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US Financial Quagmire Bringing Out the Scammers

timothy posted about 6 years ago | from the brother-where-is-your-empathy? dept.

Security 272

coondoggie contributes this snippet from NetworkWorld: "You could probably see this one coming. With all of the confusion and money involved you knew there would be cyber-vultures out there looking to cash in. Well the Federal Trade Commission today issued a warning that indeed such increased phishing activities are taking place. Specifically the FTC said it was urging user caution regarding e-mails that look as if they come from a financial institution that recently acquired a consumer's bank, savings and loan, or mortgage. In many case such emails are only looking to obtain personal information — account numbers, passwords, Social Security numbers — to run up bills or commit other crimes in a consumer's name, the FTC stated."

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well ... (5, Funny)

Average_Joe_Sixpack (534373) | about 6 years ago | (#25323137)

I've heard Americans are so broke they are now scamming Nigerians

Re:well ... (4, Funny)

svnt (697929) | about 6 years ago | (#25323263)

There you are!

Hey guys, he does exist! You betcha!

Re:well ... (-1, Troll)

PunkOfLinux (870955) | about 6 years ago | (#25323323)

Oh, just go dig a ditch, tell your sister you love her and that you're sorry your marriage has to end, hug the kids goodbye, and get your 3 year old son to shoot you with the 12-gauge.

Re:well ... (-1, Troll)

Anonymous Coward | about 6 years ago | (#25323475)

If anyone needs to be shot it's your English teacher for not teaching you about run-on sentences.

Eat a dick, by the way.

Re:well ... (2, Informative)

FLEB (312391) | about 6 years ago | (#25324047)

That's a list, not a run-on.

Re:well ... (0)

Anonymous Coward | about 6 years ago | (#25324017)

Giggity giggity goo!

Re:well ... (0)

oldspewey (1303305) | about 6 years ago | (#25323325)

Is this some new form of the "your mamma's so fat ..." joke?

Re:well ... (4, Funny)

liquidpele (663430) | about 6 years ago | (#25323513)

Yo country so broke, it got a title loan.

Re:well ... (0)

Anonymous Coward | about 6 years ago | (#25323621)

Yo country so broke, it got a title loan.

Well, if anyone wants to repo that car its up on blocks in front of Amos Moses Milsap's house about 45 minutes southeast of Thibodeux, Louisiana.

Re:well ... (3, Interesting)

smallfries (601545) | about 6 years ago | (#25323883)

Dude, I ain't even from Iceland...

Re:well ... (5, Funny)

Anonymous Coward | about 6 years ago | (#25323695)

I've heard Americans are so broke they are now scamming Nigerians

Did you see the latest?

SUBJECT: REQUEST FOR URGENT BUSINESS RELATIONSHIP

DEAR AMERICAN:

I need to ask you to support an urgent secret business relationship with a transfer of funds of great magnitude.

I am ministry of the treasury of the republic of america. my country has had crisis that has caused the need for large transfer of funds of 800 billion dollars us. if you would assist me in this transfer, it would be most profitable to you.

I am working with mr. phil gram, lobbyist for ubs, who will be my replacement as ministry of the treasury in january. as a senator, you may know him as the leader of the american banking deregulation movement in the 1990s. this transactin is 100% safe.

This is a matter of great urgency. we need a blank check. we need the funds as quickly as possible. we cannot directly transfer these funds in the names of our close friends because we are constantly under surveillance. my family lawyer advised me that i should look for a reliable and trustworthy person who will act as a next of kin so the funds can be transferred.

Please reply with all of your bank account, ira and college fund account numbers and those of your children and grandchildren to wallstreetbailout@treasury.gov
so that we may transfer your commission for this transaction. after i receive that information, i will respond with detailed information about safeguards that will be used to protect the funds.

Yours faithfully minister of treasury paulson

Re:well ... (1)

SpaceLifeForm (228190) | about 6 years ago | (#25324165)

Kudos sir or madam.

There exists no moderation high enough to do you honour.

(disregarding the next post that has the link)

Re:well ... (-1, Redundant)

Fluffeh (1273756) | about 6 years ago | (#25323805)

One of my mates got this email that he posted on our forums. Gave us all a great laugh.

Dear American [nazgulguild.com] - it's just classic.

*illegal* scammers (5, Insightful)

Anonymous Coward | about 6 years ago | (#25323147)

As apposed to the mortgage brokers, sub prime lenders, financial institutions,ceos that got us into this mess and will walk away loaded and scott free.

Re:*illegal* scammers (-1, Troll)

Anonymous Coward | about 6 years ago | (#25323241)

"apposed"? Surely you're not so poor you can't buy a 5$ dictionary?

Re:*illegal* scammers (0)

Anonymous Coward | about 6 years ago | (#25323261)

Na, just taa paar ta buy anather Ah.

Re:*illegal* scammers (0)

Anonymous Coward | about 6 years ago | (#25323581)

since we're nitpicking here... the dollar sign goes before of the amount, not after.

Re:*illegal* scammers (0)

Anonymous Coward | about 6 years ago | (#25323911)

since we're nitpicking here... the dollar sign goes before of the amount, not after.

Unless you's one o' them thar Europeons. Some of them thar Europeon folks put thar punktuashun in funnee plases.

They shuldun be mekin fun o' us over heer for ower spellin' or nuthin' else no how. They's all laffin' 'bout ower banks collapsin'. Now they got thar banks a' collapsin' too. How'd'ja like them thar apples huh?

Re:*illegal* scammers (3, Insightful)

quizwedge (324481) | about 6 years ago | (#25323559)

Don't forget that it wasn't just the mortgage brokers, but the government requiring banks to loan to people who normally wouldn't qualify for a loan and couldn't afford to pay it back.

