Question by dont worry bout it: Collapse of Financial Systems e.g. banks?
Somebody inform me result in I truly got to know. I saw an article about Bank of America getting a two.two Billion dollar loss. I dont care who you are or which organization you belong to, you happen to be gonna feel a 2.2 Billion dollar loss.

A lot of items have been mentioned via out the ages, from Nostradamus, to ancient civilizations..They say the truth will drive you crazy, it would quit our way of life so THEY maintain it away from ‘commoners’.

Is this and the turmoil in the Middle East, Iran’s quest for superpower most recently the beginning of a new order, in which systems and societies will be forced to adjust?

Do you feel there is any truth in this?

Best answer:

Answer by Stella
The current financial crisis was precipitated by a bubble in home rates and its subsequent burst, which led to a wave of foreclosures, the seizure by the Federal government of the principal automobile for securitization (the Government Sponsored Enterprises [GSEs] Fannie Mae and Freddie Mac), the obliteration of the “private label” securitization industry, the failure of 92 banks so far this year, and bailout costs for the remainder of the banking program. No 1 has come out smelling like a rose. The question we address is what should happen to the historically most essential players in the mortgage market place: Fannie Mae, Freddie Mac, and the banks.

Broadly speaking there are two models for funding mortgages (and other loans): the portfolio lender model, which entails economic institutions (e.g., banks) originating and holding loans in their portfolio and funding them with debt (e.g., deposits), and thesecuritization model, which entails getting loans and placing them into pools and selling (perhaps structured [1]) shares in the pools to capital marketplace investors. Numerous of the present monetary arrangements are combinations of the two. The easiest way of hunting at the two models is to believe of them as applying to institutions called “banks” and “securitizers” and to view the rules and positive aspects that apply to them as their “charters.”

What do you feel? Answer beneath!