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jdog2050
Joined: 17 Dec 2006
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 Posted: Mon Dec 10, 2007 10:03 pm Post subject: Sub Prime loan scandal and Korea |
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Someone posted that they were concerned that SK was heading for another IMF crisis...
While I would have liked to have seen more sources from that other guy's post, I did think that he was on to something.
Since we aren't back home, I don't think a lot of us here realized how f'ed up the Prime Loan scandal (and it's a scandal) is back in America. It's Enron times 20, and this time, instead of one state, it's the country, and instead of one corporation...it's ALL of them.
What they were doing was this:
giving loans to people who couldn't pay them back, meanwhile, they were selling the interest on the loans to other countries in the form of bonds. However, a lot of the countries buying these bonds didn't understand, fully, what it was that they were buying and why these loans were made in the first place. The loans were sold to them as being given to credible sources who could pay them back, when in reality, the loans and mortgages were given to people who were damned near homeless at ridiculously high interest rates. Thus, the housing bubble, bound to burst once the interest rates set in.
One of the main buyers of these loans was...dun dun dunnn, South Korea.
http://www.globalization101.org/index.php?file=news1&id=87
Also, this should show you how out of touch the Korean government is with the situation:
"Local financial firms have a combined $850 million subprime-related exposure and most of their investment is related to higher-rated securities."
Ha!!! They are either hiding or don't realize that this Sub-prime issue is a *scandal*; there's no such thing as a "higher rated" security with this because they were virtually all frauds.
http://www.kdi.re.kr/kdi_eng/highlights/govern_view.jsp?no=1806&page=21&rowcnt=10
Now, you add to this the slow down in demand for exports, and the problem just builds and builds.
Hopefully, the saving grace of this situation is that so many other countries bought into these, that the damage will be spread evenly. |
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RACETRAITOR
Joined: 24 Oct 2005
Location: Seoul, South Korea
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| Posted: Mon Dec 10, 2007 10:19 pm Post subject: |
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| Proooime lewwwn? |
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The_Eyeball_Kid
Joined: 20 Jun 2007
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| Posted: Mon Dec 10, 2007 11:00 pm Post subject: Re: Sub Prime loan scandal and Korea |
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| jdog2050 wrote: |
Someone posted that they were concerned that SK was heading for another IMF crisis...
While I would have liked to have seen more sources from that other guy's post, I did think that he was on to something.
Since we aren't back home, I don't think a lot of us here realized how f'ed up the Prime Loan scandal (and it's a scandal) is back in America. It's Enron times 20, and this time, instead of one state, it's the country, and instead of one corporation...it's ALL of them.
What they were doing was this:
giving loans to people who couldn't pay them back, meanwhile, they were selling the interest on the loans to other countries in the form of bonds. However, a lot of the countries buying these bonds didn't understand, fully, what it was that they were buying and why these loans were made in the first place. The loans were sold to them as being given to credible sources who could pay them back, when in reality, the loans and mortgages were given to people who were damned near homeless at ridiculously high interest rates. Thus, the housing bubble, bound to burst once the interest rates set in.
One of the main buyers of these loans was...dun dun dunnn, South Korea.
http://www.globalization101.org/index.php?file=news1&id=87
Also, this should show you how out of touch the Korean government is with the situation:
"Local financial firms have a combined $850 million subprime-related exposure and most of their investment is related to higher-rated securities."
Ha!!! They are either hiding or don't realize that this Sub-prime issue is a *scandal*; there's no such thing as a "higher rated" security with this because they were virtually all frauds.
http://www.kdi.re.kr/kdi_eng/highlights/govern_view.jsp?no=1806&page=21&rowcnt=10
Now, you add to this the slow down in demand for exports, and the problem just builds and builds.
Hopefully, the saving grace of this situation is that so many other countries bought into these, that the damage will be spread evenly. |
Can you explain this part a bit more slowly, please? |
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Wangja
Joined: 17 May 2004
Location: Seoul, Yongsan
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| Posted: Mon Dec 10, 2007 11:16 pm Post subject: Re: Sub Prime loan scandal and Korea |
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| jdog2050 wrote: |
Someone posted that they were concerned that SK was heading for another IMF crisis...
While I would have liked to have seen more sources from that other guy's post, I did think that he was on to something.
Since we aren't back home, I don't think a lot of us here realized how f'ed up the Prime Loan scandal (and it's a scandal) is back in America. It's Enron times 20, and this time, instead of one state, it's the country, and instead of one corporation...it's ALL of them.
