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Extend And Pretend Update: Bank Of America Chimes In On Foreclosure Halt
Bloomberg Headlines:
- BOFA CONSIDERS REQUEST TO SUSPEND SOME HOME FORECLOSURES
- Bank of America Considers Request to Halt Foreclosures for HAMP
- FORECLOSURE HALT PERTAINS ONLY TO BANK-CONTROLLED LOANS
- BOFA'S DESOER CONSIDERS FORECLOSURE REQUEST, SPOKESMAN SAYS
- BOFA'S DESOER MET WITH HOUSING ADVOCATES SEEKING HAMP REVIEWS
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What if we already sold it to the Fed?
Must be a trick to preclude short sales to vultures. FDIC out of money seriously?
Though it might not be pretty to watch, vultures
provide the valuable service of cleaning up dead
garbage.
And, vultures are true capitalists. No bailouts.
No bonuses. No protection rackets. No help.
And they press on despite being misunderstood and under-appreciated.
Ironically (perhaps), many sheeple consider human
"vultures" to be bottom-feeders, whereas the well-
connected financial terrorists are shown respect
and showered with Trillions rather than being tortured at Gitmo before being jailed and/or
"disappeared". One can dream, can't one?
Never underestimate the willingness of the American
Idle to be lied to.
Ooops ... 5 minutes to Wopner. Where did I leave the
Wal-Doodlez and Wal-Dew (generic Walmart brand)?
Dear Anon,
Condescention becomes you.
When vultures can be reimbursed for their losses by an FDIC willing to send them money to cover losses on short sales, they're true corporate welfare recipients, not capitalists.
Risk free deals, with political taint?
Gitmo's got nice weather compared to NYC. Send 'em.
Kick the can a few years until inflation saves real estate.
Unfortunately, we will not be seeing inflation for quite some time. According to The Economist, there was about 47 trillion dollars worth of paper that was destroyed during the equity collapse back in the fall and spring of 2008-2009. Although there has been a bit of a spring back over the last year, It's going to take the fed a while to print that kind of cash to get us back to the money that was available back in 07-08.
$1 trillion+ increase in market cap just yesterday. Do the math...two months!
I think the FED and cohorts would be extremely happy if it can be done within the next 5-7 years. The magic of inflation compounding is just as effective as the magic of interest compounding. It doesn't take long for it to build.
It works in a recession, not a depression. Too much leveraged debt is being unwound the result will be a hyper-inflation because th FED wont be able to take his foot off the gas.
I agree. I didn't say they will be able to do it, just that the FED would be happy if it can be done. I suspect the FED is extremely worried that they may have to destroy the village to save the village. Again, this is my assumption of their point of view, a view I don't share. The FED does understand that compounding of "normal" inflation is what they're looking for, not hyper-inflation or collapse.
At least that's the cover story.
Fun with math: The style of the day.
But really, isn't it always in style?
47 trillion of Eswaps and Erivatives, no? Just a bunch of dirivative noise that only hurts when then top 5 banks decide for it to.
But that inflated money has to reach the consumers hands.
Right now the trickle down effects that were always dammed up, in good times, is now somehow worse.
The problem with inflation THIS TIME AROUND, if it happens, is that the prices of everything will go up. But that money isn't going to be in YOUR hands. Thus how anyone would be able to buy the homes because 'inflation saves them' is a bit of a misnomer. You're under the assumption that everybody that can currently afford home (or used to), will suddenly get a raise commensurate with inflation. YEAH RIGHT. If home prices were to get to 400k, from 175-225k, you'd think incomes must roughly double. Good luck seeing ANY raise, let alone a 100 percent one (to still be as unaffordable as they are now).
Unless the magic of everyone flipping the homes to each other using new bernanke loans starts the bubble process again. Nope. (nor should we want that)
Again, they're printing money, it's not getting to you. If inflation hits, it's still not getting to you.
Yes indeed kick the can and FREE HOUSING FOR ALL for 12 to 24 months plus easy.
Sweeeeeeeeeeeeeeeeeeet!!!
No not all ... free housing only for those who got in over their heads ... wealth distribution with real political pluses
Agreeed, i forgot to put /sarc
Just part of the managed economy....Obama floated the idea yesterday that all foreclosures should not be allowed to proceed until they are reviewed by the US gov't.
