Daniel
Mudd, the former CEO of Fannie Mae got a Wells notice from the SEC on
Friday. I have been waiting years for this to happen. There is a good
reason this action is so late in coming. This case could open the door
for culpability of the Federal Government in the collapse of the US
mortgage agencies.
The Wells notice is a very significant ratchet up of this story. Prosecution is not assured, but a big investigation is certain.
Mudd, who is now the CEO of buyout firm Fortress Investment Group,
commented on the bad news from the SEC in predictable fashion. He denied
everything: (Bloomberg)
“I
could not disagree more with this turn of events. The disclosures and
procedures that are the subject of the SEC investigation were accurate
and complete. These disclosures were previewed by federal regulators,
and have been issued in the same form since the company went into
government conservatorship.”
I have always believed that Mudd is dirty. He had ample foreknowledge
that the wheels were coming off at Fannie (and the entire mortgage
market). If he argues that he did not, he will just look dumb. When he
spoke to Bloomberg he was reading from a script prepared by big-shot
lawyers. Again his words:
These disclosures were previewed by federal regulators.
Mudd and his lawyers are spot on with this comment. It is a shot across
the bow of the SEC. If Mudd had used real words in his statement he
would have said:
“We
prepared statements and sent them to our regulator, OFHEO. They
reviewed them and agreed with them. Fannie has letters from OFHEO that
says we were clean. Don’t blame me for the blowup. Blame our regulator!”
OFHEO (Office Of Federal Housing Enterprise Oversight) was run by James
Lockhart. I don’t think he is responsible for the collapse of the GSE’s.
But I have always been convinced that he covered up the problems from
the day he took over as the head of OFHEO. OFHEO did fail as a
regulator. There can be no doubt about that at this point.
I hope the SEC pushes this hard. I hope there is a trial. If there is, I am betting that Mudd takes a walk. His reporting/disclosure was approved by Lockhart. That legal conclusion (should it come) would be very damaging to the government. It opens the door for a ton of lawsuits.
-Lockhart is now Vice Chair at Wilbur Ross’s holding company. He is advising on investments in distressed mortgages. Fitting.
-Don’t read this as an argument to buy the very distressed securities of
Fannie and Freddie that are now trading in the “Pinks”. If there were
to be some legal action I think it would be to the benefit of those poor
suckers who bought and held Agency preferred and common prior to the
conservatorship in the fall of 2008. That said, the Fannie Pref is up
400% in just the past few months. Go figure…..
This will go nowhere just like Mozillo.
is this guy related to harry fenton mudd? stella! shut up!
Hot tub accident or bungie jump headline coming
three years in and a wells notice for a guy named mud - nothing will come of this
Good stuff Bruce.
Unfortunately, if government is going to cover up for the big banks, it sure as hell is going to cover up for itself. I suspect we'll get one giant "Whocouldanode?!" excuse. And they'll be able to cite the chairsatan. "Why, even so sagely a counsel as the Ben Bukkake had no idea what the hell was going on."
Agree,
This is the grand stage. The criminal, corrupt, and illegitimate government only watches out for itself first. It puts on a show to quiet the masses. The games still continue even now.
The false belief is that the banking system is too big to fail. So, the public will ultimately be made to pay for all of this.
Bruce, keep the news coming. I always enjoy reading your articles.
Daniel Mudd is the son of Roger Mudd, CBS news anchor, successfully kept down in no. 2 spot for decades by Dan Rather. They are both decendants of Dr. Samuel Mudd, convicted of assisting in the assassination of Abraham Lincoln and the originator of the perjorative "My name is Mud".
