Housing Crises Blamed for Global Meltdown; What About Consumer Fraud?

Warren Buffet and Moody's Chief Executive Raymond McDaniel were subpoenaed to Washington D.C. to testify before the Financial Crisis Inquiry Commission regarding the credit raters involvement in the U.S. housing crisis. Berkshire Hathaway is a major investor in the credit rater Moody's Corp.

Buffet said the burst in the housing bubble was responsible for the global meltdown of the economy since the housing market is the biggest asset class. Credit raters Standard & Poor and Moody's did not believe the entire housing market would ever collapse. Due to their flawed credit rating system mortgage-leading terms eased and risks were created. The rest is history.

City's such as Las Vegas have seen home price decline close to 52%. Homeowners who lost their homes due to cheap loans aren't in the market to buy new ones even though the prices are significantly lower.

During an interview with CNBC, Warren Buffet repeatedly stated there must be changes in the credit rating industry since the systems they are using are majorly flawed.

Buffet said one day both Standard & Poor and Moody's would fade away due to financial reform.

Once again the blame game is occurring as all parties involved are pointing fingers at each other as to whom to blame for the current state of affairs. However, the finger of blame surprisingly is not being pointed at those homeowners who lied on their mortgage applications.

Listening to all parties involved, across all the various types of media, the financial industry and U.S. legislators sounds like little children who do not want to take any blame. But why isn't massive consumer mortgage fraud being investigated? Yes, mortgages were given to anyone who could breath but fraud is fraud.

On a wide scale, those who obtained mortgages that defaulted knew the situation they were buying into that equated into loans they could not afford and/or purchasing too much home. Sure you could blame the mortgage leaders, yet homeowners still had to fill out credit applications and sign loan documents with full awareness of what was going on.

The reality is people thought the housing market would never go down. The dream of home equity going up without ever going down was like being addicted to drugs. When the bubble burst and/or interest only loans came to term the first thing a lot of homeowners did was point the finger at the mortgage leaders suggesting they did not know what they were signing into. Isn't this type of mentality like a child getting caught with their hands in the cookie jar and not wanting to take the blame. Instead, they blame their sibling who was in the other room?

Come on and let's be real. American's live in a world of entitlement where a majority feel they deserve something for nothing. The blame game is old and people need to take accountability for their actions.

Analysts are predicting the worst is not over in the housing market especially for cities like Las Vegas who still have not hit the bottom. Home prices will continue to drop in Vegas while the unemployment rate will remain high. There are plenty of great buying opportunities but the worst is not over.

Yes, the financial industry needs reform yet when do people decide to reform themselves?

Change needs to occur across all the financial markets. But, if people are reading this article that find themselves in unfortunate financial situations due to their own personal mortgage nightmare's then the hard question needs to be asked of whether or not fraud was committed on their part.

Again, why isn't there any type of investigation by the Federal Government into consumer fraud. Oh yeah, the same reason why people continue to lie to the IRS. Then again doesn't the the head of the Treasury have problems of his own so why rock the boat for others, right?