Poll Question: Does The US Media Play It Straight With The Public?

The reason that I ask this question is that I've been following HR3915 fairly closely as it went through the House Financial Services Committee and have read up fairly well on how this whole sub-prime mortgage fiasco has come about.  In following this bill and reading up on this mess, I've done quite a bit of reading, as well as watching news and business news reports on the "crises"!  In all of this reading and watching, I've only heard an occasional murmur about the roll that Wall Street has played in this mess.

While Barney Frank, who if you watch as he chairs the Financial Services Committee comes across as rude, arrogant and either not very well educated on this particular issue or bought and paid for by the banking industry, rants about the evils of mortgage brokers, the true villains in this melodrama slink off with hardly a mention.  

The fact of the matter is that sub-prime mortgages weren't the cause of this "crises".  In and of themselves, there is nothing evil, immoral or wrong about sub-prime mortgages as long as everybody involved knows what they are getting into.

If the Borrower has been properly disclosed to, the loan was processed per the program guild lines and the guidance provided by the lenders who were purchasing these mortgages and the investors who bought these mortgages were property educated as to what the risks involved in investing in these types of investments, then there shouldn't be a problem.

The reason that there was a problem is that the system broke down.  Not at the originations stage, but rather at the stage where the big Wall Street companies such as Merrill Lynch, Bear and Sterns, etc. etc. pooled these mortgages together along with other non-conforming mortgages and sold these "CDO's" to investors as something that they were not.  In essence, they put make up on a pig and the Wall Street investors who bought these instruments were all to eager to dance with the made up pig!

Anybody with any knowledge and sense about them should have been able to tell that a 100%LTV Stated Income Loan to a borrower with a 580 credit score shouldn't have been anywhere close to a investment vehicle rated AAA+!  The fact that rating agencies such as Moody's and Standard and Poors rated these CDO's as investment grade is where I feel the crime was commented.  If there needs to be a new law, maybe that law should address these Wall Street Issues!

So, back to my original question;  Does The US Media Play It Straight With The Public?  I don't think so.  You can't tell me that they can't look at this situation and come to similar conclusions than I am.  Why hasn't the role of Wall Street in this mess been reported on to a greater degree?  Does it have something to do with the fact that CBS is owned by a large media conglomerate, as is NBC and ABC?  Honestly, I think so.  

Let me know what you think.  I'll keep a tally and update it from time to time.

Bob Mitchell

ValueList Real Estate Services, Inc.