In the past, housing loans in the United States were granted in this way. These people are doing this. The credit of these people is not outstanding. Through some intermediaries, they are responsible for collecting information for banks and doing first-level audit. Then the intermediary gives the information to the bank. The bank is conducting its second audit. After passing, the bank directly lends the money to the borrower. For example, if a bank borrows 1 million yuan, it will lose 1 million yuan. In order to make the funds abundant, it will sell you one million creditor's rights. You said that the familiar Fannie Mae and Freddie Mac cut one million into 1,000 pieces and sold 1,000 pieces of bonds to the whole world, including the China government. The total sales amount is 370 billion, almost 5 trillion. This process is originally. The borrower with outstanding credit gives the information to the bank, and the bank lends the money to the borrower, then transfers the bonds to Fannie Mae, and then cuts off the bonds of 1000 and sells them to the public. Therefore, the bank is not short of funds, Fannie Mae gets back one million yuan, and finally all the creditor's rights are borne by the society in a broad sense, including the China government, the European society and the American public. This is a perfect chain.
However, over the years, the greed of Wall Street in the United States has completely deteriorated this chain. How come? Subprime loan, the first invention, is to let people with poor financial statements, people with insufficient income and people with insufficient credit still buy houses. How to get to the first intermediary is very similar to our bank at first, and it is not easy to learn quickly. We got some wrong information. We cheated the bank a lot and made some false information to fool you. All the bank's analysis is based on wrong information. Therefore, through the audit, the bank lent the money to the borrower, and the bank sold these questionable subprime debts to Fannie Mae. Based on this 100000 subprime debt, they cut off1000 bonds and sold them to the public. Why does the cost of intermediary establishment, that is, the fiduciary responsibility on which capitalism depends for a living, disappear under the greed of Wall Street? Responsibility of trust is the soul of capitalism. When intermediaries lack the responsibility of trust, the whole chain will be polluted. As long as the borrower can't pay his debts, bank bonds are poor. Banks sell bad debts to Fannie Mae, and they issue bonds to the public, which will make Fannie Mae unable to repay its debts. Therefore, it led to bankruptcy.