Posts Tagged ‘The Fed’

Who gets the Golden Ticket? Charlie or the Banks?

Friday, April 29th, 2011

Who gets the Golden Ticket? Charlie or the banks?Financial Times Headline: Caution urged on US bank foreclosure fines

Who gets the golden ticket? We all remember the deserving Charlie Bucket inside the chocolate factory of the eccentric chocolatier, Willy Wonka. In the end, Charlie gets the Chocolate Factory and the golden ticket.

This week’s Financial Times writer Tom Braithwaite reported a story: Caution urged on US bank foreclosure fines. The story focuses on how banks will be fined for failures that led to the foreclosure debacle. BUT…there is some sympathy and sugar coating happening. It seems regulators are pressing to avoid “dangerously large” penalties, according to one of the top officials participating in fractious settlement talks.

John Walsh, acting comptroller of the currency, told the Financial Times that he supported financial penalties for mortgage servicers, led by Bank of America and Wells Fargo, whose shoddy paperwork and improperly signed affidavits caused the repossession of delinquent borrowers’ homes to come to a grinding halt.

Here’s another BUT….

But the Office of the Comptroller of the Currency has differed with some state attorneys-general, the Federal Deposit Insurance Corporation and the new Consumer Financial Protection Bureau, which all want a more far-reaching settlement, with $20b in fines and at least some of the money used to reduce the debt owed by struggling homeowners.

The fact is this: if the government goes too light on banks; it will be an invitation for banks to continue to skirt the law and continue to believe that they are not just too big to fail, but too big to be regulated or stopped.
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Posted in Financial Times, Florida foreclosures, Foreclosure Defense, Foreclosure Fraud, Roy Oppenheim | 4 Comments »

“Welfare for the Rich” – Matt Taibbi Exposes Disgusting Practices at the Federal Reserve

Tuesday, April 26th, 2011

Roy Oppenheim and Matt Taibbi ask, why isn't Wall Street in jail?The question of the decade: Why isn’t Wall Street in jail?

In a typical jaw-dropping article for Rolling Stone Magazine The Real Housewives of Wall Street, Matt Taibbi reveals the shocking practices of the Federal Reserve during the Great Recession.

With the nation staggering, the Federal Reserve took it upon itself to lend trillions of dollars at nearly zero percent interest. Then, as collateral, the Fed took the securities that were bought with the loans. The arrangement meant that if the securities lost money, the Fed would be stuck with the losses but if the securities made money, then the investors would pay back the loans and keep the higher priced security. Privatizing gains, socializing losses, all in an effort to stimulate the economy. Such loans were not made available to everyday folks; only to the important pillars of our economy: Japanese car companies (while bailing out their competitors), Middle Eastern banks (including one later bought by Muammar Gaddafi), tax dodgers in the Cayman Islands (imagine, subsidizing tax evasion), and the spouses of Wall Street executives. No, that isn’t a typo, the wives of Wall Street executives were offered risk free loans guaranteed by you, the taxpayer.

Taibbi looks at the case of Christy Mack and Susan Karches, the wife and widow respectively of the CEO and the late president of investment banking at Morgan Stanley. While Morgan Stanley itself received over $2 trillion in Federal Reserve risk free, subsidized loans, Christy and Susan also received $220 million for their company, Waterfall TALF Opportunity. With the money, the duo bought student loans and commercial mortgages. If the loans or mortgages ever decrease in value, Waterfall effectively will not have to pay back the Fed and let the Fed keep the devalued securities.
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Posted in Florida foreclosures, Florida real estate, Foreclosure Defense, Foreclosure Fraud, Hardest-Hit Fund, Rolling Stone, Roy Oppenheim | 4 Comments »

The Fed Finally Shows Its True Colors as to Homeowners and Foreclosure Crisis

Thursday, December 2nd, 2010

In Monday’s The New York Times editorial The Fed and Foreclosures, The Times finally took the Fed to task. They wrote: “There are two sides to every delinquent loan – a lender who made a bad lending decision and a borrower who cannot repay. Yet banks have never acted as if they bear any responsibility for the mortgage mess.” The harsh reality is banks take little to no responsibility for the fraud-closure mortgage nightmare.

The Fed on Foreclosures

According to The New York Times editorial, the Federal Reserve has proposed a rule that would disable one of the more effective legal tools that borrowers have to fight foreclosures.

The Truth in Lending Act from 1968 gives borrowers the “right of rescission,” the ability to undo a home refinancing or home equity loan within three years of the closing if the lender did not make proper disclosures. The Fed’s proposal would change all that.

But the bigger question is why would the Fed even get involved with this hot potato? Isn’t the Fed a non-partisan – above the politics – holier-than-thou institution that keeps the economy humming and rocking? Aren’t they the ones with the ability to print money and inject it into the economy as they have the ability to suck money out of circulation when things get too heated? Aren’t they the ones that paid 100 cents on the dollar for underwater virtually worthless sub-prime mortgage bonds under the ruse that the funds paid for the bonds was the fastest way to get money into the economy?
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Posted in Bank Fraud, Florida Law News, Foreclosure Defense, Foreclosure Fraud, Roy Oppenheim, The New York Times, Underwater Mortgage | 3 Comments »

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