Category: Finance

What Ken Livingstone Said

No Comments

In the time I was mayor, I used to do meetings with City bankers and I’d often open by saying, ‘This isn’t the world I would have created . . .’ [Bankers’ bonuses are] like penis extensions, among a small league of men – mine is bigger than yours.

. . . The world is run by monsters and you have to deal with them. Some of them run countries, some of them run banks, some of them run news corporations.

— The former (and hopefully future) Mayor of London Ken Livingston on the banksters and other captains of industry

(emphasis mine)

I think that this is an important thing to say.  One of the primary defenses of the banksters and the rest of the parasites on our economy is that their success is somehow the product of their virtue and ability.

This is a lie.  It has always been a law, and so long as we allow the myth that these folks are anything other than amoral winners of the genetic lottery, we grant them a legitimacy that they they do not deserve, and we do so at our own peril.

Two Banks Get Eated

No Comments

And here they are, ordered, and numbered for the year so far.

  1. Charter National Bank and Trust, Hoffman Estates, IL
  2. SCB Bank, Shelbyville, IN

An average week, and this Shelbyville is nowhere near Springfield (about 200 miles), so it’s not the real (Simpsons)  Springfield.

    Full FDIC list

    So, here is the graph pr0n with last years numbers for comparison (FDIC only):

    And here is the detail, since it is early in the year:

    Sorry Felix, You are Wrong

    No Comments

    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.

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

    No Comments

    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

    No Comments

    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.

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

    No Comments

    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

    No Comments

    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’.

    And While We are Talking Bankster Corruption

    2 Comments

    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

    No Comments

    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.

    Well, This Has Me Confused

    No Comments

    New York Attorney General Eric Schneiderman has filed suit against the big banks for fraudulent use of the MERS electronic title registry.

    He is claim fraud, deception, and illegal evasion of recording fees (to the tune of more than $2 billion on just the fees).

    This is interesting. It appears that the settlement, for which Schneiderman is the most prominent hold out would not shut down any suits already filed.

    To my mind, this is likely a bad thing, because it implies that Schneiderman is getting his ducks in a row in preparation for signing onto the sellout settlement with the banks.

    I just hope that I am wrong about that last bit.

    Full release from the AG after the break:

    A.G. SCHNEIDERMAN ANNOUNCES MAJOR LAWSUIT AGAINST NATION’S LARGEST BANKS FOR DECEPTIVE & FRAUDULENT USE OF ELECTRONIC MORTGAGE REGISTRY

    Complaint Charges Use Of MERS By Bank Of America, J.P. Morgan Chase, And Wells Fargo Resulted In Fraudulent Foreclosure Filings  

    Servicers And MERS Filed Improper Foreclosure Actions Where Authority To Sue Was Questionable

     

    Schneiderman: MERS And Servicers Engaged In Deceptive and Fraudulent Practices That Harmed Homeowners And Undermined Judicial Foreclosure Process

    NEW YORK – Attorney General Eric T. Schneiderman today filed a lawsuit against several of the nation’s largest banks charging that the creation and use of a private national mortgage electronic registry system known as MERS has resulted in a wide range of deceptive and fraudulent foreclosure filings in New York state and federal courts, harming homeowners and undermining the integrity of the judicial foreclosure process. The lawsuit asserts that employees and agents of Bank of America, J.P. Morgan Chase, and Wells Fargo, acting as “MERS certifying officers,” have repeatedly submitted court documents containing false and misleading information that made it appear that the foreclosing party had the authority to bring a case when in fact it may not have. The lawsuit names JPMorgan Chase Bank, N.A., Bank of America, N.A., Wells Fargo Bank, N.A., as well as Virginia-based MERSCORP, Inc. and its subsidiary, Mortgage Electronic Registration Systems, Inc.
    The lawsuit further asserts that the MERS System has effectively eliminated homeowners’ and the public’s ability to track property transfers through the traditional public records system. Instead, this information is now stored only in a private database – which is plagued with inaccuracies and errors – over which MERS and its financial institution members exercise sole control. Additional defendants include BAC Home Loans Servicing, LP, Chase Home Finance LLC, EMC Mortgage Corporation, and Wells Fargo Home Mortgage, Inc.
    “The banks created the MERS system as an end-run around the property recording system, to facilitate the rapid securitization and sale of mortgages. Once the mortgages went sour, these same banks brought foreclosure proceedings en masse based on deceptive and fraudulent court submissions, seeking to take homes away from people with little regard for basic legal requirements or the rule of law,” said Attorney General Schneiderman. “Our action demonstrates that there is one set of rules for all – no matter how big or powerful the institution may be – and that those rules will be enforced vigorously. Only through real accountability for the illegal and deceptive conduct in the foreclosure crisis will there be justice for New York’s homeowners.”

