The Map Pr0n
and the Graph Pr0n
Calculated Risk looks at the quarterly change in the Philadelphia Fed’s 50 state coincident index, and the map, and the graph and the map is getting redder (worse).
The idea that this is going to a meaningful recovery with a significant fiscal push from the government, which ain’t happening, because the ‘Phants are tanking the economy deliberately for political gain, is pure panglossian delusion.
H/t Emptywheel.
We just had an earthquake, in Maryland.
A little shaking, and nothing fell down.
According to the USGS, the preliminary number was 5.9 (!) on the Richter Scale, centered at 37.875°N, 77.908°W, near Mineral, VA.
The epicenter was about 250km (150 miles) from me, so it felt like a semi driving by here.
I’m glad that I’ve given up caffein, or I might not have noticed.
Posted via mobile.
Former Luzerne County Court Judge Mark A. Ciavarella Jr., who took bribes from private prison companies to send kids to jail, was sentenced to 28 years in jail:
As his moment of sentencing drew near Thursday, former Luzerne County Court Judge Mark A. Ciavarella Jr. was still trying to minimize his crimes. No way, he said, had he sold “kids for cash.”
The prosecutor would have none of it.
“In essence, Mr. Ciavarella’s argument is, ‘I was not selling kids retail,’ ” Assistant U.S. Attorney Gordon A.D. Zubrod said. “We agree with that. He was selling them wholesale.”
Minutes later, U.S. District Judge Edwin M. Kosik slammed Ciavarella, 61, with 28 years in prison. It appeared to be the longest federal prison sentence ever given in a U.S. political corruption case.
In the Scranton area, Ciavarella was a key target among many in a sweeping and still-ongoing federal corruption probe. Prosecutors have brought charges against nearly 30 officials, including two other judges, numerous court officials, a former state senator, school board members, and county officials.
(emphasis mine)
It may be a record long sentence, but it is not long enough.
His partner in crime, county president judge Michael T. Conahan, has already pled guilty, and is awaiting sentencing.
Hopefully, he gets a sentence of similar length.
Look at the video for this gem. A representative of Bank of America walks up to Rick Perry, and says, “Bank of America… We will help you out”.
It turns out that be Bank Of America’s director of public policy, James Mahoney.
Nope, no quid pro quo here, BoA has released a statement saying that, “Bank of America does not endorse Presidential candidates. The reference was about following up on the substance of the speech about job creation and economic growth.”
Yeah, we believe you, and we believe it when you say that MERS properly recorded mortgages, and that you f%$#s didn’t pay off the ratings agencies to rate your garbage as AAA,
H/t Cthulhu.*
*No, not the unspeakably malevolent super-being, the contributor to the Stellar Parthenon BBS.†
†OK, I’ve never seen the two of them together, so Cthulhu might actually be the Cthulhu, but the mere fact that he is on a BBS, interacting with humans‡ would seem to mitigate against this.
‡Yes, I know, this is the internet, where no one knows if you are a dog.
We are getting leaks that the Obama administration is going full bore to prevent New York State Attorney General from doing a thorough and diligent investigation of the banksters mortgage fraud:
Eric T. Schneiderman, the attorney general of New York, has come under increasing pressure from the Obama administration to drop his opposition to a wide-ranging state settlement with banks over dubious foreclosure practices, according to people briefed on discussions about the deal.
In recent weeks, Shaun Donovan, the secretary of Housing and Urban Development, and high-level Justice Department officials have been waging an intensifying campaign to try to persuade the attorney general to support the settlement, said the people briefed on the talks.
Mr. Schneiderman and top prosecutors in some other states have objected to the proposed settlement with major banks, saying it would restrict their ability to investigate and prosecute wrongdoing in a variety of areas, including the bundling of loans in mortgage securities.
But Mr. Donovan and others in the administration have been contacting not only Mr. Schneiderman but his allies, including consumer groups and advocates for borrowers, seeking help to secure the attorney general’s participation in the deal, these people said. One recipient described the calls from Mr. Donovan, but asked not to be identified for fear of retaliation.
So, not only are they pressuring Schneiderman, but they are trying to gin up an AstroTurf response to further intimidate him.
