USuncutMN says: Tax the corporations! Tax the rich! Stop the cuts, fight for social justice for all. Standing in solidarity with http://www.usuncut.org/ and other Uncutters worldwide. FIGHT for a Foreclosure Moratorium! Foreclosure = homelessness. Resist the American Legislative Exchange Council, Grover Norquist and Citizen's United. #Austerity for the wheeler dealers, NOT the people.
USuncutMN supports #occupyWallStreet, #occupyDC, the XL Pipeline resistance Yes, We, the People, are going to put democracy in all its forms up front and center. Open mic, diversity, nonviolent tactics .. Social media, economic democracy, repeal Citizen's United, single-payer healthcare, State Bank, Operation Feed the Homeless, anti-racism, homophobia, sexISM, war budgetting, lack of transparency, et al. Once we identify who we are and what we've lost, We can move forward.
We've spent billions of dollars - perhaps trillions - to rescue big banks. But instead of dialing back on the risky behavior that shattered the economy in 2008, they're doubling down on it. And when their bill comes due we won't just be asked to pay it again. We'll be asked to take the blame for it again, too.
But who are the real deadbeats in this country? Banks ran up a huge bill in the years leading up to the financial crisis - a bill which the rest of us have been paying since 2008. And guess what? They're doing it again.
Take student loans. Americans owe more than a trillion dollars in student loans, a figure that's growing by $50 to $60 billion every month. Now we've learned that as many as 27% of these loans are delinquent, meaning they're more than thirty days past due. That amounts to roughly $270 billion in troubled loans - most of which have been guaranteed by the US taxpayer.
We've already rescued American banks with hundreds of billions in public money, which saved them from the consequences of their incompetent underwriting of mortgage loans. Now we're about to do the same thing with student loans.
They "privatized" Sallie Mae, the government-sponsored enterprise (GSE) created to help students borrow for their education, and its greed-crazed executives went on a grotesque spending spree.They used their government backing to pay themselves inflated salaries and bought corporate jets so they could travel in luxury. Yet, without irony, their backers and shills shrieked "socialism!" when wiser heads wanted to stop private-sector skimming at the expense of our nation's students. (See "Sallie Mae's Jets.")
And now that their loans are going bad, who will pick up the tab? It won't be those high-flying executives.
Student loans aren't the only burden young people - and the rest of us - are carrying today. Today's college seniors are also graduating with an average of more than $4,000 in credit card debt - and then entering an economy where only 46 percent of their peers in the 18-24 year old age group have jobs. That's the lowest percentage since the government began tracking these figures in 1948.
Credit card debt is another exploding area of risk for America's too-big-to-fail banks - and therefore for the Federal government. In this country there are now more than 50 million American Express credit cards in circulation, along with 176 million Mastercard credit cards and 261 million Visa credit cards. That's nearly half a trillion active credit cards from these three companies alone.
Credit cards are unsecured debt, meaning that nothing has been put up as collateral if the borrower defaults. Credit-card holders owed a reported $771 billion - more than three-quarters of a trillion dollars - in the second quarter of 2011. The average amount owed by a credit-card-holding household was more than $16,000.
And the debt train's picking up speed. Lenders wrote off about $250 billion in bad credit card debt between 2008 and 2011. Credit card debt increased by more than $36 billion in the fourth quarter of 2011, which was 30 percent more than the increase in the same quarter of 2010 and and more than twice the increase during the same quarter in 2009. (Source: CardHub.com)
But banks aren't pushing this kind of risky debt on consumers anymore, are they? They've learned their lesson, right? Wrong. Credit card solicitations were up in 2011. And the worst offender is Citigroup, the too-big-to-fail superbank that only exists because of Washington's 'bipartisan' agreement to allow the merger that created it. Last year it mailed out more credit-card solicitations than there are people in the United States (346 million credit card offers in a nation of roughly 308 million people, according to the Wall Street Journal).
But then, why not chase down those bad risks and write as many as you can, if you're a too-big-to-fail bank? Someone else will pick up the tab if they go wrong.
When you add up all the forms of consumer debt in this country - medical bills, mortgages, credit cards, student loans, car loans, and other forms of indebtedness - the Federal Reserve Bank of New York says the total amount owed by consumers is now more than $11.5 billion. These runaway debts aren't just another big bill the taxpayer may have to pay to the banks someday soon. They're a burden to individuals and families - and an obstacle to economic recovery.
