(Citi)Group Of Con Men

Former Citigroup execs are due tomorrow and Thursday on Capitol Hill to answer a few questions about some very interesting subprime mortgage practices. 

The hearings are the first by the Financial Crisis Inquiry Commission to focus on a single company. Witnesses include former Citi CEO Chuck Prince and former Chairman Robert Rubin, who was Treasury secretary during the Clinton administration.

The panel also will hear from former Federal Reserve Chairman Alan Greenspan; a former risk officer with failed subprime lender New Century Financial Corp.; and former executives and regulators from government-backed mortgage giant Fannie Mae . The three days of testimony are designed to provide a firsthand accounting of decisions that inflated a mortgage bubble and triggered the financial crisis.

Much of the tension at hearings Wednesday and Thursday will come as the 10 bipartisan commissioners examine Citi's role in financing, packaging and selling risky mortgage loans.

Citi was a major subprime lender through its subsidiary CitiFinancial. The bank pooled those loans and loans purchased from other mortgage companies and sold the income streams to investors. As borrowers defaulted, Citi absorbed losses on mortgage-related investments it held on and off its books.

Mortgage troubles at Citi, defunct investment bank Bear Stearns and elsewhere exposed cracks in the financial system. In late 2007 and throughout 2008, those fissures grew into a full-fledged credit crisis that crippled the global economy.

Remember folks, this all started with a simple, five-letter word:  Greed.  Everyone was playing the multi-trillion dollar shadow banking shell game with subprime, and when the musical chairs stopped, a select few walked away winners, and 99% of us walked away losers...especially the vast majority of Americans who didn't see the game was on in the first place.

It'll be nice to get some answers.  It'll be even better to get some real financial reform going, but the powers that be will make sure that doesn't happen.  After all, it's going to take a bit to set the board back up to play again, and the smart parties want to be ready ahead of time before the next massive bubble crash puts the rest of us in the poorhouse for good.