"So, the banksters crash the economy, you lose income and your home, they buy your house at auction, then they rent it to you at an ever-increasing price." (Photo: WTPfefferle/flickr/CC)
Wall Street Thieves Find New Ways to Steal From Us
The self-described "Geniuses of Wall Street" are being stupid. Again.
In 2007, their stupid schemes and frauds crashed our economy, destroying middle-class jobs, wealth and opportunities. Far from getting punishment, however, these financial scofflaws were bailed out by their Washington enablers -- so the moral lesson they learned was clear: Stupid pays!
Sure enough, only a decade later, here they come again! Rather than investing America's capital in real businesses to generate grassroots jobs and shared prosperity, Wall Street is siphoning billions of investment dollars into speculative nonsense -- such as high-profit securities "secured" only by rickety bundles of subprime auto loans.
Car dealers, eager to goose up sales, have been hawking new vehicles to lower-income people, offering quick credit approval. Banks -- eager to hook more people on monthly car payments -- have been approving these subprime car loans without verifying the buyer's ability to pay. Then, a Wall Street bank's investment house buys up thousands of these iffy individual loans, bundles them into multimillion-dollar "debt securities," and sells them to wealthy global speculators. Last year alone, banks sold $26 billion-worth of these explosive bundles of car loans.
This is just another paper-shuffling con game, a repeat of Wall Street's subprime mortgage scam a decade ago. It generates fast, easy money at the start for superrich speculators and greedy banksters -- but as more and more low-income buyers are unable to make their car payments, defaults build up and the whole financial bubble pops.
Wasting America's much-needed investment capital on a predatory lending scheme that intentionally puts people in cars they can't afford with loans they can't repay is not only stupid, but immoral... and it's killing our real economy. Why are we letting elite Wall Street loan sharks do this to us?
Communities across the country have recently found out that Wall Streeters themselves -- from former-Goldman Sachs investment bankers to real estate investment trusts -- rushed out to scoop up thousands of those foreclosed properties, usually grabbing them at bargain basement prices when they were auctioned off on courthouse steps in Atlanta, Miami, Phoenix, Dallas, Chicago, Las Vegas and other metro areas with hard-hit working-class suburbs. The investment consortiums have deep, deep pockets and can easily outbid local buyers to take possession of the majority of the single-family homes being sold off in many of those distressed places.
Why are they buying? To turn the homes into rental properties and become the dominant suburban landlord, controlling the local market and constantly jacking up rents. For example, the Wall Street journal found that in Nashville's suburb of Spring Hill, just four of these predatory housing giants own 700 houses -- giving this oligopoly of absentee investors ownership of three-fourths of all rental houses in town. One of these bulk buyers is an arm of Blackstone, the world's largest private equity firm, another is an equity outfit that was spun out of the housing speculation department of Goldman Sachs, and another is a billionaire whose investors include the Alaska State oil fund.
Not only do rents jump dramatically when such outfits seize a market, but the Wall Street landlords are intent on imposing "a new way" on the U.S. housing market. They're pushing a cultural shift in which homeownership is no longer part of the American Dream and tenants are taught to accept annual rent increases as the price of having a home.
So, the banksters crash the economy, you lose income and your home, they buy your house at auction, then they rent it to you at an ever-increasing price. The "new way" is the same old story of the rich robbing the rest of us.
Urgent. It's never been this bad.
Dear Common Dreams reader, It’s been nearly 30 years since I co-founded Common Dreams with my late wife, Lina Newhouser. We had the radical notion that journalism should serve the public good, not corporate profits. It was clear to us from the outset what it would take to build such a project. No paid advertisements. No corporate sponsors. No millionaire publisher telling us what to think or do. Many people said we wouldn't last a year, but we proved those doubters wrong. Together with a tremendous team of journalists and dedicated staff, we built an independent media outlet free from the constraints of profits and corporate control. Our mission from the outset was simple. To inform. To inspire. To ignite change for the common good. Building Common Dreams was not easy. Our survival was never guaranteed. When you take on the most powerful forces—Wall Street greed, fossil fuel industry destruction, Big Tech lobbyists, and uber-rich oligarchs who have spent billions upon billions rigging the economy and democracy in their favor—the only bulwark you have is supporters who believe in your work. But here’s the urgent message from me today. It’s never been this bad out there. And it’s never been this hard to keep us going. At the very moment Common Dreams is most needed and doing some of its best and most important work, the threats we face are intensifying. Right now, with just two days to go in our Spring Campaign, we're falling short of our make-or-break goal. When everyone does the little they can afford, we are strong. But if that support retreats or dries up, so do we. Can you make a gift right now to make sure Common Dreams not only survives but thrives? There is no backup plan or rainy day fund. There is only you. —Craig Brown, Co-founder |
In 2007, their stupid schemes and frauds crashed our economy, destroying middle-class jobs, wealth and opportunities. Far from getting punishment, however, these financial scofflaws were bailed out by their Washington enablers -- so the moral lesson they learned was clear: Stupid pays!
Sure enough, only a decade later, here they come again! Rather than investing America's capital in real businesses to generate grassroots jobs and shared prosperity, Wall Street is siphoning billions of investment dollars into speculative nonsense -- such as high-profit securities "secured" only by rickety bundles of subprime auto loans.
