>That was the beginning of the CDO (Collateralized Debt Obligation) market, where people bundled GNMA mortgages into jumbo instruments that could be tranched and sold in pieces. The profits were so high that non-GNMA mortgages were bundled.
>It could have been stopped at any point by the government and it wasn't. What followed was the normal curve of any market - it expanded till its excesses consumed it.
>
>Unanswered here is the question of what penalties should be imposed on people such as salespeople at banks and employees of rating agencies who knowingly misled investors in these securities.
>We should also be looking at bringing regulators who closed eyes to justice.

In Cyprus 2 major banks went up in smoke. One actually went bankrupt, other left to rot with debts of the first...
Thousands of depositors lost money, some of them all of it, some of them half or less. Whole country nearly collapsed.

Not a single banker was jailed. There is process against some high execs of one bank that went bankrupt but that is very likely to go nowhere.
Only one who went to jail was ex CB Governor who went down for tax evasion, not for failure to properly oversee bank practices.
(Only reason he did is that it happened in the time of collapse so was difficult to swipe it under carpet)

So not CB Governor, not single loan pusher or loan officer, not single (mortgage colateral) property estimator.
Auditors... World wide famous audit firm still brags around about their impeccable business values etc. Knew nothing... not their fault.
Rating agencies knew nothing... not their fault.
Government regulators are joke everywhere anyway...

So whose fault it is ?
Tax payer of course!
They elected government. Government regulates and oversees banks etc. So tax payer paid the price.
(Ain't that beautiful ? From banxter's prospective I mean...)

The same system is still in place. All people, all actors. Loans are now nearly impossible to get, and banks are somehow SHOWING PROFITS (???).
The same auditors still overlook them. The same agencies still rate them. The same people still regulate them etc.

And tax payer is of course resting assured something like this can never happen again!

Nevvaa.. Evvaa.. !!!
(Never ever)

At least not this year! {g}
.