Re:*illegal* scammers (2, Interesting)

Anonymous Coward | about 6 years ago | (#25323605)

Don't forget that it wasn't just the mortgage brokers, but the government requiring banks to loan to people who normally wouldn't qualify for a loan and couldn't afford to pay it back.

To solve this mystery, we need to look at who ended up losing money out of the fiasco, and who ended up making money. For example, a lot of people who bought houses have now lost everything. Many people's retirement savings are way down. And a lot of those banking and finance types are still getting millions of dollars in bonuses. So somebody must be making a lot of money out of this. If the ones making lots of money are the same people who are in charge, then it's going to get pretty ugly.

Reserve banks all over the world have slashed interest rates, billions of dollars have been spent on bailout packages, and yet, stock markets keep crashing. Capitalism might be a fine system when it's working well, but when it fails, as it does periodically, large numbers of people suddenly lose a lot of money. You've got to wonder if somebody was able to know when the crash was coming, if they could manipulate events so that they came out of it better off.

Re:*illegal* scammers (0)

Anonymous Coward | about 6 years ago | (#25323765)

Well I think capitalism is not the problem. The capitalists running it are. I would venture to say that the American bailout coming so close to the election, and Paulson not staying on afterwards, is no coincidence.

Re:*illegal* scammers (4, Insightful)

vux984 (928602) | about 6 years ago | (#25323679)

Don't forget that it wasn't just the mortgage brokers, but the government requiring banks to loan to people who normally wouldn't qualify for a loan and couldn't afford to pay it back.

Trotting this out are you?

Its true the government did require to make loans to people who wouldn't otherwise qualify, but that's not really the issue at all. They were forced to assume some extra risk by legislation, any remotely thoughtful person would realize that the banks should have MITIGATED this EXTRA risk, by covering it elsewhere.

To give you an example, if I run a bank, and the government says, you have to lend money to joe, and I know Joe can't afford it, and will probably foreclose, I don't just "do it and blame the government when joe forecloses", I set the interest rate on ALL my customers a little higher to ensure that when Joe forecloses I'm not bankrupt.

Thus the government requiring the banks to lend to people who they would otherwise not to, is no different than any other regulation placed on banks, all of which costs them money to satisfy, and in each case they simply pass the cost onto their customers.

Instead, in this case, they just blindly did it, and worse, they then created mortgage backed securities full of these risky loans and then did the most colossally stupid thing... the thing that caused the REAL collapse of the economy... they LIED about how risky these were, leading them to be GROSSLY overvalued.

Re:*illegal* scammers (4, Insightful)

quizwedge (324481) | about 6 years ago | (#25323837)

I think there's plenty of blame to go around....

I don't think the government should have forced banks to make loans they were pretty sure would fail. Part of that is my belief in limited government; part of that is that it contributed to the housing bubble and all bubbles have to burst.

Fannie Mae and Freddie Mac should never have bought those bad mortgages in droves like they did. Having a flippant attitude of we'll buy up the mortgages and if they fail, well, we'll just get more money from the government was utterly and completely irresponsible.

The banks shouldn't have lied about the risk of the mortgage backed securities. I can't fault them too much for selling off the bad mortgages to Fannie and Freddie. They are a business and their job is to maximize profits. Having the person who made the loan having no interest in if the loan failed or not was stupid for the economy, but that's more or Freddie and Fannie buying the bad mortgages. But you're right, the banks do deserve some of the blame for lying about the securities.

Finally, having bought a house about 10 months ago, I know first hand that there is a lot of paperwork to go through. My wife and I knew what kind of loan we wanted and had done our homework to know what we could afford before we started looking at houses. While it's not popular in an election year to blame the constituency, personal responsibility comes into play. Yes, the people who signed for loans they couldn't afford bear some of the blame as well.

My point is that people are looking for the one "bad guy" to blame. Pointing fingers at one part of the problem while ignoring the rest won't get us out of this mess.

Re:*illegal* scammers (1)

Wildclaw (15718) | about 6 years ago | (#25324035)

What I think the grandparent wants to say is that even though the goverment was wrong in its regulations, the market should be able to route around such damage. The interesting discussion is why the market wasn't able to handle the situation adequatly.

Personally, I am of a very strong opinion that the main fault in the current system is lack of transparency. It is far too easy for companies to hide bad and insecure assets which is highly negative for the market that is supposed to make informed decisions regarding the value of those companies.

Re:*illegal* scammers (1)

jlarocco (851450) | about 6 years ago | (#25323913)

But that's the problem. How do you mitigate the risk of "No chance in hell of ever getting the money back"? Which is basically what the government wanted them to do in many cases. The answer is, you package it up, sell it off to somebody else, and let them worry about it.

I'm not making excuses for the banks, though. As far as I can see, the government, the banks, and the people taking out the crappy loans were all equally responsible. It's a shame they're the ones who will be least hurt by the chaos they've caused.

Re:*illegal* scammers (1)

omeomi (675045) | about 6 years ago | (#25323975)

If somebody takes a loan they can't afford and loses their house to forclosure, it's their own fault. When a bank gives out enough bad loans that the bank goes out of business, it's the bank's fault. But when the entire system goes haywire to the point that people who had nothing to do with it are losing money and jobs, it's the government's fault. Blaim the government. And then go vote in somebody better.

Turd sandwich! (1)

HornWumpus (783565) | about 6 years ago | (#25324317)

No 'Giant Douche'!

Damn it I'm voting 'Used Condom' (libertarian) even thought they nominated a Republican.

Re:*illegal* scammers (2, Funny)

penix1 (722987) | about 6 years ago | (#25323847)

Don't forget that it wasn't just the mortgage brokers, but the government requiring banks to loan to people who normally wouldn't qualify for a loan and couldn't afford to pay it back.

