FROM THE SENATE FLOOR
“I’m not here to punish banks!” Barack Obama, bankster bought, bankster owned!
BANKSTER PROFITS UP! BANKSTERS BONUSES UP! BANKSTERS REGULATION A BIG BANKSTER JOKE! FORECLOSURES ALSO UP!
OBAMA AND HIS CULTURE OF CORRUPTION! DIDN’T HE PUNK US GOOD!
With White House backing, banks resume foreclosure evictions
By Tom Eley
20 October 2010
On Monday, Bank of America (BOA), the nation’s largest lender, and GMAC of Ally Financial announced they are resuming foreclosure evictions and sales in states where they had temporarily suspended them, claiming that they found no impropriety in their foreclosure documentation.
BOA’s decision means foreclosure proceedings against more than 100,000 homeowners will restart. It is expected that JP Morgan Chase and PNC Financial, which had also implemented temporary moratoriums on aspects of the foreclosure process, will follow suit.
Banks had implemented the partial moratoriums in recent weeks after it became public that they and their contractors had falsified legal documents relating to hundreds of thousands of foreclosures. Other banks and their subsidiaries implicated in the scandal, such as Citigroup, Wells Fargo, and Goldman Sachs, never instituted a moratorium.
All the major banks used “robo-signers,” employees who, in lieu of proper documentation, submitted affidavits falsely attesting they had knowledge of foreclosure cases. They also falsified notary stamps and signatures. Some banks simply threw out paperwork, while others hired low-paid “Burger King kids,” as one Goldman Sachs executive put it, to process large quantities of foreclosure documents.
The move by BOA affects its foreclosures in the 23 states that require judicial review prior to eviction and sale. New affidavits will be submitted to courts on Monday.
“We did a thorough review of the process, and we found the facts underlying the decision to foreclose have been accurate,” said Barbara J. Desoer of BOA’s Home Loans unit.
“This is an important first step in debunking speculation that the mortgage market is severely flawed,” BOA spokesman James Mahoney declared.
The bank’s claim that it found no evidence of false attestations in its foreclosure documents after only 10 days of review is simply not credible.
“This wasn’t just a simple little mistake of forgetting to dot the ‘i,’” Florida lawyer Peter Ticktin told the New York Times. “There was a whole system put in place to make false affidavits. How are they going to erect a new system to do 102,000 affidavits unless they are going to use the same old law firms to make a second generation of bad affidavits?”
“These are lawyers. These are banks going to court and committing fraud,” said Ira Rheingold of the National Association of Consumer Advocates. “For them to say this is a minor technical problem is mind-boggling.”
“The companies are overstating the ease of withdrawing these affidavits and then resubmitting them,” Judge Lynn Tepper of Florida’s 6th Circuit Court told the Washington Post.
BOA’s move came much sooner than expected and was likely provoked by mounting pressure from powerful financial concerns. Shares of major US banks have been pummeled by investors fearful that the revelations throw into question the validity of securities based on mortgage loans. Before yesterday’s announcement, BOA’s stock had fallen by nearly 10 percent over the previous week.
On Tuesday, an alliance of leading financial concerns—Pimco, the world’s largest bond fund; BlackRock, the world’s largest money manager; MetLife, the world’s biggest insurer; and the Federal Reserve Bank of New York—will sue to seek BOA buybacks of as much as $47 billion in mortgage-based securities issued through its Countrywide unit.
In addition to accusing BOA of improper documentation, the investors are accusing the bank “of taking too long with foreclosures,” Bloomberg reported Tuesday.
BOA has already sustained major losses related to mortgage bond buybacks. In the third quarter, it had to pay $400 million for buyers’ claims related to mortgage representations and warranties. According to the Wall Street Journal, these “refer to complaints from buyers of mortgages—especially government agencies Fannie Mae and Freddie Mac—that Bank of America and other big banks issued mortgages with faulty underwriting or documentation, and now must compensate them when the loans fail.”
In total, BOA has had to pay out $3.3 billion for such claims. It admitted in a Tuesday earnings report that it anticipates the losses will continue.
Similar demands will likely follow at other banks. A moratorium on foreclosures would very likely sharpen the conflict between the big banks, on the one side, and bond funds and money management firms on the other.
It is to avert such a scenario and the risk of reigniting the global financial crisis that the Obama administration has gone on record in support of the continuation of foreclosures, disregarding evidence of the banks’ rampant lawbreaking.
The latest administration official to intervene in the crisis on the side of the banks is Shaun Donovan, secretary for Housing and Urban Development, who penned a column for the Huffington Post warning of the supposed dangers should foreclosures be slowed.
“A national, blanket moratorium on all foreclosure sales would do far more harm than good,” Donovan writes. “[H]omeowners are at risk, too—and the best hope they have is for the ‘Foreclosed’ signs in front of the vacant, abandoned properties on their block to come down, so that the value of their homes can start rising again.”
This is an extreme free-market position. Donovan is arguing that speeding up foreclosures eventually benefits other homeowners by driving down the market to the point it can deteriorate no more, after which it should, in theory, begin to improve. The alternative—keeping people in their homes in the first place—is clearly not up for consideration in the White House.
