Any homeowner knows, if you don't stop the termites in the timbers, soon you'll be wishing you did.
Just because we can't see them, doesn't mean we can trust their intentions. Without serious "barriers" those greedy critters will find a way … to consumer your personal equity.
Elizabeth Warren on “the Unfinished Business of Financial Reform”
billmoyers.com -- April 18, 2015
[...]
Those are important steps and well worth defending. But let’s get real: Dodd-Frank did not end Too Big to Fail. Last summer, both the Fed and the FDIC reported publicly that eleven – eleven – of the big banks were still so risky that if any one of them started to fail, they would need a government bailout or they would risk taking down the American economy – again.[19] That’s not a statistic that should make anyone sleep well tonight.
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So what should we do about Too Big to Fail? End it, once and for all. Not talk about ending it – truly end it.
How? First, break up the biggest banks. There are two structural ways to do this: We can cap the size of the biggest financial institutions, as Senator Sherrod Brown and former Senator Ted Kaufman proposed during the Dodd-Frank debates. And we can adopt a 21st century Glass-Steagall Act that rebuilds the wall between commercial banking and investment banking. I’ve worked with Senators McCain, King, and Cantwell to advance just such a bill. If banks want access to government-provided deposit insurance, they should be limited to boring banking. If banks want to engage in high-risk trading, they can go for it – but they can’t get access to insured deposits and put the taxpayer on the hook for some of that risk. It’s that simple.
Senator Bernie Sanders sees the need for a 21st century Glass-Steagall Act, very much in the same way as Senator Warren does. Indeed Bernie was also a co-signer of her bill. Here is some of the rationale behind the "stronger barriers" approach to the TBTF Banks, from the Sanders website:
5 Reasons Glass-Steagall Matters
berniesanders.com — November 16, 2015
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Bernie Sanders wants to implement a new version of the Act, which was repealed in 1999 after having been in effect for more than 75 years. Hillary Clinton, on the other hand, is not calling for its reinstatement.
[...]
4. The repeal of Glass-Steagall is further corrupting the culture of banking – if such a thing is possible.
Sanders was right when he said on Saturday night that “the business model of Wall Street is fraud.” The traditional practice of what Sen. Elizabeth Warren calls “boring” banking – opening savings accounts, reviewing loans, and providing other customer services – has largely been supplanted by high-risk gambling and the aggressive hustling of dubious investments to unwary clients.
The level of fraud unearthed since the 2008 crisis is nothing short of breathtaking. (The fact that no senior banking executive has gone to prison for that fraud is, if anything, even more breathtaking.) How did that happen?
Citigroup’s Reed wrote that the repeal of Glass-Steagall led to the “very serious” problem of “mixing incompatible cultures” – which, he said, “makes the entire banking industry more fragile.” He discussed the relationship-based, sociable culture of traditional banking, emphasizing its incompatibility with the risk-seeking, “short termist” mentality of investment bankers who seek “immediate rewards.”
Reed makes a very important point – although he’s being overly kind about it. Yes, traditional bankers tend to be risk-averse and customer-focused. That’s very different from the high-stakes gambling mentality of investment banking.
But what Reed fails to note – or is too polite to mention – is the extent to which today’s culture of investment banking is predicated on outright fraud. That’s reflected in polling of the banking community itself, as well as in the industry’s appalling record of documented illegality. [...]
This greed-driven fraud mentality is like a virus, consuming too-big-to-fail banks even as they exert ever-greater control over our economy – and our political system.
Even the professionals, within the modern 21st-century Banking-Casino system, know something is "rotten" in the way they sometimes 'must' conduct business, to survive. The more ethical among them will even admit it when asked anonymously ...
Historic Survey of Financial Services Professionals Reveals Widespread Disregard for Ethics, Alarming Use of Secrecy Policies to Silence Employees
Efforts to Reform Wall Street and Fleet Street May be Faltering
May 19, 2015
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The survey, the most expansive of its kind, polled more than 1,200 U.S. and UK-based financial services professionals to examine views on workplace ethics, the nexus between principles and profits, the state of industry leadership and confidence in financial regulators. With findings pointing to a continued disregard for ethical engagement and alarming new tactics to silence potential whistleblowers, the industry appears to be faltering in its reform efforts.
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Profits, Not Principles
In one of the most concerning findings, 47 percent of total respondents feel it is likely that their competitors have engaged in illegal or unethical behavior to gain an edge. While nearly one in five professionals feels it is at least sometimes necessary for financial services professionals to engage in illegal or unethical activity in order to succeed, a full 32 percent feel compensation structures or bonus plans pressure employees to compromise ethical standards or violate the law. Of those surveyed, 27 percent don't agree that the industry puts the interests of clients first. [...]
As I said in the Title of this post, there is “something rotten within” their house of cards. Still.
You can tell a status-quo Candidate, by whose needs they put first.
