Financial crisis study "Very Powerful Interests' Seeking To Undermine Investigations"

[CycloWizard]

What's sad is that there should not be a single power in this country that can stop the government from enforcing the law.

The only thing that is more powerful than government is corruption.

 

[nonlnear]

And if it is all perfectly legit, then the fallout from publicly stating their names and their actions should be almost non-existent.

If you believe this to be true, then you don't really comprehend the power that a trillion dollars represents.

If those with "trillions at stake" are doing nothing illegal but are doing unethical things to hinder the committees investigation the American people should know about it. Especially when the assholes with the trillions at stake in question almost definitely have part of those trillions due to the US taxpayer.

It's not all that big of a secret though. How many people in the world have a trillions dollar stake in anything? The world's richest person is only worth ~$50 billion. It pretty much boils down to the banks, the [investment] banks, and... the [Federal Reserve] Bank.

Which branch of government controls the currency again? The citizenship test says there were three branches of government. Sadly neither of these three has any power over the autonomous privately controlled branch of government which managed to eviscerate the legislation that would have audited them.

 

[shira]

The only thing that is more powerful than government is corruption.

Well, there's also religion, which may amount to the same thing.

 

[dawp]

That's like saying if someone robs a home, it's not the fault of the robber but rather the fault of the homeowner for not securing the home sufficiently. In reality, the robber is at fault and should end up in jail, and the homeowner is going to suffer unpleasant consequences (getting robbed) as a result of not taking all the actions he probably should have.

A lot of the sub-prime loans were not properly vetted. i.e. some of the loan officer ignored the fact the the people could not afford the loans just so they could sell the loans down the road. if the they did their job right, those loans would have been denied and the housing meltdown would have not been so bad. the employment and income verification was not done or they would never have gotten then loans.

It's the job of the loan officers to assess the risk properly to protect his bank from defaults and that was not done.

 

[Darwin333]

Darwin333, sorry again, but a bit more info is helpful on your concern 'this should not be a partisan issue'.

Again, I agree - but when it IS partisan because one side fights against the public interest, it doesn't help to say 'don't say that, pretend they aren't doing it.'

A couple facts:

- The commission is made up of six Democrats and four Republicans (because of the majority party in each house getting to name three people).

Zero of the Democrats, and all four of the Republicans, are the ones in this story who are fighting the extension of the report to include new information.



That's not the person saying this being partisan - it's the Republicans being partisan.

You want to take an issue with all six Democrats trying to look into the banks, and all four Republicans, and say 'don't be partisan by mentioning the parties!'

The Republicans are the ones making it partisan.

- To their credit, 2/3 of House Republicans voted for this commission to be created - albeit with an absurdly low $8 million budget.

But zero Democrats voted against the measure, while all 59 no votes were Republicans.

Again, that's not being partisan to say the facts - the voters are the ones being partisan.

While I agree this 'should not be a partisan issue', you make the same mistake Obama makes in pretending some people are not being partisan.

I'm all for not making an issue of the partisan behavior and trying to get a good investigation in the public interest. But when you express concern about how the (Democratic) chairman reports there are massive industry pressures on the commission not to tell the truth - when we already have ZERO criminal convictions while the previous much smaller Savings and Loan crisis had hundreds - and for not name names - it doesn't make sense to complain about saying who the blockers are.

The blockers on the commission, the ones doing what those 'massive industry pressures want' here, are all the Republicans and none of the Democrats.

That's useful information, not 'partisan' information. The partisans are the members.

I guess you'd rather say the problem has nothing to do with the parties, just because that's 'non-partisan'.

I understand what you are saying Craig and you are at least partially right.

However, I have been around long enough to know how politics and politicians work, and so have you.

We have 2 basic choices:

1. Argue the issue your way, even though it may be completely factual you must, by your very nature, point out parties. The conversation devolves into the same tired D versus R argument (which is exactly what they want, its called a diversion) and while we argue amongst ourselves nothing of real substance gets done. You know that is what will happen, I know it, and so does everyone else. Unfortunately, that is just the way it is. Oh, and if there are some crooked R's in the mix they probably don't get outed using your way.

2. Fuck the letter behind their name, for the time on this issue just pretend it isn't relevant. If you are interfering with this investigation in anyway then we demand to know who, what, when, and how. If there is any indication of illegal activity then we demand an investigation by the authorities and if found guilty we demand the maximum punishment the law will allow. Period. Full stop. End of story. WE have allowed them to fuck us over for way to long and WE need to draw a hard line. As I have always stated, and this is very well proven by their actions Craig so please don't make me dig up all of the stuff and turn this into a "which side sucks less thread", both parties have been complicit in allowing and often helping blatant and reckless lawlessness at great expense to the American people and taxpayer.


