Darrell Issa

Treaty Threatens Global Government … Run by Giant Corporations

While normally we stay away from outright political commentary especially of the kind that has no direct relation to finance or the economy, the fact is that if the US had a functioning, uncompromised, uncorrupt, and effective Justice Department, much of what we see every day on Wall Street would be vastly different since if crime did indeed have punishment, then a vast portion of the questionable behavior that is exhibited by financiers would have been eliminated long ago. Which is why we find the news just released from The Hill that "Rep. Darrell Issa (R-Calif.) has circulated a draft copy of a resolution that would hold Attorney General Eric Holder in contempt of Congress" particularly relevant. For it is none other than Holder's complete lack of involvement and intervention to outright daily crimes conducted in the financial world that is as much a reason for the deplorable economic state of this country and the world, as are all those other factor extensively discussed in books and documentaries each and every day.

What is more amusing than the pathological liars that are Tim Geithner or Ben Bernanke testifying to congress? Both of them testifying at the same time. Such as now. From C-Span: Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke go before the House Oversight and Government Reform Committee Wednesday to discuss lessons learned from Europe’s sovereign debt crisis. In a hearing titled, “Europe’s Sovereign Debt Crisis: Causes, Consequences for the United States and Lessons Learned,” both financial chiefs will share their personal experiences.  Since the crisis, the Federal Reserve has assisted foreign counterparts by provide monetary support. In November, the Fed and it's worldwide counterparts announced a cut in the interest rate premium charged to over seas banks which borrow in dollars.  The monetary policy targeted struggling European banks. In a Senate hearing earlier this year, leading economists also testified on the European debt crisis and the outlook for the eurozone. They said that the U.S. should treat the crisis as a wake-up call and urged lawmakers to bring down debt and spending to sustainable levels.

Unconstitutional ... in any language.

Down 20% from September 2006. Toyota and Honda got brutally slammed. But don't blame post-earthquake inventory shortages. They have been resolved. It's a shift in the market.

Describing new evidence of illegal foreclosures, inflated fees, and other widespread abuses, Ranking Member Elijah E. Cummings wrote to Chairman Darrell Issa today to request that the Committee issue subpoenas to require mortgage servicing companies to produce previously-requested documents. “You have not hesitated—in other investigations—to issue subpoenas in a matter of days when your deadlines were missed, so it is unclear why a different standard applies to this investigation,” Cummings wrote.  “This same sense of urgency should apply even when the targets of the Committee’s investigation are banks.” On February 10, 2011, the Committee voted unanimously to investigate “the foreclosure crisis including wrongful foreclosures and other abuses by mortgage servicing companies.” “If mortgage servicing companies are allowed to disregard requests for documents that are integral to this investigation, the Committee’s integrity will be called into question and, more importantly, abuses may continue,” Cummings wrote. Today’s letter from Cummings marks the fourth in a series of letters he has sent to Issa over the past six months urging the Committee to take action on wrongful foreclosures and other egregious abuses by mortgage servicing companies. On May 24, Cummings sent a letter to Issa requesting that the Committee issue subpoenas to six mortgage servicing companies that have refused to provide documents relating to foreclosure abuses. “The best long-term solution that our Committee can offer in response to illegal acts committed by mortgage servicing companies is vigorous investigation, oversight, and reform,” Cummings added.  “Inaction will tacitly reward abuse and signal tolerance for major corporate wrongdoing.” So... what's wrong with that exactly?

There were those who were fuming about what a great deal Bank of America got in acquiring Countrywide. Ironically, that same deal threatens to bite the banks in the ass and cost it tens of billions in litigation as more and more realize that the bank's mortgage-related practices (both before the CFC acquisition and after) have been based on a foundation of fraud. While Zero Hedge has not discussed the issue at length recently due to the expected temporary pushback by various legislatures, which would make an outright risk assessment against BofA impossible since there is far more politics than finance involved, it seems that with each passing day things are getting closer to spiralling out of control for America's largest lender. The latest news, just out from Bloomberg, indicating that the bank may be advised to urgently increase its litigation and putback reserve, is that Utah's AG Mark Shurtleff advised Brian Moynhian that the bank's foreclosures in Utah are illegal. "A Bank of America Corp. unit conducting home foreclosures in Utah is violating the law, the attorney general said in a letter as individual states advanced their investigations of mortgage servicing. “All real estate foreclosures conducted by ReconTrust in the state of Utah are not in compliance with Utah’s statutes, and are hence illegal,” Shurtleff wrote." Oops. There goes another several billion in litigation fees because that beeping noise is thousands of foreclosed upon mortgageholders calling the first attorney they can find in the yellow pages in hopes (soon to be fulfilled) of unwinding completed foreclosures. This action joins comparable pushes from Connecticut, Illinois and California, and pretty soon BofA will be unable to foreclose upon any home in the domestic US. We estimate that the legal cost associated with foreclosure delays will cost the bank well over a billion when all is said and done. And just to make life truly miserable for BofA, Elijah Cumming sent a letter to the Committee on Oversight and Government Reform advising he is considering a broad subpoena to all mortgage servicers, chief among them, you guessed it: Bank of America.

Chris Dodd's political corpse may just come out of the grave for one last dance. The reason - the even more worthless half of Frankendodd is about to see all of his preferential Countrywide records exposed in the open. Darrell Issa has just announced that he has issued a wide-ranging subpoena to Bank of America for all documents and records related to Countrywide’s VIP program. Yes, this means all of Dodd's dirty laundry is about to be made public. Not like it matters: at this point everyone in America knows too well that the biggest criminals in the country are those in charge of it (and those regulating them, just happen to be the biggest porn-addicted idiots: see Matt Taibbi on the SEC). And it is not like Wall Street's favorite pet Dodd even has a remote chance of getting within miles of a courtroom...

Per the just released OpenSecrets list of top 25 wealthiest politicians in America, there are 12 republicans and 12 democrats (and Hillary, whatever she is). While we applaud the diversity among the country's richest "representatives", we can't help but wonder if these people actually "represent" the common man, or the man (such as themselves) having a minimal average net worth of $28 million...

As of right now, there are not a lot of places to go for the skinny on things such as this Facebook investment (or BPSV, not special purpose vehicle but "Bonus Pool Support Vehicle"), at least in my not so humble opinion.

By now we all know the essentials of what happened on Election Day - Republicans gained 60+ seats in the House, at least six seats in the Senate, and 9-11 gubernatorial races (depending on recounts). We will leave it to others to analyze the "big picture" and what this election means for the long history of the American Body Politic. But, in the near term, several aspects of the overall results caught our attention for having near-term importance on Capitol Hill.

Wall Street responds to my missive on the potential of concentrated derivatives risk blowing up the banking system. Traders, salesman and financial engineers chimed in, and made some cogent points. Of course, I must rebut. It is the actual rebuttals that are probably more stinging than the original article - particularly the one concerning hedge funds. Please read on and feel free to chime in. Don't forget to bring the "Fiery Sword of Truth!"

More as we get it.

A year ago, Associated Press reporter Larry Margasak got caught
in a lie. He manufactured a false lede by concealing critical
information:

Despite their denials, influential Democratic Sens. Kent
Conrad and Chris Dodd were told from the start they were getting VIP
mortgage discounts from one of the nation's largest lenders, the
official who handled their loans has told Congress in secret testimony.

The witness also recanted his statement. When asked a second time
if he told Dodd that he was getting special treatment, he said, "I don't
remember... but, you know, it was conveyed in some way, shape or form."
No honest journalist would report that Dodd was "told from the start,"
about a mortgage discount.

Goldman employees have incriminated the company in the quest for compensation, but I have the solution...