What they were doing was this:
giving loans to people who couldn't pay them back, meanwhile, they were selling the interest on the loans to other countries in the form of bonds. However, a lot of the countries buying these bonds didn't understand, fully, what it was that they were buying and why these loans were made in the first place. The loans were sold to them as being given to credible sources who could pay them back, when in reality, the loans and mortgages were given to people who were damned near homeless at ridiculously high interest rates. Thus, the housing bubble, bound to burst once the interest rates set in.
One of the main buyers of these loans was...dun dun dunnn, South Korea.
http://www.globalization101.org/index.php?file=news1&id=87
Also, this should show you how out of touch the Korean government is with the situation:
"Local financial firms have a combined $850 million subprime-related exposure and most of their investment is related to higher-rated securities."
Ha!!! They are either hiding or don't realize that this Sub-prime issue is a *scandal*; there's no such thing as a "higher rated" security with this because they were virtually all frauds.
http://www.kdi.re.kr/kdi_eng/highlights/govern_view.jsp?no=1806&page=21&rowcnt=10
Now, you add to this the slow down in demand for exports, and the problem just builds and builds.
Hopefully, the saving grace of this situation is that so many other countries bought into these, that the damage will be spread evenly. |
I don't see Korea on the first link and the second link is nearly 4 months old.
Got anything recent? |
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jdog2050
Joined: 17 Dec 2006
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| Posted: Tue Dec 11, 2007 3:14 am Post subject: Re: Sub Prime loan scandal and Korea |
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| Wangja wrote: |
| jdog2050 wrote: |
Someone posted that they were concerned that SK was heading for another IMF crisis...
While I would have liked to have seen more sources from that other guy's post, I did think that he was on to something.
Since we aren't back home, I don't think a lot of us here realized how f'ed up the Prime Loan scandal (and it's a scandal) is back in America. It's Enron times 20, and this time, instead of one state, it's the country, and instead of one corporation...it's ALL of them.
What they were doing was this:
giving loans to people who couldn't pay them back, meanwhile, they were selling the interest on the loans to other countries in the form of bonds. However, a lot of the countries buying these bonds didn't understand, fully, what it was that they were buying and why these loans were made in the first place. The loans were sold to them as being given to credible sources who could pay them back, when in reality, the loans and mortgages were given to people who were damned near homeless at ridiculously high interest rates. Thus, the housing bubble, bound to burst once the interest rates set in.
One of the main buyers of these loans was...dun dun dunnn, South Korea.
http://www.globalization101.org/index.php?file=news1&id=87
Also, this should show you how out of touch the Korean government is with the situation:
"Local financial firms have a combined $850 million subprime-related exposure and most of their investment is related to higher-rated securities."
Ha!!! They are either hiding or don't realize that this Sub-prime issue is a *scandal*; there's no such thing as a "higher rated" security with this because they were virtually all frauds.
http://www.kdi.re.kr/kdi_eng/highlights/govern_view.jsp?no=1806&page=21&rowcnt=10
Now, you add to this the slow down in demand for exports, and the problem just builds and builds.
Hopefully, the saving grace of this situation is that so many other countries bought into these, that the damage will be spread evenly. |
I don't see Korea on the first link and the second link is nearly 4 months old.
Got anything recent? |
It's hard to find news outside America about the Sub Prime loan dealings because everyone's trying to pretend that they're not involved. Basically, Korea has about $850 million dollars worth of mortgage receipts that they bought, and don't know if they'll be worth anything in a few months because they were given to people who shouldn't have been given loans in the first place. This is still playing out. Wait for it. |
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Wangja
Joined: 17 May 2004
Location: Seoul, Yongsan
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| Posted: Tue Dec 11, 2007 3:17 am Post subject: Re: Sub Prime loan scandal and Korea |
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| jdog2050 wrote: |
| Wangja wrote: |
| jdog2050 wrote: |
Someone posted that they were concerned that SK was heading for another IMF crisis...
While I would have liked to have seen more sources from that other guy's post, I did think that he was on to something.
Since we aren't back home, I don't think a lot of us here realized how f'ed up the Prime Loan scandal (and it's a scandal) is back in America. It's Enron times 20, and this time, instead of one state, it's the country, and instead of one corporation...it's ALL of them.
What they were doing was this:
giving loans to people who couldn't pay them back, meanwhile, they were selling the interest on the loans to other countries in the form of bonds. However, a lot of the countries buying these bonds didn't understand, fully, what it was that they were buying and why these loans were made in the first place. The loans were sold to them as being given to credible sources who could pay them back, when in reality, the loans and mortgages were given to people who were damned near homeless at ridiculously high interest rates. Thus, the housing bubble, bound to burst once the interest rates set in.