The banks pay out huge fees to advertisers, psychologists, and other consultants so that all of their solicitations and offers are as persuasive as possible. So first they'll convinced Americans to borrow money - something that's easier to do now that the banks' own recklessness has left many people with no alternative but to borrow.
Then, when billions of dollars' worth of those loans turn out to be unpayable, they'll blame the very same consumers they've just prodded, pressured, and persuaded into borrowing. We'll be subject to another round of lectures about 'reckless consumers' who are 'living beyond their means,' even as we're writing fat checks to the people who got rich convincing them to borrow the money in the first place.
Americans have become indentured servants working in thrall to their lenders, manipulated into borrowing money by their culture and chained to bad debts by their FICO scores. When things go wrong with their own finances they pay the price. And when things go wrong with the finances of the banks that lent them all this money - often at usurious rates - they pay for that, too. And they'll go on paying until it becomes politically unacceptable to protect Wall Street at Main Street's expense.
There are those who will fight any attempt to rescue underwater homeowners on the grounds that it would "reward the undeserving" - and will then fight just as hard to protect banks from the consequences of their own actions. They'll lecture Americans on their "exorbitant" borrowing while rescuing the institutions that spent billions of dollars persuading them to borrow in the first place.
The real debt in this nation is the one that bankers owe the rest of the country. And as long as our politicians are allowed to rescue banks while ignoring consumers, it's a debt that will continue to go unpaid. And it's a debt that will continue to grow.
We need to tell the deadbeats that their credit's no good with us anymore - and that it's time to make good on what they already owe.
Richard (RJ) Eskow, a consultant and writer (and former insurance/finance executive), is a Senior Fellow with the Campaign for America's Future and the host of The Breakdown, which is broadast on WeAct Radio, AM 1480 in Washington DC.
Remember our report from yesterday: “Generation Jobless” was how The Wall Street Journal put it. Here’s more. From the blog “Economic Collapse:”
19 Statistics About The Poor That Will Absolutely Astound You.
#
1 According to the US Census Bureau, the percentage of “very poor” rose in 300 out of the 360 largest metropolitan areas during 2010.
#2 Last year, 2.6 million more Americans descended into poverty. That was the largest increase that we have seen since the US government began keeping statistics on this back in 1959.
#3 It isn’t just the ranks of the “very poor” that are rising. The number of those just considered to be “poor” is rapidly increasing as well. Back in the year 2000, 11.3% of all Americans were living in poverty. Today, 15.1% of all Americans are living in poverty.
#4 The poverty rate for children living in the United States increased to 22% in 2010.
#5 There are 314 counties in the United States where at least 30% of the children are facing food insecurity.
#6 In Washington DC, the “child food insecurity rate” is 32.3%.
#7 More than 20 million US children rely on school meal programs to keep from going hungry.
#8 One out of every six elderly Americans now lives below the federal poverty line.
#9 Today, there are over 45 million Americans on food stamps.
#10 According to The Wall Street Journal, nearly 15 percent of all Americans are now on food stamps.
#11 In 2010, 42 percent of all single mothers in the United States were on food stamps.
#12 The number of Americans on food stamps has increased 74% since 2007.
#13 We are told that the economy is recovering, but the number of Americans on food stamps has grown by another 8 percent over the past year.
#14 Right now, one out of every four American children is on food stamps.
#15 It is being projected that approximately 50 percent of all US children will be on food stamps at some point in their lives before they reach the age of 18.
#16 More than 50 million Americans are now on Medicaid. Back in 1965, only one out of every 50 Americans was on Medicaid. Today, approximately one out of every 6 Americans is on Medicaid.
#17 One out of every six Americans is now enrolled in at least one government anti-poverty program.
#18 The number of Americans that are going to food pantries and soup kitchens has increased by 46% since 2006.
#19 It is estimated that up to half a million children may currently be homeless in the United States.
Josef Ackermann just gave a terrifying speech about the fragility of the Euro banking sector right now.
At a conference in Frankfurt he said, "It is an open secret that numerous European banks would not survive having to revalue sovereign debt held on the banking book at market levels."
We have translated the speech based on Handelsbatt's, the organizer of the event where Ackermann spoke, account of it.