Just another reason that if you go long bank stocks, the day will come when you are going to get massacred.
True, but the robotic squid will have made a fortune on 86 million trades by the time it crashes.
Sure do wish I had bought a house I couldn't possibly pay for. Nice to have generous fellow citizens who don't mind getting hosed. Better yet, wish I had been a mortgage banker who made tons of loans to people who could never afford their homes, plus bought one for myself. Then I'd get an underserved bonus AND an underserved house.
God bless America.
Yes, some people are walking away from homes that they shouldn't have been able to qualify for in the first place, but I remember when I bought my home a few years back ... the mortgage brokers were really really pushing the ARMs. They got a piece of the action on them. I ignored them and got a 30-yr fixed because I experienced the S&L crisis in Texas.
Whenever you are out of work and have to exist on unemployment ... after you have exhausted your savings, then you have to choose between paying your bills, feeding your family, or paying your mortgage ... what would you choose? Believe me, I know plenty of people that tried to work out things with the big banks. These banks sparingly dole out information, lose your paperwork, are confused about the new programs, and don't communicate between their departments. They are really good at harassing you for full payments.
I was fortunate enough to find another job right way last year, but large corporations have laid off thousands of workers and moved those jobs to India. These jobs aren't coming back. If you look at the average age of these workers, you will see that they are over 40. Try getting another job in this economy competing against recent college graduates. I think the average is 10+ applicants for each job opening.
IBM-ex
That about sums it up. Some very good people are starting to feel like they have nothing left to lose.
Aka Soci-capa-fascism, lol
This is what Hayek meant with central planning: when you start you can’t stop. It just gets worse and more tangled until it’s wrapped around your ankles. The healthcare bill is 2700 pages!--and anyone who pretends to understand it is pretending.
What this is, this is pretending. You pretend that you can do all these things, and then something goes wrong, and you say, we can fix that, and then something else goes wrong and you say we can pay for that, and then… and all the while the tangle just gets more and more tangled…
Of course they love it. Because without it, those bleedy cunts will need to be bailed out again in less than 2 years.
For all of those who forgot how to play...
http://www.ehow.com/how_309_play-kick-can.html
Fannie and Freddie are buying lots of loans back from portfolios they securitized. Let them take the lead and show how it's done. Reduce principal and repackage them. Or they could just send them back to the originators and ask for a refund. Either way, until motivated servicer talks with interested debt slave (or vice versa) and inks something meaningful, it's all gas.
The next wave of foreclosures will take them out. Currently they are reporting only a 4.5 month supply of homes in California. If you add the shadow inventory that the banks already have that number jumps to a 13 month supply. Now if you add the homes that are either in the foreclosure process or that are more then 90 days past due the number hits a whopping 15 month supply. What you are seeing is a failed attempt to block the truth. They thought they could trickle the inventory out and keep a prop under the housing values but the numbers of default kept getting bigger and bigger? Why is that you may wonder? If you lived in a house that was 250k underwater and your neighbor just got his mortgage bailed out by the government what would you do? Probably the same thing, they created the monster and now they are just trying to contain it. It is like dominos, they are just toppling now at such a rate they have no way to service just the delinquent paper. The scary thing is pushing behind this big bottle necked fustercluck is the next wave of option arm and alt A resets, most of which are owned by the government or the likes of BOA or Countrywide. People bought McMansions and didn't even make the interest payment. They could roll the difference, up to 152 percent of the original loan onto the principal balance. Now you have a huge amount of people that are so underwater they have just stopped paying and are squatting until they get kicked out. If this proposal passes, mark my words, there will suddenly be millions of people that will become squatters because it will be the new norm, a business decision just like a stategic default. The government knows this however they need to help the banks cover up their mass insolvency and keep the curtain from being pulled all the way back. The whole housing debacle is nothing but lies and numbers on steroids, they are running out of spackle,paint,and tape to cover up the ugly mess they created selling the American Dream, or should I say the American Nightmare?
To your point, Freddie released their Jan numbers today, delinquencies going up at a pace that is not slowing down.
http://www.freddiemac.com/investors/volsum/pdf/0110mvs.pdf
Amen. There are 2b/2ba 1900 sq.ft. bungalows in Pasadena for sale at $ 675k, down from $ 1 million in 2005 !! The LA and OC jumbo markets are still way out of whack with reality. And since half the Option ARM/Alt-A recast action is in CA and runs another 2 years, I anticipate a long drawn out catastrophy for the lenders.