One of the main buyers of these loans was...dun dun dunnn, South Korea.
http://www.globalization101.org/index.php?file=news1&id=87
Also, this should show you how out of touch the Korean government is with the situation:
"Local financial firms have a combined $850 million subprime-related exposure and most of their investment is related to higher-rated securities."
Ha!!! They are either hiding or don't realize that this Sub-prime issue is a *scandal*; there's no such thing as a "higher rated" security with this because they were virtually all frauds.
http://www.kdi.re.kr/kdi_eng/highlights/govern_view.jsp?no=1806&page=21&rowcnt=10
Now, you add to this the slow down in demand for exports, and the problem just builds and builds.
Hopefully, the saving grace of this situation is that so many other countries bought into these, that the damage will be spread evenly. |
I don't see Korea on the first link and the second link is nearly 4 months old.
Got anything recent? |
It's hard to find news outside America about the Sub Prime loan dealings because everyone's trying to pretend that they're not involved. Basically, Korea has about $850 million dollars worth of mortgage receipts that they bought, and don't know if they'll be worth anything in a few months because they were given to people who shouldn't have been given loans in the first place. This is still playing out. Wait for it. |
Yes, I know it has a way to run, but I see nowt about Korea in the first link and the second one is old. Since then, Citiibank have all but failed and there has been a run on a UK bank. |
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jdog2050
Joined: 17 Dec 2006
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| Posted: Tue Dec 11, 2007 3:20 am Post subject: Re: Sub Prime loan scandal and Korea |
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| The_Eyeball_Kid wrote: |
| jdog2050 wrote: |
Someone posted that they were concerned that SK was heading for another IMF crisis...
While I would have liked to have seen more sources from that other guy's post, I did think that he was on to something.
Since we aren't back home, I don't think a lot of us here realized how f'ed up the Prime Loan scandal (and it's a scandal) is back in America. It's Enron times 20, and this time, instead of one state, it's the country, and instead of one corporation...it's ALL of them.
What they were doing was this:
giving loans to people who couldn't pay them back, meanwhile, they were selling the interest on the loans to other countries in the form of bonds. However, a lot of the countries buying these bonds didn't understand, fully, what it was that they were buying and why these loans were made in the first place. The loans were sold to them as being given to credible sources who could pay them back, when in reality, the loans and mortgages were given to people who were damned near homeless at ridiculously high interest rates. Thus, the housing bubble, bound to burst once the interest rates set in.
One of the main buyers of these loans was...dun dun dunnn, South Korea.
http://www.globalization101.org/index.php?file=news1&id=87
Also, this should show you how out of touch the Korean government is with the situation:
"Local financial firms have a combined $850 million subprime-related exposure and most of their investment is related to higher-rated securities."
Ha!!! They are either hiding or don't realize that this Sub-prime issue is a *scandal*; there's no such thing as a "higher rated" security with this because they were virtually all frauds.
http://www.kdi.re.kr/kdi_eng/highlights/govern_view.jsp?no=1806&page=21&rowcnt=10
Now, you add to this the slow down in demand for exports, and the problem just builds and builds.
Hopefully, the saving grace of this situation is that so many other countries bought into these, that the damage will be spread evenly. |
Can you explain this part a bit more slowly, please? |
It works like this;
Typically, a loan/mortgage company gives you a loan. Since you're a responsible person, the mortgage company then sells the loan as a kind of promisary note to a company or country. Basically, they sell the interest that they would have collected off of you as the years go on and you pay it off.
With the sub-prime loan scandal, what they were doing was the same thing, but selling the loans to people who didn't have the financial means to pay it off. Hence the name "sub-prime". It's hilarious because they're telling you it's a scam in the name. Prime--optimal, sub--below. It's a below-optimal loan!!!
Anyway, this became the hot new scheme in the banking world, and companies like Goldman-Sachs, Citibank, etc, began selling the interest notes to other countries in the forms of bonds. Other countries buy them, by the billions (this whole scheme went into about the 300 billions by the time people began to see the bubble).
So, you've got $300billion worth of loans that more than likely can't be paid back. You've got a record number of houses in America on the chopping block, you've got Americans going to the poor house, unable to buy the goods that other countries are producing, like Korea. It's an absolute mess, but it's still playing out. |
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mikekim
Joined: 11 Aug 2006
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| Posted: Tue Dec 11, 2007 3:34 am Post subject: |
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| jdog, can you kind of summarize in laymans terms (we ESL teachers are stupid) what this means to us. |
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Wangja
Joined: 17 May 2004
Location: Seoul, Yongsan
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| Posted: Tue Dec 11, 2007 3:50 am Post subject: |
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Yes.
Cash is King.
