How Citigroup turned debt into gold
Here's where the looting takes place: the only reason Citigroup was able to profit was because the government stepped in and assumed the risk AND fronted 1/2 trillion dollars in guarantees! Who wouldn't win in a situation like that!?!
Citi gets the gold and we get stuck with the trillions in debt.
The government took our money and gave it to Citigroup. The gothic error in this is that taking our money through an inefficient government process to bail out the decisions made by corporations responsible (for decisions and consequences) somehow benefits the people the money came from with any kind of the value of the money.
This whole process probably resulted in a <10% benefit to "the people", perhaps less, and did nothing but pay the government beast and incite it to even further intrusion.
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As the banks started to crumble, the incentives got sweeter, by the time B of A took on Countrywide's basket of goodies, the FDIC pretty much guaranteed 100% of their losses, missed payments, etc. in return for absorbing the risk.
In hindsight, I don't think it was a great deal for any of them, they ended up hiring hundreds of thousands of people to work on the foreclosures, bailouts, loan mods, etc., and true the dollars on the mortgage were kicked in by FDIC, but the gov wasn't paying all those salaries and benefits for the millions of staff to deal with it. On top of that, the generally 'ok' shitty consumer bank reputations of B of A / Wells / Chase / etc got dragged through the mud as somehow being the agents of the apocalypse when they didn't write the loans or service them in the first place.
I remember Fremont Bank products back in the day... "1 Day after Bankruptcy Discharge OK", "Minimum FICO 550 for 95% LTV", etc... lets be honest, it takes a concerted effort to get your FICO down to 500 or so, even a day after a bankruptcy, chasing that kind of stuff as a quality borrower of $300,000 and then forcing the other guy to clean up your mess is wrong in any capitalist's book.