Chain of Blame

An updated and revised look at the truth behind America's housing and mortgage bubbles In the summer of 2007, the subprime empire that Wall Street had built all came crashing down. On average, fifty lenders a month were going bust-and the people responsible for the crisis included not just unregulated loan brokers and con artists, but also investment bankers and home loan institutions traditionally perceived as completely trustworthy. Chain of Blame chronicles this incredible disaster, with a specific focus on the players who participated in such a fundamentally flawed fiasco. In it, authors Paul Muolo and Mathew Padilla reveal the truth behind how this crisis occurred, including what individuals and institutions were doing during this critical time, and who is ultimately responsible for what happened. Discusses the latest revelations in the housing and mortgage crisis, including the SEC's charging of Angelo Mozilo Two well-regarded financial journalists familiar with the events that have taken place chronicle the crisis in detail, showing what happened as well as what lies ahead Discusses how the world's largest investment banks, homeowners, lenders, credit rating agencies, underwriters, and investors all became entangled in the subprime mess Intriguing and informative, Chain of Blame is a compelling story of greed and avarice, one in which many are responsible, but few are willing to admit their mistakes.

An updated and revised look at the truth behind America'shousing and mortgage bubblesIn the summer of 2007, the subprime empire that Wall Street hadbuilt all came crashing down. On average, fifty lenders a monthwere going bust-and the people responsible for the crisis includednot just unregulated loan brokers and con artists, but alsoinvestment bankers and home loan institutions traditionallyperceived as completely trustworthy.Chain of Blame chronicles this incredible disaster, witha specific focus on the players who participated in such afundamentally flawed fiasco. In it, authors Paul Muolo and MathewPadilla reveal the truth behind how this crisis occurred, includingwhat individuals and institutions were doing during this criticaltime, and who is ultimately responsible for what happened.* Discusses the latest revelations in the housing and mortgagecrisis, including the SEC's charging of Angelo Mozilo* Two well-regarded financial journalists familiar with theevents that have taken place chronicle the crisis in detailshowing what happened as well as what lies ahead* Discusses how the world's largest investment banks, homeownerslenders, credit rating agencies, underwriters, and investors allbecame entangled in the subprime messIntriguing and informative, Chain of Blame is acompelling story of greed and avarice, one in which many areresponsible, but few are willing to admit their mistakes.

Introduction: Financial Ashes viiCast of Characters xiiiChapter 1 Angelo Speaks, the Worldwide Contagion Begins 1Chapter 2 The Repo Man Meets the Bald Granny: A Short History of Subprime 23Chapter 3 The Death of the Bailey Building and Loan, the Rise of Millionaire Loan Brokersand Countrywide 47Chapter 4 The Beach Boys of B&C: How Roland Arnall Became the Johnny Appleseed of Subprime 73Chapter 5 Angelo Rising: The Son of a Bronx Butcher Makes Good 103Chapter 6 The Holy Roller of REITs 127Chapter 7 The End of the (New) Century 149Chapter 8 A Conspiracy by Merrill? 179Chapter 9 A Warning from Lewie: CDOs, SIVs, and Other Things No One Understands 205Chapter 10 Deep in the Belly of the Bear 227Chapter 11 Armageddon Times: The Tan Man Departs, Bye-Bye Bear 249Chapter 12 What the Hell Happened? Ten Bad Years for Housing in America 277Chapter 13 TARP, the Great Recession, and the Return of Stan Kurland 309Afterword TBTF: A Mortgage Cartel Rises from the Ashes 335Source and Interview Notes 341Glossary 351Acknowledgments 359About the Authors 361Index 363