Ever consider a foreclosure or short sale? Take a look at the video
about how the politicians and bankers are managing to make billions more off
short-sale and foreclosure properties.

Watch the video...it's worth your 5 min.

http://www.thinkbigworksmall.com/mypage/player/tbws/23088/1287086

I'm no financial wizard, and am honestly interested in the thoughts
(intelligent ones) of others on this.

ISO

I once read a description of Goldman Sachs as a giant vampire squid, wrapping itself around the face of, and sucking the life out of anything that smells like money. They are without a doubt in my mind, the most corrupt organization on Wall Street.

That being said, take what this video says with a grain of salt. As one poster pointed out that in the master agreement between One West and the FDIC, OW is required to cover the first 20% of losses. Also those losses are not for individual loans, but for the portfolio in general. I haven't read the master agreement and I'm not going to. Either way you cut it's a sweetheart deal for Goldman.

The same poster points out that the FDIC is funded by premiums paid into the coffers by member banks and that the public at large does not pay for these things. That's a bit misleading, which tells me that poster has something to prove, or hide. While the general public may not pay directly into the FDIC they certainly do as customers of member banks. The cost is simply passed down. There's also zero reassurance that the money the FDIC borrows from the Treasury will be paid back at all, if ever.

We will probably see around another 800 bank failures within the next two years, if not this year. The FDIC doesn't have anywhere near the amount of money needed to cover all those deposits. The monetary base will just continue to expand as it has done for decades. Only now at a much more accelerated pace.

Didnt get into the video but just my 2c from the retail level is the short sales are a disaster and the bank owned properties are much more desirable for my clients.

Hoping to pick up a Fannie owned home today in Sno County for about 90k under an inflated assessment but still a bargain and they actually respond to offers within 2-3 days vs 2-4 months in many short sales.

Next fun step will be fighting Sno County on the property taxes as they should be about 30% lower than current amount. It will be interesting to see the new assessments come out over the next few years as the counties sure cant afford to give up this revenue but have no choice but to drop these values and the tax revenue base that they are tied to.

A few years ago we paid $200,000 in FDIC insurance. Last year, $1,000,000+. Same size bank, essentially. This year we get to prepay 3 years of FDIC insurance. Goody!

SW is partially correct. Clients end up paying for the FDIC insurance in part. Commercial clients are directly charged, consumers through other fees and charges, but not directly. Our bank has eaten a number of these charges directly but we hope to recoup a portion of it over time.

The FDIC pool of money is not a static amount of money. Money flows in and out as needed. The increased line of credit will help smooth out any funding issues caused by large failures.

Didn't watch the video, but from what I get there is a loss sharing agreement involved. This is SOP nowadays. Lennar, a large home builder based in Florida, just purchase 40% of a $3.1B loan portfolio, with the aid of a loss share agreement and a loan for 80% of the purchase price at 0.00%.

Lots of big dollar folks with money on the sidelines stand to become rich if they buy right. Little guys, not so much, but there is opportunity.

Dogfish don't you just love paying for the failures and misdeads of the mega banks?? I would expect more of the same to come as the FDIC struggles to cover deposits of even more failed institutions.

summerrun,

I wouldn't hold your breath on those taxes being reassessed.

In a sense, yes, the statements in the article are correct. The government through entities like the FHA, Fannie, Freddie, and Ginnie are now the sole purchaser of mortgage securities in the secondary marketplace. For those that afford to drop 20% down on a home, then their bank may or may not carry the note depending on available capital at the bank for such loans and their appetite for the collateral.

Since the beginning of the mortgage crisis the government has taken nearly every step, imaginable and un-imaginable, to hold a float the housing market. The reason for this is simple. Mega banks and the GSE's themselves were so overweighted in the underlying securities that if home prices were to drop precipitously, the whole house of cards would come crashing down. Values of securities would have to be valued in reality, as opposed to the Alice in Wonderland values they hold now.

Tax credits, secondary market purchases, re-works, FHA, and the like won't stop the downfall. Bottom line is that exotic financing allowed home prices to outpace real income by a large margin. Now that the financing is gone the only thing that will restart the housing market is for prices to come back into line. The gov't can waste all the time and money they wish but there will be no stopping price decline. What's next $20k tax credits for home buyers? How bout $30k? Do I hear $40k? Anybody?

What may happen (since so many have short memories) is a return to exotic mortgage products sponsored by the gov't. Although that would really suprise me,........and then again it wouldn't.

