ForclosureGate (circa 2010 forward): Widespread mortgage fraud as a result of an unregulated, rigged housing market guaranteed to create a collapse and waves of foreclosures, all of which leads to major hardship for homeowners and their families.
(Washington, DC) Wall Street created the subprime mortgage crisis leading to the 2008 financial meltdown and ongoing recession. That cost trillions in homeowner net worth, near depression era unemployment levels, and a relentless struggle for the people. As a reward for their greed and incompetence, the authors of the financial crisis got trillions in Federal subsidies to stay afloat, receive huge bonuses, and plot to do it all over again. Goldman alumnus and foreclosure machine maestro Steven Mnuchin is set to usher in a new golden era for Wall Street greed as Donald Trump's Secretary of the Treasury. (Image)
Donald J. Trump is the first major party candidate to run for president of the United States using populist rhetoric since William Jennings Bryan in 1896. Just enough of the public craved payback for 2008 financial meltdown to give billionaire populist Trump the edge in that anachronism known as the Electoral College.
Trump repeatedly promised to drain the swamp in the nation's capital and remove insiders, special interests, and the usual suspects that serve themselves so well at the expense of the people. Who better to target than perennial Washington insiders, the Wall Street investment-banking firm of Goldman Sachs, believed by many to be one of the key authors of the 2008 financial meltdown? In Trump's campaign for the Republican nomination, he excoriated Ted Cruz for his ties to Goldman:
"He forgot to say that Goldman Sachs gave him money. He forgot to say that Citibank gave him money. OK? Because he's the man of the people, he's Robin Hood, right? He doesn't want you to know that he borrowed from Goldman Sachs because let me tell you -- Goldman Sachs has him."
During the general election Trump made it clear that "the guys at Goldman Sachs have total control over Hillary Clinton."
But alas, Trump just named Goldman Sachs alumnus Steven Mnuchin as our next Treasury Secretary.
Even before assuming office, Trump's swamp draining allowed Mnuchin to crawl out and take charge of the most important government department impacting the financial well being of we the people, the same Treasury Department conceived of and first led by Alexander Hamilton from 1789 to 1795.
Is Trump going back on his words?
Of course he is! Trump never meant a word of what he said when he attacked Goldman Sachs, Citibank, and the oligarch class. Trump is a made member of the oligarch cabal. President Barack Obama tipped his hand before he assumed office by naming his good friend, Wall Street insider, and friend of Goldman Goldman Timothy Geithner as Treasury Secretary. Trump just laid his cards out, face up, right in the middle of the table by appointing Mnuchin.
Steven Mnuchin was Trump's chief fundraiser during the presidential campaign. Mnuchin was with Goldman Sachs for over 17 years. After Goldman, he put together a purchase of the failed IndyBank during the financial meltdown. Mnuchin used that position to foreclose on tens of thousands of homes. Andrew Prokop in VOX summed it up artfully in a headline: Steven Mnuchin: Trump's Treasury secretary pick is a banker with no known qualifications or views.
What's the motivation for the Mnuchin appointment? ForeclosureGate II
Well Street investment banks pulled off the biggest theft in the history of this country as a result of the 2008 financial meltdown, a crisis that these very same investment banks helped create. Irresponsible lenders made a huge market for subprime loans (top 25 list), mortgage financing for home purchases by people with marginal to poor credit. Wall Street invented a financial product called derivatives in which these subprime loans were bundled and sold as high quality investments to large investors including many retirement funds.
The underlying premise was as simple as it was absurd: bundles of home mortgages given to people with marginal to poor credit represented a good risk for investors. Derivatives were sold again and again all over the world. Perversely, the active market for these products created by smart guy investment firms gave false credence to the underlying quality of the loans.
In September 2008, we were told that the entire financial system was teetering, near collapse. Then Bush Secretary of the Treasury Henry Paulson, a former Goldman Sachs executive, began a financial bailout process that ended up totaling $14.4 trillion including all Treasury and Federal Reserve programs. (It Takes a Pillage, Naomi Prins)