Donovan assures readers that “a comprehensive review” is underway—not an investigation—involving a number of US regulatory agencies. Any changes will be put in place by the banks themselves.
“The message [we] are sending is the same: banks must follow the law—and those that haven’t should immediately fix what is wrong,” Donovan writes.
It should be noted that this same promotion of self-regulation set the stage for the financial collapse of 2008.
Indeed, the mortgage document scandal is a manifestation of an even larger fraud—the US housing bubble that exploded in 2008. Banks relentlessly promoted home buying and refinancing to cash-strapped American families with “teaser rate” loans, subprime loans, and other adjustable rate mortgages. Massive loan volume was the goal, and the resulting securities—counted in the trillions of dollars—were bundled, sold, and spread out across the global financial system. In this process, underlying legal claims to property title were of only secondary interest.
On these rotten foundations enormous personal fortunes were built up. Then, when the entire Ponzi scheme collapsed, the Bush and Obama administrations bailed out the banks to the tune of trillions of dollars, while saddling the population with the worst housing crisis in US history.
Obama’s “housing rescue” of 2009, (Home Affordable Modification Program, or HAMP) simply encouraged banks to change interest rates and payment plans, but it did not require them to lower principles, the grossly overvalued outstanding debt on loans issued during the housing bubble. The program has been a dismal failure, with only a handful of households gaining permanent refinancing.
The housing market, meanwhile, has continued to implode. In the third quarter, nearly one million US homes received a foreclosure filing.
*
WHAT DID THE BANKSTERS KNOW ABOUT OUR ACTOR OBAMA THAT WE DIDN’T KNOW?
Records show that four out of Obama's top five contributors are employees of financial industry giants - Goldman Sachs ($571,330), UBS AG ($364,806), JPMorgan Chase ($362,207) and Citigroup ($358,054).
BARACK OBAMA HAS COLLECTED NEARLY TWICE AS MUCH MONEY AS JOHN McCAIN
BY DAVID SALTONSTALL
DAILY NEWS SENIOR CORRESPONDENT
July 1st 2008
Wall Street firms have chipped in more than $9 million to Barack Obama. Zurga/Bloomberg
Wall Street is investing heavily in Barack Obama.
Although the Democratic presidential hopeful has vowed to raise capital gains and corporate taxes, financial industry bigs have contributed almost twice as much to Obama as to GOP rival John McCain, a Daily News analysis of campaign records shows.
"Wall Street wants change and wants a curtailment in spending. It wants someone who focuses on the domestic economy," said Jim Cramer, the boisterous host of CNBC's "Mad Money."
Cramer also does not discount nostalgia for the go-go 1990s, when Bill Clinton led the largest economic expansion in history.
"It wants a Clinton like in 1992, but not a Hillary Clinton," he said. "That's Barack Obama."
For both candidates, Wall Street's investment and banking sectors have become among their portliest cash cows, contributing $9.5 million to Obama and $5.3 million to McCain so far.
It's a haul that is already raising concerns that, as the nation's faltering economy has become issue No. 1, the two candidates may have a hard time playing tough on issues like market regulation or corporate-tax loopholes.
"No matter who wins in November, Wall Street will have a friend in the White House," said Massie Ritsch of the Center for Responsive Politics, which crunched the data for The News.
*
April 3, 2009
OP-ED COLUMNIST
Greed and Stupidity
By DAVID BROOKS
What happened to the global economy? We seemed to be chugging along, enjoying moderate business cycles and unprecedented global growth. All of a sudden, all hell broke loose.
There are many theories about what happened, but two general narratives seem to be gaining prominence, which we will call the greed narrative and the stupidity narrative. The two overlap, but they lead to different ways of thinking about where we go from here.
The best single encapsulation of the greed narrative is an essay called “The Quiet Coup,” by Simon Johnson in The Atlantic (available online now).
Johnson begins with a trend. Between 1973 and 1985, the U.S. financial sector accounted for about 16 percent of domestic corporate profits. In the 1990s, it ranged from 21 percent to 30 percent. This decade, it soared to 41 percent.
In other words, Wall Street got huge. As it got huge, its prestige grew. Its compensation packages grew. Its political power grew as well. Wall Street and Washington merged as a flow of investment bankers went down to the White House and the Treasury Department.
The result was a string of legislation designed to further enhance the freedom and power of finance. Regulations separating commercial and investment banking were repealed. There were major increases in the amount of leverage allowed to investment banks.
The U.S. economy got finance-heavy and finance-mad, and finally collapsed. When it did, the elites did what all elites do. They took care of their own: “Money was used to recapitalize banks, buying shares in them on terms that were grossly favorable to the banks themselves,” Johnson writes.
In short, he argues, the U.S. financial crisis is a bigger version of the crises that have afflicted emerging-market nations for decades. An oligarchy takes control of the nation. The oligarchs get carried away and build an empire on mountains of debt. The whole thing comes crashing down. Johnson’s remedy is clear. Smash the oligarchy. Nationalize the banks. Sell them off in medium-size pieces. Revise antitrust laws so they can’t get back together. Find ways to limit executive compensation. Permanently reduce the size and power of Wall Street
No comments:
Post a Comment