Couple this with the fact that States and municipalities are only beginning to come to terms with the reality that they must chop head count.
Extend and pretend with the exotic Jumbo paper is in the process of unwinding.
You are spot on tahoebumsmith. The banks are no better off today then they were during the storm. You might even say we are actually in the eye of the storm. Where everything appears to be ok and calmer than before. The thing is, this storm is not going to dissipate. It is going to gain speed. Bad debt does not go away, can't be covered up and remains a negative force until it is allowed to clear.
No. That would be the inevitable result. That's already been looked at, analyzed and expected. So why is this being engineered? That's the question to be asking.
Or Not.
The thought has also occurred to me that there in No Conspiracy, that this is just as a bunch of petty criminals, (who individually don't think of themselves as criminals, but collectively comprise a potent force that is destroying western society ) who collectively have jumped on the lucrative financial trade that they see in front of them and in the process have totally fucked most global society.
Two directions, neither of which may be correct, but both equally possible.
If either, or both (not likely) were/are correct, then the assumption/diagnosis that we will have to arrive at is that we are definitely on a downward spiral.
Good luck to us all.
P.s. and There's a Pipe Dream.
THIS SHOULD SKY ROCKET EARNINGS RIGHT????
If there aer no foreclosures......are there any losses????
Banks are gonna love this. We should put Mark to Market back in the system right now and make is effective from the date we took it out!
The forward top line revenue numbers should show contraction. Maybe this is one of the things that Meredith Whitney saw coming?
My personal plan.
1. Immediately stop paying mortgage.
2. Make as much money as possible in the next 12-18 month while taxes are "low" and housing is free.
3. Max out all of my credit cards and buy gold bullion.
3. Take 100% of my net worth and buy gold bullion.
4. Either get bailed out by team Obama or ride off into the sunset (I'm thinking a nice beach house in central america)with a big bag of gold.
Just two cents from a friend who monitors the loan servicing process at WF's servicing subsidiary. I'd like to hear how this fits into anyone else's knowledge:
[...] As far as I know the only way the government would have recourse would be if the lender agreed to HAMP in the first place. HAMP is a program to prevent foreclosure, so if the lender started f/c before they had reviewed for HAMP it would be contradicting a program that they had agreed with. duh.
The idea that the Banksters are "considering a request" is a farce.
Do you think the Government dictates to the Banks what is going to happen and then the banks do as they are told?
Let's be serious.
Programs like HAMP are created by the Big Banks and then announced by errand boy Geithner. These programs don't work because they are DESIGNED TO NOT WORK. This way the Banks can throw a TARP (or Maiden Lane blanket, or whatever)
over their garbage, and pretend to be solvent while dumping their toxic waste (ahem ... "assets") on taxpayers while the Banksters and politicians continue to party at the "punch bowl". All the while they bloviate about "keeping Americans in their homes", which makes for better politics than "let home-OWERS eat shit and die" (after paying off their credit cards, of course).
(Officially) allowing people to become squatters will "stimulate" the economy because even more people will by iPods and Xboxes instead of paying their mortgage. Eventually, the Banksters will come back for more bailouts, and taxpayers will again foot the bill. Or ... maybe, at some point, we won't.
We're told that the worst is behind us and the recession is over, yet on Christmas Eve it was necessary to provide Fannie and Freddie unlimited backing? That's a nice little backdoor bailout and TAX to slide through while the country is getting egg-nogged, isn't it?
The Corporatocracy calls the shots. Our Presidents are puppets. CONgress, with the exception of a few smart, honest people, is completely bought. Lobbyists have that taken care of with bribes now, and the revolving door eventually. The recent Supreme Court decision on campaign finance is another nail in the coffin.
Don't worry about it. Go shopping.
Mission Accomplished!
If enough people follow 246908"s plan, the price of Gold will inflate too!
Japan has been on massive debt and massive QE for a long time and they still don't have inflation.
I think in trying to determine what will happen as the USA is forced to follow a similiar path of QE and ever increasing debt that Japan has different boundry values and initial conditions than the USA.