Let's make a deal Monte. I won't blame the banks when they actually eat the losses they incurred. So far they haven't. The executives of AIG (not a bank I know but still part of the Golden Parachute Club (TM)) for example went on a spa trip to the tune of half a million dollars right after getting their corporate welfare check.

Re:*illegal* scammers (1)

tedu_again (980692) | about 6 years ago | (#25324073)

I don't think the words "executives" or "spa trip" mean what you think they mean.

Re:*illegal* scammers (2)

quizwedge (324481) | about 6 years ago | (#25324285)

I agree that the Golden Parachute Club is ridiculous. And for AIG to take that trip, just shoving it in our faces. I think that the execs that take the bailout money should not get their massive severance or salary. My understanding is that the bill that passed at least attempts to limit that. I won't claim to know what the solution is (I've wondered what would happen if we did just let it all come crashing down), but I certainly am not in favor of setting up a system where you get to keep it if you win and get bailed out if you lose.

Re:*illegal* scammers (1)

m.ducharme (1082683) | about 6 years ago | (#25324095)

Wait a minute, the government REQUIRED banks to loan money to bad credit risks? You want to provide a citation for that one?

Re:*illegal* scammers (2, Insightful)

FooAtWFU (699187) | about 6 years ago | (#25323887)

And the government who did their best to subsidize and encourage it!

Remember? It was back in the Clinton era, and there was a Fannie Mae accounting scandal, and in lieu of the serious reforms they were like "oh yeah yeah we'll be Nice instead and try to extend home ownership to even more Americans, even lower-incme ones!" Yay Subprime!

And, of course, bad money drives out the good. We're lucky there were as many responsible or quasi-responsible banks as there were. And three cheers for two candidates (four candidates?) who don't know one thing between them about how to actually manage an economy.*

(* Try not to! Trying to get Reality to conform to your will is likely to make it worse.)

Cyber-vultures. Brilliant. (2)

Samantha Wright (1324923) | about 6 years ago | (#25323169)

So does that make the victims of such scammers cybernetically [answers.com] carrion? As in "brain-dead"? Because that makes way more sense in the face of such a silly buzzword.

But what about the real scam? (5, Insightful)

gillbates (106458) | about 6 years ago | (#25323179)

That allows investment bankers to pawn off responsibility for their misdeeds on the American public?

So I'm supposed to pay an additional $10k in taxes to finance the bad decisions of those who foreclosed on middle class Americans? And if I have to pay it over time (as Congress proposed), I'll end up paying even more (because Congress will borrow money to finance the bailout).

I would say that I've got that money in my 401k, but I doubt it's worth anything now.

I've got a better idea. Start printing money. Yes, devalue the currency to the point where I can settle my mortgage for a few hours worth of work. If bank CEOs can get bonuses for shafting even the Americans who were smart enough to avoid bad lending practices, we should be able to just print the money to pay off our debts.

Re:But what about the real scam? (5, Insightful)

PunkOfLinux (870955) | about 6 years ago | (#25323293)

Yeah, but then your retirement becomes essentially worthless...

It's wrong that we're paying for their mistakes, and we will be paying for that for YEARS to come.

This is not capitalism - by influencing the market (especially so heavily) and giving money to institutions just because they're 'a huge part of the economy' we gave up capitalism. These people fucked up - by the tenets of capitalism, if they can't survive this on their own, LET THEM FAIL. Oh, boo hoo, a tough few years. Better than going even further into debt just to bail out a few rich pricks who made the mistake of doing things where the benefits were far outweighed by the costs and potential risks.

Re:But what about the real scam? (2, Insightful)

qbzzt (11136) | about 6 years ago | (#25323687)

Yeah, but then your retirement becomes essentially worthless..

Your retirement is worthless. We aren't raising enough kids, so the economy won't be able to support us retiring.

Re:But what about the real scam? (1)

PunkOfLinux (870955) | about 6 years ago | (#25323881)

That's what socking money for retirement is aimed at - self-sufficiency.

Retirement (1)

qbzzt (11136) | about 6 years ago | (#25324227)

That's what socking money for retirement is aimed at - self-sufficiency.

It only works if enough people are producing what you need, so that you can buy it with your stashed money.

If not, then the stuff you need will rise in price, making your stash worth less (= inflation). Presumably this will cause retirees to get back to work, until the system equalizes.

Re:But what about the real scam? (1)

Wildclaw (15718) | about 6 years ago | (#25323951)

Which is the whole point of working and creating more efficent factories so you need less kids to support you. Of course, that only works when you

* Are actually concerned about increasing efficency and not about how to best fool other consumers into buying vanity toys and consumption services.
* Allow ordinary workers to get a decent share of the products produced.
* Actually have workers and the country save and invest in improvements.

Re:But what about the real scam? (1)

qbzzt (11136) | about 6 years ago | (#25324235)

If we were willing to accept the standard of living of our grandparents, we could probably have an average work week for 10 hours.

But most of us are not, we like our toys too much.