"In recent weeks, the distrust of the financial markets has spread to the banks because they are now suffering from the debt crisis in Europe and have a lot of exposure to, for example, Greek bonds."
"Since the financial crisis, some European banks have lost a third or more of their market capitalization," he said, according to Google Translate.
"Most institutions have a rating of "below the book value or at best."
There are three major stress factors crushing Euro banks right now, he says: the debt crisis, structural factors and financial regulation. With them together, it will be hard for the European banks to increase their revenues.
The implication is that not just Eurozone countries are buckling under the pressure of Greece's, France's, and Italy's debts, but banks are too. It sounds like a desperate call for a bailout. Now.
However he says, "State funds could use means to put stability back into many companies and countries, but that does not remain the only solution."
Still, the situation he describes looks dire. He says, "Many countries and households would have to reduce their debt. The mortgage business and consumer loans were [the few things] driving growth. In addition, there's the problem of shrinking populations in several European countries, which negatively affects the growth of credit markets."
"All this reminds one of the autumn of 2008," said Ackermann. "We should resign ourselves to the fact that the 'new normality' is characterized by volatility and uncertainty."
Some hedge funds, like in 2007 and 2008, saw the enormity of the Eurozone debt crisis and began betting against Euro banks and other companies that have exposure to the crisis earlier this year. Their profits have already started to pay off.
As for the rest of the financial industry, things don't look good.
Here's what Ackermann sees: "Prospects for the financial sector overall... are rather limited."
"We have a financial industry that is still not really providing convincing answers to the questions about the meaningfulness of many modern financial products and trading in securities. The questions are getting louder and require new responses."
He also believes high frequency trading needs to be investigated more. He said regulators and the banks need to begin a dialogue to examine the effects of HFT in the markets, so as to avoid imbalances in the markets.
However a consequence of all of this scrutiny is that growth prospects for banks are low.
"The outlook for the future growth of revenues is limited by both the current situation and structurally."
The banks will have to ask how they can be more long-term investors in order to gain more stability in financial markets.
"We must in my opinion, check all our work in all areas thoroughly again to ascertain whether we prioritize our genuine tasks as servants of the real economic needs."
But immediately, the Euro banking sector must prepare for what happens if solutions to the Eurozone crisis and corresponding Euro banking crisis remain unsupported or nonexistent.
However recapitalization is not the answer. Ackermann duly shot down the measure suggested by IMF head Christine Lagarde at Jackson Hole.
"A forced recapitalization would give the signal that politicians do not themselves believe in the measures" they are negotiating.
As a result, it could exacerbate the debt situation in individual countries. Also, faced with a threat of dilution (a result of recapitalization), private investments in banks would be even less likely.
Another measure that he does not think will help, he says, is dissolving the Eurozone. "The costs of supporting weak member states, particularly from the German perspective, are less than the costs of disintegration.... It is a dangerous illusion to believe that a country could do better should it reclaim the sovereignty it has delegated to the EU."
Sounds like Ackermann just sounded the alarm. There is now a full-on Euro banking crisis.
The conference he's at continues tomorrow. It's entitled "Banks in Transition," and it's organized by the German business daily Handelsblatt.
Here's a couple of videos of him giving the speech. Warning: they are in German.
This is going pretty viral on FB and twitter. It's not a as succinct as some I've posted, obviously - but the point is making is quite different.
I am afraid the government of Obama is going after the Big Criminals as a show not to discourage the behaviour for all time. The people are demanding their pound of flesh and Barry better cough up w/some drama or he doesn't have a prayer (regardless of raising $1 bn buck$) in 2012. We are being "spun" with the "public hangings" of "the few bad apples."
