Whose Bubble Will Burst First, The Banks Or The Bolsheviks?

“Fight Against Stupidity And Bureaucracy”

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As 2014 ended, the Russian Rouble was in free fall and so were crude oil prices. Both affected the Russian economy and not in a good way. From a position of great strength Vladimir Putin is now under pressure due to the combined effect of lower oil prices and the sanctions imposed by the west because of the situation in the Ukraine and Crimea.

In the West there have been two notable effects of the drop in oil.

One is good in so far as consumers have to spend a lot less to run their vehicles and heat their homes.

The other, however, is bad – for the banks (tee-hee-hee) although they will no doubt pass on their pain to us.

The reason the banks are in trouble (AGAIN) is because they have lent billions of dollars to fracking operations where oil explorers use expensive techniques to extract oil from underneath American and Canadian soil.

The drop in oil prices means that you can now buy oil on the open market for a lot less than it costs to extract it in the US and Canada.

Therefore the oil exploration companies that obtained these huge loans from the banks, and other money men on Wall St, have little or no chance currently of paying them back.

If the position continues through 2015 expect payment defaults and huge debts written off again by the banks.

Will the government step in (AGAIN) to bail them out by printing more money?

I don’t know. I hope not. It’s time these bankster idiots paid for their own mistakes instead of us having to continually foot the bill.

Don’t count on it though.

So whose bubble do you think will burst first, the banks or the Bolsheviks?

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Come On Obama, Stick Them In The Slamma!

“Fight Against Stupidity And Bureaucracy”

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Around this time last month I wrote a post about the explosion of sub-prime credit for people seeking automobile loans they couldn’t afford. Here’s a link if you missed it – click here. 

They say that if you don’t learn from what happened in the past you are doomed to repeat it. And it is clear the banksters have learned nothing, mainly because the government was not man enough to teach them a lesson when they almost brought the country to its knees. Their greed was excused and rewarded, not punished in any meaningful and lasting way.

So now we have the auto loans credit explosion, which is another mini sub-prime disaster in the making. And again it is being egged on by the stupidity and greed of Wall Street who just can’t pass on the chance to reap big profits from those people silly enough to take their high interest loans.

This time, however, it turns out some of the people in positions of power are beginning to recognize that this is becoming a big problem.

The regulators and prosecutors are starting to worry about the level of lending abuses. Not only that but they are also recognizing the similarities with the home loans fiasco that eventually resulted in the financial crisis.

The Consumer Financial Protection Bureau has recently fined subprime auto lender First Investors Financial Services Group Inc. $2.75 million for knowingly providing inaccurate information to credit reporting agencies for at least three years. It was a “computer error” don’t you know, and, of course, they paid the fine but without admitting any liability – perish the thought!

It should come as no surprise that First Investors Financial Services Group is owned by a prominent New York private equity firm.

And like the mortgage sub-prime fraud, the banksters and other money men are not only screwing the people who take out the loans, but once again they are re-packaging them up as “good investments” for their richer clients too.

A United States attorney in Manhattan, has already begun an investigation into whether lenders have sold questionable auto-loan investments to investors, and has sent subpoenas to General Motors Financial and Santander Consumer USA, to try to find out whether the lenders fully disclosed to investors the creditworthiness of borrowers whose loans made up the complicated securities.

Last time they got away with it. Will this time be any different? You have a lot more faith in the system than me if you think it will. All that is happening so far is tokenism. They need a lot more than a slap on the wrist.

In China or Vietnam and some other locations banksters committing fraud are stood up against a wall a shot. That’s maybe a little harsh, but at the very least some serious jail time is in order.

The fact is the banksters are doing it again because they think that they can get away with it again. And if they get away with it this time, then they’ll do it yet again in the future. All the time racking up fortunes for themselves and leaving the other poor sods, who didn’t know any better than to take out their loans or buy their toxic investments, a lot poorer.

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