Working Class Hero lyrics
Songwriters: Lennon, John;
As soon as you're born they make you feel small
By giving you no time instead of it all
Till the pain is so big you feel nothing at all
A working class hero is something to be
A working class hero is something to be
They hurt you at home and they hit you at school
They hate you if you're clever and they despise a fool
Till you're so crazy you can't follow their rules
A working class hero is something to be
A working class hero is something to be
When they've tortured and scared you for twenty odd years
Then they expect you to pick a career
When you can't really function you're so full of fear
( From: http://www.elyrics.net/read/j/john-lennon-lyrics/working-class-hero-lyri... )
A working class hero is something to be
A working class hero is something to be
Keep you doped with religion and sex and TV
And you think you're so clever and classless and free
But you're still peasants as far as I can see
A working class hero is something to be
A working class hero is something to be
There's room at the top they are telling you still
But first you must learn how to smile as you kill
If you want to be like the folks on the hill
A working class hero is something to be
A working class hero is something to be
If you want to be a hero, well, just follow me
If you want to be a hero, well, just follow me
Lets not sugarcoat this:
Ahh, better.
Thanks for fixing the lyrics. I must have listened to his "John Lennon/Plastic Ono Band" album a hundred times when I was in ninth grade.
u recover from that yet, Hoss?
I junked John Lennon and his garbage songwriting.
Yoko Ono/ Imagine/Hey Jude/barf. I despise the Boomers that get of on Lennon even more than Lennon.
So... Tapeworm, my parasitic little friend.
How about you giving us a taste of your song writing talent.
.......... the silence is fucking deafening......
My, my, my, what a blatantly idiotic statement.
Lesser thinkers confuse the implementation of ideas and their perversion by those who stand to benefit as the ideas themselves. For example, Keynesianism did not say that government should simply print money ad infinitum and at will and everything will then be okay. That idea has simply been perverted by those in power who stand to gain from said perversion. Keynes actually said that when you're doing well, save your money; when you're not doing so hot, spend it, even if you have to borrow to do it.
Lennon's ideas, in their simplest form, are echoes of the thoughts of H.G. Wells at the turn of the last century, when he wrote The Open Conspiracy. Wells argued that we, as a human collective, should discuss amongst ourselves ways to better our existence on this planet. He recognised that the only real solution to permanent happiness and freedom from war was when everyone, everywhere benefits.
Some would call Wells' ideas "communist," the same way they would call Lennon a communist for imagining there's no possessions. Marx' ideas, also in their purest form, echo the same sentiment.
To confuse the beautiful idea of a wonderful planet for us all with its implementation by Lenin and Stalin, Mao and Pol Pot, for example, is pure buffoonery and demonstrates a shallow level of social understanding.
I feel bad for you, man.
Nice succinct point Orly. I sometimes think that the discussion will require a fresh vocabulary or at least an agreement not to engage in the gratuitous use of words like socialism, communism, fascism, democracy, freedom, terrorism etc etc. PS- Orwell was a remarkable visionary, I often wonder how he was able to extrapolate so accurately the future complexion (the now) of the world (then) in which he lived. Extraordinary intuition? Hyper sensitivity to human nature?
pps- nice rejoinder kayman... :-)
Our habit of labeling will have to be the first things eliminated because categorisations are the very thing that keep us apart from achieving more lofty, more mature and elegant goals.
The people in power not only support categories but they openly encourage the slicing and dicing of "groups" of people all over the world. Just look at American news, or British news for that matter, as an example. Spend five minutes listening to what They are wanting you to hear and you'll understand that you have been divided and conquered already.
_________
Orwell was one of the first to notice the insidious news-creep into our lives and expounded on it very well. He saw how media and belief could be easily manipulated...until it couldn't.
Four legs good, two legs bad.
We have always been ar war with Oceania.
We may be approaching the time (yes, already...) that people stop believing the lies.
Well then, let us agree that our goals will always be elegant.
"No work is insignificant. All labor that uplifts humanity has dignity and importance and should be undertaken with painstaking excellence."— Martin Luther King Jr.
Well....Orly
Our criminal bankers and their political whores meet you half way on the road to "no possessions".
When they are finished, you will have no possessions.
Good words to hear from Big John.
Real estate mortgage fraud?
First I heard of it.
Someone ought to look into that.
America, a country of Laws, not a country of Justice.
Mudd, at worst, will get a fine, no jail time.
They are all in the process of being investigated, found innocent and sent back into the world washed clean.