I’m with what Yves Smith said, “It is high time to describe the Obama Administration by its proper name: corrupt.” (emphasis mine)
What’s more, he’s also catching flack from the in the person of Kathryn Wylde, Deputy Chair of the New York Bank of the Federal Reserve, who accosted him at a memorial service
Representatives for the four big banks declined to comment. Mr. Schneiderman has also come under criticism for objecting to a settlement proposed by Bank of New York Mellon and Bank of America that would cover 530 mortgage-backed securities containing Countrywide Financial loans that investors say were mischaracterized when they were sold.
The deal would require Bank of America to pay $8.5 billion to investors holding the securities; the unpaid principal amount of the mortgages remaining in the pools totals $174 billion. Lawyers representing 22 institutional investors, including the Federal Reserve Bank of New York, BlackRock and Pimco, contended that the deal was favorable.
This month, Mr. Schneiderman sued to block that deal, which had been negotiated by Bank of New York Mellon as trustee for the holders of the securities. The lawsuit contends that the deal could “compromise investors’ claims in exchange for a payment representing a fraction of the losses” experienced by investors and that it had been negotiated without the knowledge of all of the holders of the securities.
The lawsuit angered Bank of New York Mellon, and as Mr. Schneiderman was leaving the memorial service last week for Hugh Carey, the former New York governor who died Aug. 7, an attendee said Mr. Schneiderman became embroiled in a contentious conversation with Kathryn S. Wylde, a member of the board of the Federal Reserve Bank of New York who represents the public. Ms. Wylde, who has criticized Mr. Schneiderman for bringing the lawsuit, is also chief executive of the Partnership for New York City. The New York Fed has supported the proposed $8.5 billion settlement.
Other investors in the Countrywide mortgage pools who were not part of the settlement talks between Bank of New York Mellon and Bank of America have called the terms inadequate.
Characterizing her conversation with Mr. Schneiderman that day as “not unpleasant,” Ms. Wylde said in an interview on Thursday that she had told the attorney general “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.”
(emphasis mine)
Defrauding investors and home buyers is defensible?
I’m with Barry Ritholtz, who has called for Wylds’s resignation:
If the Times report is accurate, and the quote below [it;s the last paragraph above quote] represents Ms. Wylde’s comments, than that position is a laughable mockery, and Ms. Wylde should resign effective immediately.
…………
But what is surprising is the utterly inappropriate behavior of Kathryn S. Wylde. She is not only a member of the board of the Federal Reserve Bank of New York, but occupies the seat supposedly reserved for the representing the public.
If the Times report is accurate, and the quote below represents Ms. Wylde’s comments, than that position is a laughable mockery, and Ms. Wylde should resign effective immediately.
(emphasis mine)
In any case, if you want to contact the AG and tell him not to back off, you can call (800) 771-7755 or at (212) 416-8000) or use his e-mail form.
This is particularly recommended.
BTW, if you live in Delaware, you might want to drop a dime on Beau Biden, the VP’s son, and Delaware’s AG, who has joined with Schneiderman in opposing the BoA deal.
If the Fed and the Obama administration are dead set on any sort of meaningful reform or accountability for the banks, then we need back up the State Attorneys General to pursue the banksters.
[on edit]
The AGs or Massachusetts and Nevada are also balking on the settlement offer, and considering that Nevada has probably the worst foreclosure problems in the nation, it makes any settlement even more problematic.
Not the historical figure, but rather the nom de blog of the principal of Economic Policy Advice for Barack Obama, formerly called Economists for Firing Larry Summers, has returned to posting after taking a few months off because life (Grad School, my guess) got in the way.
I still use the old name in my blogroll, because I think that it is a better name.
His posts are uniformly good, but rather too infrequent for the medium of a blog.
Or will be in a matter of hours.
I was listening to NPR, and they were hoping that the rebels would not go medieval on former Gaddafi loyalists, but that is a pipe dream.
They have no credibility, because they were installed largely as the result of direct military action by NATO, which requires the widespread application of violence against any potential opposition.
Additionally, because they are effectively clients of big oil and finance NATO, they will have to aggressively implement “free market reforms”, which means the end of their publicly financed healthcare and education systems, as well as signing sweetheart deals with big oil, which will not be supported by the general populace.