Re:But what about the real scam? (1)

minus-sign (1371393) | about 6 years ago | (#25323893)

Every time I hear about the financial crisis I think of the CarMax commercial. Don't know if you've seen it but there's a guy sitting behind a desk, not even looking as his little rubber stamp thumps down rhythmically to his mellow voice mumbling "approved, approved, approved, approved" as one loan application after another whisks by. The problem is less to do with the few "rich pricks" that might take a short walk out their 20 story window when the market implodes. I agree that the credit institution is passed the point of "out of control"; that they have inflated house prices to the point where no one can afford the American dream if they don't sell their soul--well, lease--to creditors. This country lives on credit nowadays. It seems like the vast majority of our population has forgotten how to save. Instant gratification; its the next big killer behind obesity and smoking. Which makes it all that much more unfortunate that I, you, and a lot of taxpayers are going to end up paying for someone else's house because they could and were encouraged to borrow beyond their means. Those are the idiots tax payers will be bailing out in the long run. Now...is the answer going to be found by a bunch of professional politicians who wouldn't know a payroll from a pig in a poke? No. Let me be clear: H-E-double-hockey-sticks NO. But an election year has a tendency to get the wrong spoons stirring the soup. Those loans should have defaulted. No one living in a doublewide trailer needs a H2. When they reach that point where they just can't pay anymore, then...they should lose that H2 or (if they really want it that bad) live in it. But nobody really wants to hear that kind of talk.

Re:But what about the real scam? (1)

PunkOfLinux (870955) | about 6 years ago | (#25324067)

I really think it's wrong to blame the people who took out the loans. Yeah, they did some bad stuff when they got loans they couldn't afford, but look at the climate around them. Easy credit, a 'buy now!' economy, and outright deception by the lenders all led to their action. Should they be punished? Yes. Should those responsible for the conditions that led to this be punished? Even more.

Yeah, sure, people got mortgages they couldn't afford - it happens all the time; it's just that now, with the combination of their stupidity biting them in the ass, and the sale of securities backed by useless mortgages, the financial institutions are totally boned. Problem is, they could have VERY easily avoided this. Their own greed led to this - let it be their end.

Why are we bailing them out? So they can stick three more cocks up our ass? I mean, mine's already sore...

Re:But what about the real scam? (1)

FooAtWFU (699187) | about 6 years ago | (#25323917)

This is not capitalism - by influencing the market (especially so heavily) and giving money to institutions just because they're 'a huge part of the economy' we gave up capitalism.

We messed up before that - when the government decided that they wanted Fannie Mae to subsidize home ownership for all sorts of people, even lower-income types. Remember those good old intelligent progressive Clinton-era policymakers? And bad money drives out the good. We're just lucky more banks weren't overzealously subprime.

So our solution to a government-market-intervention failure is MORE INTERVENTION! Yay us! P.S. Obama will make everything better with his anti-free-trade policies and assorted miscellaneous subsidies to politically favored industries and assorted other intervention! (Alternatively, McCain will make it all better with... i got nothin', sorry.)

Re:But what about the real scam? (5, Interesting)

Quasar1999 (520073) | about 6 years ago | (#25323339)

I was going to mod you, but I couldn't find '+1 really bitter but ultimately on to something'.

Sadly your idea of printing money to devalue it to the point where you can easily pay off your debts would work, but only if the US was self-sustaining, which it isn't. And I doubt you'd get the Chinese to agree to devaluing the US Dollar much more, they seem to have a very large amount of US dollars in their hands... some sort of insane trade deficit? They'd probably invade the US to over-throw the government and attempt to stop the devaluation of the currency (and their investment). Somehow I see world war 3 coming out of this royal fuck up by the US.

It's times like these I'm so happy to live in Canada, and look forward to enjoying the nuclear winter that's inevitibly coming sooner rather than later.

Re:But what about the real scam? (1)

slashtivus (1162793) | about 6 years ago | (#25323571)

I'm not trolling you, but you do realize that economically the US and CA are very much tied to one another? You don't have to like it, but it really is the truth: If the US crashes so do you.

Re:But what about the real scam? (1, Funny)

Anonymous Coward | about 6 years ago | (#25323829)

The difference is that we're hearty lumberjacks that can survive the rough cold wilderness with nothing more than our bare hands, while the U.S. is mostly a bunch of pussies that would assume the fetal position if they missed an episode of American Idol.

Re:But what about the real scam? (3, Funny)

jagdish (981925) | about 6 years ago | (#25324225)

The difference is that we're hearty lumberjacks ...

So you sleep all night and work all day?

Re:But what about the real scam? (1)

Quasar1999 (520073) | about 6 years ago | (#25323897)

30% of our economy is directly tied to US importing our goods. However, most of our product is raw natural resources, which there always will be a demand for. That said, the US economy crashing and burning will take us down a ways, but not as far as you'd think.

Re:But what about the real scam? (2, Interesting)

IanHurst (979275) | about 6 years ago | (#25324019)

I don't want to knock Canada, cause I think you guys are pretty cool, but you understand, when the largest economy in the world crashes, natural resource prices go along with it.

The other thing is while Canada is loaded with natural resources, so is the USA. In the nightmare world where the USA runs out of better ways to make money, it will turn to natural resource extraction too, and that is not going to have a good effect on Canada's extraction industry.

Again, not knocking Canada - great country, great people. But our fates are tied. Usually that's pretty cool, and sometimes, like now, it the pits.

Re:But what about the real scam? (0)

Anonymous Coward | about 6 years ago | (#25323999)

I was reading the Canadian magazine Macleans coming back from Toronto the other day. Their (Canada's) economy is doing rather well right now. Their government didn't let homebuyers get into the crap they did like here in the US. No "$0 down, variable rate!" crap. And they're a very resource rich nation which helps considerably. About the only sector of their economy hurting is the automotive industry because they sell lots to the US.

ps: I was in Toronto looking at houses :)

Yeah sure. (1)

jotaeleemeese (303437) | about 6 years ago | (#25323669)

China invading to stop the dollar losing value.

The Canadian pot is obviously top drawer quality.

Re:But what about the real scam? (-1, Troll)

HornWumpus (783565) | about 6 years ago | (#25323711)

The Chinese can pound sand. We'd still wipe them out in a shooting war and they know it. In 10 years it will all be over, 15 at the outside. Baby boom retires, taps retirement, print still more money, dollar and euro are done. Inevitable.

