Squirrlnutz Posted August 24, 2011 Report Share Posted August 24, 2011 [url="http://www.rollingstone.com/politics/blogs/taibblog/obama-goes-all-out-for-dirty-banker-deal-20110824"]http://www.rollingstone.com/politics/blogs/taibblog/obama-goes-all-out-for-dirty-banker-deal-20110824[/url] Matt Taibbi [quote] [size=4]Obama Goes All Out For Dirty Banker Deal[/size] [size=4] [b]On the one side is Eric Schneiderman, the New York Attorney General, who is conducting his own investigation into the era of securitizations – the practice of chopping up assets like mortgages and converting them into saleable securities – that led up to the financial crisis of 2007-2008.[/b][/size] [size=4] On the other side is the Obama administration, all the banks, and, now, apparently, all the other state attorneys general.[/size] [size=4] This second camp has all gotten together, put their heads together, and cooked up a deal that would allow the banks to walk away with just a seriously discounted fine from a generation of fraud that led to millions of people losing their homes.[/size] [size=4] The idea behind this federally-guided “settlement” is to concentrate and centralize all the legal exposure accrued by this generation of grotesque banker corruption in one place, put one single price tag on it that everyone can live with, and then stuff the details into a titanium canister before shooting it into deep space.[/size] [size=4] This deal is all about protecting the banks from future enforcement actions on both the civil and criminal sides. The plan is to provide year-after-year, repeat-offending banks like Bank of America with some stability and certainty, so that they know exactly how much they’ll have to pay in fines (trust me, it will end up being a tiny fraction of what they made off the fraudulent practices) and will also get to know for sure that there are no more criminal investigations in the pipeline. [/size] [size=4] This deal will also submarine efforts by both defrauded investors in MBS and unfairly foreclosed-upon homeowners and borrowers to obtain any kind of relief in the civil court system. The AGs initially talked about $20 billion as a settlement number, money that would “toward [url="http://topics.nytimes.com/your-money/loans/loan-modifications/index.html?inline=nyt-classifier"]loan modifications[/url] and possibly counseling for homeowners,” as Gretchen Morgenson reported the other day.[/size] [size=4] The banks, however, apparently “balked” at paying that sum, and no doubt it will end up being a lesser amount when the deal is finally done.[/size] [size=4] To give you an indication of how absurdly small a number even $20 billion is relative to the sums of money the banks made unloading worthless crap subprime assets on foreigners, pension funds and other unsuspecting suckers around the world, consider this: in 2008 alone,[url="http://www.tampabay.com/news/business/article905919.ece"] the state pension fund of Florida, all by itself, lost more than three times that amount ($62 billion)[/url] thanks in significant part to investments in these deadly MBS. [/size] [size=4] So this deal being cooked up is the ultimate Papal indulgence. By the time that $20 billion (if it even ends up being that high) gets divvied up between all the major players, the broadest and most destructive fraud scheme in American history, one that makes the S&L crisis look like a cheap liquor store holdup , will be safely reduced to a single painful but eminently survivable one-time line item for all the major perpetrators.[/size] [size=4] [b]But New York’s Schneiderman, who earlier this year launched an investigation into the securitization practices of Goldman, Morgan Stanley, Bank of America and other companies, is screwing up this whole arrangement. Until he lies down, the banks don’t have a deal. They need the certainty of having all 50 states and the federal government on board, or else it’s not worth paying anybody off.[/b] To quote the immortal Tony Montana, [url="http://www.hark.com/clips/yvrfczjhsc-last-cop-i-am-going-to-have-to-grease"]“How do I know you’re the last cop I’m gonna have to grease?”[/url] They need [i]all [/i]the dirty cops on board, or else the whole enterprise is FUBAR. [/size] [size=4] In addition to the global settlement, Schneiderman is also blocking an individual $8.5 billion settlement for Countrywide investors. He has sued to stop that deal, claiming it could “compromise investors’ claims in exchange for a payment representing a fraction of the losses.”[/size] [size=4] If Schneiderman thinks $8.5 billion is an insufficient, fractional payoff just for defrauded Countrywide investors, then you can imagine how bad a $20 billion settlement for the entire industry would be for the victims.[/size] [size=4] In that particular Countrywide settlement deal, incidentally, it looks like Bank of New York Mellon, the New York Fed, Pimco and other players negotiated on behalf of defrauded investors. They told the [i]Times [/i]they were happy with the deal, but investors outside the talks told Gretchen they weren’t happy with the settlement. Schneiderman apparently listened to those voices instead of the Mellon-Fed-BofA crowd, which infuriated the insiders who struck the actual deal. In a remarkable quote given to the [i]Times, [/i]Kathryn Wylde, the Fed board member who ostensibly represents the public said the following about Schneiderman:[/size] [indent][size=4] It is of concern to the industry that instead of trying to facilitate resolving these issues, you seem to be throwing a wrench into it. Wall Street is our Main Street — love ’em or hate ’em. They are important and we have to make sure we are doing everything we can to support them unless they are doing something indefensible.