    The financial industry created MERS in 1995 to allow financial institutions to evade local county recording fees, avoid the hassle and paperwork of publicly recording mortgage transfers, and facilitate the rapid sale and securitization of mortgages. MERS operates as a membership organization, and most large companies that participate in the mortgage industry – by originating loans, buying or investing in loans, or servicing loans – are members, including JPMorgan Chase, Bank of America, Wells Fargo, Fannie Mae, and Freddie Mac. Over 70 million loans nationally have been registered in MERS System, including about 30 million currently active loans.

    Through their membership in MERS, these companies avoided publicly recording the purchase and sale of mortgages by designating MERS Inc. – a shell company with no economic interest in any mortgage loan – as the “nominal” mortgagee of the loan in the public records. Instead, MERS members were supposed to log mortgage transfers in the MERS private electronic registry. The basic theory behind MERS is that, because MERS Inc. serves as a “nominee” (or agent) for most major lenders, it remains the “mortgagee” in the public records regardless of how often the loan is sold or transferred among MERS members. Thus, although MERSCORP has only about 70 employees, MERS Inc. serves as the mortgagee of record for tens of millions of loans registered in the MERS System.
    MERS has granted over 20,000 “certifying officers” the authority to act on its behalf, including the authority to assign mortgages, to execute paperwork necessary to foreclose, and to submit filings on behalf of MERS in bankruptcy proceedings. These certifying officers are not MERS employees, but instead are employed by MERS members, including JPMorgan Chase, Bank of America, and Wells Fargo.
    MERS’ conduct, as well as the servicers’ use of the MERS System, has resulted in the filing of improper New York foreclosure proceedings, undermined the integrity of the judicial process, created confusion and uncertainty concerning property ownership interests, and potentially clouded titles on properties throughout the State of New York. In fact, several New York judges have questioned the standing of the foreclosing party in cases involving MERS loans and the validity of mortgage assignments executed by MERS certifying officers.
    The lawsuit specifically charges that the defendants have engaged in the following fraudulent and deceptive practices:
    • MERS has filed over 13,000 foreclosure actions against New York homeowners listing itself as the plaintiff, but in many instances, MERS lacked the legal authority to foreclose and did not own or hold the promissory note, despite saying otherwise in court submissions.
    • MERS certifying officers, including employees and agents of JPMorgan Chase, Bank of America, and Wells Fargo, have repeatedly executed and submitted in court legal documents purporting to assign the mortgage and/or note to the foreclosing party. These documents contain numerous defects, including affirmative misrepresentations of fact, which render them false, deceptive, and/or invalid. These assignments were often automatically generated and “robosigned” by individuals who did not review the underlying property ownership records, confirm the documents’ accuracy, or even read the documents. These false and defective assignments often masked gaps in the chain of title and the foreclosing party’s inability to establish its authority to foreclose, and as a result have misled homeowners and the courts.
    • MERS’ indiscriminate use of non-employee “certifying officers” to execute vital legal documents has confused, misled, and deceived homeowners and the courts and made it difficult to ascertain whether a party actually has the right to foreclose. MERS certifying officers have regularly executed and submitted in court mortgage assignments and other legal documents on behalf of MERS without disclosing that they are not MERS employees, but instead are employed by other entities, such as the mortgage servicer filing the case or its counsel. The signature line just indicates that the individual is an “Assistant Secretary,” “Vice President,” or other officer of MERS. Indeed, these documents often purport to assign the mortgage to the certifying officer’s own employer. Moreover, as a result of the defendants’ failure to track the designation of certifying officers and the scope of their authority to act, individuals have executed legal documents on behalf of MERS, such as mortgage assignments and loan modifications, when they were either not designated as a MERS certifying officer at the time or were not authorized to execute documents on behalf of MERS with respect to the subject loan.
    • MERS and its members have deceived and misled borrowers about the importance and ramifications of MERS’ role with respect to their loan by providing inadequate disclosures.
    • The MERS System is riddled with inaccuracies which make it difficult to verify the chain of title for a loan or the current note-holder, and creates confusion among stakeholders who rely on the information. In addition, as a result of these inaccuracies, MERS has filed mortgage satisfactions against the wrong property.
    The lawsuit seeks a declaration that the alleged practices violate the law, as well as injunctive relief, damages for harmed homeowners, and civil penalties. The lawsuit also seeks a court order requiring defendants to take all actions necessary to cure any title defects and clear any improper liens resulting from their fraudulent and deceptive acts and practices. 
    The matter is being handled by Deputy Bureau Chief of the Bureau of Consumer Frauds & Protection Jeffrey K. Powell, Assistant Attorney General Clare Norins, and Assistant Solicitor General Steven C. Wu, under the supervision of First Deputy Attorney General Harlan Levy.

