HSBC Finance is a nationally known subprime lender. At the onset of United States mortgage problems HSBC Finance had few, if any, prime FHA insured loan packages. Casting caution to the wind HSBC loaned to almost anyone. While HSBC was not the only subprime lender, nor the only mortgage lender to suffer big losses, specialists and niche markets bear considerable watching. Now the President of Organisation of Petroleum Exporting Countries (OPEC), Chakib Khelil insisted on Tuesday that oil producers saw no need to raise supply, blaming high prices on factors outside its control.

Khelil blamed high prices on the US subprime crisis when banks became fearful last August of lending to each other when complex investments based on US housing loans to people with poor credit emerged as far more risky than was at first believed. “I think the fundamentals of the high price are due basically initially to the subprime crisis in the United States. That’s where it all started,” he said.

Investors moved away from poisoned subprime paper and into futures. Speculation on oil fueled record high oil and gasoline prices (see more about oil futures) and high gas prices made it even more difficult for subprime borrowers. A perfect storm of financial greed has polarized people, with some saying the government should not effectively bail out troubled borrowers. On the other hand the dollar is now so weak and oil so high that something must be done. It appears that subprime lenders looked to commercial paper and bonds to make a profit, with little regard for long term impact. We said “HSBC subprime fuels high gas prices” although HSBC is not the only bandit in this robbery of people around the world.

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