Car dealers, eager to goose up sales, have been hawking new vehicles to lower-income people, offering quick credit approval. Banks -- eager to hook more people on monthly car payments -- have been approving these subprime car loans without verifying the buyer's ability to pay. Then, a Wall Street bank's investment house buys up thousands of these iffy individual loans, bundles them into multimillion-dollar "debt securities," and sells them to wealthy global speculators. Last year alone, banks sold $26 billion-worth of these explosive bundles of car loans.
This is just another paper-shuffling con game, a repeat of Wall Street's subprime mortgage scam a decade ago. It generates fast, easy money at the start for superrich speculators and greedy banksters -- but as more and more low-income buyers are unable to make their car payments, defaults build up and the whole financial bubble pops.
Wasting America's much-needed investment capital on a predatory lending scheme that intentionally puts people in cars they can't afford with loans they can't repay is not only stupid, but immoral... and it's killing our real economy. Why are we letting elite Wall Street loan sharks do this to us?
Communities across the country have recently found out that Wall Streeters themselves -- from former-Goldman Sachs investment bankers to real estate investment trusts -- rushed out to scoop up thousands of those foreclosed properties, usually grabbing them at bargain basement prices when they were auctioned off on courthouse steps in Atlanta, Miami, Phoenix, Dallas, Chicago, Las Vegas and other metro areas with hard-hit working-class suburbs. The investment consortiums have deep, deep pockets and can easily outbid local buyers to take possession of the majority of the single-family homes being sold off in many of those distressed places.
Why are they buying? To turn the homes into rental properties and become the dominant suburban landlord, controlling the local market and constantly jacking up rents. For example, the Wall Street journal found that in Nashville's suburb of Spring Hill, just four of these predatory housing giants own 700 houses -- giving this oligopoly of absentee investors ownership of three-fourths of all rental houses in town. One of these bulk buyers is an arm of Blackstone, the world's largest private equity firm, another is an equity outfit that was spun out of the housing speculation department of Goldman Sachs, and another is a billionaire whose investors include the Alaska State oil fund.
Not only do rents jump dramatically when such outfits seize a market, but the Wall Street landlords are intent on imposing "a new way" on the U.S. housing market. They're pushing a cultural shift in which homeownership is no longer part of the American Dream and tenants are taught to accept annual rent increases as the price of having a home.
So, the banksters crash the economy, you lose income and your home, they buy your house at auction, then they rent it to you at an ever-increasing price. The "new way" is the same old story of the rich robbing the rest of us.
In 2007, their stupid schemes and frauds crashed our economy, destroying middle-class jobs, wealth and opportunities. Far from getting punishment, however, these financial scofflaws were bailed out by their Washington enablers -- so the moral lesson they learned was clear: Stupid pays!
Sure enough, only a decade later, here they come again! Rather than investing America's capital in real businesses to generate grassroots jobs and shared prosperity, Wall Street is siphoning billions of investment dollars into speculative nonsense -- such as high-profit securities "secured" only by rickety bundles of subprime auto loans.
Car dealers, eager to goose up sales, have been hawking new vehicles to lower-income people, offering quick credit approval. Banks -- eager to hook more people on monthly car payments -- have been approving these subprime car loans without verifying the buyer's ability to pay. Then, a Wall Street bank's investment house buys up thousands of these iffy individual loans, bundles them into multimillion-dollar "debt securities," and sells them to wealthy global speculators. Last year alone, banks sold $26 billion-worth of these explosive bundles of car loans.
This is just another paper-shuffling con game, a repeat of Wall Street's subprime mortgage scam a decade ago. It generates fast, easy money at the start for superrich speculators and greedy banksters -- but as more and more low-income buyers are unable to make their car payments, defaults build up and the whole financial bubble pops.
Wasting America's much-needed investment capital on a predatory lending scheme that intentionally puts people in cars they can't afford with loans they can't repay is not only stupid, but immoral... and it's killing our real economy. Why are we letting elite Wall Street loan sharks do this to us?
Communities across the country have recently found out that Wall Streeters themselves -- from former-Goldman Sachs investment bankers to real estate investment trusts -- rushed out to scoop up thousands of those foreclosed properties, usually grabbing them at bargain basement prices when they were auctioned off on courthouse steps in Atlanta, Miami, Phoenix, Dallas, Chicago, Las Vegas and other metro areas with hard-hit working-class suburbs. The investment consortiums have deep, deep pockets and can easily outbid local buyers to take possession of the majority of the single-family homes being sold off in many of those distressed places.
Why are they buying? To turn the homes into rental properties and become the dominant suburban landlord, controlling the local market and constantly jacking up rents. For example, the Wall Street journal found that in Nashville's suburb of Spring Hill, just four of these predatory housing giants own 700 houses -- giving this oligopoly of absentee investors ownership of three-fourths of all rental houses in town. One of these bulk buyers is an arm of Blackstone, the world's largest private equity firm, another is an equity outfit that was spun out of the housing speculation department of Goldman Sachs, and another is a billionaire whose investors include the Alaska State oil fund.
Not only do rents jump dramatically when such outfits seize a market, but the Wall Street landlords are intent on imposing "a new way" on the U.S. housing market. They're pushing a cultural shift in which homeownership is no longer part of the American Dream and tenants are taught to accept annual rent increases as the price of having a home.
So, the banksters crash the economy, you lose income and your home, they buy your house at auction, then they rent it to you at an ever-increasing price. The "new way" is the same old story of the rich robbing the rest of us.