I know, calling John Edwards a hypocrite and then pointing out that hypocrisy is getting to be fish-in-a-barrel easy, but this latest one takes the cake:
Democratic presidential contender John Edwards has investing ties to subprime lenders who are foreclosing on victims of Katrina, according to a report published Friday.
The Wall Street Journal said there are 34 homes in New Orleans that face foreclosure from the subprime unit of Fortress Investment Group. Edwards has about $16 million in Fortress (Charts), a hedge fund and private equity manager, the newspaper said.
...Rising defaults among subprime mortgages - those home loans given to borrowers with the weakest credit records has triggered a credit crunch and resulted in a wave of foreclosures.
Where to begin? Edwards has $16 million invested in a company that offers mortgages to those with credit problems. Many of those people are the poorer among us or many are the unfortunate such as victims of Katrina. Subprime lenders saw a market niche whereby they could lend to these people -- generally at higher interest rates--and make a lot of money. In essence, they lent money to those who were incapable of qualifying anywhere else and probably shouldn't have received loans and charged a premium for the service.
Edwards says he may or may not have known about subprime lending. That's a real endorsement for president, "I can't remember."
Anyone who has an iota of brains saw this subprime crash coming. Lending money to those who are not able to pay it back does nothing for those people but drive them into bankruptcy. There's a reason it's known as "predatory lending". The markets are experiencing huge swings because of this issue and it's not going to end soon.
Now to Edwards; he's spinning this as if he invested the money to help poor people and once he discovered that -- gasp! -- they were actually foreclosing on those who couldn't pay and some of them are Katrina victims, well, he's going to pull his money out or make sure it isn't used for subprime lending. I would imagine with a nice, tidy profit.
This is Edwards in a nutshell; he has spoken out against subprime lending before saying that it wrong but was at Fortress when they increased their subprime business. He knew about the lending practices and he knew that they were making money on the backs of those who have the most to lose.
To add to the hypocrisy, this is from Edwards campaign blog (posted by one of his diarist's and we know how selective he is about them) posted less than a week ago:
Predatory lending - including pay day lenders as well as sub prime mortgagors - is a genuine populist issue where John can clearly distinguish himself from the crowd. I'd like to see him really go after it.
First, predatory lending - including but not limited to sub prime mortgages - is not new despite the only recent attention it is receiving in the main stream media. It is and has been directed against the poorer consumer for at least 10 years - there are consumer experts who have gone unheeded for at least a decade. The results are tragic but not that well known outside consumer circles.
Emphasis mine. Yeah, "two Americas", one where you can make money off of those you claim to be standing up for and another where you talk out of both sides of your mouth when asked about it.
Update: (8/17/07 1609) OK, people seem to not understand that Edwards worked for Fortress:
BusinessWeek has learned that Edwards has signed up to work for the New York-based private investment concern Fortress Investment Group as a part-time senior advisor. As such, he will be "providing support in developing investment opportunities worldwide and strategic advice on global economic issues," says Edwards spokesperson Kim Rubey. Fortress declined to comment about hiring Edwards, who teamed up with Massachusetts Senator John Kerry in a losing bid against President George Bush and Vice-President Dick Cheney last year.
He was an investor and an employee in a senior position.
Reader Comments ( Page 2 of 3)
16. If bamks realy want to help those with questionable credit retings or who are a poor risk, why don't they give them their loans at a reduced rate of interest, instead they add more interest to them, making it more likely for them to fail, sounds like the pay day lenders all over again, trying to fill their own pockets and heck with those who are less fortunate.
Jm
jonas at 1:50PM on Aug 17th 2007
17. Scott,
You didn't answer my question. I don't care if its a bank or mortgage company. Do you know if all those who invest for you are only invested in socially conscious ventures? Or might some of your dollars be invested in "predatory" ventures? But you still wouldn't be a hypcrite unless/until you are trying to voice concern for the poor.
Kay at 1:58PM on Aug 17th 2007
18. C'mon Kay, I'm a Republican business owner, we hate the poor, immigrants and welfare recipients plus everybody else that can't make us money, haven't you been reading your liberal talking points?
Anyway, I have never had anything negative to say about predatory lending and I'm not running for President. Edwards has panned predatory lending and is a candidate. He also WORKED FOR THE COMPANY that is foreclosing on these houses.
I help people out by hiring them and putting them to work. And as for investing, I'm a free market guy and if money can be made in investing in these firms, my investor should do it.