The US $ is for the time being the global reserve currency and a lot of the US debt is held by non US entities, which is quite different from the situation in Japan.
If the US committs to a very long term QE plan and increases its spending on creating new job building industries, technologies, factories, and work force, will we ever get the necessary inflation required to prevent a drop of 25 - 75 % in housing prices or will will follow the Japanese path of QE coupled with no inflatin - deflation. Its a very difficult problem to model and I don't know that the Fed has it right.
One thign is clear, the Fed is failing to get Wall Street firms, once called banks, brokers and insurance companies, many now merged, to do the lending requierd to ramp up R&D, new industries, small business and jobs. The amount of grid lock caused by such ugly and self serving pure partisanship and the newly mandiated approval by the Supreme Court to make our system almost entirely special intrest driven via unlimimted cash corruption makes the probability of rationale and pragmatic, humane measures increasingly less likely in my opinion.
Thoughts?
nice summary of our current GPS coordinates in the Wasteland
who are these people buying financials today on all this bad facts?
if obama forces this on banks, BAC will have millions more stop paying mortgages and bac will lose billion in mortgage cash flow payments
“There is a master plan to take down the world’s economies and exercise complete control in the aftermath by introduction of a master plan to control banking and currency.” That was written by Bill Sardi a year ago.. And, according to Bruce Wiseman, the plan underway is to intentionally take down the U.S. dollar and issue a single global currency via the world’s central bankers, who in turn will distribute money to depository and investment banks.
Said Sardi, “What Wiseman is talking about here is that a small group of less than a dozen central bankers are likely to rule the world via control of currency.” And even though mark-to-market requirements have been relaxed, the accounting manipulations and shenanigans continue. At this stage of the game, some might like to review Wiseman:
The purpose of this financial crisis is to take down the United States and the U.S. dollar as the stable datum of planetary finance
The Financial Crisis: A look behind the wizard’s curtain by Bruce Wiseman, March 19, 2009
excerpts:
I’m tired of hearing about subprime mortgages.
It’s as if these things were living entities that had spawned an epidemic of economic pornography.
Subprime mortgages are as much a cause of the current financial chaos as bullets were for the death of JFK.
Someone planned the assassination and someone pulled the trigger…
Only this time the target is the international financial structure and the bullets are still being fired.
EASY MONEY ALAN: There are various places we could start this story, but we will begin with the 1987 ascendancy of Rockefeller/Rothschild homeboy Alan Greenspan from the Board of Directors of J.P. Morgan to the throne of Chairman of the Federal Reserve Bank…
THE COMMUNITY REINVESTMENT ACT: Greenspan had been the Fed Chairman for seven years when, in 1994, a bill called the Community Reinvestment Act (CRA) was rewritten by Congress. The new version had the purpose of providing loans to help deserving minorities afford homes. Nice thought, but the new legislation opened the door to loans that set aside certain lending criteria: little things like a down payment, enough income to service the mortgage and a good credit record.
With CRA’s facelift, we have in place two of the five elements of the perfect financial storm: Alan (Easy Money) Greenspan at the helm of the Fed and a piece of legislation that turned mortgage lenders into a division of the Salvation Army.
Perhaps you can see the pot beginning to boil here. But the real fuel to the fire was yet to come.
GLASS-STEAGALL…Greenspan’s role in our not-so-little drama is made clear in one of his first speeches before Congress in 1987 in which he calls for the repeal of the Glass-Steagall Act. In other words, he’s trying to get rid of the legislation that kept a lid on banks speculating in financial markets with securities.
He continued to push for the repeal until 1999 when New York banks successfully lobbied Congress to repeal the Glass-Steagall Act. Easy-Money Alan hailed the repeal as a revolution in finance.
Yeah, Baby!
A revolution was coming…
You now have three of the five Horsemen of the Fiscal Apocalypse: Greenspan, CRA mortgages and repeal of Glass-Steagall.
WAIVER OF CAPITAL REQUIREMENTS: Enter Hammering Hank Paulson.
In April of 2004, a group of five investment banks met with the regulators at the Securities and Exchange Commission (SEC) and convinced them to waive a rule that required the banks to maintain a certain level of reserves.