[/size] [/indent][size=4] This, again, is coming not from a Bank of America attorney, but from the person on the Fed board who is supposedly representing the public![/size] [size=4] This quote leads one to wonder just what Wylde would consider “indefensible,” given that [i]stealing [/i]is pretty much the worst thing that a bank can do, and these banks just got finished the longest and most orgiastic campaign of stealing in the history of money. Is Wylde waiting for Goldman and Citi to blow up a skyscraper? Dump dioxin into an orphanage? It’s really an incredible quote.[/size] [size=4] The banks are going to claim that all they’re guilty of is bad paperwork. But while the banks are indeed being investigated for mass tax evasion (by failing to pay fees associated with mortgage registrations deed transfers) and mass perjury (a la the “robo-signing” practices), their real crime, the one Schneiderman is interested in, is even more serious.[/size] [size=4] The issue goes beyond fraudulent paperwork to an intentional, far-reaching theft scheme designed to take junk subprime loans and disguise them as AAA-rated investments. The banks lent money to corrupt companies like Countrywide, who made masses of bad loans and immediately sold them back to the banks. The banks in turn hid the crappiness of these loans via certain poorly-understood nuances in the securitization process – this is almost certainly where Scheniderman’s investigators are looking – before hawking the resultant securities as AAA-rated gold to fools in places like the Florida state pension fund.[/size] [size=4] They did this for years, systematically, working hand in hand in a wink-nudge arrangement with clearly criminal enterprises like Countrywide and New Century, with the victims being millions of investors worldwide (like the pensioners who saw their funds drop in value) and hundreds of thousands of individual homeowners, who were often sold trick loans and often hustled into foreclosure when unexpected rate hikes kicked in.[/size] [size=4] In a larger sense, even the (often irresponsible) people who simply bought more house than they could afford were victims of this scam, for in many cases credit simply would not have been available to those people had the banks not discovered a way to raise vast sums of money dumping crap loans on an unsuspecting market.[/size] [size=4] If Bank of America hadn’t found a way to sell worthless subprime loans as AAA paper to the Chinese and the Scandavians in May, you can be sure that it wouldn’t be going back to Countrywide in June to lend out more money for more subprime loans. And Countrywide, in turn, wouldn’t have been sending masses of reps out into the ghettoes to offer juicy home loans to undocumented immigrants and refis to confused old ladies on social security.[/size] [size=4] This is as bad as white-collar crime gets, but to Wylde, it doesn’t rise to the level of being “indefensible.” Until they do something worse than this, we apparently should support the banks, and make sure they don’t have to pay more than a fraction of what they made off of this kind of crime. What I love about Wylde’s quote is the clear implication that even an Attorney General like a law enforcement official like Schneiderman should view it as his job to “do everything we can to support” Wall Street. That would be astonishing interpretation of what a lawman’s duties are, were it not for the fact that 49 other Attorneys General apparently agree with her.[/size] [size=4] [b]In Schneiderman we have at least one honest investigator who doesn’t agree, which is to his great credit. But everyone else is on Wylde’s side now. The [i]Times [/i]story claims that HUD Secretary Shaun Donovan and various Justice Department officials have been leaning on the New York AG to cave, which tells you that reining in this last rogue cop is now an urgent priority for Barack Obama.[/b][/size] [size=4] Why? My theory is that the Obama administration is trying to secure its 2012 campaign war chest with this settlement deal. If he can make this foreclosure thing go away for the banks, you can bet he’ll win the contributions battle against the Republicans next summer. Which is good for him, I guess, but it seems to me that it might be time to wonder if is this the most disappointing president we’ve ever had. [/quote] So what happens when one guy stands up to the machine? [url="http://www.democracynow.org/2011/8/24/headlines/ny_attorney_general_booted_from_mortgage_company_settlement_task_force"]http://www.democracynow.org/2011/8/24/headlines/ny_attorney_general_booted_from_mortgage_company_settlement_task_force[/url] [/size] [quote] [b] NY Attorney General Booted from Mortgage Company Settlement Task Force[/b] New York Attorney General Eric Schneiderman has been kicked off a 50-state task force negotiating a possible settlement with the nation’s largest mortgage companies. The move came just one day after the New York Times reported that the Obama administration was pressuring Schneiderman to agree to a broad state settlement with banks over questionable foreclosure tactics. The federal settlement has been widely criticized because it would insulate the nation’s largest banks, including Bank of America, Citigroup, JPMorgan Chase and Wells Fargo, from all criminal investigations in exchange for civil fines. Schneiderman, who is leading his own investigation into the mortgage industry, has said that he opposes any deal that gives participating banks a release from other litigation surrounding their mortgage activities. [/quote] We all lose, thats what happens. Link to comment Share on other sites More sharing options...