More foreclosure records on the way this year with the maturity of a large number of Option ARM mortgages. Although those problems will be limited to certain markets they do end up affecting lending as a whole. Which in turn put more downward pressure on prices nationally.

This to me, as someone who is trying to sell a house right now. Is the crux of the issue. We (as people in this country who own real estate), have to get used to the fact that our holdings are not worth what they were 2 years ago. We need to get used to this new reality, and realize that it ain't coming back, at least not in the way we grew used to it for the last 7 years (up until 2009). Everyone out there who is thinking that their next big thing is going to be bankrolled by their equity line (and they haven't applied yet), need to start thinking seriously about their expectation for that line.

I lecture my wife almost weekly, that the best asset we could get a hold of right now, is one of these really low interest rates for primary residences. I am going to lower my house price again at the end of this month, in a effort to make sure we get into one for the new place.

I keep telling her "There is a new reality, the faster we get used to it the better of we are."

You hit the nail on the head RocketRed. It's too bad more sellers don't see it the same way you do. Unfortunately having to sell your home in this kind of market puts you in a pinch. You can lower your price in order to find a buyer, but how low is too low? As low as you can afford IMHO.

Buyers are also pinched right now. Do they take advantage of low interest rates and federal tax credits and run the risk of owning a depreciated assett down the line? Or, do they wait it out and see if prices adjust? Me personally, I was lucky enough to get out from underneath my home in Kirkland in late 2008. I'm just fine with renting until things look more stable.

If you are set on buying again though you're correct in wanting to take advantage of the low rates being offered. Mark my words,.......these rates won't last forever. Sooner or later federal debt loads and attractive investments other than US treasury bonds will force the Feds to raise interest rates, and they won't be small hikes. This will put further downward pressure on home prices exacerbating the problem even more.

It's a tough situtation for everyone around. We would all have been served much better if the gov't hadn't intervened the way they had. Sure, things would have been terrible for a little while, but the recovery would have come much sooner and swifter.

We are fully expecting a rate jump of 1/2 to 1% by the end of 2010 and it should start in earnest around the 2nd quarter when the Fed pulls out of their $1.4 trillion buying spree of Mortgage Backed Securities.

Everything keeping the housing market going is artificial and alot of this will be going away by the end of April unless another extension of tax credit/something else is enacted.

We are already seeing rates slowly but steadily going up from late 09 record lows and UW guidelines tightening up even further on automated engines from Fannie and Freddie.

I am in a situation where I have 2 homes currently. Scary right? I just plugged about $130k into a turn of the century we bought in 2008. I am servicing 2 loans on it, and my regular mortgage. Just brutal. The only light I see is the good interest rate, and I want it locked up by the middle of April.

Carpet is going in on the 18th, we are going to probably move at the end of this month, and I will drop price on my current home again. The thing is I am at a good price (probably the best one) compared to all the other homes on the market in my area, except the short sales and foreclosures. (Anyone want 2 acres, 2300sf, built in 2006 within walking distance of a stellar salmon hole, and top rated steelhead plunking lane?)

I wish banks made short sales so hard, that realtors wouldn't even consider them. I guess if you got bailed out a short sale is better than a foreclosure.

I got lucky and was able to re-fi my primary residence at %4.75 on a 30 year fixed last month. I had to suck a lot of the equity out of it to buy my ex-wife out a few years back, but it held it's value well enough that I still managed to come in below 80%... so no PMI.

Ahh thanks for adding summerrun. Lest I forget that the Fed is pulling out of their purchase program. Yet to be seen as to what "creative" lending facility will be implemented as a replacement. The absolute last thing the Feds want to see is another home price crash (this time for real). Although, part of me thinks that the players at the Fed may actually want this to happen.

Haven't wrote or packaged loans in a couple of years but it's hard to imagine AUS engines tightening guidelines anymore than they were when I left the industry.

We're a long ways away from being out of the woods. Like Rocket said,.......prepare for a new reality.

Not so scary as long as you can manage them both. Scary only if you're facing a deadline.

Sounds like you've done your research and priced accordingly. If the price is right then someone will buy. (PM me the listing actually. I'd like to take a look.)

Banks do make short sales hard,......usually. In this market they don't have much of a choice when faced with the costs of foreclosure,.......add to that the moratorium that was in place. Maybe we'll see a change in the policy, who knows.