Sell property. |
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bacasper
Joined: 26 Mar 2007
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| Posted: Tue Dec 11, 2007 3:51 am Post subject: Re: Sub Prime loan scandal and Korea |
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| jdog2050 wrote: |
| Basically, Korea has about $850 million dollars worth of mortgage receipts that they bought, and don't know if they'll be worth anything in a few months because they were given to people who shouldn't have been given loans in the first place. This is still playing out. Wait for it. |
What is the size of the Korean economy? Isn't this a mere drop in the bucket? |
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Capo
Joined: 09 Sep 2007
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| Posted: Tue Dec 11, 2007 4:03 am Post subject: Re: Sub Prime loan scandal and Korea |
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| bacasper wrote: |
| jdog2050 wrote: |
| Basically, Korea has about $850 million dollars worth of mortgage receipts that they bought, and don't know if they'll be worth anything in a few months because they were given to people who shouldn't have been given loans in the first place. This is still playing out. Wait for it. |
What is the size of the Korean economy? Isn't this a mere drop in the bucket? |
its also a drop in the bucket of the subprime mortgage scandel only this week the swiss bank UBS wrote down $10 billion dollars in subprime mortgage exposure and it is just one of many banks which have run up billions of dollars worth of bad debt, the only bank/institution which has actually been doing well these last 2 quarters is goldmen sachs. |
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hogwonguy1979
Joined: 22 Dec 2003
Location: the racoon den
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| Posted: Tue Dec 11, 2007 4:12 am Post subject: |
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bottom line is if you read krugman in the nyt or listen to the talking heads on cnbc, they dont really know how much bad debt in this market is out there as they have sold and resold several times what may be a $850 exposure to korea now could be $85 billion next month
banks and the govt were stupid in allowing these practices to occur. but in reality the problem lies in public/corporate policies that didnt allow wages to rise enough to allow people to get good credit to qualify and combine this with the ease of getting a cc in the us raising personal debt to unafforable levels. then the problem becomes banks being allowed to sell off the mortgages as A+ rated bonds when in reality they were junk. lots of people were misled
get it? |
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The_Eyeball_Kid
Joined: 20 Jun 2007
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| Posted: Tue Dec 11, 2007 4:35 am Post subject: Re: Sub Prime loan scandal and Korea |
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| jdog2050 wrote: |
| The_Eyeball_Kid wrote: |
| jdog2050 wrote: |
Someone posted that they were concerned that SK was heading for another IMF crisis...
While I would have liked to have seen more sources from that other guy's post, I did think that he was on to something.
Since we aren't back home, I don't think a lot of us here realized how f'ed up the Prime Loan scandal (and it's a scandal) is back in America. It's Enron times 20, and this time, instead of one state, it's the country, and instead of one corporation...it's ALL of them.
What they were doing was this:
giving loans to people who couldn't pay them back, meanwhile, they were selling the interest on the loans to other countries in the form of bonds. However, a lot of the countries buying these bonds didn't understand, fully, what it was that they were buying and why these loans were made in the first place. The loans were sold to them as being given to credible sources who could pay them back, when in reality, the loans and mortgages were given to people who were damned near homeless at ridiculously high interest rates. Thus, the housing bubble, bound to burst once the interest rates set in.
One of the main buyers of these loans was...dun dun dunnn, South Korea.
http://www.globalization101.org/index.php?file=news1&id=87
Also, this should show you how out of touch the Korean government is with the situation:
"Local financial firms have a combined $850 million subprime-related exposure and most of their investment is related to higher-rated securities."
Ha!!! They are either hiding or don't realize that this Sub-prime issue is a *scandal*; there's no such thing as a "higher rated" security with this because they were virtually all frauds.
http://www.kdi.re.kr/kdi_eng/highlights/govern_view.jsp?no=1806&page=21&rowcnt=10
Now, you add to this the slow down in demand for exports, and the problem just builds and builds.
Hopefully, the saving grace of this situation is that so many other countries bought into these, that the damage will be spread evenly. |
Can you explain this part a bit more slowly, please? |
It works like this;
Typically, a loan/mortgage company gives you a loan. Since you're a responsible person, the mortgage company then sells the loan as a kind of promisary note to a company or country. Basically, they sell the interest that they would have collected off of you as the years go on and you pay it off.
With the sub-prime loan scandal, what they were doing was the same thing, but selling the loans to people who didn't have the financial means to pay it off. Hence the name "sub-prime". It's hilarious because they're telling you it's a scam in the name. Prime--optimal, sub--below. It's a below-optimal loan!!!
