Financial reform – Page 3

Didn’t Even Need Scooby Doo

Ladies and gentlemen, the reason that GDP looks fine while to the rest of us the economy looks like a rusted out Ford Escort with a leaky power steering pump and a transmission that slips now and then: A typical hedge fund manager, in just one hour, “earns” what it would take you or I 47 years to accumulate. And at the end of the day, he doesn’t even make anything as useful or durable as a latte. After all, he did not cause the money he “makes” to come into being, only to come into his pocket. Even better yet, if you were to close one simple tax loophole, the top 25 of them would pay an additional $4,400,000,000 in taxes.

When even the IMF notices that we’ve got an income inequality problem in this country, you know it’s really bad.

In Closing: even Republicans think it’s a bad idea to slash Medicare; yeah, that could be why they’re fat; truly sad; stereotype theatre; I notice that sunshine and fortified milk are not on this list; the long version; riffing on a theme; caffeine!; oh yeah, that‘s gonna help; truth; incompetent photoshop tricks; better than it could have been; just in case you ever wondered what they ate; soldier fitness; have a Koch and a smile.

Connecting the Dots

Today, the SEC announced fraud charges against a third banker for selling worthless and non-existent mortgages to Colonial Bank, leading to its collapse. This is on the heels said executive confessing to conspiracy and being sentenced to 30 years in prison.

Most reporting on “mortgage fraud” centers on one of two themes: Joe Average knew perfectly well he couldn’t afford the house and lied to get the mortgage in the first place; or robosigning was a just an unfortunate oversight caused by the sheer volume of foreclosures and nobody could reasonably predicted a problem. Both infuriate me. The first was only a small fraction of the foreclosures we have, and the second is merely a cover-up for the real mortgage fraud.

Let’s start from the beginning.

The buyer is told by an unscrupulous mortgage broker that he indeed does qualify for a mortgage, even though the mortgage broker knows that within 3 to 5 years, this buyer will have to refinance or go into foreclosure.
Some buyers — mostly minorities — are pushed into sub-prime mortgages despite the fact that they qualify for a better deal. They are at higher risk of foreclosure from day one and the mortgage broker knows it.
In some cases, a bait-and-switch occurs at the closing table. Either the documents presented are not what was promised, or only the first few pages reflect what the buyer was promised. The rest of the huge stack of paper the buyer must sign is at a higher rate or with worse terms.
The mortgages are sold to trusts, banks, insurance companies, pension funds, investment firms, Fannie Mae and Freddie Mac. They have been fraudulently represented as “performing” — that is, paying every month and likely to continue. Sometimes, these loans change hands multiple times. This is particularly true in an environment where some financial institutions have failed.
The original bank is now just the servicer, and they have every incentive to add fees, post payments late, deny short sales, deny mortgage modifications, and push the homeowner into foreclosure.
Meanwhile, in violation of the laws of every state in the union, they have failed to report the new mortgage holder at the county recorder’s office. After all, that costs money. Instead, they put together a private company to keep track of who owns what: MERS stands for Mortgage Electronic Registration System. The banking industry insists that this is fine, the law is quaint, this is the way everybody does things now, so the courts need to just accept it. Courts in several states have disagreed. Just because everybody goes above the speed limit doesn’t mean you won’t get a ticket.
The homeowner knows he is in trouble. He calls to ask about a mortgage modification. He is fraudulently told that they won’t even consider it unless he stops paying for 3 months. When the 3 month mark comes, the homeowner is in default and the foreclosure process is begun; it’s a race to see whether the modification or the foreclosure finishes first.
Default is where the robosigners finally come in to play. They have stacks and stacks of documents, some of which need to be fabricated because originals were shredded to hide fraud.
I would be remiss if I did not point out that in some cases, banks are foreclosing illegally: they foreclose on the wrong home, they foreclose without legal standing to do so, they foreclose in violation of a bankruptcy order, they foreclose on a member of our military who is serving overseas.
In the fallout, some financial institutions fail.
The banks turn around and sell the properties at absurdly low prices, sinking property values. In any other industry, they would face charges of dumping.