If you want to buy a short sale or need to sell as a short sale you better have two agents on either side of the transaction who know their $hit and never give the bank a moment to breathe. Although, the way the market is now most buyers are looking to get into distressed property so every agent out there is proclaiming to be an "expert" in handling short sales.

If anyone out there needs to short sell a home I do happen to know a real bulldog who knows how to get things done.

We're in the same boat, new house, old house, 2 mortgages. Luckily we are renting the old house to someone we know, so it lessens the burden, as they cover the note payment and taxes.

I've thought about renting, but I really just want to be done with it. Plus I don't think I could get a good rate for the second mortgage.

My new mortgage is 4.5%. Didn't hamper us.

Nope. Same ol' same ol' that everybody else gets, except I didn't have to pay any fees or closing costs (and no, I didn't pay a higher rate because of that) because I am a wheel, not a cog.

#1. Goldman Sachs IS the blood sucking vampire of the financial world. Granted.

#2. The failure of Indy Mac Bank was set in motion by Chuck Schumer. They were well capitalized, meaning they should have been able to weather some downside on their profits, which they were experiencing. http://www.bloomberg.com/apps/news?pid=20601103&sid=aAYLeK3YAie4 Schumer should be looked at, with his ties to Goldman Sachs. Both from New York, etc. Indy Mac's failure was one that didn't have to happen. Schumer was teh cause. Can't find the New Yorker magazine article just yet, but it describes in detail his roll in the failure of Indy Mac. Schumer orchestrated a run on the bank. Schumer needs to be investigated.

#3. Goldman Sachs got a sweetheart deal, but Indy Mac was the first of the large banks to go down, so FDIC didn't know how many willing buyers there were, and had just started ramping up their bank closure operations. Current banks that are being sold are now having their assets (loans) sold at par (100%), or with a slight discount. Indy Mac's portfolio of Alt A loans held a higher risk, so some discount was appropriate, but I'm not sure that the steep discount was appropriate.

#4 Loss share agreements are S.O.P. nowadays. It usually only applies to a portion of the loan portfolio purchased, and with the elimination of the steep discounts, fewer of the abomination type deals are out there.

#5. The video only shows one example. They don't discuss the transactions where Goldman Sachs took it on the chin. You need to look at the portfolio performance as a whole, not just one single transaction. I don't know if that data is available. As far as that homeowner is concerned, they signed a contract to pay the debt, they defaulted, and their loss was soley based on the front end of eth transaction. While it sucks that GS made money on the short sale, they had essentially hedged that short sale in a SEPARATE transaction. Had they not defaulted, it wouldn't have occured.

#6. The FDIC is funded by member banks, not by taxpayers directly. The fund for failed banks is not a static amount. Money flows in as assessments are collected from member banks, and flows out as bank failures occur. Look for a few more to be announced today after 5pm tonight. They close banks on Fridays. The line of credit will help smooth out the inflows and outflows if assessments aren't collected in a timely manner. Corporate clients are charged directly for FDIC insurance. Consumers receive no direct charge for the service, it is a service because it protects them. The consumer portion is collected through other fees, etc.

Andy, what is your perspective on commercial over the next few years? On the residential side I personally see 2010 and early 2011 as the bottom and most of the "bad" paper will have worked its way through the system in the next year or so once the Option Arm resets are completed.

From what I understand most if not all commercial loans are written with a short term maturation and there is a huge underwater portfolio just waiting to explode over the next few years?

BTW I worked at IndyMac during their last 6 months in business. It was the first and last big box bank I will ever work for. An unreal mess from top to bottom in that company from what I saw.

Blood sucking vampire squid

IndyMac would have eventually folded under their own weight. Their construction lending portfolio was almost exclusively CA properties and the value of the Alt-A business would have tanked just like everyone else's did.

Despite all this it does not clear Chuck Shumer from his actions and responsibility for creating a run on that institution. Chuck Schumer is crooked enough to sleep in a trombone and deserves to be in jail. I'm not sure how much he was, if at all, involved in the passing of the CRA, but I know his buddy Barney Fwank was. It's ironnic Schumer cites that the OTS should have been doing their job in controlling IndyMac's irresponsible lending practices. When it was those lending practices that were satisfiyiing CRA requirements in the form of MBS's bought by Fannie and Freddie.

The video is misleading (the first video anyway, I didn't watch this latest one) in that the examples cited are of individual transactions,.......and yes I'm sure there were a couple where Goldman or OW took it on the chin. If I had to guess I'd say the probably made out better than alright on the portfolio as a whole.

