Senate Report Lays Bare Mortgage Mess

Panel Recommends a Range of Remedies for Financial Sector; 'I Found White Elephant, Flying Pig'

By CARRICK MOLLENKAMP And LIZ RAPPAPORT
WSJ

Some call the concept of owning a home the American dream.

Wall Street bankers called it something different: "Pigs." "Crap." A "white elephant, flying pig and unicorn."

Those descriptions of the U.S. mortgage market were highlighted in a U.S. Senate report Wednesday that offered one view of the events leading up to the financial crisis of 2008.

Senate investigators spent two years gathering and analyzing 5,901 pages of confidential emails and documents from Washington Mutual Inc., Goldman Sachs Group Inc., Deutsche Bank AG, and regulators including the Office of Thrift Supervision. Though lacking evidence of outright fraud, the report shows Wall Street in gritty, day-to-day detail, angling to profit from a booming mortgage market, and then scrambling to cope with its collapse.

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