And there you have it. Robosigners and “people who should have known better” are only a very small part of the mess we now face.

Cross-posted at The Moderate Voice.

In closing: the center is further left; “don’t expose our law breaking trade secrets!”; odd recall; on austerity; women‘s issues; tied hands; seriously??; Pac-Man was supposed to be for girls; I’ve got a soft spot for VW, but this is not likely to be my next car; glad they can agree on something; Superman‘s citizenship and other issues; what are we hiding?; fix it; Matt Damon; and a picture:

The End of the BAMTOR Principle?

Alas, I can only hope. However, I do know better.

Somebody’s actually going to jail for fraud at a mortgage company that caused another bank to collapse. I’m quite pleased that finally, somebody is actually being punished for a crime. But frankly, we need a lot more bankers being escorted off premises in handcuffs. The only way to break the BAMTOR Principle is to make it so Joe Banker tells his boss: “I can’t do that! It’s against the law! Don’t you remember that they arrested Bob for that?”

Elsewhere, Bank of America and Wells Fargo are whining that they may actually have to pay “material fines” for breaking the law in foreclosures. Poor babies. B of A may also have to pay investors a few hundred million dollars for delaying foreclosures because it turns out that some pesky activist judges wanted them to follow the law! It seems like the only way to make a bank pay up is when it’s paying another financial institution. Gee FDIC, I hope you’ve got a plan for what to do when one of these big boys finally collapses.

Finally, some pesky activist judges are finally saying to big institutions “Just because it’s standard practice doesn’t make it legal.”

In Closing: Americans without passports; a recap; another reason to quit smoking; Bring It; no TSA required; stagflation; the center is way off here, no, a little more to the left; worth reading; budget cutting their own throats; stop manipulating me!; that sounds easy; free in Tokyo (did you know Tokyo is 4 syllables long?); and you know I don’t generally do celebrity news, but this sounds like the setup for a re-make of Weekend at Bernie’s. What could possibly go wrong??

Mulholland Shorties

Was I Wrong About Rahm?: He’s not even sworn in yet, and he’s announced that something he wants to do is enlarge a good old-fashioned public works project! Granted, it’s just bike lanes, but it will put people to work and help other people get around when it’s done.

Food Insecurity is just a fancy word for Going Hungry: Here’s a viewpoint from somebody who once had to endure it. It turns out there are a lot of issues in play.

So You Want to be a Revolutionary: This man wrote a book about non-violent revolution. There’s a link to the PDF, which is credited with change around the world.

Income Inequality: When people in other nations notice it, it’s bad. If that has too many words, this one has lots of pretty pictures. Here’s more.

Release the Hounds: An Indiana Deputy Attorney General suggested using live ammunition on protesters in Wisconsin. Thankfully, he didn’t have the authority to order such a thing. But sanity did prevail: he is now unemployed on the grounds that a man in his position must demonstrate civility.

Speaking of Shafting the People who Teach Your Kids: Providence just sent lay-off notices to each and every teacher. They will decide later who actually gets the axe. Way to promote morale! And just a reminder, the average teacher in Wisconsin makes less than the Wisconsin median income.

Your Insurance Company Believes in Global Climate Change: Because 2010 was one of the worst years for climate disasters ever! That would include things like storms. Oh, and I sure hope those of you in San Francisco enjoy the expected snow.

Too Big to Fail is Too Big to Exist: Seriously, even people from the Fed say so.

Making the Situation Worse: Banks are moving branches from poor neighborhoods to wealthy ones — despite laws requiring them to serve the entire community. In this vacuum, payday lenders and check cashing businesses spring up out of need. And did you know that one in nine banks is in danger of collapse?

Some People Have Never Heard of the First Amendment: Some people think you can outlaw “shariah.”