I don't have a problem with Goldman making money, everyone should have the opportunity. What I have a problem with is their undue influence in the market itself,.......often times accomplished by placing former employees in top gov't positions.

During the run up in subprime mortgage loans Goldman Sachs provided the bulk of warehouse line credit for more than a few of the top subprime origination firms. When they pulled their line that comprised of more than 50% of New Century's funding capability in early 2007 it precipitated a larger crisis. Immediately Goldman began betting on the other side of transactions they had spent the last decade funding.

Your analysis of FDIC premiums is what I was basically saying earlier in the thread although I would still argue that consumers of member banks pay for increased premiums one way or another. If a member bank has to raise associated fees to cover the cost of increased premiums it's still a direct cost to the consumer even if they pay for it indirectly through an increased fee.

Yesterday while home for lunch I caught a snippet of Sheila Blair on CNBC saying that by Q3 40% of commercial borrowers would be underwater adversly affecting over 4,000 banks (mostly smaller community banks) nationwide.

The future of the commercial market does not look good and hasn't for some time.

Conflicting reports on the status of the commercial markets are what I have been reading. I'd be nervous for note holders of non owner occupied office space. Some point to gloom & doom, others point to bright spots.

Big huge deals, $1-5B and above, are usualy 5-7 year contracts with 0.25% of loan balance quarterly pay plus interest. The primary source of repayment is refinance at the end of the term. A lead bank will structure the deal, then farm it out to smaller entities in $1-2MM (M=1,000, MM=million) chunks. Some of these are marketed through the National Shared Credits (NSC) program. I've bought a number of these, and have subsequently sold all but 2. They were good performers 2 years ago. Not so much today. These are the "option arms" of the commercial world. Many companies are doing well enough. some are not.

Most commercial real estate loans in the $250M-10MM ranges are notes with defined loan terms of 10-15 years with amortizations as long as 30 years. I'm not so worried on these, as these loans are generally based on sound lending principals and a realistic repayment term. They don't rely on a refinance in 5-7 years to pay the note off, they rely on cash flow.

The NSC loans to companies that are maturing here shortly may have an issue getting refinance money, especially if the financials aren't so hot. This is where a portion of these commercial loan failures will come from. The shorter time horizons don't allow clients the ability to dig themselves out of a hole from poor financial performance towards the end of their loan term. Refinance risk is higher than the longer term amortizing loans. The NSC credits almost qualify as "evergreen" loans, where the balances never really decrease, and they may actually increase throughout time. I see a correlation between home owners who pull equity out of their homes constantly over time, and the NSC type credits.

For Ma and Pa Kettle, they are getting less on their CD's, but that is primarily related to the current market rate conditions. Their mortgage rates are lower now than 10 years ago. If they overdraft their accounts, sure they'll pay more, but in a lot of ways consumers have really been spared additional costs. Companies are seeing the biggest hits with decreased earnings credit allowances and increased per item fees. Even then, most banks have not yet passed all of these costs accrued to their depositors. That will be recouped over time. Shareholders of these stocks are feeling it though.

Good stuff Andy.

Interesting thread. I just read a story on Yahoo that appears relevent to the disscuion at hand;

http://realestate.yahoo.com/promo/americas-most-overvalued-cities

This may be nothing more than opinion, but the list is heavy on PNW cities.

We took a few hits on the Bellingham properties our bank was financing, so that correction in value up there of 21% is about right. To give you an idea of how quickly values were escalating at one time, we helped a developer build a number of homes, 30+, in a subdivision. One home originally appraised for $440M prior to contruction in 2004. At completing 6 months later, the home was valued at just over $510M, and it sold for $530M. Crazy, and that home was on a .25 acre lot, no view, in a McMansion development.

Good stuff indeed. Thanks for your insight.

12/31/2013 is when that ends. The TAGP, transaction account guarantee program, that give unlimited FDIC insurance on business checking accounts and a few others, ends 6/30/2010.

Will there be any sort of account protection after these programs are closed out?

FDIC insurance will likely stay at the $250M amount. It is easy to structure accounts to gain additional FDIC insurance at a single bank where a couple could easily insure upwards of $2MM if they have a few kids, and still retain complete control of the money.

CDAR's is a program available for CD investors. Plain vanilla CD's with about 0.15% less return, but each bank is limited to $20-50MM in total participation. Find this program at your local community bank.