Do you really believe we ever intended for the Chinese to collect on the dollars. The fucking Arabs?

Do you believe in the SS trust fund as well.

Easter bunny?

It's not so much that 'they' did it on purpose, it's just that once running there was nothing to be done but hang on.

Buy land, seeds, guns and ammo cause Darwin is going to come knocking for the slow and trusting. Real assets are the only hard currency left.

This will be the first mega inflationary cycle with internet. Perhaps a new independent hard currency can save us but I doubt it.

Re:But what about the real scam? (1)

Ravon Rodriguez (1074038) | about 6 years ago | (#25323773)

Real assets are the only hard currency left.

>
Not true, once the dollar is valueless, gold will be the currency to own

Re:But what about the real scam? (1)

HornWumpus (783565) | about 6 years ago | (#25323933)

Gold is a real asset.

If you can hold it, fire it, drive it, farm it or work it then it's a real asset.

Currency is too useful, a new reserve currency will arise.

Re:But what about the real scam? (0)

Anonymous Coward | about 6 years ago | (#25323957)

Real assets are the only hard currency left.

>

Not true, once the dollar is valueless, gold will be the currency to own

You're not real bright there are you sonny boy? Did you look at what the parent poster said to buy?

If things go to hell in a handbasket I'm sure you'll enjoy having your gold... right up until the point where someone decides it is their gold instead of yours.

Things get real bad then gold won't matter one fucking bit for a good, long time.

Re:But what about the real scam? (1)

smallfries (601545) | about 6 years ago | (#25323891)

Who is holding all your debt right now (and they got nukes, so it counts)?

Re:But what about the real scam? (5, Insightful)

Maudib (223520) | about 6 years ago | (#25323899)

While things are certainly going to be bad you have badly misread what is happening.

(1) The liquidity crisis is actually preventing inflation and there is a good chance that we could even witness some deflation if things don't change. Economic downturns are not necessarily couple with inflation, in fact we could even see deflation during this recession.

(2) Treasuries (U.S. Debt) have become even more valuable. Yields are almost effectively zero while prices are sky high. This is because everyone is so afraid of the markets that they are running to pick up the safest instrument available: U.S. debt. You really think China or anyone else will dump treasuries? Where would they put the money? Europe? China? Russia? Europe is as screwed as we are while Russia and China are even worse.

(3) The U.S. Dollar has actually been gaining value lately, likely due to point #2.

(4) "Buy land, seeds, guns and ammo cause Darwin is going to come knocking for the slow and trusting. Real assets are the only hard currency left." This is a nonsensical point. In order for "Real Assets" to trump cash it is likely that we would need a total failure in the rule of law, at which point having bought land or seeds would be meaningless as anyone with a gun would simply take them. Logic points to a couple years of slow or negative growth, not the collapse of society. I bet you spent Y2K in a basement.

You can have your land and seeds, I am going to start accumulating value stocks at all time lows.

Re:But what about the real scam? (1)

HornWumpus (783565) | about 6 years ago | (#25324023)

Reading long term dollar stability into the current treasury price is silly.

What I see is a panicky mob stampeding into treasuries as that's the only 'safe' place left to park capital.

This supply/demand imbalance is driving yields to zero. But that's a fickle crowd and they are mostly buying short term treasuries (yield curve etc.)

Treasuries aren't if fact making anywhere close to real inflation (CPI calculation methods etc. I'm sure this is old ground for you to.)

Let's just hope treasuries aren't allowed to be the next bubble. That's the one with teeth. The one that wrecks the dollar.

The SS trust fund train wreck if not sooner. Do you really think the Chinese won't at some point stop buying up all those Treasuries? IIRC 2015 China is China's biggest market, 2017 SS Trust fund 0 point (where it's supposed to be maxed out and start generating payments). The Chinese bankers know these projected dates (or better ones).

Land and guns are always good to own. Especially now you can't go wrong if you can pull it off.

I spent Y2K drunk as a skunk but not worrying. Where are we?

Pacific rim value stocks at all time lows.

Re:But what about the real scam? (1)

Maudib (223520) | about 6 years ago | (#25324117)

Well on the subject of Social Security, thats one place where I give a degree of respect to the "Starve the beast" argument. The baby boomers got us into this, if SS goes tits up then I am ok with that- we can just cut benefits. Its not that I want seniors to starve, I just don't think that they are entitled to more then cat food given the mess they have given us. It won't even require legislation to do, we will just re-rig the CPI and let inflation over a few years take care of the rest.

"But that's a fickle crowd and they are mostly buying short term treasuries"

The treasury bubble dooms day scenario requires the collapse of government, at which point we are all dead anyway. \\

"Land and guns are always good to own."

Tell that to the people that bought land anytime in the last 7 years.

Re:But what about the real scam? (1)

Detritus (11846) | about 6 years ago | (#25324249)

Don't blame the baby boomers for the Social Security mess. It was doomed as soon as Congress discovered that they could buy votes by increasing the benefits. This started before the baby boomers were even born. That's why you should never leave a politician and a bag of money alone in the same room. They just can't help themselves, that money is whispering "spend me, big boy".

Re:But what about the real scam? (1)

qbzzt (11136) | about 6 years ago | (#25323715)

They'd probably invade the US to over-throw the government and attempt to stop the devaluation of the currency (and their investment). Somehow I see world war 3 coming out of this royal fuck up by the US.

China doesn't have the navy to invade the US. It may or may not be able to nuke the US, but if it does, their investment in Chinese cities will be devalued.

Our (I'm in the US) standard of living will probably drop, once we can't buy valuable stuff from China for dollars is doesn't cost us anything to produce. But it won't be apocalyptic.