Who Knew: It turns out Americans like having clean air and water.

Priceless: It turns out you can download sheet music of the classics for free. Mozart’s copyright rights are long since expired.

Truth in Comics: Drew and Bors.

Can we Stop Calling it the Party of Lincoln?: It turns out President Lincoln would disagree with almost everything the current Republican party stands for.

They Really Would Prefer All Women were Pregnant: No word on whether they think we should be allowed to wear shoes.

Plastic Tubes and Pots and Pans, Bits and Pieces: Kids need to do more science.

Batshit Crazy: Qaddafi.

The Only Evidence that I am “Moderate”: I’m clearly somewhere between these two crazy extremes. Honestly, I think of myself as left of center. You know I think that the banks are the root cause of much of our current economic woes, but it would be childish to assert that “Wall Street causes all bad things.”

Placebo: Dogs just want to please their masters. That’s why drug sniffing dogs only have an accuracy rate of 44%. That rate drops to 27% when the person in question is Hispanic.

Lily the Pink: Or, Who Knew Moldovans Drank So Much?

Advice for Democrats: Stop using the Republican’s terminology! I want to scream every time i hear one of you talk about the “death tax” or “tax reform” or “Obamacare” or “Social Security reform.” For pity sake, all these things have names that don’t admit that their way of looking at it is correct!

What Happens When This One Pops?: College textbook price bubble.

Follow-Up Thursday

HR3: “Ok ok, we’ll take that word out if you’re going to get pissy about it. Damn feminists and liberals! We’d better get some concessions in return!” It’s still a bad bill that should not become law.

Banking Corruption: Oh yeah, JP Morgan knew Madoff wasn’t quite legit, problem? Elizabeth Warren still needs to head the CFFB, and to hell with Timmy Geithner. Did you know that the highest paid guy at Bank of America is still Angel Mozilo? The same guy whose business practices cost B of A billions of dollars last quarter alone?? It sure would be nice if someone would enforce the law regarding foreclosure fraud.

I felt a disturbance in the Force, as if a million wingnuts’ heads exploded and were suddenly silenced: The Obama administration is investigating whether the Health Insurance Reform bill can be used to require insurers to provide — not just cover, but provide free — contraceptives and family planning services!

On the Tea Party: Excuse me, I seem to have fallen into some alternate universe where George W. Bush is talking sense, and more or less agreeing with Howard Dean. Does the letter J exist in this universe?

On the Economy: Google got 75,000 job applications in one week because the economy is soooo good, right? At least demand for temps is up (pro tip: I’ve gotten job offers working at temp agencies; they’re a good way to earn a little money, get your feet wet, and maybe end up in a working interview!). On the whole, the employment situation is still “a lighter shade of gray.” The number of people using food stamps is up 14% from last year. So yeah, there’s a teensy disconnect between Wall Street and Your Street.

Will of the People: We want alternative energy, and the jobs we hope will be created by it, and the lower power/fuel bills, and just maybe the cleaner world. This is one of those “excuse me, the center is way off there to the left” moments.

On Education: You know, maybe teachers would do a better job if they had a decent curriculum to work from! Oh, now that’s crazy talk; everybody knows a really good teacher re-invents the wheel every semester…..

In Closing: Republicans hate puppies; they hate the environment too (Nixon was a dirty hippie!!) homeless shelters sometimes break up families; anchor babies; Weird Al; China; and VW is trying to win me back after making the Jetta look like ass:

Inland Shorties

To Paraphrase My Source: why do we demonize doctors for over-prescribing (and parents for over-demanding) antibiotics when 80% of them are used on the farm?

Don’t Panic: Yellowstone has risen by as much as 10″ in spots.

Useless: New food labels tell you everything they think you need to know at a glance on the front of the package! Except, of course, how big a serving is.

Follow Up: Great Jack LaLanne quotes.