It’s good that Gaddafi is gone, but because he was removed through what was essentially a colonial intervention, the new regime will for the foreseeable future be a colonial administration, which may in the long run prove worse for the average Libyan.
Wall Street Aristocracy Got $1.2T in Loans
The “T” stands for Trillion, and we need to bring back Madame Guillotine.
I’m shocked, shocked to find that gambling is going on here!A former senior VP at Moody’s has written a detailed layer to the SEC alleging that the ratings agency systematically pressured analysts to uprate crappy derivatives:
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, which he submitted to the agency on August 8th. The comment is a scathing indictment of Moody’s processes, conflicts of interests, and management, and it will likely make Harrington a star witness at any future litigation or hearings on this topic.
His specific allegations:
(emphasis original)
The fact that no senior manager on Wall Street has been indicted over this sort of behavior, and they continue to work, and continue to be criminally overpaid, fills me with despair.
Cthulhu* posted this, and I felt that it had to be shared:
With the plethora of archetypes in the animated series, I’m beginning to think that this might be some sort of modern Gilgamesh for our day.
*No, not the unspeakably malevolent super-being, the contributor to the Stellar Parthenon BBS.†
†OK, I’ve never seen the two of them together, so Cthulhu might actually be the Cthulhu, but the mere fact that he is on a BBS, interacting with humans‡ would seem to mitigate against this.
‡Yes, I know, this is the internet, where no one knows if you are a dog.
Something odd on the FDIC failed bank page, do you notice it?
Do you see it? Public Savings Bank, of Huntingdon Valley, PA was closed yesterday, a Thursday.
The only other time I remember the FDIC closing a bank on a not-Friday, it was when senior bank executives were facing a criminal indictment as well.
That’s my guess anyway. These non-Friday closings tend to be associated with breaking news of some sort of criminality.
In any case, here are the bank failures, ordered, and numbered for the year so far.
So, here is the graph pr0n with last years numbers for comparison (FDIC only):
It’s not just S&P, it’s Moody’s too:
The U.S. Justice Department is probing Moody’s Investors Service and Standard & Poor’s over ratings of mortgage-backed securities, according to three former employees who said they were interviewed by investigators.
Washington-based lawyers from the Justice Department spoke to former employees as recently as last month about whether the companies raised their grades for the complex investments in order to win business, said the former employees, who asked for anonymity because the investigation is ongoing. The inquiry is a civil matter, two of them said.
The probe is the latest of dozens of government investigations and investor lawsuits targeting Moody’s and S&P, a unit of McGraw-Hill Cos., all based in New York, over the top grades they assigned to bonds backed by subprime mortgages. Even as the Financial Crisis Inquiry Commission called them “key enablers of the financial meltdown,” the raters avoided legal liability, according to Benchmark Co.’s Edward Atorino.
Note there that the DoJ being involved means that this is some sort of criminal investigation.
Here’s hoping that Eric “Place” Holder doesn’t decide to look forward instead of backward.
But as a part of the joint announcement by Sarkosy and Merkel on greater EU integration to fix the current series of debt crises they have proposed to impliment a Tobin tax on financial transactions:
The French president, Nicolas Sarkozy, and German chancellor, Angela Merkel, announced the dramatic proposals after a two-hour mini-summit. They also called for the imposition of tighter restrictions on member country’s deficits and announced a synchronising of the tax policies of their own two countries. Sarkozy has also secured the support of Merkel for a Tobin tax – a financial tax on all international transactions – to raise funds to ease the crisis engulfing the European economy.
The amount of money generated by a Tobin tax would actually be smaller than generally anticipated, because much of the financial activity is pure short speculation, where extremely short term bets with payoffs of a fraction of a percent, create profits for doing nothing.
The banks suggest that such a tax is a bad idea because it would discourage such activity, but I consider it to be an even more valuable feature than any potential revenue raised.
Much of the unproductive rent seeking that occurs in our economy is an artifact of just such a behavior.
So, to paraphrase this xkcd cartoon, Mission F%$#ing Accomplished:
Of course, in reality, it’s just smoke and mirrors: The Tobin Tax proposal is just a way to sell their idea for a European balanced budget amendment, and at the end of the day, the Tobin Tax will go away, and the Banksters will get what they want, because that’s how the game is played.
