according to one of the people interviewed in the documentary entitled- "Fall Of The Republic".
You can 'Google' this- YOUTUBE FALL OF THE REPUBLIC, and watch it on the web. Make sure to listen to what the people in that documentary said about the banking system in the USA.
*It basically boils down to this-
A group of people decided to 'trick', 'deceive', & 'manipulate', the masses of Americans into buying and re-financing homes after the FED lowered the rate to 1% back in 2003. The interest rate was manipulated in order to 'lure' Americans into taking the 'bait'. Millions took the bait and found out that all of those ARM's and 'Interest Only Mortgages' weren't what they had expected.
However, the 'big-shots' were all making millions upon millions of dollars because they were bundling and selling all of these mortgages to investors all over the world. Many of the banks, like Bank of America, Wells Fargo, & others, fell prey to the massive fraud and invested in these securities as well.
Guess what?
Millions upon millions of people began to realize that they couldn't afford their new payment, and MILLIONS upon MILLIONS of foreclosures started to take place. Those foreclosures were also the root of the massive JOB LOSSES in this country, and it eventually trickled down to the entire economy. Now there are people who never took out an ARM or an 'Adjustable Rate Mortgage' that are losing their jobs as well and they're being forced into foreclosure.
All of those job losses did damage to the credit card industry because people could no longer afford to pay that bill each month. When people lose their jobs, they can't afford to pay their school loans, credit card bills, car loans, & other loans that eventually go to the BANKS. The banks are now in a position to do whatever they can to stay afloat.
That's WHY so many consumers are experiencing problems because the banks are TARGETING as many consumers as possible.
The housing industry is the FOUNDATION of America and its economy. The foundation is now broken. Nothing is going to fix it because once a foundation is broken the rest of the house eventually falls apart.
Starting in 1994 the Federal Reserve was given more authority to oversee the mortgage industry in this country. That was a BIG mistake. Now the USA is in deep trouble because of what took place and jobs are not being created.
The politicians don't know what to do. The economists don't know what to do. The FED doesn't know what to do. They're hoping, wishing, & waiting for things to get better.
Guess what?
Things are not going to get better, in my opinion.
WELCOME TO THE U.S. ECONOMY- ONE TOXIC MESS
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