Our government representatives would like us to believe that the subprime mortgage crisis (2, 3, 4, 5) could not have been predicted. The truth is, the collapse was expected and authorities were well aware that crimes were being committed.
It is said that if you want to find the corrupt, follow the money. This catchphrase, however, cannot be used as a preventative measure; it can only be used in retrospect to punish perpetrators of a crime. It does very little to protect us from predators. This is unfortunate when applied to our current crony capitalistic system; a wrong decision in our personal finances can mean the difference between living a life of debt servitude or one of freedom.
In our current centralized economic system, the best way to avoid pitfalls and preserve wealth, improving lifestyle, is to pay close attention to changes in laws and be mindful of their implications. Take, for example, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA):
“Referred to colloquially as the ‘New Bankruptcy Law’, the Act of Congress attempts to, among other things, make it more difficult for some consumers to file bankruptcy under Chapter 7; some of these consumers may instead utilize Chapter 13…. It was hailed at the time as the banking lobby’s greatest all-time victory.”
The Bill: 119 STAT. 23, and general comparison of Chapter 7 and Chapter 13 bankruptcy (pdf).
Considering the timing of the 2005 Bankruptcy Bill, its passing coinciding with the largest economic crisis in contemporary history, one can infer that it came into effect to protect Wall Street from the full impact of the looming financial crisis; to transfer the liabilities of the shady business practices of the banks to the citizenry. The information presented below should shatter any delusions for the steadfast that this bill was made into law for any other reasons than to preserve Wall Street’s capital. The banks were, after all, the ones that bundled toxic debt, sold them to their clients as triple-A securities, and then bet against them:
… continued at via chycho