Anyway, this became the hot new scheme in the banking world, and companies like Goldman-Sachs, Citibank, etc, began selling the interest notes to other countries in the forms of bonds. Other countries buy them, by the billions (this whole scheme went into about the 300 billions by the time people began to see the bubble).
So, you've got $300billion worth of loans that more than likely can't be paid back. You've got a record number of houses in America on the chopping block, you've got Americans going to the poor house, unable to buy the goods that other countries are producing, like Korea. It's an absolute mess, but it's still playing out. |
Why do they sell on the interest that they were going to collect? Does this transfer the debt to the buyer? So if I take out a mortgage with Bank A and they sell it on to Country B, does that mean that I owe the money to Country B now? |
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GoldMember
Joined: 24 Oct 2006
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| Posted: Tue Dec 11, 2007 4:35 am Post subject: |
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How dare you imply that there are faults with the Korean financial system, you'll upset Captain Corea.
I too am concerned about what's happening. One of my sources. is Harry Schultz. Harry who? He's in the Guiness Book of records as the highest paid financial advisor in the world. He charges and gets over $2000 per hour. Unfortunately I can't supply any links, as his newsletter is by subscription only.
Consider this, rich Koreans, the ones in the know, they send their funds offshore. Maybe they know something we don't. |
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jdog2050
Joined: 17 Dec 2006
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| Posted: Tue Dec 11, 2007 5:09 am Post subject: Re: Sub Prime loan scandal and Korea |
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| The_Eyeball_Kid wrote: |
| jdog2050 wrote: |
| The_Eyeball_Kid wrote: |
| jdog2050 wrote: |
Someone posted that they were concerned that SK was heading for another IMF crisis...
While I would have liked to have seen more sources from that other guy's post, I did think that he was on to something.
Since we aren't back home, I don't think a lot of us here realized how f'ed up the Prime Loan scandal (and it's a scandal) is back in America. It's Enron times 20, and this time, instead of one state, it's the country, and instead of one corporation...it's ALL of them.
What they were doing was this:
giving loans to people who couldn't pay them back, meanwhile, they were selling the interest on the loans to other countries in the form of bonds. However, a lot of the countries buying these bonds didn't understand, fully, what it was that they were buying and why these loans were made in the first place. The loans were sold to them as being given to credible sources who could pay them back, when in reality, the loans and mortgages were given to people who were damned near homeless at ridiculously high interest rates. Thus, the housing bubble, bound to burst once the interest rates set in.
One of the main buyers of these loans was...dun dun dunnn, South Korea.
http://www.globalization101.org/index.php?file=news1&id=87
Also, this should show you how out of touch the Korean government is with the situation:
"Local financial firms have a combined $850 million subprime-related exposure and most of their investment is related to higher-rated securities."
Ha!!! They are either hiding or don't realize that this Sub-prime issue is a *scandal*; there's no such thing as a "higher rated" security with this because they were virtually all frauds.
http://www.kdi.re.kr/kdi_eng/highlights/govern_view.jsp?no=1806&page=21&rowcnt=10
Now, you add to this the slow down in demand for exports, and the problem just builds and builds.
Hopefully, the saving grace of this situation is that so many other countries bought into these, that the damage will be spread evenly. |
Can you explain this part a bit more slowly, please? |
It works like this;
Typically, a loan/mortgage company gives you a loan. Since you're a responsible person, the mortgage company then sells the loan as a kind of promisary note to a company or country. Basically, they sell the interest that they would have collected off of you as the years go on and you pay it off.
With the sub-prime loan scandal, what they were doing was the same thing, but selling the loans to people who didn't have the financial means to pay it off. Hence the name "sub-prime". It's hilarious because they're telling you it's a scam in the name. Prime--optimal, sub--below. It's a below-optimal loan!!!
Anyway, this became the hot new scheme in the banking world, and companies like Goldman-Sachs, Citibank, etc, began selling the interest notes to other countries in the forms of bonds. Other countries buy them, by the billions (this whole scheme went into about the 300 billions by the time people began to see the bubble).
So, you've got $300billion worth of loans that more than likely can't be paid back. You've got a record number of houses in America on the chopping block, you've got Americans going to the poor house, unable to buy the goods that other countries are producing, like Korea. It's an absolute mess, but it's still playing out. |
Why do they sell on the interest that they were going to collect? Does this transfer the debt to the buyer? So if I take out a mortgage with Bank A and they sell it on to Country B, does that mean that I owe the money to Country B now? |
That's a good question.
Again, how it works:
They don't directly sell the debt. They "repackage" it as a low-risk security bond. Essentially they lie and make it the equivalent of a mutual fund stock. So, basically, they were turning debt into a type of stock that could be bought and sold on the market. |
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