Posts Tagged ‘Bailout’

Bank of America edges closer to tipping point

Saturday, November 6th, 2010

Full story here from Bloomberg.

It was only last April that Bank of America Corp. was making fools out of the doomsayers who had called for its nationalization a year earlier. Taxpayers had gotten their bailout cash back. Investors who bought its shares at the bottom were making a killing. Government leaders lauded the company’s rescues, both of them, as a great success.

Now the bank may be on the verge of trouble again. Its stock has fallen 41 percent since April 15. Mortgage-bond investors are demanding untold billions of dollars in refunds. The foreclosure fiasco is metastasizing. A member of the Troubled Asset Relief Program’s oversight panel, AFL-CIO attorney Damon Silvers, openly worried at a hearing last week about the risk that Bank of America might need another bailout. (more…)

QE2 unveiled a/k/a Return of the Night of the Living Zombie Bankers

Wednesday, November 3rd, 2010

Full story here from ZeroHedge.

For immediate release

Information received since the Federal Open Market Committee met in September confirms that the pace of recovery in output and employment continues to be slow. Household spending is increasing gradually, but remains constrained by high unemployment, modest income growth, lower housing wealth, and tight credit. Business spending on equipment and software is rising, though less rapidly than earlier in the year, while investment in nonresidential structures continues to be weak. Employers remain reluctant to add to payrolls. Housing starts continue to be depressed. Longer-term inflation expectations have remained stable, but measures of underlying inflation have trended lower in recent quarters. (more…)

S&P estimates of Dodd-Frank TBTF now at $22 billion

Tuesday, November 2nd, 2010

Full story here from ZeroHedge. Billion? It should be TRILLION if we’re really going to be honest.

S&P has released its first official estimate of what it believes the cost of Donk will be on the Too Vampiric To Fail. In a nutshell, the range of various costs could be as high as $22 billion, due to a drop in debit fees, lower derivative income, FDIC DIF replenishment, prop trading, and new compliance expenses. Additionally S&P expects another $85 billion in additional required Tier 1 Capital (which is a joke compared to its Tangible Common cousin). (more…)

Still stepping in the Bernanke

Monday, November 1st, 2010

Full story here from Mike Whitney via CounterPunch.

On Friday, The Bureau of Economic Analysis (BEA) reported that 3rd Quarter GDP rose by 2% meeting most analysts expectations. The real story, however, is hidden in the data. Inventories added 1.44 percentage points to the 3Q real GDP, which means that–absent the boost to existing stockpiles– GDP would be well-below 1%. If it wasn’t for Obama’s fiscal stimulus (ARRA), the economy would be sliding back into recession. (more…)

The Fed bought mortgage fraud

Monday, November 1st, 2010

Full story here.

In the wake of the financial meltdown of 2008, the Federal Reserve announced it would buy mortgage-backed securities, or MBS.  The January announcement by the Fed said it would buy MBS from failed mortgage giants Fannie Mae and Freddie Mac in the amount of $1.25 trillion.  At the time, the Fed said in a press release, “The goal of the program was to provide support to mortgage and housing markets and to foster improved conditions in financial markets more generally.” (Click here for the full Fed statement.)It did provide “support” to the mortgage market, but did it also buy fraud and cover the banks that sold it?  The evidence shows, at the very least, it bought massive amounts of fraud. (more…)

The tipping point has arrived

Thursday, October 28th, 2010

Full story here from ZeroHedge.

The Tipping Point has Arrived

Our age is retrospective.  It builds the sepulchres of the fathers.  It writes biographies, histories, and criticism.  The foregoing generations beheld God and nature face to face; we, through their eyes.  Why should not we also enjoy an original relation to the universe?  Why should not we have the a poetry and philosophy of insight and not of tradition, and a religion by revelation to us, and not the history of theirs?  Embosomed for a season in nature, whose floods of life stream around and through us, and invite us, by the powers they supply, to action proportioned to nature, why should we grope among the dry bones of the past, or put the living generation into masquerade out of its faded wardrobe?  The sun shines today also.  There is more wool and flax in the fields.  There are new lands, new men, new thoughts.  Let us demand out own works and laws and worship.

