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HomeMortgage Settlement Pisses Into the Wind
Posted by Larry Doyle on February 12th, 2012 5:34 PM |
In a nation now all too familiar with a “too big to fail” banking system, a heavily manipulated and high frequency dominated equity market, and an incestuous financial regulatory system, we should not be surprised with a mortgage settlement that does little more than ‘piss into the wind’.
Pardon my cynicism, but one does not need to look too deeply into the recently announced mortgage settlement to understand there is little in the way of meaningful justice embedded in this contrivance. (more…)
Is Capitalism Dead?
Posted by Larry Doyle on April 11th, 2011 8:20 AM |
While Uncle Sam in the persons of Ben Bernanke, Tim Geithner et al may promote the fact that our capital markets currently are a reflection of a rebound in capitalism, they would be wrong.
Our markets and the Wall Street banks that dominate them no more embody the true tenets of capitalism than the incestuous nature of the Wall Street-Washington relationship truly represents the best interests of the American public. As The New York Times highlighted this weekend, Banks Are Off the Hook Again,
Americans know that banks have mistreated borrowers in many ways in foreclosure cases. Among other things, they habitually filed false court documents. There were investigations. We’ve been waiting for federal and state regulators to crack down. (more…)
Will Wall Street Mortgage Settlement Talks Halt Homeowner Abuse?
Posted by Larry Doyle on April 7th, 2011 5:57 AM |
Call me old fashioned but the idea that those engaged in abusive, and very likely fraudulent, business practices are allowed to negotiate a settlement strikes me as un-American.
That said, the world of unintended consequences in our Uncle Sam and Wall Street dominated economic system brings us just such an un-American approach in terms of addressing our current mortgage mess.
Negotiate? Settlement? Growing up in Boston in a family full of lawyers, I was under the impression that fraud and abuse likely got you 5 to 7 years in a medium security facility and maybe you got out in 3 to 4 with good behavior. Perhaps that form of justice still applies to you and me but for the large monied interests who run this country, we’re talking negotiations and settlement. Wow!! Little wonder why the rage in our nation directed at the Wall Street-Washington incest continues to burn so strongly. Let’s navigate. (more…)
Is The Clock Getting ‘Close to Midnight’ for FHLB-Seattle?
Posted by Larry Doyle on October 26th, 2010 5:46 AM |
All financial accounting charades to the contrary, the reality of a decaying asset quality and insufficient capital position will cause any institution to quiver. With more banking institutions declaring bankruptcy each and every week, the clock has yet to strike twelve on any of our larger banking institutions. That said, the pressure is certainly mounting on a large west coast institution, that being the Federal Home Loan Bank of Seattle.
I first addressed issues within this specific institution 18 months ago when writing, Putting Perfume on a Pig. I highlighted at that time:
Who gets this? Charles Bowsher, who resigned just last week as chairman of the Federal Home Loan Banks Office of Finance. Bloomberg’s Jonathan Weil does yeoman work in profiling Mr. Bowsher and the joke that is FHLB accounting: (more…)
“The Giant Elephant in The Room”
Posted by Larry Doyle on September 21st, 2010 12:02 PM |
What is holding back our economy? Why isn’t there more credit available in our banking system?
I have answered these questions numerous times over the last two years BUT many in Washington pretend not to know the answer and pander to their constituencies in the process. Regular readers of Sense on Cents are well aware that the books of our banks–especially our largest money center banks–remain chock-filled with loans that are being valued far in excess of what they are truly worth. Let’s navigate.
I first addressed issues within the second mortgage and HELOC (home equity line of credit) space in Fall of 2008 (Sense on Cents/Second Mortgages). Here we are a full two years later and America still has not received a straight answer and a full accounting by the banks or their regulators as to this “sinkhole” on their books and in our economy.
Let’s dive into this hole, get a little dirty, and again expose the issues within this sector. (more…)
FDIC “Kicks the Can”
Posted by Larry Doyle on June 24th, 2010 9:31 AM |
How secure do you feel about your bank deposits? They are insured, right? Well, how secure would you feel about your health insurance if your provider was not collecting badly needed premiums?
I am not pulling any fire alarms, but a recent announcement from the FDIC in regard to its insurance premiums collected from depository institutions speaks volumes about the current state of our banking system and our overall economy.
Recall that the FDIC’s insurance fund was exhausted late last year (Sense on Cents commentary: FHA and FDIC Getting Ready to Ask Uncle Sam for a Bigger Allowance). To replenish its fund, the FDIC had banks prepay estimated assessments of $45 billion, and also imposed higher premiums to rebuild the fund.
While Wall Street banks were in a position to pay out approximately $140 billion in 2009 bonuses, we now learn that the banking system is not in a position to begin paying the higher premiums to the FDIC. (more…)
Good News!! Credit Card Delinquencies Declining
Posted by Larry Doyle on June 16th, 2010 1:30 PM |
In the midst of challenging twists and turns along our economic landscape, I find it heartening to come across a bit of positive news.
Declining credit card delinquencies should be juxtaposed to the fact that mortgage delinquencies continue to increase. That divergence indicates to me that American homeowners are making their card payments prior to their mortgage payments. Why? Banks will quickly pull their cards while working with homeowners to modify their mortgages and allowing them to remain in their homes for an extended period. (more…)
Fannie Mae Plays “Let’s Make a Deal”
Posted by Larry Doyle on March 5th, 2010 12:38 PM |
“Let’s see, do you want to go for the prize behind Door #1 or take a chance on what’s in the big box?”
“Well Monty, I’m playing with your money so it doesn’t really matter now, does it?”
1970’s vintage TV may have been entertaining, but is the current deal-making used by Fannie Mae to liquidate housing inventory truly the way to develop a healthy and robust housing market?
Just what is Fannie Mae doing? (more…)
Will Cantwell-McCain Reinstate Glass-Steagall?
Posted by Larry Doyle on December 18th, 2009 11:18 AM |
Might we turn the clock back in an attempt to make our way forward? How so?
Pressure is certainly building in America to curtail, if not derail, the excessive risks embedded in our largest banks. How may these risks be unwound? Reinstating the Glass-Steagall Act, which separated commercial and investment banking activities. If this Act were to be reinstated, that would be the end of the mega-banks (Citi, JP Morgan, Bank of America, Wells Fargo) as we know them.
Who has been harping on this? Former Fed Chair Paul Volcker. Although Wall Street and Washington turn a deaf ear to Volcker, America listens to him intently.
In September, I wrote “Volcker Launches Bombshell on Wall Street and Washington” which highlighted Volcker’s call to reinstate Glass-Steagall. That story resonated far and wide. Now we learn from the American Banker that Senators Maria Cantwell (D-WA) and John McCain (R-AZ) have introduced legislation which would once again separate commercial and investment banking activities. (more…)