    Now They Tell Us

    No Comments

    One of the architects of the European austerity program is now saying that austerity is making things worse:

    A leading architect of the austerity programme in Greece – one of the harshest ever seen in Europe – has admitted that its emphasis on fiscal consolidation has failed to work, and said economic recovery will only come if the crisis-hit country changes tack and focuses on structural reforms.

    Poul Thomsen, a senior International Monetary Fund official who oversees the organisation’s mission in Greece, also insists that, contrary to popular belief, Athens has achieved a lot since the eruption of the debt crisis in December 2009.

    “We will have to slow down a little as far as fiscal adjustment is concerned and move faster – much faster – with the reforms needed to modernise the economy,” he told the Greek daily Kathimerini, adding that the policy shift would be “reflected” in the conditions foreign lenders attached to a new rescue programme for Athens.

    Hoocoodanode?

    Taking a pay cut makes it harder to pay off your debts.

    In the Interest of Fairness

    2 Comments

    And because I respect Yves Smith a lot, I have to note that she takes issue with the Pro Publica report about Freddie Mac betting against homeowners:

    A new ProPublica story, “Freddie Mac Betting Against Struggling Homeowners,” treats the fact that Freddie Mac retains the riskiest tranche of its mortgage bond offering, known as inverse floaters, as heinous and evidence of scheming against suffering borrowers.

    The storyline in this piece is neat, plausible, and utterly wrong. And my e-mail traffic indicates that people who are reasonably finance savvy but don’t know the mortgage bond space have bought the uninformed and conspiratorial ProPublica thesis hook, line, and sinker.

    Basically, she says that what we are looking at are normal hedges against interest rate fluctuations, and this was one part of this strategy, and, “Looking at one position in isolation is meaningless.”

    Additionally, she implies that this might be a hit job from the Obama administration, because FHFA head Edward DeMarco, who supervises the GSEs in receivership, is not moving aggressively to refinance troubled mortgages, and he’s signed off on some of the big paydays for officials at Fannie Mae and Freddie Mac.

    Additionally, FHFA has become increasingly aggressive about forcing banks to take back fraudulent mortgages (Put-backs), which opens a multi-billion dollar can of whup ass on the big Wall Street banks, which almost certainly puts DeMarco on Timothy “Eddie Haskell” Geithner’s naughty list, and leaking this to the press is very much the Treasury Secretary’s style.

    Truth be told, I don’t know who is right, though if I were betting, I would take wrong and evil for both DeMarco and Geithner, but I’m a cynic.

