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View Full Version : WaMu Boosted Bad Loans, Report Finds



Qtec
04-15-2011, 01:48 AM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"><span style='font-size: 14pt'>Well Aware Of Bubble, WaMu Boosted Bad Loans, Report Finds </span>

NEW YORK -- Top executives at Washington Mutual actively boosted sales of high-risk, toxic mortgages in the two years prior to the bank's collapse in 2008, according to emails published in a wide-ranging Senate report that contradicts previous public testimony about the meltdown.

The voluminous, 639-page report on the financial crisis from the Senate Permanent Subcommittee on Investigations singles out Washington Mutual for its decision to champion its subprime lending business, <u>even as executives privately acknowledged that a housing bubble was about to burst.</u>

<span style="color: #990000">"I have never seen such a high-risk housing market," CEO Kerry Killinger wrote in a 2005 email to his chief risk officer. "This typically signifies a bubble."</span>

Nonetheless, in a series of memos over the next two years, Killinger told board members that the bank should accelerate its subprime portfolio as part of a major growth strategy.

The internal memos detailed in the report are a stark contrast to Killinger's testimony last year before the same Senate subcommittee, where he said that by 2004 the company "quickly determined that the housing market was increasing in its risk, and we put most of those strategies for expansion on hold."

<span style='font-size: 14pt'>The report finds Washington Mutual continued its aggressive foray into high-risk lending because of the "gain on sale." When repackaged and sold to investment banks as securities, higher-risk loans would yield more profits for the bank.

One chart presented to the bank's board in 2006 showed that <span style="color: #3333FF">selling subprime loans could generate eight times as much profit as lower-risk, government-backed loans.</span></span>

http://i.huffpost.com/gen/267066/SCREENSHOTCHART.jpg

One of the largest and most aggressive issuers of subprime mortgages in the country, Washington Mutual eventually collapsed in September 2008 -- the largest bank failure in U.S. history. It was eventually purchased by J.P. Morgan Chase as part of a deal brokered by the Federal Deposit Insurance Corporation. </div></div>

link (http://www.huffingtonpost.com/2011/04/14/well-aware-of-bubble-washington-mutual_n_849435.html)

What a surprise.

Q

LWW
04-15-2011, 03:21 AM
So why did they make loans they knew to be bad?

Think dude, think.

pooltchr
04-15-2011, 06:38 AM
Because someone told them they had to?

Or maybe because someone told them it was ok, because they would take those bad loans off their hands, so there was no risk?

just guessing.

Steve

wolfdancer
04-15-2011, 11:24 AM
I banked at WAMU, and bought their stock after a "glowing" report was issued on the bank. As I remember it was more then their own
hi- risk mortgage loans that did them in....it was other banks mortgage loans that were repackaged and lumped together in some sort of investment vehicle...and WAMU invested in them. It's been awhile, so that may be only partially correct

LWW
04-15-2011, 05:24 PM
Well Snoopy ... why did they knowingly make bad loans?

wolfdancer
04-15-2011, 05:46 PM
check on the internet...there are lots of knowing stories about them. The one I remember, was the one where they were in great shape financially, making r.e. loans in just a few western states. The stock was trading at a low P.E. ratio, etc. AND then their new CEO, decided to become a "player" and get in on the action. They made some small bank acquisitions which allowed them to become an interstate banker, and they began making hi risk loans.People were fired or demoted if they weren't making enough loans.
It was like the corner Mom and Pop grocery store, was trying to become a Supermarket. Like most of the relatively small banks, they thought the Feds would bail them out if things went bad.
They just were doing the same thing that many other small banks were doing....they just had bigger hopes.
It was an interesting story.....and it has nothing to do with politics, sorry....

LWW
04-15-2011, 05:49 PM
That was a statement, not an answer.

And, the answer has everything to do with politics.

wolfdancer
04-15-2011, 05:55 PM
actually now....your post is a statement, and a poorly conceived one at that(imho)....maybe if you took a minute to mull over your reply before putting pen in hand, so to speak.....