You talk about "unfair transfers of wealth to the top", do you want to stop the tippity top from stealing our money or not? Do you want to see people who have defrauded the citizens and tax payers of this country out of untold billions of dollars prosecuted and their ill-gotten gains clawed back? Do you want to stop them from continuing to do the same? Do you want to make the uber-elite banksters play by the same rules as the rest of us? Then even though you might not like the right, you are gonna need their help for this fight.

That means just leave the damned letters behind their names alone, they are literally irrelevant right now. AFTER we stop the looting and start the prosecuting we can all drink a beer and point all the fingers you want at whatever party you so desire. Until then, can't we at least agree to fix the damned problem first and foremost?

 

[Darwin333]

If you believe this to be true, then you don't really comprehend the power that a trillion dollars represents.

It only exists because we allow it to exist.

It's not all that big of a secret though. How many people in the world have a trillions dollar stake in anything? The world's richest person is only worth ~$50 billion. It pretty much boils down to the banks, the [investment] banks, and... the [Federal Reserve] Bank.

Yup. Which bank? Exactly which executive? Exactly how are they influencing the investigation?

Which branch of government controls the currency again? The citizenship test says there were three branches of government. Sadly neither of these three has any power over the autonomous privately controlled branch of government which managed to eviscerate the legislation that would have audited them.

This is goes beyond the Fed. This is about blatant and now absolutely provable fraud that has and is taking place, at great cost to the citizens and tax payers of this country that is going unpunished. And now we have the head of the committee tasked to investigate the lawlessness saying that they are being impeded. We can not stand for that.

 

[DucatiMonster696]

They'll tell the public that Obama and Big Business are one and the same, while also telling them Obama is anti-business. And people will lap it up as usual.

So I guess Goldman Sach's wont be contributing to Obama's campaign the second time around?

 

[DucatiMonster696]

If the lenders had been doing their job in the first place, those loans would have never been made. They had a responsibility to their shareholder to make sure all loans made were above board and they did not.

That would of been racist.

 

[dawp]

That would of been racist.

do you know how stupid that makes you look?

 

[nonlnear]

It only exists because we allow it to exist.

True enough, but actually doing something about it would require another revolution - and even that wouldn't be likely to weed it out.

Yup. Which bank? Exactly which executive? Exactly how are they influencing the investigation?

I have no special kinowledge of the details. The simple fact is that identifying interests with "trillions at stake" is not nearly as mysterious as many people make it out to be. Giving a short list of names would actually be irrelevant because the entire industry acts in concert as a cartel when it comes to exerting regulatory influence. They compete in the retail space, but when facing government they act as one.

This is goes beyond the Fed. This is about blatant and now absolutely provable fraud that has and is taking place, at great cost to the citizens and tax payers of this country that is going unpunished. And now we have the head of the committee tasked to investigate the lawlessness saying that they are being impeded. We can not stand for that.

Of course it goes beyond the Fed. However if there were effective oversight of the Fed, many of the other players' influence would be greatly diminished as well. So much so that one might as well just focus on the Fed because if you don't it's just an endless game of Whack-a-Mole.

 

[nonlnear]

That would of been racist.

do you know how stupid that makes you look?

I suspect he doesn't know how stupid it makes him look when he says "would of" - among other things.

 

[Darwin333]

That's like saying if someone robs a home, it's not the fault of the robber but rather the fault of the homeowner for not securing the home sufficiently. In reality, the robber is at fault and should end up in jail, and the homeowner is going to suffer unpleasant consequences (getting robbed) as a result of not taking all the actions he probably should have.

Bullshit. Banks can make all the bad loans they want and people are free to do the same, as long as they both have to take responsibility for their bad decisions. You seem to be rather adamant about one side taking their lumps but not the other, that isn't what this issue is really about either though. This is about those same banks that knew the loan was bad misrepresenting them when they sold them to other investors. That is called fraud and it has nothing to do with the schmucks that borrowed too much money.

In mid-2006 I discovered that over 60% of these mortgages purchased and sold were defective. Because Citi had given reps and warrants to the investors that the mortgages were not defective, the investors could force Citi to repurchase many billions of dollars of these defective assets. This situation represented a large potential risk to the shareholders of Citigroup.