Jamie_B Posted August 24, 2011 Report Share Posted August 24, 2011 **sigh** Link to comment Share on other sites More sharing options...
|Elflocko| Posted August 24, 2011 Report Share Posted August 24, 2011 [media]http://www.youtube.com/watch?v=i5dBZDSSky0[/media] It's a big club, and you ain't in it... Link to comment Share on other sites More sharing options...
|Tigers Johnson| Posted August 24, 2011 Report Share Posted August 24, 2011 Bill Seitz... SB5. Happens all the time. Link to comment Share on other sites More sharing options...
Jamie_B Posted August 25, 2011 Report Share Posted August 25, 2011 Well said George. Link to comment Share on other sites More sharing options...
Vol_Bengal Posted August 25, 2011 Report Share Posted August 25, 2011 In the end... we get screwed... And, somebody actually asked me why I automatically assume the worst in politicians... I know, I know - only Obama is the politician here but if they cared they wouldn't allow this shit to go on... Link to comment Share on other sites More sharing options...
Jamie_B Posted August 25, 2011 Report Share Posted August 25, 2011 It's the system, the system doesnt allow for caring, it allows for me getting elected. The Oligrachy is only going to get broken through revolution, I just hope its not a violent one. Link to comment Share on other sites More sharing options...
Jamie_B Posted August 25, 2011 Report Share Posted August 25, 2011 On this note... [url="http://www.boston.com/Boston/politicalintelligence/2011/08/romney-would-repeal-dodd-frank-law/FrxSh5Jqsdveyjy5tgKzxK/index.html"]http://www.boston.com/Boston/politicalintelligence/2011/08/romney-would-repeal-dodd-frank-law/FrxSh5Jqsdveyjy5tgKzxK/index.html[/url] [quote] [b] Romney would repeal Dodd-Frank law[/b] CLAREMONT, N.H. - Republican presidential candidate Mitt Romney has sharpened his critique of the financial regulatory overhaul signed by President Obama. In response to the financial meltdown, Obama and Congress passed the Dodd-Frank bill, Wall Street reform legislation that enacted consumer protections, reformed some derivatives trading, and imposed new regulations on mortgage lenders and hedge funds. In the past, Romney has criticized the bill for creating uncertainty in the financial industry and causing bankers and the financial service employees to pull back . Today, he went further and said he would repeal Dodd-Frank, if he were elected president. “The extent of regulation in the banking industry has become extraordinarily burdensome following Dodd-Frank,” Romney told a roundtable of 18 businessmen at The Common Man Restaurant. “I’d like to repeal Dodd Frank, recognizing that some revisions make sense,” Romney said. In July, Romney was unable to name specific parts of the bill that he liked or disliked. When asked, he said only, “It’s 2,000 pages. I’m sure there’s something in there that’s good…I’d be happy to take a look at it perhaps line by line at some point and lay out the provisions that I think are unfortunate.’’ Today, he was more specific. Romney said he believes it does make sense to regulate derivatives. He said it also makes sense to have different capital requirements if someone is holding a home mortgage compared to someone holding high-risk securities. “Some features have to be addressed,” he said. At the same time, he said, the 2,000 pages of the bill are “overwhelming” for community banks and the fact that pages of rules must still be written creates too much uncertainty. Romney also took a swipe at Obama on the jobs front. Romney intends to lay out his jobs plan Sept. 6 in Nevada – the same week as Obama plans to release his own plan for creating jobs. “I’d like to have mine come out a day or two before his does so he can copy a couple of ideas,” Romney said. “If so we’ll have a lot better chance of actually getting people back to work.” [/quote] Link to comment Share on other sites More sharing options...
