He seemed disappointed, he said I would have to pay a higher interest rate.

A couple of years later, my new mortgage company, TBW, sent an inquiry to my employer. They wanted to verify my income. They were on the hook for a bunch of liar loans. Poor saps went under while the crooks at Wells Fargo got off scot-free.

Crooks don’t seem to worry much about tomorrow.

Suzanna
Suzanna

EC, I got a loan from Wells Fargo, arranged by the broker,
NY office. I asked for 15K additional $ for a new roof. Oh No!
We never do that. The check came with the 15K extra. It was
a 15 year, paid in 10, and one refinance for a lower rate/and gone
was the Wells Fargo.
We know the banks are a steaming miasma of theft and corruption.

Thanks EC

Hollow man
Hollow man

Evan the “good guys” are so corrupt they can’t see the forest for the trees

Mike
Mike

Maybe, just maybe, he is right. I personally think he is. Forget what ought to be and focus on the reality. Money will continue to flow into the US markets as the deepest, most liquid and trustworthy (yes, relatively) in the world. Where is money going to hide? China? Europe? Emerging markets? Africa? Shorting US markets (or being out) in a world where money can be produced with a keystroke is a fools errand. Yes, someday we will get deflation if they do not print and spend enough to create real inflation. We already had the big crash of our lifetimes. Did any of you guys buy near the bottom? I didn’t. I bought a few gold/silver miners and rode them up and most of the way down. They say not to fight the trend. Learned that the hard way. It will never happen again when this many people are bearish. It will happen 5-10-15 years from now at a double (triple?) in the market and everyone will finally be onboard for the ride. The system seems insane and imbalanced but we can’t see all the inputs so really can’t read the tea leaves properly. My money is on a continued market rally/bleed higher for at least the next several years. May have a few minor shakeouts along the way but the bull is real and will continue. JMO for what it’s worth.

Boat Guy
Boat Guy

The entire financial system from Wall Street to K-Street to Capital Street in collusion with the federal reserve and nearly every mortgage brokerage firm and rating institution cooked every book imaginable and no one stopped it ! In the end they were rewarded for it while responsible people that did the old fashion way of paying off their conventional mortgage and saving for retirement and their children’s education were FUCKED BY ALL INVOLVED ! They should all be bankrupted and sentenced to hard labor for life , this includes government employees at these agencies who were paid to regulate and report to the justice department and did nothing !
My wife and I did the old fashion right thing and wow we have been financially damaged but still OK . Because we did the right thing we have been punished and the punishment continues and all attempts to hide it from us made my great grandmothers comment about the insiders of Washington DC ring more true : “THEY ARE ALL SCURRYING AROUND LIKE CATS COVERING UP SHIT ” , and one more :”AT LEAST JESSIE JAMES HAD THE GUTS TO FACE YOU AND USE A GUN WHEN HE ROBBED YOU !” . She was a self made independent business woman that always saw through the general bull shit slung about .
My wife and I went to several investment seminars in the 90’s and were laughed at and accused of eating bad food when we asserted that the investment run up we were supposed to tie up our savings and equity in was a pipe dream and returns were based on a risk tolerance that was closer to Las Vegas then a responsible path of wealth management for average Americans . I also recall a couple a few years younger than us that were fully entrenched in this mortgage go round , he was an aggressive mortgage broker and she worked part time at the private school we sent our children to , they flashed the new Mercedes the bigger home etc … we paid cash they financed and rolled everything over and over right into a wall ! Divorce with no assets to divide and my wife and I are to feel bad for them , maybe for their children and the situation but not them !
Now Wall Street , K-Street and Capitol Street coupled with the babbling nonsense announced by Janet Yellen have been at it again like Marley and Scrooges chain forged in their life that lead them to eternal toil and misery not my wife and I nor our children ! So when the bail in starts and the policy wonks tax us into the street we will go down the system assures us of that ! Sadly we will be forced to resort to force of our own 1776 style ! As for those enforcement wonks just doing their job , you will win we will lose but it’s gonna cost you more than it’s worth ! Remember following orders and just doing your job was an excuse trashed a long time ago at Nuremberg !

EL Coyote
EL Coyote

Boaty, my erstwhile neighbor got sucked into that run-up in house prices. He bought the house next to ours at the peak; $400K+. When it dropped, our houses were valued at around $150K. We’re at around $280K right now, so they say. It didn’t help him, he lost it right after the market tanked.

He made a cryptic remark about, Bush lied to us. Since he was a Mexican immigrant, I might surmise that word to the rubes was that no doc loans were designed to help workers like him; people who had little in the way of documented income. He had a good business, self-employed as a lot of Mexican immigrants are; truckdrivers, yard work, pool servicing, plumbing, construction contractors…

Bob
Bob

Do yourself a BIG favor: Read Mike’s comment. Then re-read it. Take it under advisement. It is the most likely future scenario.

Do yourself another BIG favor: Go cold turkey off your addiction to doomer porn — life as we have come to know it over the last 10 years has a long time left to run.

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