There isn't much here that isn't already posted on the blog, BUT it just could be y'all need reminders. Good video links ! - Virginia
Full-Blown Civil War Erupts On Wall Street: As Reality Finally Hits The Financial Elite, They Start Turning On Each Other
Finally, after trillions in fraudulent activity, trillions in bailouts, trillions in printed money, billions in political bribing and billions in bonuses, the criminal cartel members on Wall Street are beginning to get what they deserve. As the Eurozone is coming apart at the seams and as the US economy grinds to a halt, the financial elite are starting to turn on each other. The lawsuits are piling up fast. Here’s an extensive roundup:
Collapse Roundup #5: Goliath On The Ropes, Big Banks Getting Hit Hard, It’s A “Bloodbath” As Wall Street’s Crimes Blow Up In Their Face
Time to put your Big Bank shorts on! Get ready for a run… The chickens are coming home to roost… The Global Banking Cartel’s crimes are being exposed left & right… Prepare for Shock & Awe…
Well, well… here’s your Shock & Awe:
First up, this shockingly huge $196 billion lawsuit just filed against 17 major banks on behalf of Fannie Mae and Freddie Mac. Bank of America is severely exposed in this lawsuit. As the parent company of Countrywide and Merrill Lynch they are on the hook for $57.4 billion. JP Morgan is next in the line of fire with $33 billion. And many death spiraling European banks are facing billions in losses as well.
FHA Files a $196 Billion Lawsuit Against 17 Banks
The Federal Housing Finance Agency (FHFA), as conservator for Fannie Mae and Freddie Mac (the Enterprises), today filed lawsuits against 17 financial institutions, certain of their officers and various unaffiliated lead underwriters. The suits allege violations of federal securities laws and common law in the sale of residential private-label mortgage-backed securities (PLS) to the Enterprises.
Complaints have been filed against the following lead defendants, in alphabetical order:
1. Ally Financial Inc. f/k/a GMAC, LLC – $6 billion 2. Bank of America Corporation – $6 billion 3. Barclays Bank PLC – $4.9 billion 4. Citigroup, Inc. – $3.5 billion 5. Countrywide Financial Corporation -$26.6 billion 6. Credit Suisse Holdings (USA), Inc. – $14.1 billion 7. Deutsche Bank AG – $14.2 billion 8. First Horizon National Corporation – $883 million 9. General Electric Company – $549 million 10. Goldman Sachs & Co. – $11.1 billion 11. HSBC North America Holdings, Inc. – $6.2 billion 12. JPMorgan Chase & Co. – $33 billion 13. Merrill Lynch & Co. / First Franklin Financial Corp. – $24.8 billion 14. Morgan Stanley – $10.6 billion 15. Nomura Holding America Inc. – $2 billion 16. The Royal Bank of Scotland Group PLC – $30.4 billion 17. Société Générale – $1.3 billion
These complaints were filed in federal or state court in New York or the federal court in Connecticut. The complaints seek damages and civil penalties under the Securities Act of 1933, similar in content to the complaint FHFA filed against UBS Americas, Inc. on July 27, 2011. In addition, each complaint seeks compensatory damages for negligent misrepresentation. Certain complaints also allege state securities law violations or common law fraud. [read full FHFA release]
BofA sued over $1.75 billion Countrywide mortgage pool
Bank of America Corp (BAC.N) was sued by the trustee of a $1.75 billion mortgage pool, which seeks to force the bank to buy back the underlying loans because of alleged misrepresentations in how they were made. The lawsuit by the banking unit of US Bancorp (USB.N) is the latest of a number of suits seeking to recover investor losses tied to risky mortgage loans issued by Countrywide Financial Corp, which Bank of America bought in 2008. In a complaint filed in a New York state court in Manhattan, U.S. Bank said Countrywide, which issued the 4,484 loans in the HarborView Mortgage Loan Trust 2005-10, materially breached its obligations by systemically misrepresenting the quality of its underwriting and loan documentation. [read more]
Bank of America kept AIG legal threat under wraps
Top Bank of America Corp lawyers knew as early as January that American International Group Inc was prepared to sue the bank for more than $10 billion, seven months before the lawsuit was filed, according to sources familiar with the matter. Bank of America shares fell more than 20 percent on August 8, the day the lawsuit was filed, adding to worries about the stability of the largest U.S. bank…. The bank made no mention of the lawsuit threat in a quarterly regulatory filing with the U.S. Securities and Exchange Commission just four days earlier. Nor did management discuss it on conference calls about quarterly results and other pending legal claims. [read more]
Nevada Lawsuit Shows Bank of America’s Criminal Incompetence
As we’ve stated before, litigation by attorney general is significant not merely due to the damages and remedies sought, but because it paves the way for private lawsuits. And make no mistake about it, this filing is a doozy. It shows the Federal/state attorney general mortgage settlement effort to be a complete travesty. The claim describes, in considerable detail, how various Bank of America units engaged in misconduct in virtually every aspect of its residential mortgage business. [read more]
