Never a Dull Mortgage

AND SO, THE UNITED STATES GOVERNMENT has filed, or is filing suit against the bank of america, for allegedly making a whole lotta bad loans (i.e. loans made by an over zealous lender in which the lendee has no reasonable hope or intent of making good on the loan), and then palming them off to poor unwitting helpless victims like fannie mae and freddie mac.

fannie mae and freddie mac, being those two huge independent mortgage companies that were established by the fed government, given cute names, then turned loose during the great society of LBJ. you would think they would know a bad mortgage when they see one, and would stay away from doing business with the Bank of America. Oh well.

So, first the federal government tries to create a pro business environment in which anyone can easily loan anything to anyone, including houses; big lenders like the BoA  et al dive headlong into the less regulated market, loaning hundreds of millions to michael jackson, handing out debit cards to mexicans illegally in the USA, turning the economy into a casino, and creating the Housing bubble".

Then, the bubble bursts, as all bubbles do, the big lenders, (like BoA)  go belly up, and get bailed out by, you guessed it, the federal government, and now, several years after the fact, the lawsuits start hitting the fan. The people will suffer, the corporations will recover, and the trial lawyers will prosper, according to the standard scenario.

so what will happen if the justice department army of attorneys wins the lawsuit against Bank of America, Inc., and the compensatory damages force big red into bankruptcy? Will the Treasury department bail B o A  out- again?

Now all we need is for mitt romney to check in on all this, and see where, exactly, he stands on all these issues and questions begging to be answered, at least, for the time being. Whatever mitt says today, about anything, he's liable to change tomorrow.

We know that mitt wants a wide open free as a bird business environment, unregulated, we can be sure he does not want corruptions, but does he want lawsuits dispensed by the government. As we say, stay tuned.

One thing you can't deny; there is never a dull moment in american financial and legal circles.