Wall Street's alchemy: lead to gold

There's some good news for people who oppose the decades-long love affair between The White House and Wall Street. HuffPo's Shahien Nasiripour reports:

During a little-noticed hearing this week in Sacramento, Calif., a firm hired by Wall Street to analyze mortgages given to borrowers with poor credit, which were then packaged and sold to investors during the boom years, revealed that as much as 28 percent of those loans failed to meet basic underwriting standards -- and Wall Street knew all along.

Worse, when the firm flagged those loans for potential issues, Wall Street banks ignored its recommendation nearly half the time and likely purchased those loans anyway -- selling them to unwitting investors who were never told that the biggest home loan due diligence firm in the country had found potential defects in these mortgages.

The revelations give a better picture of what many have likely known for years: Wall Street firms knew they were buying lead yet passed it off as gold to investors who had no knowledge of the alchemy behind the scenes.

There is a shortcoming here though. While Wall Street may finally take a hit for their wrongs, the Clinton / Bush / Obama / Greenspan / Bernanke / Paulson / Rubin / Geithner team will remain in power. That's unfortunate for working class America as they continue to abate Wall Street through a number of means, including the "quantitative easing" that steal our money everyday.

I can't wait for next spring. I'm guessing that my guy, Ron Paul, will again run for POTUS. Hopefully he'll get a real chance to discuss monetary and banking policy in depth this time.

Tim White