    That’ll Teach Him

    2 Comments

    The British are finally cracking down on the Banksters.

    What are they doing? They are rescinding knighthoods:

    The former chief executive of the Royal Bank of Scotland, Fred Goodwin, has been stripped of his knighthood by the Queen for his role in the creation of the biggest recession since the second world war.

    With unceremonial haste, a committee of five senior civil servants took away the knighthood given to Goodwin by the last Labour government in 2004 for services to banking.

    The chancellor, George Osborne, welcoming the move, said: “RBS came to symbolise everything that went wrong in the British economy over the past decade.”

    The move provoked a cacophony of calls for honours to be stripped from other miscreant bankers, politicians and regulators. The campaign to humble Goodwin was reignited by the Daily Mail a fortnight ago and then hastily backed in a highly political move by David Cameron as he sought to show he will side with the public against crony capitalists and bonus-seeking bankers.

    You know, I thought that Geithner’s charades about supporting ordinary homeowners were lame, but the Brits have taken lame to a while new level.

    More Change We Cannot Believe In

    No Comments

    It turns out that while under federal receivership, and under the direction of the FHFA, Freddie Mac has simultaneously made it more difficult to refinance your mortgage and invested in risking and hard to sell financial instruments that profit from you not being able to refinance:

    Freddie Mac, the taxpayer-owned mortgage giant, has placed multibillion-dollar bets that pay off if homeowners stay trapped in expensive mortgages with interest rates well above current rates.

    Freddie began increasing these bets dramatically in late 2010, the same time that the company was making it harder for homeowners to get out of such high-interest mortgages.

    No evidence has emerged that these decisions were coordinated. The company is a key gatekeeper for home loans but says its traders are “walled off” from the officials who have restricted homeowners from taking advantage of historically low interest rates by imposing higher fees and new rules.

    Yeah, there was no coordination here.

    Just aggressive tightening of refinancing standards (further down in the story) that have put people, “in financial jail,”  and as it was ramping up on its risky bets, it also, “quietly announced that it was raising charges, called post-settlement delivery fees, for refinancing.”

    But we aren’t going to see a recess appointment to replace the acting head of FHFA, Edward DeMarco, with someone who might reign in executive bonuses or work for home owners.

    Yes, ML Global is allowed to steal

    No Comments

    The point about the “loss” of ML Global customer accounts is not that it was lost, but that it was looted as the company collapsed, but it’s all “no harm, no foul,” and there are no criminal investigations:

    Federal officials looking for an estimated $1.2 billion missing from customers of MF Global Holdings Ltd. feel more and more that a lot of it may never be located, according to a report citing sources familiar with the probe.

    What’s been learned so far suggests that a good deal of the money may have “vaporized” because of scrambling in trading in the week before MF Global filed for bankruptcy protection Oct. 31, the Wall Street Journal reported, citing “a person close to the investigation.”

    This money was stolen, most likely by Jamie Dimon’s peeps at JPMorgan.

    Even if you cannot prove criminal intent, you can get back this money, if you are willing to actually pursue it.

    Still, Jon Corzine being frog marched out of his offices in hand cuffs would be a good thing.

    H/t Atrios.

    Europe is F%$#ed

    No Comments

    Because the Germans have been allowed to force their self delusions on the rest of Europe:

    Chancellor Angela Merkel cemented her political ascendancy in Europe on Monday when 25 out of 27 EU states agreed to a German-inspired pact for stricter budget discipline, even as they struggled to rekindle growth from the ashes of austerity.

    Only Britain and the Czech Republic refused to sign a fiscal compact in March that will impose quasi-automatic sanctions on countries that breach European Union budget deficit limits and will enshrine balanced budget rules in national law.

    The accord was eagerly greeted by the European Central Bank which has long pressed euro zone governments to put their houses in order.

    The solution to problems caused austerity and overly aggressive efforts at European integration will be more austerity and overly aggressive efforts at European integration.

    It’s Bank Failure Friday!!!! (on Saturday)

    No Comments

    Huh, 4 closings this Friday.  After a lull at the beginning of the year, we’ve had a bit of a spike.