Vol_Bengal Posted August 25, 2011 Report Share Posted August 25, 2011 [quote name='Jamie_B' timestamp='1314288141' post='1020850'] On this note... [url="http://www.boston.com/Boston/politicalintelligence/2011/08/romney-would-repeal-dodd-frank-law/FrxSh5Jqsdveyjy5tgKzxK/index.html"]http://www.boston.co...KzxK/index.html[/url] [/quote] In fairness... It ought to be. It is some of the worst-written legislation I've had to deal with. The initial idea was wonderful. What they turned out is a regulatory nightmare, particularly for financial institutions that actually do have their members' best financial interests in mind. The whole thing needs to be re-written to ACTUALLY solve the issues that were there effectively and not hamstring FI's that were doing it the right way to start with. Link to comment Share on other sites More sharing options...
|Elflocko| Posted August 25, 2011 Report Share Posted August 25, 2011 They needed to re-institute Glass-Steagall... Link to comment Share on other sites More sharing options...
CincyInDC Posted August 25, 2011 Report Share Posted August 25, 2011 [quote name='Elflocko' timestamp='1314295228' post='1020920'] They needed to re-institute Glass-Steagall... [/quote] bank of america doesn't think so... Link to comment Share on other sites More sharing options...
|Elflocko| Posted August 25, 2011 Report Share Posted August 25, 2011 There's a shocker... Link to comment Share on other sites More sharing options...
sois Posted August 25, 2011 Report Share Posted August 25, 2011 [quote name='Elflocko' timestamp='1314295228' post='1020920'] They needed to re-institute Glass-Steagall... [/quote] yup fucking banks Link to comment Share on other sites More sharing options...
Jamie_B Posted August 25, 2011 Report Share Posted August 25, 2011 [quote name='Elflocko' timestamp='1314295228' post='1020920'] They needed to re-institute Glass-Steagall... [/quote] This. Link to comment Share on other sites More sharing options...
Jamie_B Posted August 25, 2011 Report Share Posted August 25, 2011 [quote name='Vol_Bengal' timestamp='1314295025' post='1020918'] In fairness... It ought to be. It is some of the worst-written legislation I've had to deal with. The initial idea was wonderful. What they turned out is a regulatory nightmare, particularly for financial institutions that actually do have their members' best financial interests in mind. The whole thing needs to be re-written to ACTUALLY solve the issues that were there effectively and not hamstring FI's that were doing it the right way to start with. [/quote] You realize of course he just admitted to wanting to repeal something he hasnt read? Link to comment Share on other sites More sharing options...
|Elflocko| Posted August 25, 2011 Report Share Posted August 25, 2011 [quote name='Jamie_B' timestamp='1314299438' post='1020950'] You realize of course he just admitted to wanting to repeal something he hasnt read? [/quote] I'm convinced that you could say that about pretty much everything that passes in DC... Link to comment Share on other sites More sharing options...
Jamie_B Posted August 25, 2011 Report Share Posted August 25, 2011 [quote name='Elflocko' timestamp='1314299699' post='1020952'] I'm convinced that you could say that about pretty much everything that passes in DC... [/quote] Sadly this is likely true. Link to comment Share on other sites More sharing options...
Vol_Bengal Posted August 25, 2011 Report Share Posted August 25, 2011 [quote name='Jamie_B' timestamp='1314299438' post='1020950'] You realize of course he just admitted to wanting to repeal something he hasnt read? [/quote] Sure... understand, Jamie, I'm not promoting him as a candidate. I'm strictly looking at it from a "that legislation is crap" perspective. Nothing more. None of them have read it. He's just echoing what his people tell him to say. [quote name='Elflocko' timestamp='1314299699' post='1020952'] I'm convinced that you could say that about pretty much everything that passes in DC... [/quote] This. Bar none, isn't even debatable. Link to comment Share on other sites More sharing options...
Fela Kuti Posted August 25, 2011 Report Share Posted August 25, 2011 Matt Taibbi is our generation's best author Link to comment Share on other sites More sharing options...
Jamie_B Posted August 26, 2011 Report Share Posted August 26, 2011 [quote name='Fela Kuti' timestamp='1314312518' post='1021073'] Matt Taibbi is our generation's best author [/quote] Absolutely. Link to comment Share on other sites More sharing options...
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