Testimony of Richard M. Bowen, III page 2
I started issuing warnings in June of 2006 and attempted to get management to address these critical risk issues. These warnings continued through 2007 and went to all levels of the Consumer Lending Group.
We continued to purchase and sell to investors even larger volumes of mortgages through 2007. And defective mortgages increased during 2007 to over 80% of production.

That is sworn testimony from a senior VP at Citi while all of this was going on. Again, nothing to do with the dumb borrower, this is about what the banks did with the bad loans AFTER the bad loans (fault to both parties) were made. You can not take a dog turd, dip it in chocolate so that at first glance it looks like chocolate, and sell it as chocolate. That is called FRAUD and it is already illegal. Furthermore, the tax payer has and is continuing to cover this fraudulent activity. You can argue about the necessity of the bank bailouts and keeping them aflot but the fact is a ton of people committed a ton of fraud to get those banks there and they profited very nicely from it. Those people should be brought to justice and all of their illgotten gains should be clawed back JUST like the joe blow who borrowed more than he could afford should reap the consequences of his actions (losing his house, fucked up credit, etc..).

I don't understand why so many people keep wanting to concentrate on some asshole who borrowed too much money instead of the assholes that illegally sold THAT loan and misrepresented what it was when they sold it which led to the tax payers being on the hook for trillions of dollars. You are worried about some schmuck getting a break on his house because he was dumb, I am talking about people who made billions of dollars by committing FRAUD and then put us on the damn hook for it.

Maybe you can explain it to me, why is the homeowner the "robber" in this case and not the bankster that bundled all of those loans they KNEW at the time were bad loans and sold them as AAA investments. They blatantly misrepresented what they sold and we have proof. The homeowner was dumb but he wasn't a robber. The guys misrepresenting what they sold, made billions in personal gains from that misrepresentation, and put us in a position of having to cover their fraudulent activity are the robbers. At least in my book, so please explain why the homeowner is somehow worse.

Read this and you will understand that the issue has nothing to do with the original borrower and everything to do with what they did with the loan afterwords.

Here ya go http://fcic.gov/hearings/pdfs/2010-0407-Bowen.pdf read up on what the banks were doing and tell me where the home owner fits into any part of what I am talking about.

 

[Darwin333]

True enough, but actually doing something about it would require another revolution - and even that wouldn't be likely to weed it out.
I have no special kinowledge of the details. The simple fact is that identifying interests with "trillions at stake" is not nearly as mysterious as many people make it out to be. Giving a short list of names would actually be irrelevant because the entire industry acts in concert as a cartel when it comes to exerting regulatory influence. They compete in the retail space, but when facing government they act as one.
Of course it goes beyond the Fed. However if there were effective oversight of the Fed, many of the other players' influence would be greatly diminished as well. So much so that one might as well just focus on the Fed because if you don't it's just an endless game of Whack-a-Mole.

Look, I agree with you completely but that doesn't mean we should allow people to get away with and profit to the tune of billions from blatant fraud. That is what is happening right now.

We do need to fix the oversight that didn't catch this shit when they should have (and it was their job to do so) but you don't let the bankrobbers keep the money because the security guard was sleeping. This goes well above "influence" and lobbying for some law in your favor, this is blatant lawlessness that is going unpunished.

 

[nonlnear]

Look, I agree with you completely but that doesn't mean we should allow people to get away with and profit to the tune of billions from blatant fraud. That is what is happening right now.

We do need to fix the oversight that didn't catch this shit when they should have (and it was their job to do so) but you don't let the bankrobbers keep the money because the security guard was sleeping. This goes well above "influence" and lobbying for some law in your favor, this is blatant lawlessness that is going unpunished.

I agree with your sentiment, but there is very little in the way of lawful remedies for the theft which has already transpired. It was lawlessness only in principle (a higher moral principle, not a legal principle), not in fact. The banksters' private legislation authors (i.e. their in house authors, not the dupes in Congress - at least most of them) made sure of that. (There may have been practices which were material fraud, but I suspect that any such acts would have been compartmentalized withing the organizations so that culpability will never reach the top in any criminal or civil proceedings.)

There is no moral hazard in the financial industry, and there is no legislation that has passed or has any hope of passing which will remedy that.