- Ralph Waldo Emerson, Nature (more…)

The robo-signing mess is just the tip of the iceberg

Tuesday, October 12th, 2010

Full story here from ZeroHedge.

Now that the Robo-Signing scandals have achieved full notoriety through the media, it is time to address the real issues facing investors in bank stocks. I also believe that the media is staring at the wrong target. Each major media outlet is copying what is popular or what the next outlet broke as a story versus where the true economic risks actually lie – which is essentially the real story and where the meat actually is. Here’s what’s truly at stake – the United States is now at risk of losing its hegemony as the financial capital of the world! Why? Because when we had the chance to put the injured banks to sleep and redirect resources to into new productivity, we instead allowed politics to shovel 100’s of billions in tax payer capital into zombie institutions as they turned around and paid much of it right back out as bonuses. As a result, significant capital has been destroyed, the original problem has metastized, and the banks are still in zombie status, but with share prices that are multiples of the actual values of the entities that they allegedly represent – a perfect storm for a market crash that will make 2008 look like a bull rally! For those who feel I am being sensationalist, I refer you to my track record in making such claims. (more…)

Foreclose This!

Monday, October 11th, 2010

Full story here from Global Research. And while I’m writing this, another bombshell hits.  I know, it’s a lot of foreclosure/mortgage stuff lately. Don’t worry, we didn’t forget how to trade. But…this issue keeps teasing me, like a splinter in my mind. If the charade were able to go along full speed, we wouldn’t be seeing banks halting foreclosures, or title companies afraid to insure. SOMETHING is coming down the pipe– whether that’s a Quantitative Easing about 10x bigger than before, a total Federal takeover of existing mortgages, a debt jubilee, or something else. The main thing is that this will never be the same again. More fun here.

The other day, during an interview on Al Jazeera, I was asked if I was frustrated because my warnings and worries about the financial meltdown and foreclosure crisis, first aired in 2006, have been ignored so long.

Duh!

The excruciating lesson I learned is that it takes time for a problem to turn into an issue and, then, an issue to get attention, to move from the business section to the news section, from the back of the paper to page one. (more…)

FL mortgage muck

Monday, September 20th, 2010

Full story here from ZeroHedge.

The key story from this morning was the Bloomberg report that GMAC Bank had halted foreclosures in 23 states, following disturbing news from last week that rekindled the latent debate over whether servicer banks do in fact own deeds to mortgages on which they foreclose on, and whether the entire foreclosure process is in fact fraudulent (one judge found it to be so, creating a massive headache precedent for the banker community). (more…)

Global collapse of the fiat money system

Wednesday, September 15th, 2010

Full story here from Global Research. Musical interlude here.

Readers of my articles will recall that I have warned as far back as December 2006, that the global banks will collapse when the Financial Tsunami hits the global economy in 2007. And as they say, the rest is history.

Quantitative Easing (QE I) spearheaded by the Chairman of Federal Reserve, Ben Bernanke delayed the inevitable demise of the fiat shadow money banking system slightly over 18 months.

That is why in November of 2009, I was so confident to warn my readers that by the end of the first quarter of 2010 at the earliest or by the second quarter of 2010 at the latest, the global economy will go into a tailspin. The recent alarm that the US economy has slowed down and in the words of Bernanke “the recent pace of growth is less vigorous than we expected” has all but vindicated my analysis. He warned that the outlook is uncertain and the economy “remains vulnerable to unexpected developments”.

Obviously, Bernanke’s words do not reveal the full extent of the fear that has gripped central bankers and the financial elites that assembled at the annual gathering at Jackson Hole, Wyoming. But, you can take it from me that they are very afraid. (more…)