9. Middlemen Mortgage Brokers
I want to buy a house, but I
do not have any money to
make down payment nor I can Sure, I can help you get a
pay regular installments for loan a loan for your new
loan. Can you help me ?? house…
Mortgage
Broker
10. Middlemen Mortgage Brokers
Since the value of the new house you will buy, will
always go up in the future, you need not make any
down payment. Moreover, initially you will need to pay
very low rate of interest on the loan taken which will
be increased in the future.
Sub prime Mortgage
Borrower Broker
11. Middlemen Mortgage Brokers
Why shouldn’t I get you a loan ? The
actually loan will be given by a bank and
You guys are awesome. I will get my commission on it. I don’t
Are you really willing to care whether you pay back or not.
get me a loan for
buying a new house..?
Sub prime Mortgage
Borrower Broker
13. BANK FOR ALL
We should get rid of these
crappy loans quickly. They are
Do you think they
just stinking get us
can really our office. What do
you suggest?
out of trouble ?
Yes Sir!! They can. They are from the top
We can take help from
league business schools of the world. They
the REALLY SMART
are really smart. We will sell these loans
guys at Wall
to them and they will perform some
Street, New York.
financial magic on these loans.
MANAGER
15. “ Really Smart” Investment bankers
Pheww..!! We shall get rid of these bad
loans as soon as possible. They are just
stinking our office badly
They are just
useless.
Smart Guy Subordinate
16. “ Really Smart” Investment bankers
I have got an idea…
We will create a new security and use these
crappy mortgages as collateral. We will call
it a CDO. We can sell those CDO’s to
investors and promise them t pay back as
mortgages are paid off. I am “Really Smart”.
But, crap is a
crap. I don’t get it.
Let me explain it
to you.
Smart Guy Subordinate
17. “ Really Smart” Investment bankers
Individually these are a bunch of crappy
loans. But, if we pool them together,
then only a few of them are expected to
go bad-NOT ALL. And since housing
prices will continue to go up in the
future, we have little to worry about.
I know it.
Boss, you are “Really
Smart.”
TUSSI GREAT HO..!!
Smart Guy Subordinate
18. “ Really Smart” Investment bankers
So, you have managed to
create AAA and BBB securities
We will also go ahead to buy insurance
out of a pile of stinky, risky
for these securities. By this, the rating
mortgage loans.
agencies will give a “very good” rating Boss, you are a genius…
for these securities.
Smart Guy Subordinate
19. “ Really Smart” Investment bankers
No. To get rid of this, we will create a
shell company in the Hululu islands. We This is all great. But, won’t we
will transfer all such mortgage loans in have to show all these crappy
the balance sheet of that shell company. mortgages used as a collateral
in our balance sheet??
The fancy name for it will be “Special
Purpose Vehicle.”
Smart Guy Subordinate
20. “ Really Smart” Investment bankers
To insurance companies, banks, small Okay, and who are we going to
towns in Norway, school boards in sell these securities to ?
Kansas – to anyone who is looking for a
high quality and safe investment.
Smart Guy Subordinate
22. Consumer Grievance Agency
Sir, I request you to order the security
issuing companies to show greater
transparency regarding their financial
reporting
23. Hey man… we are not receiving our
monthly payments.