Visit The Boston Globe Share on Twitter Share on Facebook Comment on this Scroll to top of page Globe Staff and wire services August 14, 2018 The Royal Bank of Scotland will pay the largest fine arising out of the mortgage crisis to settle allegations it misled investors about risky home loans made during the housing bubble that ultimately led to the 2008 financial collapse.The $4.9 billion settlement was reached with the US Attorney’s office in Boston and was the largest penalty on a single company that the US Department of Justice has imposed on banks and lenders for financial crisis-era misconduct.“This resolution . . . holds RBS accountable for defrauding the people and institutions that form the backbone of our investing community,” Andrew Lelling, the US attorney in Boston, said in a statement. Advertisement In 2008, RBS was the third largest underwriter of residential mortgages, which it then packaged and sold on to … [Read more...] about Royal Bank of Scotland fined $4.9B for housing bubble role
United states housing bubble
Share Tweet Share Email Comments Print Homeland Security Secretary Kirstjen Nielsen, left, walks past White House press secretary Sarah Huckabee Sanders, right, after speaking to the media. ASSOCIATED PRESS Enlarge The expulsion of Sarah Huckabee Sanders from a Virginia restaurant last weekend will be run through the inevitable left and right propaganda machines. The right will see it as bullying and the left as a polite, nay classy, stand for principle. The left will say that freedom of association means that a business owner can refuse to serve any person or ask any person to leave the premises, so long as the owner is not discriminating based on race or sexual orientation. And the right will say: Wait a minute! What about the Christian cake maker? All of the sudden you are for the rights of business people? What about Hobby Lobby and Chick-fil-A? But maybe this is really about common sense, or the lack thereof. Click here to view more Blade editorials … [Read more...] about United States of Intolerance
Last Updated Apr 10, 2009 4:17 PM EDT Back at the start of 1996, the U.S. unemployment rate was 5.6 percent. Then the assembled investors and businesses of the United States discovered the Internet. Over the next four years spending on information technology equipment and software in the United States roared upwards from a pace of $281billion to a pace of $446 billion a year -- and the U.S. unemployment rate dropped to 4.0 percent. The economy grew at a 4.3 percent real annual rate as the spending of the high-tech boom pulled extra workers out of unemployment and into jobs. Back at the start of 2004, America's banks discovered that they could borrow money cheaply from Asia and lend it out in higher-yielding domestic mortgages while using sophisticated financial engineering to -- they thought, or was it that they claimed? -- control their risks. Over the next two years, spending on housing roared upward from a pace of $624 billion to a pace of $798 billion a year -- and the U.S. … [Read more...] about The Stimulus Package: Like the Housing Bubble, Only Better
Last Updated Aug 17, 2010 1:12 PM EDT Who was astute enough to realize that a bubble was forming in the U.S. housing market, and when did they know it? asks a new paper from researchers at the Boston branch of the Federal Reserve Bank. I found it through FT Alphaville, who comment: "It's an interesting rundown of who made the housing crash call, but it's also 'interesting' because the paper's authors go further than just identifying the prescient. They also break down their then-arguments and conclude that, actually, many of them were wrong from a pure economics perspective." This paper is an unusual exercise, especially coming out of the Fed, because the economics community is really small, and sooner or later you wind up working with or for just about anyone, or relying on them to favorably review your own work. But the housing bubble has been such a conspicuous oversight that it deserves comment, especially to commend those who got it right. Still, here is the Fed's conclusion, as … [Read more...] about Nobody Knows Anything, Part 2: Avoiding The Next Housing Bubble
In the U.S., house prices have been rising for 20 straight months and construction permits have hit a five year high. In the U.K. meanwhile, house prices have hit a 40-month high, with some London prices showing double digit growth. It's not unreasonable in this context to imagine a future housing bubble. (In the U.K., that future feels pretty close.) If one were to emerge, have we learned anything from the last one to help us manage better? Peter Orszag, vice chair of corporate and investment banking at Citigroup, has argued that this is exactly what New Zealand's central bank is doing today, by limiting to 15 percent the value of high loan-to-value mortgages any bank can initiate. Canada, Israel, Singapore and Sweden are doing likewise. It sounds a good idea insofar as it forces banks to examine their risk more closely, and it encourages consumers to bring more capital to their homes. But I can't help but notice that the … [Read more...] about Can housing bubbles be controlled?