Been a while since we had a Japanfilter: Old pictures, traditional recipes. Less traditional. Free Japanese lessons.

Holocaust Remembrance Day: Enough said.

About Jobs: It’s not about competition; this might take some time; if he’s right, his wife may be unemployed in 2 years.

ACLU: Oh Snap.

Unaffiliated: Monitor lizard.

When can I buy one?: VW‘s latest mileage monster.

Harry? Is that you??: Reid says we must “reintroduce truth into the public debate.” Among other things!

Sharron: Won’t rule out running for President in 2012. Shudder.

Google: strange sense of censorship.

Deficit: Why austerity is a sucker’s game.

Duh: Financial crisis was avoidable.

The War On Drugs Gets Silly: Drug catapult.

That Nixon Was Too Liberal: Newt Gingrich says the EPA must go.

JP Morgan Takes the Fifth: Won’t detail a half million loans.

No, really?: Housing bust means workers can’t move to new jobs, a key feature of the “job market.”

Rare Fossil: Pterosaur and egg.

Blog for Choice

It’s that day again.

As it turns out, “abortion foes have high hopes for new Congress.” And their hopes do not stop with overturning Roe V. Wade.

If the So-Called Pro-Life movement gave a darn about life, they would not have accosted this man and his wife, who were arguably having the worst day of their lives already.

If the So-Called Pro-Life movement gave a darn about life, they would already have tossed out the minority among them that think it is acceptable to enforce their opinion with terrorism: vandalism, violence, and murder in the name of politics.

If the So-Called Pro-Life movement gave a darn about life, they would embrace reforms that benefit children, such as universal health coverage for minors, and programs that would promote family stability (such as, oh I don’t know, jobs??) for born-already-Americans.

If the So-Called Pro-Life movement wanted to reduce the number of abortions — and even somebody like me has to think there are places and populations where it might be to high — they would take steps to ensure that unwanted pregnancies and birth defects are prevented. They would try to prevent sexual assaults in their community. They would support widely available birth control. They would want to improve the environment. They would want to make healthy food more available than junk food.

The truth is that the “It’s A Baby!” crowd is anti-sex, anti-woman, anti-free-will.

In Closing: standards; mindfulness; multi-layered WTF; and where will they find the money?; ok we agree; Howard!; maybe, maybe not; lies revisited; scanners.

Homework

There has been much wringing of hands over the “Achievement Gap,” which is “observed disparity on a number of educational measures between the performance of groups of students, especially groups defined by gender, race/ethnicity, ability, and socioeconomic status. The achievement gap can be observed on a variety of measures, including standardized test scores, grade point average, dropout rates, and college-enrollment and -completion rates.” [Emphasis mine]. One of the specific goals of NCLB was to measure and close this gap once and for all — a noble goal, even if the methods are questionable.

Now, I am far from the first person to point out that homework can make the gap worse, but let me give you some concrete examples.

Imagine a high school student. He arrives home, and his Mom is waiting for him thanks to a flexible work schedule. He gets a snack — teenage boys are universally always hungry — and sits down to work on homework for several classes. At one point he needs help with his foreign language work; Mom studied that language and certainly knows enough to help him through grammar and vocabulary. Later he uses internet resources to find a news article for another class. At one point he is stumped by a science problem. While Mom doesn’t know the answer, she suggests that it’s a topic that doesn’t change a lot and might be in Dad’s college biology book. When Dad arrives home shortly, he is able to help the student with mnemonics, or clever ways to remember all that information. Later, Mom cooks a healthy dinner, and later still everybody goes to bed at a reasonable hour.

Now let’s look at all the obstacles he did not have:

He didn’t worry about getting home from school safely, nor about his safety in his upper-middle class neighborhood
There was plenty of nutritious food in the house
He did not have to supervise the homework of younger siblings
He was not responsible for housework, such as starting dinner before Mom and Dad got home
Someone was there to keep him focused on the task at hand when necessary
He did not need to be at an after school job to help the family finances
He had all the resources to do homework, such as pencils, paper and reference materials
His parents were college educated and could in fact help when he had trouble with homework
His parents could afford tutoring services if they were necessary
He had access to a computer and high-speed internet
His parents were both willing and able to see to it that his physical and academic needs were taken care of.