JohnnyD
04-15-2011, 06:44 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: wolfdancer</div><div class="ubbcode-body">actually now....your post is a statement, and a poorly conceived one at that(imho)....maybe if you took a minute to mull over your reply before putting pen in hand, so to speak..... </div></div>Yet with your super high iq you cannot answer his very simple question.Typical YOU.Loser.

wolfdancer
04-15-2011, 06:54 PM
Reread my post...his q was answered. As a WAMU investor,I read everything that I could about the company.....if he or you, want to know anymore about the company, I suggest that you do a little basic research on the web, and not try to debate something you apparently don't know feces about.
AND I have given him the basic outline of what went wrong there. If it went over your head, that's your problem, twinkle toes.

JohnnyD
04-15-2011, 09:12 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: wolfdancer</div><div class="ubbcode-body">Reread my post...his q was answered. As a WAMU investor,I read everything that I could about the company.....if he or you, want to know anymore about the company, I suggest that you do a little basic research on the web, and not try to debate something you apparently don't know feces about.
AND I have given him the basic outline of what went wrong there. If it went over your head, that's your problem, twinkle toes. </div></div>Yet you cannot comprehend what you say.Your super high iq is not helping you at all.

wolfdancer
04-15-2011, 11:46 PM
Do your own due diligence on WAMU if you have any objection to my post, and then come back here and refute my statement. Otherwise you are just talking through the wrong end of your alimentary canal.

Stretch
04-16-2011, 02:34 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: wolfdancer</div><div class="ubbcode-body">Do your own due diligence on WAMU if you have any objection to my post, and then come back here and refute my statement. Otherwise you are just talking through the wrong end of your alimentary canal.
</div></div>

Wolf, hey looks like your public enemy #1 now! I'm just waiting for teach, ugo, and loiter to smell the blood and zoom in for some jabs. Sure hope you stick around as i enjoy your storys. Couldn't blame you for working on your golf game more though. That's where i'd be if not for work, SOON! 2014 is my lucky number. St.

LWW
04-16-2011, 03:34 AM
So nary a leftist has any clue why they would knowingly make bad loans?

Qtec
04-16-2011, 03:54 AM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">check on the internet...there are lots of knowing stories about them. </div></div>

As usual, LWW is playing dumb.

What the recent report confirms, just one of many reports on this who have came to the same conclusion, <span style='font-size: 11pt'>is that there was widespread fraud throughout the banking industry and Wall St.
It also proves that the GOP TP that the crisis was caused by Joe Sixpack who couldn't meet his payments is absurd.</span>

Q

LWW
04-16-2011, 04:45 AM
Was the question too hard?

Or, are you waiting for the "ANSWER" to be spoon fed to you?

C'mon Snoopy ... you can do this.

Why did they knowingly make bad loans?

wolfdancer
04-16-2011, 11:19 AM
Thanks Stretch....but don't be looking forward to your retirement. That makes you 3 years older and some age related ailments could pop up. It also kind of makes you feel obsolete. Even Dee now has more time on his hands then he knows what to do with it.
However I still enjoy setting the alarm clock for my old working time to get up.....then shutting it off and going back to sleep....

Stretch
04-16-2011, 12:57 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: wolfdancer</div><div class="ubbcode-body">Thanks Stretch....but don't be looking forward to your retirement. That makes you 3 years older and some age related ailments could pop up. It also kind of makes you feel obsolete. Even Dee now has more time on his hands then he knows what to do with it.
However I still enjoy setting the alarm clock for my old working time to get up.....then shutting it off and going back to sleep.... </div></div>

I do that on weekends lol. Ya i can get a full pension at 57. Maybe then i can finish this place (my 4th house) and landscape the 2 acres of woodlot down to the lake. I'm thinning it out and getting some sightlines down to the water, putting in an irrigation type frog pond beside the garden and some walking trails. Maybe a gazebo. Then there's a wood shed to build and a proper work shop. Lots of plans.