This freed up an enormous reservoir of capital, which the investment banks were able to use to purchase oceans of Mortgage-Backed Securities (cleverly spiked with the subprime CRA loans like a martini in a Bond movie). The banks kept some of these packages for their own portfolios but also sold them by the bucketload to willing buyers from every corner of the globe.
The investment bank that took the lead in getting the SEC to waive the regulation was Goldman Sachs. The person responsible for securing the waiver was Goldman’s Chairman, a man named Henry Paulson…
Goldman made billions. And Hammering Hank? According to Forbes magazine, his partnership interest in Goldman in 2006 was worth $632 million. This on top of his $15 million per year in annual compensation. Despite his glistening dome, let’s say Hank was having a good hair day.
In case this isn’t clear, it was Paulson who, more than anyone else on Wall Street, was responsible for the boom in selling the toxic mortgage-backed securities to anyone who could write a check.
Many of you may recognize the name Hank Paulson. It was Paulson who left the Goldman Sachs’ chairmanship and came to Washington in mid-2006 as George Bush’s Secretary of the Treasury.
it?…
Congress has its own responsibility for this fiscal madness, but that’s another story.
This one still has one more piece—the pièce de résistance.
BASEL II: Greenspan, the Community Reinvestment Act, the repeal of Glass- Steagall, and Paulson getting the SEC to waive the capital rule for investment banks have all set the stage: the economy is screaming along, real estate is in a decade-long boom and the stock market is reaching new highs. Paychecks are fat…
While there surely would have been losses, truth be told, the U.S. banking system would likely have gotten through this, as would have the rest of the world, had it not been for an accounting rule called Basel II promulgated by the Bank for International Settlements.
Who? What?
That’s right, I said an accounting rule.
The final nail in the coffin—and this was really the wooden spike through the heart of the financial markets—was delivered in Basel, Switzerland, at the Bank for International Settlements (BIS).
Never heard of it? Neither have most people; so, let me pull back the wizard’s curtain.
Central banks are privately owned financial institutions that govern a country’s monetary policy and create the country’s money.
The Bank for International Settlements (BIS), located in Basel, Switzerland, is the central banker’s bank. There are 55 central banks around the planet that are members, but the bank is controlled by a board of directors, which is comprised of the elite central bankers of 11 different countries (U.S., UK, Belgium, Canada, France, Germany, Italy, Japan, Switzerland, the Netherlands and Sweden).
Created in 1930, the BIS is owned by its member central banks, which, again, are private entities. The buildings and surroundings that are used for the purpose of the bank are inviolable. No agent of the Swiss public authorities may enter the premises without the express consent of the bank. The bank exercises supervision and police power over its premises. The bank enjoys immunity from criminal and administrative jurisdiction.
In short, they are above the law.
This is the ultra-secret world of the planet’s central bankers and the top of the food chain in international finance. The board members fly into Switzerland for once-a-month meetings, which they hold in secret.
In 1988 the BIS issued a set of recommendations on how much capital commercial banks should have. This standard, referred to as Basel I, was adopted worldwide.
In January of 2004 our boys got together again and issued new rules about the capitalization of banks (for those that are not fluent in bank-speak, this is essentially what the bank has in reserves to protect itself and its depositors).
This was called Basel II.
Within Basel II was an accounting rule that required banks to adjust the value of their marketable securities (such as mortgage-backed securities) to the “market price” of the security. This is called mark to market. there can be some rationality to this in certain circumstances, but here’s what happened.
THE MEDIA AND MARK TO THE MARKET: As news and rumors began to circulate about some of the subprime CRA loans in the packages of mortgage-backed securities, the press, always at the ready to forward the most salacious and destructive information available, started promoting these problems…
When the value of their assets were marked down, it dramatically reduced their capital (reserves), and this—their capital—determined the amount of loans they could make.
The result? Banks couldn’t lend. The credit markets froze…
THE CRISIS: Mortgage lending slammed to a halt as if it had run headlong into a cement wall, credit lines were cancelled and credit card limits were reduced and in some cases eliminated altogether. In short, with their balance sheets butchered by Basel II, banks were themselves going under and those that weren’t simply stopped lending. The results were like something from a financial horror film—if there were such a thing…
Welcome to planetary cold turkey.