You could also purchase collateralization if you are a major client at your bank. If you have a few million on deposit, or a few million on deposit and a few million in loans, you should have no issue getting this for 0.15-20% rate reduction at a local community bank. Just finished up collateralizing deposits for 3 clients doing this. They all wanted to stay at 1 bank and not go through the hassles of account structuring.

Those are your three options.

Put my house on the market right after the first of the year. I interviewed a number of realtors. The one I selected priced the house right and it was sold in a day short of two weeks. Other homes across the street have been on the market for months; but they are probably unrealisticly priced.

You have to be real and not live in the past. It is worth what it is worth today and that is it. Tough for people who have very little equity. Fortunately I resisted the urge to sell the house at the height of the market and buy another one. Been in it for 19 years, but had to buy it a second time from the ex; but all worked out.

I am buying a home in Post Fall Idaho where my wife and I will retire. The wife just retired and I will work until the end of July or August and go myself. Prices in Idaho are really low compared to out here. Amazing how much house you can buy for less then $250K. Thought about waiting to see how much lower the prices get; but I am worried about interest rates taking a jump. I hope to lock in around 4.75 on Tuesday. Looking forward to my tax credit.

I told the wife she better really be happy with this place because we will live in it for at least the next 10 years. It is going to be a change for me as I am used to having property and all my toys parked in the shop. No room for toys at the new place and now I will have to store the boat. On the plus side I can mow the new yard in 45 minutes as opposed to the current yard at 3 hours.

Good read on the banking stuff. Good luck Rocket Red on the sale of your place.

The following reminds me of what's going on in our financial institution, banks, real estate, Wall Street and te entire cabal.



Dear Friend,

I am Mr Wei Ming, Principal Assurance manager for the Huaxia Bank in China. I am getting in touch with you regarding the estate of Gavin Stuart and an investment placed under our banks management 7 years ago. I would respectfully request that you keep the contents of this mail confidential and respect the integrity of the information you come by as a result of this mail. I contact you independently and no one is informed of this communication.

In 2001, the subject matter; Gavin came to our bank to engage in business discussions with our private banking division. He informed us that he had a financial portfolio of 8.35 million UnitedStates dollars, which he wished to have us invest on his behalf. Based on my advice, we spun the money around various opportunities and made attractive margins for our first months of operation, the accrued profit and interest stood at this point at over 10 million United States Dollars. In mid 2003, he instructed that the principal sum (8.35M) be liquidated because he needed to make an urgent investment requiring cash payments in Hong Kong and China. We got in touch with a specialist bank in Hong Kong, the Guangdong Development Bank (GDB) who agreed to receive this money for a fee and make cash available to Gavin. However Guangdong Development Bank got in touch with us only last year that this money has not been claimed. On further enquiries we found out that Gavin was involved in an accident in Mainland China, which means he died intestate and had no next of kin.

What I propose is that since I have exclusive access to his file, you will be made the beneficiary of these funds. My bank will contact you informing you that money has been willed to you. On verification, which will be the details I make available to my bank, my bank will instruct GDB to make payments to you. You do not have to have known him. I know this might be a bit heavy for you but please trust me on this. For all your troubles I propose that we split the money in half. In the banking circle this happens every time. The other option is that the money will revert back to the state.

Nobody is getting hurt; this is a lifetime opportunity for us. I hold the KEY to these funds, and as a Chinese National we see so much cash and funds being re-assigned daily. I would want us to keep communication for now strictly by my chinese email. Please, again, note I am a family man; I have a wife and children. I send you this mail not without a measure of fear as to the consequences, but I know within me that nothing ventured is nothing gained and that success and riches never come easy or on a platter of gold. This is one truth I have learnt from my private banking clients. Do not betray my confidence. If we can be of one accord, we should act swiftly on this. Please pardon my writing mistakes and get back to me immediately.

I await your response.

Mr Wei Ming

JLH, you're missin' the boat on this one.

JLH is so used to spewing that he never takes the time to learn.

Here is the article that was on the CNBC site yesterday.

http://www.cnbc.com/id/35392686/site/14081545

Debt restructure, yawn.

It would be nice to see them get caught for something really evil, like funding Al Queda or the Taliban. Then maybe they would go away. They'll shrug that off and be back in business in a few days.

I remain teachable and solicit advise when needed from people I know and trust. Period!