Nevada Wallops Bank of America With Sweeping Suit; Nationwide Foreclosure Settlement in Peril
The sweeping new suit could have repercussions far beyond Nevada’s borders. It further jeopardizes a possible nationwide settlement with the five largest U.S. banks over their foreclosure practices, especially given concerns voiced by other attorneys general, New York’s foremost among them…. In a statement, Bank of America spokeswoman Jumana Bauwens said reaching a settlement would bring a better outcome for homeowners than litigation. "We believe that the best way to get the housing market going again in every state is a global settlement that addresses these issues fairly, comprehensively and with finality. [read more]
FDIC Objects to Bank of America’s $8.5 Billion Mortgage-Bond Accord
The Federal Deposit Insurance Corp. is objecting to Bank of America Corp. (BAC)’s proposed $8.5 billion mortgage-bond settlement with investors, joining investors and states that are challenging the agreement. The FDIC owns securities covered by the settlement and said it doesn’t have enough information to evaluate the accord, according to a filing today in federal court in Manhattan. Bank of America has agreed to pay $8.5 billion to resolve claims from investors in Countrywide Financial mortgage bonds. The settlement was negotiated with a group of institutional investors and would apply to investors outside that group. [read more]
Fed asks Bank of America to list contingency plan: report
The Federal Reserve has asked Bank of America Corp to show what measures it could take if business conditions worsen, the Wall Street Journal said, citing people familiar with the situation. BofA executives recently responded to the unusual request from the Federal Reserve with a list of options that includes the issuance of a separate class of shares tied to the performance of its Merrill Lynch securities unit, the people told the paper. Bank of America and the Fed declined to comment to the Journal. Both could not immediately be reached for comment by Reuters outside regular U.S. business hours. [ read more]
Bombshell Admission of Failed Securitization Process in American Home Mortgage Servicing/LPS Lawsuit
Wow, Jones Day just created a huge mess for its client and banks generally if anyone is alert enough to act on it. The lawsuit in question is American Home Mortgage Servicing Inc. v Lender Processing Services. It hasn’t gotten all that much attention (unless you are on the LPS deathwatch beat) because to most, it looks like yet another beauty contest between Cinderella’s two ugly sisters. AHMSI is a servicer (the successor to Option One, and it may also still have some Ameriquest servicing).
AHMSI is mad at LPS because LPS was supposed to prepare certain types of documentation AHMSI used in foreclosures. AHMSI authorized the use of certain designated staffers signing with the authority of AHSI (what we call robosinging, since the people signing these documents didn’t have personal knowledge, which is required if any of the documents were affidavits). But it did not authorize the use of surrogate signers, which were (I kid you not) people hired to forge the signatures of robosigners. The lawsuit rather matter of factly makes a stunning admission… [read more]
Fraudclosure: MERS Case Filed With Supreme Court
Before readers get worried by virtue of the headline that the Supreme Court will use its magic legal wand to make the dubious MERS mortgage registry system viable, consider the following:
1. The Supreme Court hears only a very small portion of the cases filed with it, and is less likely to take one with these demographics (filed by a private party, and an appeal out of a state court system, as opposed to Federal court). This case, Gomes v. Countywide, was decided against the plaintiff in lower and appellate court and the California state supreme court declined to hear it
2. If MERS or the various servicers who have had foreclosures overturned based on challenges to MERS thought they’d get a sympathetic hearing at the Supreme Court, they probably would have filed some time ago. MERS have apparently been settling cases rather than pursue ones where it though the judge would issue an unfavorable precedent
3. The case in question, from what the experts I consulted with and I can tell, is not the sort the Supreme Court would intervene in based on the issue raised, which is due process (14th Amendment). But none of us have seen the underlying lower and appellate court cases, and the summaries we’ve seen are unusually unclear as to what the legal argument is. [read more]
Iowa Says State AG Accord Won’t Release Banks From Liability
The 50-state attorney general group investigating mortgage foreclosure practices won’t release banks from all civil, or any criminal, liability in a settlement, Iowa Attorney General Tom Miller said. [read more]
