LOL Irony

Pot, meet kettle.

U.S. mortgage bonds pioneer chastises industry

http://www.reuters.com/article/marketsNews/idINN0845263520080708?rpc=44

A pioneer of mortgage finance who taught Wall Street how to make big bets on the U.S. homes market said on Tuesday that the lending industry must stop making risky loans to low- and moderate-income borrowers.

“It has been a mistake to think that yield and house price appreciation could substitute for solid underwriting,” said Lewis Ranieri, who was an early wizard of the financial alchemy that turns home loans into mortgage bonds that let Wall Street claim a large stake in the housing market.

Ranieri is chairman and chief executive of Franklin Bank Corp, a Texas-based company that has come under investigation by the Securities and Exchange Commission over its lending practices.

This entry was posted on Tuesday, July 8th, 2008 at 5:10 pm and is filed under Blog. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

Comments are closed.