Status-quo solution-providers, — those who focus on the needs of the Banks instead of the needs of the People — will just 'paper-over' the rot, instead of eradicating any of the "unethical" pests within …
Editorial, nytimes.com -- Aug. 22, 2011
The Obama administration has turned up the heat on Eric Schneiderman, New York’s attorney general, to go along with a proposed settlement with the nation’s largest banks over dubious foreclosure practices. Mr. Schneiderman should stand his ground in not supporting the deal. The administration says that a settlement would quickly deliver much needed relief to hard-pressed borrowers, but it’s doubtful it would provide redress on a par with the banks’ wrongdoing or borrowers’ needs.
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The deal has been in the works for nearly a year, after the state attorneys general announced an investigation into a robo-signing scandal in which banks were found to have filed false foreclosure papers in state courts. It was widely believed that the scandal would lead to a broad inquiry into how banks inflated the housing bubble, profiting as it expanded. [...]
Shaun Donovan, the secretary of Housing and Urban Development, however, says that a settlement on the narrow issue of robo-signing would not preclude other investigations by individual attorneys general. [...]
The administration also says that the proposed settlement would require the banks to write down the principal balance on underwater loans. According to news reports, the banks are likely to pay around $20 billion in the deal. With 14.6 million homeowners owing $753 billion more on their mortgages than their homes are worth, how far does the administration think $20 billion would go?
Given the dates between the status-quo settlement, and the date of this next Citizens-fight-back "home cure" catching on around the country {prior to the settlement above} -- it's very clear whose interests, the 'robo-immunity' settlement was really designed to protect. (Hint: the Law-breakers.)
HOMEOWNERS' REBELLION: COULD 62 MILLION HOMES BE FORECLOSURE-PROOF? Ellen Brown, webofdebt -- Aug 18, 2010
Mortgages bundled into securities were a favorite investment of speculators at the height of the financial bubble leading up to the crash of 2008. The securities changed hands frequently, and the companies profiting from mortgage payments were often not the same parties that negotiated the loans. At the heart of this disconnect was the Mortgage Electronic Registration System, or MERS, a company that serves as the mortgagee of record for lenders, allowing properties to change hands without the necessity of recording each transfer.
MERS was convenient for the mortgage industry, but courts are now questioning the impact of all of this financial juggling when it comes to mortgage ownership. To foreclose on real property, the plaintiff must be able to establish the chain of title entitling it to relief.
Afterall, think of the poor bankers, facing such a legal demand: having to provide clear chain of ownership, for all their “blenderized” Mortgage products. Such an unfair “legal requirement” could have proved “systematically toxic” to their over-extended balanced sheets. Using Other Peoples Money.
And without their Termite-worldview, how are Bankers ever expected to survive, to thrive, to capitalize? “Munch, munch, munch. Hmmm, there’s still some untapped equity over there ...”
Investigative link documenting the illegal “rot” within.
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Under-utilized consumer equity such as this … just waiting there to be extracted:
RealtyTrac notes (via North Carolina State University) that:
From January 2007 to December 2011 there were more than four million completed foreclosures and more than 8.2 million foreclosure starts ….
CoreLogic reported a year ago:
Approximately 1.4 million homes, or 3.4 percent of all homes with a mortgage, were in the national foreclosure inventory as of May 2012 compared to 1.5 million, or 3.5 percent, in May 2011 and 1.4 million, or 3.4 percent, in April 2012. The foreclosure inventory is the share of all mortgaged homes in some stage of the foreclosure process.
Given that there are currently around 316 million Americans – more than twice the number during the Great Depression [...]
Shelter is shelter … so what’s the problem?
Tragic numbers … “Numbers” which have resulted in how many untold tragic stories, such as this:
Sheila Ramos' grandsons, 10 and 13, started crying. They wanted to know where the house was. There wasn't one. There was only a tent. [...]
The story of how she ended up in a tent is the story of how America ended up in a foreclosure crisis that has not ended, that still drags down the economy and threatens to force millions of families from their homes. Already, banks have foreclosed on more than 4 million homes since the crisis began in 2007. With almost 6 million loans still in danger of foreclosure, 2012 could very well be the worst year yet. Ramos' story is remarkable not because it's unique but because it isn't.
No wonder so many average Americans “are angry” at the TBTF Banks. Are they — the Bankers — living in a tent?
Has a single Mortgage-mill Banker gone to Jail — for their failed bets — with consumers “sweat equity”?
There have been fines against some of them — these rot-ridden Institutions — but “No worries, they have set-aside untold funds” for dealing with such speed-bump fines.
It’s just another cost of doing 21st-century business. They set-aside legal-funds to accomplish their “timber-churning work” unhindered. Chalk it up to just another one of those “necessary costs” for them to reach their political and economic goals.
Systematic rot, calls for such systematic “investments”, in order to continue operating their unchallenged “Business as Usual” … without those pesky people-centered “barriers” getting in their way (also known as that confining, progressive 21st century Glass-Steagall Act.)
Barrier-free investments are worth their weight in gold.
In their worldview, “Unchecked profits, will always find a way”. Their rigged system demands it. Still.