New Banking Laws
It has become apparent that all of the blame game going on in Wall St and also in the “hallowed halls” of Washington has finally filtered down to street level and how this pontificating about who was guilty today’s credit mess.
Let me tell you from years of experience and understanding of the system, the “fat cats” in Washington that you elected, whether Republican or Democrat has still not gotten the message. I see on CNN almost everyday the charades that are playing out. Politicians are lining up with their “fangs bared” looking for the scape goat so that their constituents back home think “Oh my gosh, my representative is really laying the law down” on those thieves.
Well, lets remember what I wrote in earlier articles about how the silent thief simply replaced performing loans with high risk loans that yielded a higher rate of interest. Well, when he did this, those toxic loans were insured by AIG and others. BUT, here is what you forgot. Almost all of the “in crowd” knew that those toxic loans were not going to perform. Their performance was funded by the bailout money that our leaders provided for AIG and others.
So, this gift of your money to AIG and others was pure crap. The Wall St thieves knew that those toxic loans were NOT going to perform. BUT, they didn’t care. The loans were insured. So, when they exchanged them for the good loans that were performing at.06% for toxic loans that yielded.14% they simply put that.08% difference in their pockets and you and I are left holding the bag because that’s the way that it is.
Now, here we see in the latest news, the efforts by the bureaucrats to put “handcuffs” on the lending practices of the banks in order to insure that toxic loans are a thing of the past. That might have some merit. But lets look at the horse from another angle. The credit crunch has hurt everyone in this country. Small businesses cannot get credit so therefore they are going out of business. The beacon scores required for a bank approval have skyrocketed to well over “700″.
Anyone understand that less then (10%) of the American public have credit scores over “700″. So, how can anyone borrow anything? I know where the real “cancer” is. But no one wants to go there. The real cancer on society is our credit reporting agencies. They are in cahoots with the lenders and creditors because “IF” they keep your credit scores down, anything that you want to buy will require higher interest rates.
We have all been through the “night time prowler” that snuck into your home in the middle of the night and lowered your credit score. You might have been sleeping, but “Credit Cancer Charlie” wasn’t. Because you used your credit card for an emergency and almost reached the limit of your card, the other credit card companies found this out electronically and “whammo” they hired “CCC” to lower your credit score for no other reason than he thought you were a higher risk. Garbage, but that is the system.
This covert action really impacted your budget. If, you owed $ 50,000 in credit cards and when you went to sleep your weighted average of interest was (12%) you were paying $ 500.00 a month in interest alone. You were not happy with that, but you were managing. Now, some medical emergency or other event that caused you to run up to the limit on one credit card now “Credit Cancer Charlie” raised your interest rate while you were sleeping to 36%. Lets take a look at the damage. This now costs you $ 1,500.00 a month. You were penalized $1,000.00 a month while you were sleeping.
What will that do to your budget? Now you see why the connection between the credit reporting agencies and the lenders and creditors should be investigated by the “Dodd” gang? But, they won’t act at all. Too many lobbyists and payoffs.
