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Saving Banks: How the Mortgage Bailout Strains Accounting Efforts to contain damage from the subprime mortgage meltdown are stretching accounting safeguards put in place after Enron.

Tim Reason, CFO.com | US
December 10, 2007

SubPrime Mortgage Processes: Having worked in one of those SubPrime Mortgage companies for a while I knew it was going to burst its bubble. The trend was to bring a bunch of subprime loans in, call the mortgagee and demand payment now. If no payment was received within five days, bunch them up again and send them back into the market as a new debt instrutment to be brokered to another group.

I really do not know how many subprime mortgagees who did not have the funds at the time could pay anyone since the banking agreements where not followed (they are supposed to inform the mortgagee who has the loan and where to make payment too). But then again this was years before the recent crisis that a few financial experts and our public accountants put us into again. Debt should be placed with those that started the debt versus being farmed out to others that might not be under the rules of the US Banks.

After all, how many of these debts do countries we are not friendly with, own?

Scared yet, I wonder when China will call the note.; Posted by Bob Kinsler | Dec 13, 2007 2:15 PM ET