Author: Matthew G. Saroff

Sorry Felix, You are Wrong

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Yesterday, I talked about Dave Dayen and Yves Smith’s take on the settlement, and their take was “bankster bailout”, and I noted that Felix Salmon’s take was that it was a good thing.

Well, now the journalist who is I think the best person (this side of Jon Stewart, anyway) at distilling the complexities of Wall Street to you average reader, Matt Taibbi has weighed in, and not only is he calling bailout for Wall Street crooks, but he apologizes for his earlier optimism. What’s more, he distills what it all means in one paragraph:

But this deal not only doesn’t end robosigning, it officially makes getting caught for it inexpensive. Shame on me for ever thinking that might be a good thing.

That is the final word.  Fraud and forgery have been given a price tag, and it’s less than 2 grand.

OK, These Are Some Tax Collectors That I Could Love

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So, the Italian police have taken to staking out posh neighborhoods and pulling over drivers of expensive cars. They then take their personal information, and send that to the tax bureau to make sure that their lifestyle matches up to their declared income:

Police fanned out across Milan in late January halting more than 350 vehicles, mostly luxury SUVs and Porsches.

At checkpoints, including one adjacent to the fashionable Corso Como, the police got the driver’s license and registration, which they passed on to the national tax agency. The tax authorities will use the data to check if the cars’ owners had declared enough income — and of course paid the right amount of income taxes — to justify their lifestyles.

It was at least the fifth raid targeting wealthy Italians since a Dec. 30 sweep at the posh Cortina d’Ampezzo ski resort, where 251 high-end cars were stopped, including Ferrari and Lamborghini supercars, Bloomberg Businessweek reports in its Feb. 13 issue. Rome, Portofino on the Italian Riviera and Florence have also been targeted.

I’m Matthew Saroff, and I approve of this tactic.

So, the Pedophile Protection Bureau Wants Contraception Coverage Banned

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So, the Conference of Catholic Bishops, or more accurately the guy they hired to represent their position, has admitted that they want to ban coverage for all forms of contraception for everyone:

“There has been a lot of talk in the last couple days about compromise, but it sounds to us like a way to turn down the heat, to placate people without doing anything in particular,” [Conference general council Anthony] Picarello said. “We’re not going to do anything until this is fixed.”

That means removing the provision from the health care law altogether, he said, not simply changing it for Catholic employers and their insurers. He cited the problem that would create for “good Catholic business people who can’t in good conscience cooperate with this.”
“If I quit this job and opened a Taco Bell, I’d be covered by the mandate,” Picarello said.

They want to pull all coverage for contraception for everyone, and so we should take it seriously when they they say want to ban all contraception.

At least the Taliban does not find f%$#ing little boys to be a moral imperative.

The Obama Administration Just F%$#ed Us All to Benefit the Banks Again

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Well, it looks like everyone (except Oklahoma) has signed onto Obama’s bank sellout settlement :

After months of painstaking talks, government authorities and five of the nation’s biggest banks have agreed to a $26 billion settlement that could provide relief to nearly two million current and former American homeowners harmed by the bursting of the housing bubble, state and federal officials said. It is part of a broad national settlement aimed at halting the housing market’s downward slide and holding the banks accountable for foreclosure abuses.

Despite the billions earmarked in the accord, the aid will help a relatively small portion of the millions of borrowers who are delinquent and facing foreclosure. The success could depend in part on how effectively the program is carried out because earlier efforts by Washington aimed at troubled borrowers helped far fewer than had been expected.

Still, the agreement is the broadest effort yet to help borrowers owing more than their houses are worth, with roughly one million expected to have their mortgage debt reduced by lenders or able to refinance their homes at lower rates. Another 750,000 people who lost their homes to foreclosure from September 2008 to the end of 2011 will receive checks for about $2,000. The aid is to be distributed over three years.

An announcement was scheduled in Washington for Thursday morning. The final details of the pact, including how many states would participate, were expected to be announced then. The two biggest holdouts, California and New York, now plan to sign on, according to the officials with knowledge of the matter who did not want to be identified because the negotiations were not completed.

So, if a bankster steals your house, you get $2000, which might cover the cost of having all your furniture hauled to the dump.

And as for the write-downs, that’s about $17 billion for about one million home owners ($5 B goes to the states), or about $17k  for homeowners, but there are 11 million homeowners under water, and on average it’s more than $50K each.

And, BTW, the banks get to do this for mortgages that they manage, but don’t hold, meaning that the money is coming from investors, pension funds, and the taxpayer, and this serves to strengthen the second mortgages, which the banks do hold.