Fed Launches New Formal Enforcement Action Against Goldman Sachs To Review Foreclosure Practices
The Federal Reserve Board has just launched a formal enforcement action against Goldman Sachs related to Litton Loan Services. Litton Loan is the nightmare-ridden mortgage servicing unit, a subsidiary of Goldman, that Goldman has been trying to sell for months. They penned a deal to recently, but the Fed stepped in and required Goldman to end robo-signing taking place at the unit before the sale could be completed. Sounds like this enforcement action is an extension of that requirement. [read more]
Goldman Sachs, Firms Agree With Regulator To End ‘Robo-Signing’ Foreclosure Practices
Goldman Sachs and two other firms have agreed with the New York banking regulator to end the practice known as robo-signing, in which bank employees signed foreclosure documents without reviewing case files as required by law, the Wall Street Journal said. In an agreement with New York’s financial-services superintendent, Goldman, its Litton Loan Servicing unit and Ocwen Financial Corp also agreed to scrutinize loan files for evidence they mishandled borrowers’ paperwork and to cut mortgage payments for some New York homeowners, the Journal said. [read more]
Banks still robo-signing, filing doubtful foreclosure documents
Reuters has found that some of the biggest U.S. banks and other "loan servicers" continue to file questionable foreclosure documents with courts and county clerks. They are using tactics that late last year triggered an outcry, multiple investigations and temporary moratoriums on foreclosures. In recent months, servicers have filed thousands of documents that appear to have been fabricated or improperly altered, or have sworn to false facts. Reuters also identified at least six "robo-signers," individuals who in recent months have each signed thousands of mortgage assignments — legal documents which pinpoint ownership of a property. These same individuals have been identified — in depositions, court testimony or court rulings — as previously having signed vast numbers of foreclosure documents that they never read or checked. [read more]
JPMorgan fined for contravening Iran, Cuba sanctions
JPMorgan Chase Bank has been fined $88.3 million for contravening US sanctions against regimes in Iran, Cuba and Sudan, and the former Liberian government, the US Treasury Department announced Thursday. The Treasury said that the bank had engaged in a number of "egregious" financial transfers, loans and other facilities involving those countries but, in announcing a settlement with the bank, said they were "apparent" violations of various sanctions regulations. [read more]
This Is Considered Punishment? The Federal Reserve Wells Fargo Farce
What made the news surprising, of course, was that the Federal Reserve has rarely, if ever, taken action against a bank for making predatory loans. Alan Greenspan, the former Fed chairman, didn’t believe in regulation and turned a blind eye to subprime abuses. His successor, Ben Bernanke, is not the ideologue that Greenspan is, but, as an institution, the Fed prefers to coddle banks rather than punish them.
That the Fed would crack down on Wells Fargo would seem to suggest a long-overdue awakening. Yet, for anyone still hoping for justice in the wake of the financial crisis, the news was hardly encouraging. First, the Fed did not force Wells Fargo to admit guilt — and even let the company issue a press release blaming its wrongdoing on a “relatively small group.”
The $85 million fine was a joke; in just the last quarter, Wells Fargo’s revenues exceeded $20 billion. And compensating borrowers isn’t going to hurt much either. By my calculation, it won’t top $20 million. [read more]
U.S. securities regulators have taken the unprecedented step of asking high-frequency trading firms to hand over the details of their trading strategies, and in some cases, their secret computer codes. The requests for proprietary code and algorithm parameters by the Financial Industry Regulatory Authority (FINRA), a Wall Street brokerage regulator, are part of investigations into suspicious market activity, said Tom Gira, executive vice president of FINRA’s market regulation unit. [read more]
And here’s part of the Collapse Roundup I wrote on August 25th, referenced in the beginning of this report – as you will see, I would probably make a lot more money as an investment adviser:
Collapse Roundup #5: Goliath On The Ropes, Big Banks Getting Hit Hard, It’s A “Bloodbath” As Wall Street’s Crimes Blow Up In Their Face
Time to put your Big Bank shorts on! Get ready for arun…
The chickens are coming home to roost. Reality is catching up with the market riggers (Fed, ECB, PPT, CIA) and the “too big to fail” banks are getting whacked. Trillions of dollars in bailouts and legalized (FASB) accounting fraud cannot save these insolvent zombie banks any longer. The Grim Reaper is on the horizon and his sickle will do what paid off politicians won’t, cut ‘em down to size. So get your silver stakeready, time to plunge it into their vampire squid hearts….