Mark Thoma has a good analysis of the tax, and you can also check out the Wiki page.
H/t Calculated Risk for the Chart Pr0n
The Federal Reserve Bank of Philadelphia’s index of economic activity just fell off a cliff:
Optimists on the U.S. economy have conceded that things are weak, but they’ve argued we’re not falling off a cliff.
But on Thursday, Wall Street got a hint that a cliff dive could be imminent.
Philly The Philadelphia Federal Reserve Bank’s index of economic activity in the mid-Atlantic region plummeted to a negative 30.7 this month, down from a positive 3.2 in July and the lowest since a negative 30.8 reading in March 2009 — in the depths of the last recession.
Get ready for President Bachmann and similar disasters.
And initial claims are back above 400,000 this week, though the week moving average and continuing claims fell.
It’s really crappy, and in a sane world people in power would be freaking out about this.
In Illinois, the state Department of Revenue regularly certifies non-profits, with the idea making sure that they behave in a not-for-profit manner, as opposed to accumulating mountains of cash and overpaying their executives.
Well they have now denied tax exemptions to three hospitals, and are reviewing 15 more because they are abrogating their responsibility to serve their communities:
The Illinois Department of Revenue has denied property tax exemptions to three hospitals and is reviewing applications from 15 others, officials said Tuesday, signaling that the state plans to get tough on nonprofit hospitals it believes operate more like businesses than charities.
At stake are millions of dollars in tax revenues that the hospitals could contribute to cities, parks and schools by paying taxes.
Northwestern Memorial’s Prentice Women’s Hospital in Chicago’s Gold Coast neighborhood, Edward Hospital in Naperville and Decatur Memorial Hospital in Decatur were informed of the decisions Tuesday morning, Revenue Department officials told The Associated Press.
They follow last year’s Illinois Supreme Court ruling that found a central Illinois hospital wasn’t doing enough free or discounted treatment of the poor to qualify for an exemption, obligating it to pay $1.2 million in local property tax payments per year.
The hospitals have 60 days to ask an administrative law judge to review the decisions. In Illinois, property taxes are collected by county governments, and the Department of Revenue decides which institutions are eligible for tax exemptions.
This is actually something bears on my personal past, not from the hospital angle, but from the undeserving non-profit angle.
A little over 20 years (!) ago, I incorporated a not-for profit tax exempt corporation as a 501(c)3 that puts on Science Fiction conventions, which in that case meant that I represented it as an educational organization. While technically legal, I’ve always felt that the organization was more properly a 501(c)7, a social organization.
I filled out the forms, and chased them through the state and federal bureaucracies. And it was all technically legal, and I did not materially misrepresent anything in the applications
That being said, even at the time, I felt that this was an undeserving use of this status.
I was aware of the differences between a (c)3 and a (c)7 at the time, but we felt that we needed the ability for people to deduct donations, and (more importantly) the postage discount available for the (c)3.
The more scrutiny that is placed on organizations that use these sorts of status as a shield (501(c)4 tend to be used as political front group, for example), the better.
There are a lot of slimy things under the rocks that are section 501 of the IRS code.
H/t Washington Monthly.
He just uncovered another bit of regulatory capture, specifically he is reporting on allegations that the SEC routinely destroyed all records of its investigations:
Imagine a world in which a man who is repeatedly investigated for a string of serious crimes, but never prosecuted, has his slate wiped clean every time the cops fail to make a case. No more Lifetime channel specials where the murderer is unveiled after police stumble upon past intrigues in some old file – “Hey, chief, didja know this guy had two wives die falling down the stairs?” No more burglary sprees cracked when some sharp cop sees the same name pop up in one too many witness statements. This is a different world, one far friendlier to lawbreakers, where even the suspicion of wrongdoing gets wiped from the record.