Bad spending and bad lending. (4, Insightful)

EmbeddedJanitor (597831) | about 6 years ago | (#25323431)

America as a whole, citizens and government, have a "charge it" mentality.

Government don't want to tighten their belts because that's an instant turn off to the voters. Nope, rather rack up more debt and hope that you die or leave office before the shit hits the fan.

Re:Bad spending and bad lending. (0)

XMode (252740) | about 6 years ago | (#25323501)

If the shit hasn't already actually hit the fan, its now so close that its stench is getting blown around for all..

Re:But what about the real scam? (5, Insightful)

Maudib (223520) | about 6 years ago | (#25323815)

The bailout isn't a bailout. The bankers who screwed up are for the most part being wiped out, along with the investors. Please see AIG, LEH and BS stock prices and you will see that the company owners and the company employees are being entirely wiped out. The "bailout" is preventing the guys who screwed up and are wiped out from wiping out everyone else. Its about liquidity and fear. Good companies are being destroyed due to too much fear and too little liquidity. It isn't a lie when the Fed says that most of what will be bought with the $700 million will be good or profitable. So the feds loose a couple hundred mil on this. Several trillions are being wiped out every week in the stock market.

Re:But what about the real scam? (1)

jank1887 (815982) | about 6 years ago | (#25323983)

It's all about too little liquidity. But where did their money go? It went into the Mark-to-Market system, or at least got tied up in the related regulations.

Basically, these banks have tons of cash tied up in different types of loans, which have a certain estimated street value. Then *BAM*, bank X finds out it overvalued a bunch of those loans because the risk was MUCH MUCH higher than it had either pretended or been made to believe. All of a sudden Bank X more-or-less goes out of business because of that major cock-up.

Now for the kicker. Bank X just had to devalue tons of 'loan assets'. They're having a fire sale on derivatives. This becomes a huge problem for Banks A, B, C, W, Y, and Z. Why? Because they have a lot of similar loan assets, which might or might not have been similarly overvalued (or under-risk-assessed). According to SEC Mark-to-Market regulations, these banks have to set aside enough cash to cover the difference between their assets' "fair market value" and Bank X's "going out of business sale" rock bottom prices, whether or not those items were actually improperly valued.

All of a sudden, all that money that these banks would have been lending to each other and to businesses gets locked down by the accounting system. Hence, a lack of banking liquidity, and there's the mess we're in.

So, when they talk about all this bailout money to 'buy troubled assets', they're referring to the bank assets that are currently tying up the banks' lend-able cash reserves. Taxpayers buy them, and some of them may be perfectly good assets. Some might be crap.

Some people suggest the SEC should relax the mark-to-market reserve regulation. not sure I completely support that. It's there to do what it is doing now, prevent banks from giving away all of their cash reserves to the point where they can't make good on loans that go bad. There could be a lot of loans going bad, but it's hard to tell when and how many really are bad. Getting rid of mark-to-market would allow even the 'good banks' to drive themselves out of business. if that happened en masse, it would be like a nuclear event hitting wall street instead of just the current quagmire.

I would just like to know more about how all of these loan and derivative or hedge assets are valued in the first place. Is it that hard to re-rate all of these loan products that were sold as lower risk than they really were? There seems to be this persistent uncertainty about banks not being sure which assets are good and which are fool's gold.

Re:But what about the real scam? (1)

Maudib (223520) | about 6 years ago | (#25324319)

Well what you describe is only part of the problem though. The 700billion is supposed to offset the damange of mark to market, but banks still aren't lending. They have the money, but they are charging a premium for it to other banks. This lockup is totally fear oriented, no one wants to be the first to lend overnight.

I abhor the idea of the treasury buying a bank to get around this, but as a threat it is a good play. Banks can start lending again or play Russian roulette and risk being nationalized. This is such a cock-up, its unreal.

Re:But what about the real scam? (1)

jank1887 (815982) | about 6 years ago | (#25324381)

really? they have the money?

The bill was just approved and signed last week. Please show me anything that says money has left the gov't coffers yet. Banks still can't lend if all their cash is tied up with mark-to-market.

Re:But what about the real scam? (1)

Fluffeh (1273756) | about 6 years ago | (#25323841)

It would all be funny and right in your post, if your country (or any for that matter) could continue to exist without a banking and finance group. If any other sector that wasn't needed made such a monumental cockup it would simply self implode and everyone would be "sorry about that mishap, but lets move on". Because however that banking (and insurance, and healthcare and other such operations) are so vital for a country, yes, you do have to cover for their mistakes with your taxes. If you don't it will be much worse.

Should the managers and bankers that allowed it to get to this level be punished? Certainly. In Australia when we had a major insurance company meltdown [independent.co.uk] we put the blighter in jail for it. If I were American, I would be expecting the prison population to be filled up with bankers and lenders in the near future.

Re:But what about the real scam? (1)

Detritus (11846) | about 6 years ago | (#25324357)

Lots of ordinary Americans benefited from the real-estate bubble, not just the obvious scammers and thieves. Think of all the people who sold their houses at greatly inflated prices. Think of all the people who have been "livin' large" by cashing out the equity in their houses. How do you recover that money? You can't. Some people profited and society at large gets stuck with the bill when the bubble bursts.

not just phishing mails.. (5, Funny)

owlnation (858981) | about 6 years ago | (#25323193)

Also, look out for legitimate emails from banks -- they are probably being sent by scammers too.

Yep. (5, Funny)

Shadow Wrought (586631) | about 6 years ago | (#25323195)

One of the scammers was so brazen he came right to my doorstep! Said he needed a "contribution" so he could "go to Washington" and "fix this mess."
Yeah, right! I fell for that one four years ago!