It’s clear to see why homework is sometimes just one more academic obstacle.

In Closing: on the economy; on being ripped off; on Medicaid; on honesty and civility and history; on the free market; on climate change; lost wages; and oops.

Shorties Horizon

Dead Zombie Horse: a few thoughts on health insurance reform. And Immaculate Infection.

Oh Christmas Tree, Oh Christmas Tree: you make a fine fish habitat.

Laughing all the way to the bank: Only $3 billion? Pshaw! Let me get my checkbook.

Speaking of Banks: FDIC may sue executives of failed banks to try and get some of their money back. Oh and if we won’t do anything about too big to fail, Europe will.

Just Call Him Phoenix: a real life superhero in Seattle.

Nice: The Westin St. Francis washes every coin it receives.

Nuts: the rift between environmentally conscious Christians and nutjobs who think Jesus will just fix the environment.

The Dude Abides: Well no, it’s really just Jeff Bridges.

Obligatory January Weight Items: most Americans think their weight and dietary habits are just fine, thank you. Here’s the 8 worst diet and fitness fads of 2010. And for the motivated, a kick-start workout guide (don’t forget to eat healthy foods in moderate quantities!)

On Poverty: officially and in reality. At least it’s creating jobs at Dollar General, for what it’s worth.

Nevertheless: I hope you never need to know this information.

On Republicans: Go ahead and read the Constitution. How do they get away with telling the same lies so much we start to believe it’s true? Three Cups of Tea (tell ’em, Howard!). Hey big businesses, what laws do you want to not follow anymore? Guide to Governance. The sane people are concerned. And an open letter.

On all the other parties: Ha! Seriously though, I’d like to see a big, televised debate between party leaders of all these “third parties,” live during prime time. It would be a great laugh (have you ever read some of the published party platforms??), and the few good ideas will get picked up by someone who can run with it.

Delicious: Bison.

Oops: I mean oats.

Immigration Reform: it’s more complicated than putting up a fence.

Images: ranging from merely amusing to mind-blowing.

Welcome to 2011.

Revisiting the BAMTOR Principle

Banks Always Make Their Own Rules, and this has been a banner week for demonstrating it!

You’ve heard of course about the lady who arrived at her second home to discover new locks and all her stuff missing, including her late husband’s ashes, right?

What about Deutsche Bank agreeing to pay a bunch of fines for helping wealthy Americans dodge their taxes?

Arizona and Nevada are both suing Bank of America over loan adjustments, and the Nevada AG has evidence that B of A has engaged in massive deceptive trade practices.

In California, Wells Fargo has been forced to admit that “pick a payment” was a bad idea and strongarmed into modifying a whopping 15,000 homeowners (sounds much more impressive if you say $2 billion in mortgages, doesn’t it?).

Meanwhile, the federal agencies that should be regulating the banks and protecting the citizens are protecting the banks from the citizens. The Federal Reserve has actually blocked new foreclosure regulations.

Even MarketWatch suggests that the banks have pulled on over on all of us.

We don’t just need rules for Big Banks, we need them to be forced to follow the law. Put a few bankers in jail, and I imagine the rest will be more likely to resist criminal activity.

In Closing: less American Pie; when Pat Robertson says to decriminalize pot, you know the War on Drugs is a failure; duh; security threat; Schneier; look, there’s never going to be a “get out of the security line free” card, so stop wishing for one!; gee, whoda thought?; good idea, wish somebody thought of it during the Clinton Administration; and idiot motorists drove through wet cement, getting stuck and delaying a project that would have been open in time for Christmas until probably Easter. Hope they’re real proud of themselves.