What about Warren Buffet? He saved Goldman Sachs with a bailout in 2008. Can he save Bank of America?…
Warren’s bailout will help BofA over the short run, but $5 billion is just a drop in the bucket when it comes to their problems. The only thing his $5 billion will accomplish is a temporary run up in stock value so everyone who has been killed on the plummeting stock price can then jump out without complete loss….
Trouble a-comin’…
Goldman Sachs TANKS After CEO Lloyd Blankfein Hires Famous Defense Lawyer
Is the Goldman Sachs CEO facing a new lawsuit?
The market seems to think so. Goldman Sachs just tanked in minutes before the close after news that Lloyd Blankfein hired a lawyer famous for defending vilified execs. It’s back up a bit since dropping over 5%, but the news is still concerning.
It’s unclear whether the lawyer is for him, Goldman Sachs, or both, but Goldman Sachs’s CEO Lloyd Blankfein hired Reid Weingarten, a high profile defense attorney who says “I’m used to these monstrously difficult cases where everybody hates my clients,” according to Reuters.
Reuters says the hire might have something to do with accusations of Blankfein’s committing perjury. Or something else:
One former federal prosecutor, who was not authorized to speak publicly, said Blankfein may have hired outside counsel after receiving a request from investigators for documents or other information. [read full report]
Speaking of hiring lawyers…
The Global Banking Cartel’s Crimes Are Being Exposed Left & Right…
Blowing Up In Their Face… Prepare for Shock & Awe…
BOOM! Moody’s exposed:
MOODY’S ANALYST BREAKS SILENCE: Says Ratings Agency Rotten To Core With Conflicts
A former senior analyst at Moody’s has gone public with his story of how one of the country’s most important rating agencies is corrupted to the core.
The analyst, William J. Harrington, worked for Moody’s for 11 years, from 1999 until his resignation last year.
From 2006 to 2010, Harrington was a Senior Vice President in the derivative products group, which was responsible for producing many of the disastrous ratings Moody’s issued during the housing bubble.
Harrington has made his story public in the form of a 78-page “comment” to the SEC’s proposed rules about rating agency reform….
Here are some key points:
* Moody’s ratings often do not reflect its analysts’ private conclusions. Instead, rating committees privately conclude that certain securities deserve certain ratings–but then vote with management to give the securities the higher ratings that issuer clients want.
* Moody’s management and “compliance” officers do everything possible to make issuer clients happy–and they view analysts who do not do the same as “troublesome.” Management employs a variety of tactics to transform these troublesome analysts into “pliant corporate citizens” who have Moody’s best interests at heart.
* Moody’s product managers participate in–and vote on–ratings decisions. These product managers are the same people who are directly responsible for keeping clients happy and growing Moody’s business.
* At least one senior executive lied under oath at the hearings into rating agency conduct. Another executive, who Harrington says exemplified management’s emphasis on giving issuers what they wanted, skipped the hearings altogether. [read full report]
BOOM! The SEC Caught Covering Up Wall Street Crimes:
Matt Taibbi Exposes How SEC Shredded Thousands of Investigations
An explosive new report in Rolling Stone magazine exposes how the U.S. Securities and Exchange Commission destroyed records of thousands of investigations, whitewashing the files of some of the nation’s largest banks and hedge funds, including AIG, Wells Fargo, Lehman Brothers, Goldman Sachs, Bank of America and top Wall Street broker Bernard Madoff. Last week, Republican Sen. Chuck Grassley of Iowa said an agency whistleblower had sent him a letter detailing the unlawful destruction of records detailing more than 9,000 information investigations. We speak with Matt Taibbi, the political reporter for Rolling Stone magazine who broke this story in his latest article….
KA-BOOM! The Fed And All Their Crony-Capitalist Cartel Members Exposed, Yet Again:
Wall Street Pentagon Papers Part III – Are The Federal Reserve’s Crimes Still Too Big To Comprehend?
Another day, another trillion plus in secret Federal Reserve “bailouts” revealed. Bloomberg News exposes this latest Fed “deal” after winning a long Freedom of Information Act (FOIA) legal battle to get the details on what was done with the American people’s money. Their report runs with an AmpedStatus style headline: “Wall Street Aristocracy Got $1.2 Trillion From Fed.”
The aristocracy is alive and well… thanks to the Fed, of course.