Re:Yep. (2, Insightful)

TubeSteak (669689) | about 6 years ago | (#25323297)

One of the scammers was so brazen he came right to my doorstep! Said he needed a "contribution" so he could "go to Washington" and "fix this mess."
Yeah, right! I fell for that one four years ago!

We call those guys "incumbents"
Your default position this election season should be not voting for them.

Don't listen to campaign promises, look at the incumbent's voting history.

Re:Yep. (-1, Troll)

Anonymous Coward | about 6 years ago | (#25323453)

I know it!

He said, "Vote for Obama! Let's make sure the Government gets back into the black!"

Or something like that.

Re:Yep. (-1, Troll)

ZonkerWilliam (953437) | about 6 years ago | (#25323557)

So the last guy you gave contribution to didn't make it either, huh?

A solution to the financial crisis (2, Funny)

igny (716218) | about 6 years ago | (#25323211)

Paulson's plan is nothing. Throwing $700bln into the financial system... pfft. I am willing to negotiate my plan with Bush and his administration. All I have to do is to realize my loss, and all the stocks will rally to the sky. It will also solve bankruptcy of several big corporations in which I have big (err, now small) positions. I have done so many times in the past, I single-handedly stopped dot-com collapse, helped to avoid a complete meltdown after 9/11, last fall I helped Dow to regain $14k. Unfortunately I have decided to invest a lot in May 2008 again and doubled down just recently. Now the market awaits for me to close all my positions.

Scammers? (2, Funny)

iminplaya (723125) | about 6 years ago | (#25323233)

Hell, the elections bring 'em out every two years.

Bringing out Scammers?? (5, Insightful)

arthurpaliden (939626) | about 6 years ago | (#25323275)

Hell, it was started by scamers, they wore three piece suits but they were still scammers.

Re:Bringing out Scammers?? (1)

carlzum (832868) | about 6 years ago | (#25323947)

Dear Investment Bank,

I am the victim of a terrible phishing scam. Over the past few years I've deposited 10% of my earnings into an account the scammers claimed was managed by your company. But when I checked my balance last week I discovered they had made off with my money.

It's a sophisticated operation with hundreds, possibly thousands, of people posing as customer service agents and financial advisers. They have 800 numbers, mail quarterly statements, and run a very legitimate looking website.

Please help me track down these parasites and recover my money. My wife and I were depending on that money to buy food and medicine when we retire.

Sincerely,
Every American with a 401K

Bernanke (4, Funny)

areusche (1297613) | about 6 years ago | (#25323281)

Dear BENJAMIN BERNANKE,

I am the Chairmen of the Nigerian Treasury. I have recently come into the possession of inheritance from the Esteemed Master Defenestrator . Unfortunately I cannot use take possession of his honorableness's inheritance locally. I therefore must move it into a foreign account. For the sum of 700 (SEVEN HUNDRED) BILLION UNITED STATES DOLLARS (USD$) I can deposit this into your banking reserve system. You may keep 15% (fifteen percent) of the total amount for your troubles.

We look forward to your correspondence. Please make your time.

Sincerly,

Chuck Norris

Make it an even trillion! (5, Funny)

Anonymous Coward | about 6 years ago | (#25323403)

Dear Mr. Norris,

Why don't we make it an even $1,000,000,000,000 (ONE TRILLION) dollars [politico.com] ? We can use the extra $300,000,000,000 (THREE HUNDRED BILLION) dollars to buy up mortgages so that taxpayers lose money when the loans default, instead of the banks. My economists are convinced that it's a great way to prove that I'm actually a Socialist who understands the economy so that those loony liberals elect me instead of that one.

I look forward to your reply, my friends.

Sincerely,

John Sidney McCain

Loving it! (1, Funny)

Anonymous Coward | about 6 years ago | (#25323303)

That's right everyone! Keep pointing the finger and making accusations that you can't back up. The Republicans and Democrats love you keep you small minded fucks bickering and buying into their bullshit. If we could have Photobucket images on here most of these posts would look like campaign posters for dumb and dumber.

Dagnabit (2)

the eric conspiracy (20178) | about 6 years ago | (#25323385)

There goes my strategy for recovering my stock market losses!

Of course, it was caused by scammers. (0, Flamebait)

jcr (53032) | about 6 years ago | (#25323539)

As long as we put up with fiat currency, this kind of thing is bound to happen over and over.

-jcr

That has nothing to do with the problem. (1)

jotaeleemeese (303437) | about 6 years ago | (#25323693)

The problem is lack of regulation of complex financial instruments and how political campaigns are financed in the US.

The corrupt lobbying of US politicians ensures that regulation is as light as possible.

does too (1)

rubycodez (864176) | about 6 years ago | (#25323793)

money created from debt is the problem, our particular type of fiat currency has that problem too. a pyramid scheme to create increased debt is required for the system to function

Re:does too (1)

Wildclaw (15718) | about 6 years ago | (#25324179)

Another viewer of "Money as Debt" that has fallen for the deceptive lies that is packaged among the truth.

Debt is not a problem per se. Claims that you can't repay all loans because there isn't enough money is false. It is a complete misconception of how money flows, neglecting to take into account that banks themselves also buy services and products, invest in stuff and occasionally deal with bad investments.

Sure, if banks were to just sit on all money they get from interest, then it would indeed be troublesome. But that is a basic result of bad money circulation which would only hurt the banks in the long run.

What is dangerous is bad debt as in bad investments. As long as most debt is in solid investments, debt is not bad. Of course, most people have a misconception of what good investments are. A luxury house is not a good investment. It is a consumption item. Same with an SUV for most people. A smaller house however is an investment as it makes your life much better at a good cost/benefit ratio, allowing you the ability to work somewhere. Same with a smaller car that allows you to be more efficent at transporting yourself and your family around. Credit Card debt and other smaller debts are pretty much bad all around except for the occasional emergency.