I don't play competative pool anymore. Working nights now killed league play and the Provincial ranking tournaments are set up so that you have to commit to most of them to have a chance to get enough points to go anywhere. Basicaly just don't have the time, although there is this one mixed Scotch doubles thing held on the last Sat. of every month that has been booming. Loads of fun and only 10 dollar entry for all day of pool. Best bang for your entertainment dollar around. /forums/images/%%GRAEMLIN_URL%%/smile.gif St.

JohnnyD
04-16-2011, 01:12 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: LWW</div><div class="ubbcode-body">So nary a leftist has any clue why they would knowingly make bad loans? </div></div>
Looks like you lost them again LWW.Soon as you post a question their high iq's are runnin scared.

wolfdancer
04-16-2011, 01:14 PM
I probably would have given up on pool by now, but there are several tournaments a week here, within 20 miles that I can play in, and they only cost $5 to enter. I gave up on league play,as you have to deal with too many "personalities" both on your team and the other team. I enjoy watching a good league match though.
I take care of my pool "Jones" by having my own 9 ft'r out in the garage.
Sounds like you have some good projects in mind, for when you retire. I read where the avg. retiree collects just 18 SS checks, so if you can retire at 57....go for it.

JohnnyD
04-16-2011, 01:15 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: LWW</div><div class="ubbcode-body">Was the question too hard?

Or, are you waiting for the "ANSWER" to be spoon fed to you?

C'mon Snoopy ... you can do this.

Why did they knowingly make bad loans? </div></div>
He is in over his head.

Stretch
04-16-2011, 01:57 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: JohnnyD</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: LWW</div><div class="ubbcode-body">Was the question too hard?

Or, are you waiting for the "ANSWER" to be spoon fed to you?

C'mon Snoopy ... you can do this.

Why did they knowingly make bad loans? </div></div>
He is in over his head. </div></div>

Care to answer that question Johnny?......didn't think so, they don't cover that material on Sesame Street. St.

JohnnyD
04-16-2011, 02:04 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Stretch</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: JohnnyD</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: LWW</div><div class="ubbcode-body">Was the question too hard?

Or, are you waiting for the "ANSWER" to be spoon fed to you?

C'mon Snoopy ... you can do this.

Why did they knowingly make bad loans? </div></div>
He is in over his head. </div></div>


Care to answer that question Johnny?......didn't think so, they don't cover that material on Sesame Street. St.

</div></div>
Didn't think you would.Your proven unreliable.

wolfdancer
04-16-2011, 02:08 PM
lol
All the info on WAMU is available on line, and I have already spelled out what went wrong. If lww is looking for an explanation that even he can understand....he should have avoided commenting on the thread.

JohnnyD
04-16-2011, 02:10 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: wolfdancer</div><div class="ubbcode-body">lol
All the info on WAMU is available on line, and I have already spelled out what went wrong. If lww is looking for an explanation that even he can understand....he should have avoided commenting on the thread. </div></div>
Glad you admitted to doing it.

wolfdancer
04-16-2011, 02:25 PM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">Glad you admitted to doing it. </div></div>
That makes no sense.....you make the dumbest posts ever...that I have seen on this board.
Like your idol, you just seem to need the attention, and your schtick to get that, seems to be to post like a teen on myspace.
I'm done replying to your idiocy.....

LWW
04-16-2011, 03:07 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: wolfdancer</div><div class="ubbcode-body">lol
All the info on WAMU is available on line, and I have already spelled out what went wrong. If lww is looking for an explanation that even he can understand....he should have avoided commenting on the thread. </div></div>

I didn't ask what went wrong.

I asked why they knowingly made bad loans.