ODDITIES… Despite the fact that Hammering Hank dished out hundreds of billions to his banker buddies to “stimulate” the economy and defrost the credit markets, the recipients of these taxpayer bailout billions have made it clear that they will be reducing the amount of money they will be lending…to conform to Basel II.
What do you think—Hank, with his Harvard MBA, didn’t know? The former chairman of the most successful investment bank in the world didn’t know that the Basel II regulations would inhibit his homies from turning the lending back on?
Maybe it slipped his mind.
Like the provision he put into his magnum opus, the $700 billion bailout called TARP. It carried a provision for the Federal Reserve to start paying interest on money banks deposited with it.
Think this through for a minute. The apparent problem is that the credit markets are frozen. Banks aren’t lending. They can’t use the money from TARP to lend because Basel II says they can’t. On top of this, Paulson’s bailout lets the Fed pay interest on funds they deposit there.
If I am the president of a bank, and let’s say that I’m not Basel II impaired, why in the world am I going to lend to customers in the midst of the worst financial crisis in human history when I can click a mouse and deposit my funds with the Fed and sit back and earn interest from them until the chaos subsides?…
So, given the provisions of Basel II and the refusal of the BIS to lift or suspend the regulations when they are clearly the driving force behind the planet-wide credit crisis, and considering the lack of provisions in Paulson’s bailout bill to mandate that taxpayer funds given to banks must actually be lent, and given the added incentive in the bill for banks to deposit their bread with the Fed, one gets the idea that maybe, just maybe, these programs weren’t designed to cure this crisis; maybe they were designed to create it.
Indeed, my friends, this is crisis by design.
Someone planned the assassination and someone pulled the trigger.
THE RUBBER MEETS THE ROAD
All of which begs the question, How come?
Why drive the planet into the throws of fiscal withdraw—of job losses, vaporized home equity, and pillaged 401ks and IRAs?
Because when the pain is bad enough, when the stock markets are in shambles, when the cities are teaming with the unemployed, when the streets are awash with riots, when governments are drenched in the sweat of eviction and overthrow, then the doctor will come with the needle of International Financial Control.
This string of ineffective solutions put forth by people who know better are convincing bankers, investors, corporations and governments of one thing: the system failed and even the U.S. government—the anchor of international finance (which is blamed for causing the disaster)—has lost its credibility.
The purpose of this financial crisis is to take down the United States and the U.S. dollar as the stable datum of planetary finance and, in the midst of the resulting confusion, put in its place a Global Monetary Authority—a planetary financial control organization to “ensure this never happens again.”
Sound Orwellian? Sound conspiratorial? Sound too evil or too vast to be real?
This entity is being moved forward by world leaders “as we speak.” It is coming and the pace is quickening.
A year ago, I saw an article in which the president of the New York Federal Reserve bank was calling for a “Global Monetary Authority” or GMA to deal with the world’s financial crisis. While I have been following international banking institutions for some time, this was the clue that they were making their move. I wrote an article on it at the time.
By the way, as some may recall, the president of the New York Fed last year was a man named Timothy Geithner. Geithner was very involved in structuring the booby-trapped TARP bailout with Paulson and Bernanke.
Of course, now, he is the Secretary of the Treasury of the United States.
Change we can believe in.
Once Geithner started to push a global financial authority as the solution to the world’s financial troubles, other world leaders and opinion-leading voices in international finance began to forward this message. It has been a PR campaign of growing intensity. Meanwhile, behind the scenes, the international bankers are keeping their hands on the throat of the credit markets choking off lending while the planet’s financial markets asphyxiate and become more and more desperate for a solution.
British Prime Minister Gordon Brown, who has taken the point on this, has said that the world needs a “new Bretton Woods.” This is the positioning. (Bretton Woods, New Hampshire, was the location where world leaders met after the Second World War and established the international financial organizations called the International Monetary Fund (IMF) and the World Bank to help provide lending to countries in need after the war.)
Sir Evelyn de Rothschild called for improved (international) regulations, while the Managing Director of the IMF suggested a “high level of ministers capable of reaching agreements and implementing them.”
The former director of the IMF, Michael Camdessus, called on “the global village” to “urgently and radically” implement international regulations.
As the crisis has intensified, so too have calls for a global financial policeman, and of late, the PR has been directed in favor of—surprise—the Bank of International Settlements.