Scott at 2:04PM on Aug 17th 2007
19. What has happened to Christian values & doing the right thing? I don't understand why people lie & think that's ok. What ever happened to morals? What happened to common sense, decency & respect of others? It looks like everyone in politics should ask themselves these questions. It makes me so upset to know that this country was based on Christian values & "In God We Trust" & no one takes heed to this. I feel sorry for all that don't abide in God's laws. I know that I am far from perfect. Needless to say "we all fall short of the glory of God". But for goodness sake people, let's wake up & do the right thing! ALWAYS! And if we make a mistake, apologize & move on! I pray for our leaders to make the right decisions & for them to take into thought who will reap the benefits or repercussions from their decisions that they make. Take it from an Indiana Jones' movie line, "choose wisely". Think what the outcome could be "before" you finalize your decisions.
From a firm Christian Believer!
Stand on Faith
Debbie Barker at 2:21PM on Aug 17th 2007
20. If holding an interest in private equity groups is cause for disqualification from public service then let us look to the list of advisors and investors in that most respectable business venture, The Carlyle Group. Bush, Bush, Bin Laden, and Baker just to name a few.
Aaron at 2:52PM on Aug 17th 2007
21. Edwards is neither honest or a saint. How did the man make his money before politics? He has made a difference. How hard is it now to get a OBGYN because of his frivolous law suits. He stands behind his wife cancer, when will he be a man and speak for himself.
dvan1068 at 2:53PM on Aug 17th 2007
22. Amazingly enough, Edwards went from being an "investor" in this company (in the initial post) to being an "executive" for this company by post #6.
Which one is it, Scott. Just making it up as you go along?
Ray at 4:36PM on Aug 17th 2007
23. Scott you need to click on the links. It clearly states that he was an investor. I can't tell you where all of my money is invested. I have stocks and an IRA, but I don't know where every penny is invested. I happen to work in the Mortgage industry and it is not a "not for profit" industry. I have always worked for "A" lenders and abhor subprime policies, however doesn't the consumer have some responsibility in this also? I know what I can afford to pay monthly why shouldn't they?
Geri at 4:08PM on Aug 17th 2007
24. You all make this too easy:
http://www.businessweek.com/bwdaily/dnflash/oct2005/nf20051013_3314_db016.htm
"BusinessWeek has learned that Edwards has signed up to work for the New York-based private investment concern Fortress Investment Group as a part-time senior advisor. As such, he will be "providing support in developing investment opportunities worldwide and strategic advice on global economic issues," says Edwards spokesperson Kim Rubey. Fortress declined to comment about hiring Edwards, who teamed up with Massachusetts Senator John Kerry in a losing bid against President George Bush and Vice-President Dick Cheney last year."
Hmm Ray, I guess he was an investor and senior management, which is an executive. I guessI was right after all.
Scott at 4:07PM on Aug 17th 2007
25. An "advisor," even a "senior advisor," is NOT an executive.
Maybe you should look into attending a business school before you start posting about business stuff. Just a thought...
Then again, given the sorry lot of candidates on the Republican side of the aisle, it probably makes more sense to keep bashing Dems than to try to show Americans how great the Reps are. lol
Ray at 4:37PM on Aug 17th 2007
26. This just goes to show as lucidly as possible how our government officials are only out to make as much money as they can, regardless if it is going to hurt America.
The devaluations in the World Markets as a result of "Investors" like Mr. Edwards have really made the dream of America a complete joke.
sblank at 4:44PM on Aug 17th 2007
27. Seems JE is just another megalomaniac.
Ron Paul sounds like a decent man, one who actually carries, reads and understands the constitution. Peace and best wishes to all.
DC at 8:58AM on Aug 18th 2007
28. If the Bush Administration would have fixed the levies we would not be having this conversation. Republicans are such idiots! This country is devoid of competent leadership. Republican led Wall Street created the subprime mess. And now blame it on every on else. Typical...
Rick Garcia at 6:53PM on Aug 17th 2007
29. Bush's friends and family are making money hand over fist off of this was, but you deflect that because you are a neocon prick sucker. Where is your outrage regarding that. Our kids are dying over there, and you can't seem to notice.
Rick Garcia at 6:59PM on Aug 17th 2007
30. no matter how much u put about these candidates people will still blindly vote for them. it makes no sense. are u gonna wait until he gets into office to say hey maybe that article was tell the the truth???? well u guys waited to catch our current president after all the signs that showed the american people that he was wrong and now look where we are! check out these candidates before u vote for them. dont just go by the words or their money. y vote another rich person into office so the he could rule the average and the poor people. Vote RON PAUL 2008. he has no special interest, doesn't take money from any lobbyist or corporations, and is trying to deliver us to real freedom and not the one we think that we have. RON PAUL 2008. check him out.
kenisthaman2005 at 9:49PM on Aug 17th 2007