Local view for "http://purl.org/linkedpolitics/eu/plenary/2007-09-05-Speech-3-208"
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"en.20070905.21.3-208"2
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"Mr President, this crisis is the third major crisis in 10 years. Could it have been avoided? Mr McCreevy tells us it could. To do this, we would need to teach the poor not to borrow money when they have none.
What is the reality? US sub-prime mortgage lenders are the main culprits and players in this crisis. To increase their profits, they have turned to households in great financial difficulty. In 2006, half of the loans granted were made without a check on income. These lenders have earned money with loans that should never have been made. They have been supported by their banks; however, these are controlled by their board of directors, auditors and regulatory authorities. That has not prevented the banks from lending money to credit agencies, or from selling their customers lucrative though risky financial products on the back of this mortgage lending.
These securities, backed by the sub-prime market, were bought on a massive scale by hedge funds mostly domiciled in tax havens, which are exempt from any regulation. So it is the whole control and supervision chain that failed.
My question is simple. What serious initiatives is the Commission now going to take to prevent the rush of the financial markets to the American property market from happening with new assets tomorrow, ending up with the same results: a stock market crisis then loss of growth?"@en1
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