Instead of laundering money, they are laundering felons.
Spainish Inq - forget it, the SEC and other honking cronies of Washington will jawbone and waffle and bluff and in the end do precisely zero.... the State is rotten to the core, end of... the only part of the economy that'll bring these crooks to court are the private sector. Namely the defrauded consumers who took out mortgages and the defrauded investors that bought these sugar coated turds called MBS's.... Wall Street is going to get off every hook by the US Govt and its rotten agencies but be sued to a 2nd bankruptcy by the private sector (the only sector you can depend on to deliver anything)
SEND THEM ALL TO JAPAN SO THEY CAN RADIATE ABOUT THE THINGS THEY DID WRONG!
Pray, you wouldn't be volunteering our criminal bankster class to clean out a few reactor cores, would you?
Might have to put a few extra FRN's into the bonus envelopes as Hazard Pay.
Let no crisis go to waste!
PS - Fannie Preferred is up because banks have been stuffing it with 800 FICO re-fi's is my guess.
If only the general public was aware of stories like this - they need to pay attention, now more than ever.
What was Lockhart's relationship with Armando Falcon? When can we get the Congressional Black Caucus indicted as a co-conspirator?
http://www.youtube.com/watch?v=_MGT_cSi7Rs
Look at Mudd's "deer in the headlights" obiesance
http://www.youtube.com/watch?v=usvG-s_Ssb0
When the rats left the sinking ship, it appears they didn't go far ...
"Lockhart is now advising on distressed mortgages" --Jesus Christ you couldn't make this stuff up. Great reportage Bruce; my opinion; Federal Regulators never regulate anything; nice legal "out" for another smug slimeball with a moral compass like a gutter rat.
+ 14 T
What good are regulators and regulations when enforcement of regulations and prosecutions are absent in the equation?
A violated regulation is like a tree falling in the woods that no one hears.
Michael
We need to understand Law/rules or more importantly about rule makers. History teaches us one adult telling another adult what to do or how to behave is a bit of a nonsense. So while your Dad may give you the odd rule to follow when you're a juvenile a Dad, or fellow adult, that gives you 100 rules to follow as an adult is an asshole.
The Labour Party in Britain spent its 13 raping bankrupting years in power handing down 2,600 new Laws. You've got to be an epic asshole to spew 2,600 rules onto your country on top of the 1,000's already on statute. And there's no shadow of doubt the Labour Party were epic assholes, the worst Govt in British history by far. And it's no coincidence the politicians of Washington are called lawmakers. Because most are lawyers. And yes you've guessed it they've made warehouses full of new Laws and right again are also the biggest assholes (and rule breakers) in the country.
So we've reached a discription of the mental mind-set of lawmakers. They are total assholes.
Now we can address your question properly. Why do the assholes that make asshole rules not apply their own anal rules?
Answer: because they are fuking assholes (politicians)
This is why the universal truth is, 'the biggest rule makers are the biggest rule breakers'. That's simply because the biggest rule makers are with no coincidence the biggest assholes in society
"I have always believed Mudd is dirty..."--Duh!
How anyone involved at any senior position in Fannie or Freddie, including the fuking useless non-executive directors, can still find jobs in the 'private' sector is beyond reason!
The exception being politicians such as putrid windbags like Barney Frank who have a 'public mandate' to mangle any sector and never be held to account no matter how bankrupt and how bigger disaster they create.
Remember the No.1 Rule of Washington DC for the past 10 years: Barney Frank knows everything and has a 'solution' for improving any sector but when the shit hits the fan, he had "nothing whatsoever to do with it"
" How...can still find jobs in the 'private' sector is beyond reason!"
How? They are all in it together like fraternity brothers. Pay back, thru barter...someone calls a bro and says "hire him" and I'll see to it you get such and such contract, or a bill thru congress, or some other 'reward'. Rent "FOOD INC" that is full of examples.
As for proving guilt...right...the claim "bad judgement", don't recall, etc and know that it is hard to prosecute that defense. These guys have everything under control all the way thru the courts.
They just jump aboard the nearest ship floating by