This whole crisis is the results of nothing but a big fat scam. A scam is a scam, is a scam. The bank robbery or "mortgage crisis," was an inside job, perpetrated by thieves, and netting them Trillions of tax payer dollars. This so called "mortgage crisis" (scam) was a collaborative actions more blatant and corrupt than all of the Magoo's of Africa, or the Mr. Wei Ming's of China's scams put together, and multiplied by 1,000,000. I posted it as a reality check, for those that want to rationalize, legitimize, intellectualize and justify the "Mortgage (scam ) crisis" as something innocent or makes sense. Well excuse me if I don't drink the Koolaid.

I'm not blaming little guy's as yourself, because you're just another paper pushing lackey with few clues, and probably up to your neck in debt to the bank. Having about as much clot in the scheme of things, as an indentured servant. BTW, your feelings of superiority doesn't apply, nor am I impressed with such an overture. I know better that to be a stooge for someones needy, self serving, inflated ego, combined with a holier than thou, hyperbole feeling of self importance.

The latest "Fox News Polls" are indicating that the majority of American's feel that what "Bankers" and financial institutions need most, is a little edgumacation from the woody end of a 2 X 4.

You been taking lesson from Big Stick on scriblin'?

While I agree with your statement Dogfish it's been just this kind of attitude that has let them get away with deals like this for so long. That, and the fact that the Treasury and the Fed are riddled with their former employees.

This story has been out for a few weeks now. CNBC is behind the curve as usual and printed a more sanitized version of events. What people should be asking themselves is what other governments has Goldman and JPMorgan sucked into this debt trap? Rumors around that Goldman has done the same thing for England. How about our government? Would we even know? All the more reason to demand the passing of HR1207 and SB604 and audit the federal reserve. As GAO Fed audit rules stand now the Fed could be secretly propping up Greece through their central bank or the ECB and we wouldn't know.

Sure, it'd be great to find out that GS was funding the Taliban (ironically enough, the Pentagon already does that indirectly BTW) so the masses would have something they could understand. Shouldn't matter, the crimes this syndicate have committed to date warrant more than a few arrests now.

"The bank robbery or "mortgage crisis," was an inside job, perpetrated by thieves, and netting them Trillions of tax payer dollars. "

The largest robbery was Iraq. So we've had the "illegal war" the "banking crisis", the "energy crisis", the "Oil crisis", "natural gas"........ what other robberies took place under the former administration?

Oh. I agree that there was a robbery that took place. Look at the folks paid out at 100% from AIG.

Switch to a community bank or CU folks.

PBS Frontline is doing a show on OTC derivatives called 'The Warning', detailing how Alan Greenspan, Robert Rubin, and Congress were warned by Brooksley Born of the impending sh!tbomb that was going to go on in the banking industry , and how there was a bipartisan effort to silence her and take away the power of her office to do anything about it.

It was a bipartisan buttf'ing to the tune of trillions.

Good show.

Yeah, that show was pretty good. I like how that one female attorney was essentially pushed under the rug for trying to do the right thing with her new appointment. Head should have rolled on that one other than hers, but our legislators keep getting elected and being rewarded for their arrogance.

Fixed that for ya.

Yes, we agree.

I was shocked that those at the top went as far as to say there was no need to police and prosecute fraud, as the market would take care of it.

Yeah, why don't we just decriminalize everything at let the "market" take care of it.

That was the big issue I have with Greenspan. He believed his own ink.

I have enjoyed most all of this thread, albeit angering. I read an article recently by John Lifflander, a local economist, and commercial appraiser, among other things, whom I met and corresponded with for a brief time. Fascinating insight and observations that coincided with many of my own. I've never googled him, but am sure there would be some interesting stuff.
Anyway, thanks for the great input.

Just so we're all clear here there are rules and laws to be followed even in a "free market".

Even in a true laissez faire definition participants in the market must adhere to the rule of law. A true free market allows market forces to determine the distribution of goods and services and to determine prices without government intervention or government monopolies.

I watched the Frontline program a few months ago. What Greenspan advocated was more akin to economic anarchy. Something even your most die-hard Libertarian wouldn't advocate.

The problem with our "crony capitalism" or "soft facism" structure today is that there is no justice. We have the worst of all worlds. Government interference in places where the market should dictate things (i.e. - prices, interest rates) and almost zero government protection from fraud. Government has completely failed to do it's job in enforcing the rule of law. That it was the gov'ts job in the market is. Not to "stimulate" or control or set prices and interest rates. There seems to be a lot of confusion out there as to what the governments role should be.