I’m with Yves Smith’s take on this, “The Top Twelve Reasons Why You Should Hate the Mortgage-Settlement.html,” not Felix Salmon’s rather more optimistic take on this.

This is not a settlement, it’s another sellout and back door subsidy to the banksters.

The Foreclosure Sellout Settlement Is Getting Weird

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I missed it, but the New York AG canceled a press conference about his position on the mortgage/foreclosure fraud settlement at the last minute:

New York Attorney General Eric Schneiderman late Tuesday postponed a much anticipated conference call with reporters that was set up to announce whether the state would participate in broad a settlement with five big banks over foreclosure practices. Schneiderman, who is co-chair of a new mortgage fraud task force, told reporters in late January that he was not ready to participate in state settlement negotiations. Observers had speculated that he might announce his participation.

This is happening despite the full court press from the Obama administration for this deal to go through.

The sticking point appears to be the MERS lawsuit, and the banks want this dropped before they sign off on any deal.

I think that this delay is a good thing because:

  • The deal is basically another bailout for the banks.
  • As it gets nearer to the election without a deal, the more it becomes likely that the Obama administration will be forced to go after them for electoral benefit, as opposed to just going after some small fry.

This should get interesting.

More on the Catholic Church and Sh%$

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Amanda Marcotte has a great example of just what “public accommodation” means, and it is both illustrative of just how hypocritical the Catholic Church is being over the requirement that they follow the law in insuring their employess.

It has the additional advantage of goring my own ethnic ox, albeit that I am not at a black hat Jew:

There was an interesting story a few months ago here in Brooklyn about a privately owned company that serves the public that was engaging in discrimination against women.

Women who ride the B110 bus in Brooklyn can’t sit where they want unless they’re okay with being berated by Orthodox Jewish men, even though technically the B110 is a public bus.

The B110, which travels between Williamsburg and Borough Park is open to anyone, has a route number, and goes to city bus stops. However, the line is run by a private company under a decades-old agreement with the city, and since the bus is designed to serve the Hasidic community in the area, a board of rabbis sets the rules. They’ve decreed that women should sit in the back and men should sit in the front to avoid contact betwen members of the opposite sex.

When it was exposed that a bunch of religious fanatics were doing this, the city came down on them and said, “God or no god, you can’t discriminate against women if you’re serving the public.”

She’s right.  Hospitals and universities  serve the public provide public accomodation.

The Catholic Church has no more right to make its employees sit at the back of the bus for their insurance than do those Jews running that bus line.

If You Choose to Invest in a Criminal Enterprise, You are Supposed to Lose Money

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So, the SEC is giving the banksters a free pass when they defraud investors, but the SEC gives them a pass. Why? To protect the investors.

You know, for most people, letting the banksters steal with impunity is not protecting investor:

Even as the Securities and Exchange Commission has stepped up its investigations of Wall Street in the last decade, the agency has repeatedly allowed the biggest firms to avoid punishments specifically meant to apply to fraud cases.
By granting exemptions to laws and regulations that act as a deterrent to securities fraud, the S.E.C. has let financial giants like JPMorganChase, Goldman Sachs and Bank of America continue to have advantages reserved for the most dependable companies, making it easier for them to raise money from investors, for example, and to avoid liability from lawsuits if their financial forecasts turn out to be wrong.
An analysis by The New York Times of S.E.C. investigations over the last decade found nearly 350 instances where the agency has given big Wall Street institutions and other financial companies a pass on those or other sanctions. Those instances also include waivers permitting firms to underwrite certain stock and bond sales and manage mutual fund portfolios.
JPMorganChase, for example, has settled six fraud cases in the last 13 years, including one with a $228 million settlement last summer, but it has obtained at least 22 waivers, in part by arguing that it has “a strong record of compliance with securities laws.” Bank of America and Merrill Lynch, which merged in 2009, have settled 15 fraud cases and received at least 39 waivers.
Only about a dozen companies — Dell, General Electric and United Rentals among them — have felt the full force of the law after issuing misleading information about their businesses. Citigroup was the only major Wall Street bank among them. In 11 years, it settled six fraud cases and received 25 waivers before it lost most of its privileges in 2010.

By granting those waivers, the S.E.C. allowed Wall Street firms to have powerful advantages, securities experts and former regulators say. The institutions remained protected under the Private Securities Litigation Reform Act of 1995, which makes it easier to avoid class-action shareholder lawsuits.

And why are they doing this?