That, it now appears, is exactly how the Securities and Exchange Commission has been treating the Wall Street criminals who cratered the global economy a few years back. For the past two decades, according to a whistle-blower at the SEC who recently came forward to Congress, the agency has been systematically destroying records of its preliminary investigations once they are closed. By whitewashing the files of some of the nation’s worst financial criminals, the SEC has kept an entire generation of federal investigators in the dark about past inquiries into insider trading, fraud and market manipulation against companies like Goldman Sachs, Deutsche Bank and AIG. With a few strokes of the keyboard, the evidence gathered during thousands of investigations – “18,000 … including Madoff,” as one high-ranking SEC official put it during a panicked meeting about the destruction – has apparently disappeared forever into the wormhole of history.
Under a deal the SEC worked out with the National Archives and Records Administration, all of the agency’s records – “including case files relating to preliminary investigations” – are supposed to be maintained for at least 25 years. But the SEC, using history-altering practices that for once actually deserve the overused and usually hysterical term “Orwellian,” devised an elaborate and possibly illegal system under which staffers were directed to dispose of the documents from any preliminary inquiry that did not receive approval from senior staff to become a full-blown, formal investigation. Amazingly, the wholesale destruction of the cases – known as MUIs, or “Matters Under Inquiry” – was not something done on the sly, in secret. The enforcement division of the SEC even spelled out the procedure in writing, on the commission’s internal website. “After you have closed a MUI that has not become an investigation,” the site advised staffers, “you should dispose of any documents obtained in connection with the MUI.”
Many of the destroyed files involved companies and individuals who would later play prominent roles in the economic meltdown of 2008. Two MUIs involving con artist Bernie Madoff vanished. So did a 2002 inquiry into financial fraud at Lehman Brothers, as well as a 2005 case of insider trading at the same soon-to-be-bankrupt bank. A 2009 preliminary investigation of insider trading by Goldman Sachs was deleted, along with records for at least three cases involving the infamous hedge fund SAC Capital.
The widespread destruction of records was brought to the attention of Congress in July, when an SEC attorney named Darcy Flynn decided to blow the whistle. According to Flynn, who was responsible for helping to manage the commission’s records, the SEC has been destroying records of preliminary investigations since at least 1993. After he alerted NARA to the problem, Flynn reports, senior staff at the SEC scrambled to hide the commission’s improprieties.
And that’s just his first 5 paragraphs.
What’s also in the article is the pattern of what can only be described as a patterned of end loaded bribery, where SEC senior bureaucrats spiked investigations, destroyed all evidence collected, and then found well remunerated positions with firms that they had “exonerated.”
There should be hundreds of people on Wall Street, and regulating Wall Street, who should have been frog marched out of the places of work in hand cuffs.
*In a 110% purely heterosexual kind of way, of course, as the General would say.
With Democrats almost retaking the Senate in Wisconsin, and his union busting bill down significantly in the polls, Ohio wingnut Governor John Kasich is asking for Democratic Party and labor groups if he could negotiate to forestall the referendum:
Gov. John Kasich and fellow Republicans William Batchelder, Ohio House speaker from Medina, and Senate President Tom Niehaus of New Richmond, offered today to revise the controversial collective bargaining law, known as Senate Bill 5, if public unions will drop their campaign to repeal the bill on the November ballot.
We Are Ohio, the coalition of unions behind the repeal effort, has rejected earlier back-channel efforts by some Republicans to strike a deal, citing the GOP-controlled legislature’s unwillingness to compromise when the bill was written.
Following a press conference by Kasich, We Are Ohio issued the following statement rejecting a call for a compromise.
“We’re glad that Governor Kasich and the other politicians who passed SB 5 are finally admitting this is a flawed bill,” said Melissa Fazekas, spokeswoman for We Are Ohio. “Just like the bill was flawed, this approach to a compromise is flawed as well. Our message is clear. These same politicians who passed this law could repeal it and not thwart the will of the people. They should either repeal the entire bill or support our efforts and encourage a no vote on Issue 2.”
Good for them.
The only reason to call off the referendum that you are certain to win is if he backs down completely, which will not only weaken Kasich among the average voters, but will poison his relationships with Republicans in the state house, because he seriously twisted arms to get SB 5 passed in the first place.
It couldn’t happen to a nicer guy.
Here.
And we are beginning to hear a drum beat about how the Dems should drop their recall effort against Scott Walker.
F%$# that.