Keep in mind, this $1.2 trillion is in addition to the $16 trillion the Government Accountability Office (GAO) audit revealed and the over $2 trillion in Quantitative Easing the Fed dished out, not to mention the now continued promise of the Zero Interest Rate Policy (ZIRP). This is also separate from the $700 billion TARP program that Congress approved. This is yet another unknown secret program, throwing another mere $1.2 trillion in public money at the Wall Street elite (global banking cartel), just being revealed now.
Those of us paying attention over the past three years have had Fed crony-capitalism on steroids fatigue for awhile now. Nonetheless, this is deja vu all over again as another mindbogglingly huge story that must be covered comes to light.
BOOM! GAO audit exposed, missing some vital details:
More on how the GAO’s Fed audit failed to disclose some dirty secrets about BlackRock and JP Morgan
In its review of the Fed’s outsourcing practices, it failed to mention the most damaging and suspicious sole-source (no bid) contract awarded to BlackRock, which was for handling the New York Fed’s toxic Bear Stearns portfolio, otherwise known as Maiden Lane. This contract would generate $108,000,000 in fees and was one of the largest awarded during the bailout period, but it might also have saved JP Morgan $1.1 billion in losses from its Bear Stearns acquisition….
Also, BlackRock was also one of the managers of the NY Fed’s separate $1.25 trillion MBS purchase program as part of QE1. Contrary to the lie on the NY Fed’s webpage (that the MBS auctions were conducted via competitive bidding), the NY Fed’s own purchasing manager, Brian Sack, admitted in a paper that, “the MBS purchases were arranged with primary dealer counterparties directly, [and] there was no auction mechanism to provide a measure of market supply.”
Putting it all together, it looks like Jamie Dimon signed off on hiring BlackRock for no justifiable reason to trade the very Maiden Lane portfolio that could have caused his bank, JP Morgan, to lose up to $1.1 billion. And, it was entirely possible that BlackRock saved the portfolio by trading the MBS portion of ML with the New York Fed directly as QE1 was underway. [read full report]
BOOM! Bear Stearns exposed:
Report Says Bear Stearns Executives Sold Illegal RMBS and Covered It Up
Former back office employees from Bear Stearns are coming out of the woodwork to explain how Tom Marano’s mortgage group cheated their own clients out of billions. This week I reported at The Distressed Debt Report, EMC insiders say they were told to make up the classification for whole loans, packaged into mortgage securities, to get them switched out of the trust. By classifying the loans as ‘prepaid’ or having ‘subsequent recoveries’ Bear employees were able to fool the trustee into giving them back loans they were not able to legally service. A move New York Attorney General Eric Schneiderman is actively investigating now.
In my latest DealFlow story we hear from EMC staffers who describe how subprime loans, that would have been sold by Bear Stearns trader Jeff Verschleiser’s team, never had a proper servicing license in West Virginia when they were packaged into the residential mortgage backed security. In 2003 Bear/EMC put $100 million of subprime loans from West Virginia into a few RMBS transactions. EMC, the banks wholly owned mortgage servicing shop, would service all of Bear’s RMBS after they were sold.
A year latter, when senior executies realized the mishap instead of Bear going out and informing their regulator and applying for a license, they orchestrated a cover up and even threaten EMC employees not to talk about it. [read full report]
Let’s end with this video. We need to keep in mind that the Federal Reserve has known about all of this criminal activity from the start. Yet, they have done everything they could, and are still trying, to keep this criminal operation up and running. As all these criminal banks begin to blow up, let’s not forget who their central bank is and what they have done to the American people.
Finally, after trillions in fraudulent activity, trillions in bailouts, trillions in printed money, billions in political bribing and billions in bonuses, the criminal cartel members on Wall Street are beginning to get what they deserve. As the Eurozone is coming apart at the seams and as the US economy grinds to a halt, the financial elite are starting to turn on each other. The lawsuits are piling up fast. Here’s an extensive roundup:
Time to put your Big Bank 
Is the Goldman Sachs CEO facing a new lawsuit?
Another day, another trillion plus in secret Federal Reserve “bailouts” revealed. Bloomberg News exposes this latest Fed “deal” after winning a long Freedom of Information Act (FOIA) legal battle to get the details on what was done with the American people’s money. Their report runs with an AmpedStatus style headline: “Wall Street Aristocracy Got $1.2 Trillion From Fed.”