 

[Darwin333]

I agree with your sentiment, but there is very little in the way of lawful remedies for the theft which has already transpired. It was lawlessness only in principle (a higher moral principle, not a legal principle), not in fact. The banksters' private legislation authors (i.e. their in house authors, not the dupes in Congress - at least most of them) made sure of that. (There may have been practices which were material fraud, but I suspect that any such acts would have been compartmentalized withing the organizations so that culpability will never reach the top in any criminal or civil proceedings.)

There is no moral hazard in the financial industry, and there is no legislation that has passed or has any hope of passing which will remedy that.

sworn testimony

That is fucking fraud anyway you slice it. Front running is illegal, market manipulation is illegal, bribery is illegal (funny how the person who took the bribe went to jail but the bank that gave the bribe got nothing), perjury is illegal, and the list goes on. No new laws need be written to prosecute these assholes but its funny how I haven't heard of a single grand jury being asked to look at any charges, have you?

How about the banks that the FDIC took over only for the FDIC to find the assets the bank held to be worth 40%-50% less than the bank said they were. You want to know what would happen if I did that with my business? I would go to freakin jail but because its a bank and the taxpayers are on the hook its magically a-ok? I say bullshit, those bastards should have to abide by the same laws that you and I do.

 

[lothar]

I may work in the industry but I do not defend the actions of criminals any more than I do those of people who over-levered themselves to buy houses, cars, and tvs, through HELs and houses.

The moral hazard isn't the bailout. The moral hazard isn't fixing the problem after the bailout and making an example.

My example? Every single CEO who led the banks to financial ruin would forfeit their earnings through criminal investigations. If homeowners have to forfeit their "wealth", then so do the CEOs.

This is why Mozilo should be penniless. It's why John Thain shouldn't be the head of CIT.

What exactly did John Thain do that caused the financial crisis or led his firm to financial ruin?

I think you must be confusing John Thain with his predecessor, Stan O'Neal who ran the firm to the ground by making foolish acquisitions(First Franklin, First Republic Bank), synthesizing billions of CDO's and making billions of write-downs on them and destroying the "Mother Merrill" culture during his tenure.

If I remember correctly, John Thain was appointed to Merrill after they fired the CEO/Chairman Stan O'Neal while giving him a golden parachute. John Thain was only at Merrill for about a year and couldn't get rid of Merrill's toxic assets fast enough, which after the Fed and Paulson forced a hastily arranged shotgun marriage with BAC.

 

[blackangst1]

Not many will, as its a fairly long video, but The Fall of The Republic in my sig explains much of this and is worth the watch.

 

[nonlnear]

sworn testimony

That is fucking fraud anyway you slice it. Front running is illegal, market manipulation is illegal, bribery is illegal (funny how the person who took the bribe went to jail but the bank that gave the bribe got nothing), perjury is illegal, and the list goes on. No new laws need be written to prosecute these assholes but its funny how I haven't heard of a single grand jury being asked to look at any charges, have you?

How about the banks that the FDIC took over only for the FDIC to find the assets the bank held to be worth 40%-50% less than the bank said they were. You want to know what would happen if I did that with my business? I would go to freakin jail but because its a bank and the taxpayers are on the hook its magically a-ok?

I'm not disputing that laws were broken, or even that it was a widespread practice. I'm just saying that if you think going after them for the sake of extracting reasonable punishments and/or damages through due process you're setting yourself up for disappointment.

I do think there is something to be gained form a Congressional investigation with serious teeth. After all, if Congresscritters have time to ogle baseball stars they have time to give bank executives a serious dressing down. However the only real purpose that I would want that to happen for is to keep public outrage focused on the banks, so that the legislative process remains focused. We have already lost almost three years of the public's attention span though, so I'm not optimistic about things moving fast enough.

I say bullshit, those bastards should have to abide by the same laws that you and I do.

Should they? Certainly. Do they? Certainly not. The remedy is to chagne the rules. It may be cathartic to extract damages (and, as I said, may serve as a useful PR move to keep the public pressure on while the rules are changed) but if that's the only thing that gets done then nothing will end up getting fixed.

 

[Fern]

-snip-
Financial crisis study "Very Powerful Interests' Seeking To Undermine Investigations"

Well, that's kind of a sinister sounding charge. Unfortunately, the article leaves it at that, no explanation of what he means at all. Who is he referring to? They don't say. How are they attempting to "undermine investigations? They don't say. Could he/they have been more vague?

Before getting all excited I think I'll wait for more info.

The other 99.99% of the article is dedicated to the proposed delay. They should be able to work that out among themselves.

Fern