Re:That has nothing to do with the problem. (0, Flamebait)

Mesa MIke (1193721) | about 6 years ago | (#25323963)

Seems more like it's too much regulation that's caused the problem.
Banks were basically forced by regulation to lend money to people who wouldn't qualify, absent the coercion.

Re:That has nothing to do with the problem. (1)

SpaceLifeForm (228190) | about 6 years ago | (#25324337)

You are an idiot. Please go fuck the reicht-wing talking point you rode in on.

Re:Of course, it was caused by scammers. (5, Funny)

Konster (252488) | about 6 years ago | (#25323763)

Always a bad move basing a currency upon poorly made Italian cars.

Re:Of course, it was caused by scammers. (1)

p0tat03 (985078) | about 6 years ago | (#25324261)

Fiat currencies haven't caused our problems. Rampant speculation on the housing market has. Let's not forget the Tulip Mania a few hundred years ago (when currency was gold-backed!) that resulted in much the same thing.

The problem is a lot of people took on a lot of big risks, and they lost. And now the taxpayer is on the hook.

The problem is also because we *all* started believing the same lie: that there is a free lunch. We all started buying up house after house, stretching ourselves thin with impossibly large mortgages, in the hope that we can score a quick buck by flipping it later. Nobody ever thought about the fact that there's *no value being created* anywhere in the system to justify rising house prices. Nothing.

People used to invest in things that have real value. You invest in a company because they create a compelling product that people will buy. But of course, nowadays (especially if you look at the tech industry), companies with no discernible profitability, or products of questionable usefulness, are still getting funded because of boneheaded investors who are not interested in long term growth, but rather their exit strategy.

Like the housing bubble that's killing us right now, the tech bubble will soon burst. Get your money out of the markets now, or at least into companies that create actual products with actual demand.

hmmmmmm (4, Insightful)

qzulla (600807) | about 6 years ago | (#25323587)

From TFA:

Perhaps the concern is unfounded as this PC World article notes. The article states that more than half of us are deleting messages from banks and financial institutions without even thinking twice. Experts say recipients who receive these e-mails believe that all the messages are part of phishing e-mail scams.

So more than half of the 16 bazillion people are ignoring them?

My guess is that five bazillon are responding.

Think about that.

Fake numbers but you get my point.

qz

Re:hmmmmmm (1)

zippthorne (748122) | about 6 years ago | (#25323811)

I don't see you think you need a disclaimer that a "bazillion" is anything but a fake number.

Oh... I see what you're saying....

My SOP for Bank E-mails (4, Informative)

istartedi (132515) | about 6 years ago | (#25323959)

1. Delete e-mail.

2. Log in to bank via their web site.

What scares me is that while this guards against the garden variety phishing attack, it can't protect me from an ISP DNS compromise. Running *NIX on your home PC or using a Mac can't protect you from that either, so don't get smug. It's a good idea to find an "obscure" yet stable feature on your bank's site. Phishing sites may not take the time to duplicate it. If you know the bank is based in New York, and you traceroute it to Bulgaria, that's a bad sign too. I have to admit I'm not that paranoid though.

At the very least, 1 and 2 should be SOP for everybody. Financial institutions shouldn't put any kind of hypertext in a mail, and really ought not to even be using HTML mail which was evil right from its inception. I can dream, can't I?

Re:My SOP for Bank E-mails (1)

arthurpaliden (939626) | about 6 years ago | (#25324061)

Ignore the email. If you really have a problem the bank will freeze your account and phone you to come into the nearest branch and deal with the problem there.

LOL!!! Truth stranger than scammers. (2, Funny)

danwarne (545932) | about 6 years ago | (#25324009)

"I run a merchant bank that went bankrupt and have recently come into possession of $900 billion in US treasury funds......"

Correlating Gov't announcments and the Market... (4, Funny)

NotQuiteReal (608241) | about 6 years ago | (#25324039)

It seems like the biggest scam does start with line "I'm from the government and I'm here to help."

Just like after Katrina, etc (1)

Haoie (1277294) | about 6 years ago | (#25324059)

Except with different motivations. This is still about greed.

What keeps spammers away? (0)

Anonymous Coward | about 6 years ago | (#25324105)

Is there anything that won't bring out the spammers?

My webmaster@(Site).com address... (0)

Anonymous Coward | about 6 years ago | (#25324293)

Has gotten the snot beaten out of it recently by phishers.

First, as a small site owner, I was spoiled by not having to do any complicated email setup. That came to bite me back in the ass, as I had never set up an SPF record or domainkeys support. So, as you might guess, I got a joe-job pulled on me. All of the sudden I'm inundated with bounceback and angry emails from people who think I'm trying to rip them off. Publishing an SPF record quickly solved that problem.

However, now I'm getting about 20 phish emails a day, half are for Wachovia telling people they will lose their money in the merger if they don't install updated sercurity certificates on their computer. I heuristic scanned the EXE from the site and it looks like it's a worm that mass mails itself after setting itself up in the winsock and blocking several antivirus sites (it attempts to also block update.microsoft.com via the HOSTS file- which, to my understanding, Windows won't obey anyways...)

I keep putting the URLs on PhishTank, but it's scary as an actual Wachovia customer (I never gave Wachovia my email address or mentioned anywhere where my email alias is used that I bank there). Still, it's good; it keeps me paranoid. I recognize the fakes going around quickly and, when in doubt, I visit the site directly via HTTPS and login, so I guess every cloud has a silver lining.
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