Is the question above your intellectual level?

wolfdancer
04-16-2011, 03:16 PM
as I wrote (it may have gone over your head) ....and the info is available online.....in street parlance...they wanted to become a "player" The much larger BOFA, HQ'd in Charlotte, N.C. also got themselves in a financial jam through risky mortgage loans.
I'm not sure what your problem is about this.....but I'm done 'splaining to you. Either pony up, yourself...some offsetting info, or drop the inquiry. Either way, I could give a **** what you do

JohnnyD
04-16-2011, 05:51 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: wolfdancer</div><div class="ubbcode-body"> <div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">Glad you admitted to doing it. </div></div>
That makes no sense.....you make the dumbest posts ever...that I have seen on this board.
Like your idol, you just seem to need the attention, and your schtick to get that, seems to be to post like a teen on myspace.
I'm done replying to your idiocy..... </div></div>
YOU finally admit to doing it and are embarrassed.I would be too.That's ok wolfe go to handoe's and help clean his crap laden house.

JohnnyD
04-16-2011, 05:52 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: wolfdancer</div><div class="ubbcode-body">as I wrote (it may have gone over your head) ....and the info is available online.....in street parlance...they wanted to become a "player" The much larger BOFA, HQ'd in Charlotte, N.C. also got themselves in a financial jam through risky mortgage loans.
I'm not sure what your problem is about this.....but I'm done 'splaining to you. Either pony up, yourself...some offsetting info, or drop the inquiry. Either way, I could give a **** what you do
</div></div>Lost another dabate with the Great One i see.You never will win one against him.Loser.

JohnnyD
04-16-2011, 05:54 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: wolfdancer</div><div class="ubbcode-body">as I wrote (it may have gone over your head) ....and the info is available online.....in street parlance...they wanted to become a "player" The much larger BOFA, HQ'd in Charlotte, N.C. also got themselves in a financial jam through risky mortgage loans.
I'm not sure what your problem is about this.....but I'm done 'splaining to you. Either pony up, yourself...some offsetting info, or drop the inquiry. Either way, I could give a **** what you do
</div></div>Now go sit and pout all night,wolfe.

LWW
04-17-2011, 04:39 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: wolfdancer</div><div class="ubbcode-body">as I wrote (it may have gone over your head) ....and the info is available online.....in street parlance...they wanted to become a "player" The much larger BOFA, HQ'd in Charlotte, N.C. also got themselves in a financial jam through risky mortgage loans.
I'm not sure what your problem is about this.....but I'm done 'splaining to you. Either pony up, yourself...some offsetting info, or drop the inquiry. Either way, I could give a **** what you do
</div></div>

That's why they bought other loans.

Now, why did they make loans they knew would go bad?

That doesn't make you a player, it makes you broke ... unless ...

Gayle in MD
04-17-2011, 10:12 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Qtec</div><div class="ubbcode-body"> <div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">check on the internet...there are lots of knowing stories about them. </div></div>

As usual, LWW is playing dumb.

What the recent report confirms, just one of many reports on this who have came to the same conclusion, <span style='font-size: 11pt'>is that there was widespread fraud throughout the banking industry and Wall St.
It also proves that the GOP TP that the crisis was caused by Joe Sixpack who couldn't meet his payments is absurd.</span>

Q

</div></div>

The most respected economists, have stated the same, all along.

But you know how the sheep like to blame everyone except for the actual crooks. Helps them to think, erroneously, that they are smarter than the average bear, lol, It's in their DNA. That's why they vote for Repiglicans. /forums/images/%%GRAEMLIN_URL%%/grin.gif

LWW
04-17-2011, 10:16 AM
So ... why did they knowingly make bad loans?

LWW
04-17-2011, 10:18 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: pooltchr</div><div class="ubbcode-body">Because someone told them they had to?

Or maybe because someone told them it was ok, because they would take those bad loans off their hands, so there was no risk?

just guessing.

Steve </div></div>

That's the closest guess yet BTW.

LWW
04-19-2011, 06:07 AM
Can not a single leftist explain this ... even though they accept it as undeniable truth?