Another crack in Humpty Dumpty.

[formercia]

http://news.bbc.co.uk/2/hi/business/6519051.stm


Top US lender in Chapter 11 move

New Century Financial, one of the largest sub-prime lenders in the US, has filed for Chapter 11 bankruptcy.

New Century sought protection from creditors after it was forced by its backers to repurchase billions of dollars worth of bad loans.

The company said it would immediately cut 3,200 jobs, more than half of its workforce, as a result of the move.

[DCKit]

1. Who got rich off these loans?

Follow the money trail. Seems too much like Enron, Tyco and MCI to me. Somebody made money off this and there was never any doubt where it was heading.

[formercia]

3. they sold the paper at discount, took their commissions and ran.

and never kept enough reserves to buy back bad loans. The crash is only starting and the money's already gone.

[Raven]

2. NPR had a story on this company today...

they used a bait and switch tactic with borrowers changing the loan deal at the last minute. Lots of borrowers got hurt.

[leftofthedial]

4. Another wing on the Joe Biden School of Predatory Lending

Capitalism is completely out of control and is killing us