The person at the BIS who was primarily responsible for the creation of Basle II is Jaime Caruana. The BIS Board has now appointed him as the General Manager, the bank’s chief executive position, where he will be in charge of dealing with the current financial crisis which he had no small part in creating.
A few well-chosen sound bites tell the story.
Following a recent IMF function, discussion centered on the fact that the BIS could provide effective market regulation, while the Global Investor magazine opined that “…perhaps the Bank of International Settlements in Basel…” could undertake the task of best dealing with the crisis in the financial markets.
The UK Telegraph is right out front with it.
“A new global solution is needed because the machinery of global economic governance barely exists…it’s time for a Bretton Woods for this century.
“The big question is whether it is time to establish a global economic ‘policeman’ to ensure the crash of 2008 can never be repeated.”…
“The answer might be staring us in the face in the form of the Bank of International Settlements (BIS). The BIS has been spot on throughout this.”
And so you see, this was a drill. This was a strategy: bring in Easy Money Alan to loosen the credit screws; open the floodgates to mortgage loans to the seriously unqualified with the CRA, bundle these as securities, repeal Glass-Steagall and waive capital requirements for investment banks so the mortgage-backed securities could be sold far and wide, wait until the loans matured a bit and some became delinquent and ensure the media spread this news as if Heidi Fleiss had had a sex-change operation, then slam in an international accounting rule that was guaranteed to choke off all credit and crash the leading economies of the world.
Ensure the right people were in the key places at the right time—Greenspan, Paulson, Geithner and Caruana.
When the economic pain was bad enough, promote the theory that the existing financial structures did not work and that a Global Monetary Authority—a Bretton Woods for the 21st century—was needed to solve the crisis and ensure this does not happen again.
Which is exactly where we are right now…
Bio: Bruce Wiseman is the co-founder of a company that oversees the business and financial affairs of some of the biggest names in Hollywood. He writes and speaks on matters of international finance and banking with particular attention to the oppressive activities of the International Monetary Fund and the World Bank. Bruce has also been an advisor and consultant on the subject of market research, branding and positioning.
http://canadafreepress.com/index.php/article/9454
The disturbing part of all that tin hat stuff is that it is probably a lot closer to the truth than anyone would dream to be the case.
What about FASB 166 / 167 - the banks don't have to mark to market under several conditions, specifically the ones we are in now. So they aren't. You left that part out.
Tried to cover it with this, "And even though mark-to-market requirements have been relaxed, the accounting manipulations and shenanigans continue," The details of the article are so long and require posting in full to go into changes in mark to market. IMO, implication as to purpose remains the same.
I wouldn't blame the banks for giving folks interest only mortgages or Adjustables. If your too dumb to read the fine print on the biggest purchase most people will ever make, then they deserve what they got. Sure banks are crooks, but only if you let them steal from you.
The big scam today is the fact that banks got bailed out with taxpayer dollars and then payed back the taxpayers by hiking the rates on their credit cards or even worse demanding not 2% of the balance each month but 5% and more.
Imangine if your monthly minimum was $200 and you were paying back $300 and then the bank sends you a notice that they want their money sooner. So they are raising your monthly minimum to 5%. Suddenly your minimum is $450. Shit that more then most auto loans. But thats what they were doing.
Its also a good example of why the banks are not lending now. They are building up a pile of cash to cover the big losses they still have off their balance sheets. Its why the FDIC recently announced 700 banks are in deep shit.
Remember, this business of "paying interest on reserves" is the same as printing money. It is at no cost to the supplier. And the "reserves?" They are printed too. Look back to the Federal Reserve reports in July of 2008 - it clealry showed that all "real reserves" had disappeared, and in their place were only "borrowed" reserves, that is, money borrowed from the Fed. If you can borrow at zero, and get paid interest, you make money at no cost. Repeat for a few years and suddenly you are quite rich.
Does it seem possible that hyperinflation could show up with unprecedented speed? I wonder if all external holders of dollars real and electronic get scared with QE2 would they just send them back and bid up the price of all hard assets in the US in a matter of days/weeks? Is this possible? Wouldn't that get $ into consumer hands and spark out of control inflation? Any thoughts?
How long until foreign dollar holders decide to cut their losses and send the paper back?
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