“The ramifications of losing those exemptions are enormous to these firms,” David S. Ruder, a former S.E.C. chairman, said in an interview. Without the waivers, agreeing to settle charges of securities fraud “might have vast repercussions affecting the ability of a firm to continue to stay in business,” he said.

S.E.C. officials say that they grant the waivers to keep stock and bond markets open to companies with legitimate capital-raising needs. Ensuring such access is as important to its mission as protecting investors, regulators said.

…………

Thomas Lee Hazen, a securities law professor at the University of North Carolina at Chapel Hill, said that it is understandable that the S.E.C. might relax some potential sanctions on Wall Street firms — where it appears that lessons have been learned, or when a fine is thought to be sufficient punishment.

“The ripple effect of having a sanction that could shut them down or could seriously impede a company’s operations would seriously affect a lot of innocent customers,” he said. “It’s a very fine balance. That’s not to say that the S.E.C. is striking the balance properly. That is in the eye of the beholder.”

Let’s be clear here. The SEC is using regulatory forbearance to subsidize fraud.

If people stopped investing in firms that committed fraud, the firms would be less inclined to defraud investors.

It’s Official, We Have a 2nd Tech Bubble in 15 Years

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How do I know this? I know this because Paul R. La Monica says that we are not in one.

When he says, “If you want to declare that tech stocks are once again a bubble … you’d be dead wrong,” any sane person would start shorting tech.

This is a guy who called short sales the next bubble, and used a song about masturbation to suggest that it was time to reenter the market. (My posts about him can be found at this link.)

In the world of investing advice, it’s hard to find someone who gets it right even half the time, but there lots of people, like Paul, who can be counted on to function reliably as a reverse barometer.

I’m just sayin’.

Appeals Court Rules that Prop 8 Is Unconstitutional

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It was a 2-1 decision, and the opinion is a pretty strong:

“Although the Constitution permits communities to enact most laws they believe to be desirable, it requires that there be at least a legitimate reason for the passage of a law that treats different classes of people differently,” Judge Stephen R. Reinhardt wrote in the decision. “There was no such reason that Proposition 8 could have been enacted.”

“All that Proposition 8 accomplished was to take away from same-sex couples the right to be granted marriage licenses and thus legally to use the designation ‘marriage,’ ” the judge wrote, adding, “Proposition 8 serves no purpose, and has no effect, other than to lessen the status and human dignity of gay men and lesbians in California.”

BTW, all three judges agreed that the defendants request that the judge Vaughn Walker recuse himself was pretty much a crock of sh%$.

The precedent on this case is fairly straightforward, the Supreme Court ruling on Colorado’s Amendment 2 about 15 years ago, where they said that voters can’t strip rights from a group just because they make them feel squicky, the so-called “rational basis” test.

The question now is whether or not this case goes to the full appeals court (en banc), or to the Supreme Court.

And while we are on recusals.  Seeing as how Scalia has publicly, and repeatedly, made comments explicitly stating that he has pre-judged the matter, how about he recuse his flabby ass from the case?

If SCOTUS takes it, it will be closer though, as O’Connor has been replaced by Alito, who is an almost certain vote against gay civil rights.

And While We Are Talking About White House Spelunking…

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It looks like the White House is preparing to cave to the Conference of Catholic Bishops on reproductive rights:

A top adviser to President Barack Obama’s re-election campaign suggested on Tuesday that the administration was open to working with Catholic hospitals and universities over their objections to providing birth control services to women.

“I’m less concerned about the messaging of this than to find a resolution that makes sense,” David Axelrod said on MSNBC.

“I heard earlier Joe [Scarborough] say, ‘Well, there may be compromises that can be reached.’ We have great respect for the work that these religious institutions do. … We certainly don’t want to abridge anyone’s religious freedoms, so we’re going to look for a way to move forward that both provides women with the preventative care that they need and respects the prerogatives of religious institutions,” he explained.

Jeebus.

It’s like capitulation is so firmly engrained in their DNA that they can’t stand their ground even when it is to their advantage to do so.

These days, the Catholic Bishops is as likely to support Democrats as the Chamber of Commerce, so all you are doing is pissing off your base.

Am I the Only One to Call False Flag?

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Symantec with an assist from the FBI, is now alleging that a group of hackers stole the source code for pcAnywhere and attempted to shake them down for $50,000.

OK, I get that. But what I doubt is the claim, coming from either the software firm, or the boyz in the Hoover building, that the miscreants are, “group of hackers associated with Anonymous and AntiSec.”*

As MP at the Stellar Parthenon BBS observes, “Anyone claiming to be raising funds in any way on behalf of Anonymous is about as kosher as bacon-wrapped shrimp.”