    Still, it’s better than the past two years.

    1. First Guaranty Bank and Trust Company of Jacksonville, Jacksonville, FL
    2. Tennessee Commerce Bank, Franklin, TN
    3. Patriot Bank Minnesota, Forest Lake, MN
    4. BankEast, Knoxville, TN

    Full FDIC list

    So, here is the graph pr0n with last years numbers for comparison (FDIC only):

    And here is the detail, since it is early in the year:

    Well, I Was Wrong on My Assessment of His SOTU Statement

    No Comments

    The one thing that I liked, a task force to investigate bank/mortgage fraud appears to be an attempt to undermine any meaningful review of bank and mortgage practices:

    New York Attorney General Eric Schneiderman has been celebrated as the progressive Great White Hope. But the danger of assuming leadership is that that individual becomes a target both of attacks and of seduction. And while I’d like to think better of Schneiderman, an announcement earlier this evening has strong hallmarks of Schneiderman falling prey to the combined pressures and blandishments of the Administration and its allies.

    ………

    So get this: this is a committee that will “investigate.” The co-chair, Lanny Breuer, along with DoJ chief Eric Holder, hail from white shoe Washington law firm Covington & Burling, which has deep ties to the financial services industry. Even if they did not work directly for clients in the mortgage business, they come from a firm known for its deep political and regulatory connections (for instance: Gene Ludwig, the Covington partner I engaged for some complicated regulatory work when I was at Sumitomo Bank, later became head of the OCC). We’ve written at length on how the OCC is such a shameless tout for the banking industry that it cannot properly be called a regulator. Similarly, the SEC has been virtually absent from the mortgage beat, no doubt because its enforcement chief, Robert Khuzami, was general counsel to the fixed income department at Deutsche Bank. That area included the trading operation under Greg Lippmann who we have described as Patient Zero of so called mezz CDOs, or to the layperson, toxic mortgage paper that kept the subprime bubble going well beyond its sell date. And we don’t need to say much about the DoJ. It has been missing in action during this entire Administration.

    ………

    It’s clear what the Administration is getting from getting Schneiderman aligned with them. It is much less clear why Schneiderman is signing up. He can investigate and prosecute NOW. He has subpoena powers, staff, and the Martin Act. He doesn’t need to join a Federal committee to get permission to do his job. And this is true for ALL the others agencies represented on this committee. They have investigative and enforcement powers they have chosen not to use. So we are supposed to believe that a group, ex Schneiderman, that has been remarkably complacent, will suddenly get religion on the mortgage front because they are all in a room and Schneiderman is a co-chair?

    See also here.

    So, this isn’t an attempt to stop law breaking, it’s yet another attempt to cover up law breaking by co-opting people who do want to pursue corruption and law breaking.

    It’s like his appointment of Elizabeth Warren to set up the CFPB all over again.

    Only About 2½ Years Late

    1 Comment

    Tim Geithner has pretty much said that he won’t serve in Obama’s next term:

    Treasury Secretary Timothy F. Geithner, the last remaining member of the Obama administration’s original economic team, said he doesn’t expect the president to ask him to stay in office if re-elected.

    “He’s not going to ask me to stay on, I’m pretty confident,” Geithner said in an interview with Bloomberg Television today. “I’m confident he’ll be president. But I’m also confident he’s going to have the privilege of having another secretary of the Treasury.”

    Geithner, 50, has led President Barack Obama’s efforts to pull the U.S. economy out of the worst recession since World War II, including overseeing bailouts of automakers General Motors Co. and Chrysler Group LLC, which have since emerged from bankruptcy. Before joining the administration in 2009, Geithner was president of the Federal Reserve Bank of New York, playing a key role in the government’s rescue packages for banks including Citigroup Inc. (C) and Bank of America Corp. (BAC)

    Well, after completely f%$#ing the economy, the financial system, and the Democratic Party, through your relentless ass kissing of Wall Street, I guess that your work is done.

    It should be noted though, the Cossacks work for the Czar.