I have no doubt that Symantec got hacked. I’ve suffered with their software at a number of work places, but my sense is that any mention Anonymous is something that the FBI spent a lot of time manufacturing.

After all, it looks much better in a personnel file at annual review time.

*Tin foil hat. When I originally read the first article, there were constant mentions to anonymous, and now they are all gone.

I Guess She Could Not Handel the Pressure

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Yes, the right wing hack hired by Komen as their VP for public policy, Karen Handel, has>called it quits, or as Erin Gloria Ryan so clearly states, Noted Liar Karen Handel Defensively Resigns From Komen, with a self-indulgent letter of resignation where she denies it being about politics.

I’d say, “Cry me a river,” but the letter was more like “Water Music”.*

The thing is, the folks at Komen knew that she was a right wing political hack.  Not only had she campaigned for governor on defunding Planned Parenthood before Komen hired her, but she also has a long history of voter suppression and civil rights violations so bad that the Bush Justice Department called her out.

She was clearly a right wing political hack, and Komen chose to let Ari Fleischer pimp her for a cushy office job, and they knew what she was.

There are lots of better breast cancer charities out there.

Even ignoring politics, the corporate pink-washing Komen does for companies probably contribute to higher cancer rates (KFC? Seriously?) should look elsewhere.

When you add in their politics, any woman who gives them money is like a chicken donating to Colonel Sanders, because they are a a petri dish for right wing zealots who think that the problem with the world is that, “women [are] not being properly punished for having unapproved sex.”

*OK, that’s it for the Handel puns.

And While We are Talking Bankster Corruption

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The Missouri AG has filed criminal indictments for felony forgery over “robo-signing”.

This is a remarkable development, because while what on pretty clearly was forgery, but I never expected someone to actually prefer criminal charges:

“Linda Greene” has become a household word to those on the foreclosure fraud beat. And it turns out, for once, that the work of diligent investigators such as the foreclosure attorneys around Max Gardner, and investigators like Lynn Szymoniak and Lisa Epstein led to press coverage which in turn spurred prosecutors to act.

What is striking about the indictment by a Missouri grand jury is that the Missouri AG Chris Koster has decided to challenge the banks’ party line that robosigning and related abuses were mere “paperwork problems.” He’s called robosiging what it is: forgery. The 136 count indictment is for forgeries and false declarations, and the targets are LPS subsidiary and its founder and past president, Lorraine Brown.

About f%$#ing time.

Foreclosure Sellout Settlement Update

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Well, over 40 states have signed onto the deal, but the biggies, New York, California, Nevada (highest foreclosure rate in the nation), and Delaware (all the banks are covered by Delaware law, and Beau Biden is Joe’s kid), are not (yet) a part of this deal, so the “deadline” has been pushed back two weeks.

We know the deal is bad.

We know that it’s a sellout because:

That being said, the fact that this deal is pitting one part of Wall Street against the other, with, asset management group of SIFMA frantically lobbying negotiators for a better deal,  is a welcome development.

We also have the fact that the deal  favors 2nd mortgages, generally held by the banks, would be favored over 1st mortgages, which the judge who has to approve the deal might see as an illegal taking.

FWIW, if any of the biggies move, it will be California first, because (when current Governor Jerry Brown when he was AG, thanks Governor Moonbeam) they already cut a deal with Bank of America/Countrywide, the largest mortgage lender in the state, which eliminated most pre-2008 liability, so they have the least to gain from holding out.

What a Surprise

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The USAF is determined to avoid having a meaningful close support capability. Case in point, they are cutting 5 to 10 A-10 squadrons:

The A-10 Thunderbolt II provides the type of close-air support that ground-pounders love and the Taliban dread. Although the A-10s are workhorses in the war on terrorism, the Air Force in its new budget request is planning to get rid of five squadrons.

As part of the Defense Department’s efforts to trim close to $500 billion in spending over the next decade, defense officials said Friday that the service intends to cut five A-10 tactical squadrons and two other squadrons as well.

The Thunderbolt squadrons to be stood down encompass one active-duty, one Reserve and three National Guard units. The remaining two squadrons disappearing are a Guard F-16 tactical unit and an F-15 training squadron.

Let’s be clear about this: The F-35 and the F-22 cannot take over this role effectively.

The A-10 can deploy and loiter over the battlefield for hours below 15,000 feet, while the two supersonic stealth jets can loiter for something like 15 minutes before calling bingo fuel.