Thursday, October 21, 2010

Mortgage Fraud and the Great American Cover-Up

I first stumbled onto a William K Black interview a few years ago when I was trying to sort out just how the greatest theft in the history of man had taken place in front of my eyes. Retired cops do that sort of thing.

This video is 98 minutes long. If this whole mortgage banking fraud has you mystified- or if you are wondering why American politicians are allowing banks to cover up their losses, then this will be the best video you will ever watch. Black cuts thru rhetoric and bs to tell you what happened. It's the best 90 min education you can get. You will be far better informed but like me, people will think you are nuts. Grow thick skin.

Some facts.

There were only 2298 views of this video when I swiped it. That is pathetic.

Black was one of the regulators who cleaned up the Savings and Loan mess in the 80's. He helped lock up over 1000 fraudulent bankers. His credentials and reputation are as close to as impeccable as you can get. The Keating Five were 5 Senators who tried to pressure Black and his co-workers into not doing that job. In fact, Keating wanted him killed. It's in the vid.

I gleaned a couple of great insights from the video. Banks are essentially allowed to value "assets" at whatever they deem appropriate. Any figure. That is legal and thus they have created the illusion that they are solvent. They are not. He states repeatedly that fraud, control fraud, occurred at virtually every level in the mortgage mess and that until it is addressed, it will only get worse.

Black supports the position that a gold standard cannot work. He is a supporter of the audit the FED bill which still has not passed. (2 years in the making) Black gave a trite "no" in response to an eliminate the Federal Reserve (central bank) question regarding manipulating the quantity of currency and creating recessions. Interpret that as you wish.

I think Black is too intelligent for that trap. He is not going to jeopardize the credibility he would lose from a public that has come to view the central bank as essential. To do that, would piss off any chance he might get to work for the government and ruin his credibility- remember this guy is actually trying to convince Congress to do an investigation into this massive fraud. Ergo Black, will not risk the potential backlash of a maniacal opinion to eliminate the FED.

He leaves that shit to maniacal bloggers off their medications. The video follows;

Wednesday, October 20, 2010

Is the United States Still a Nation of Law?

As a young cop many years ago, my indoctrination into the legal system and my role within that system was clearly stated by my instructors. We enforce the law to the "spirit" and not to the letter.

Just what does that mean?

My best explanation is that police officers are or should be looking for compliance rather than discipline. That in fact- if we could get a motorist to slow down or renew his license upon agreement, then perhaps it was not necessary to issue a ticket. I learned this lesson early on. It came to me as the result of a man who rushed his pregnant wife from a camping trip to the local hospital. He was speeding and he had been drinking when I stopped him in the hospital parking lot. His wife was clearly in labor. He explained that he had no other alternative but to drive her to the hospital. This incident occurred well before the appearance of cell phones.
The driver agreed not to drive again and in fact, the delivery took an eternity. That's how we resolved that situation. To the spirit of the law. Did he break the law? Of course. Did he have an alternative? Not really.

Now that is the compassionate side of the law and I used the spirit of the law frequently in that respect. But there is another side to the spirit of the law. The rule of law. I'd like to give you a definition here.

British jurist A. V. Dicey popularized the phrase "rule of law" in 1885.[2][45] Dicey emphasized three aspects of the rule of law: (1) no one can be punished or made to suffer except for a breach of law proved in an ordinary court; (2) no one is above the law and everyone is equal before the law regardless of social, economic, or political status; and (3) the rule of law includes the results of judicial decisions determining the rights of private persons.[46]

The United States has been referred to as a nation of laws. Our entire judiciary and legal system is built upon that premise. It is point (2) that I would like to draw your attention to here. Nobody is above the law. That is also the spirit of the law.

Is there anyone out there that truly believes that all people are treated equally in front of the law? If there is, I don't know many. Rather, I believe, a two tiered justice system has evolved. One for the rich, famous, and elite. The power wielders and the connected. And one for the rest of us.

Think Ted Kennedy and the prosecutors that refused to prosecute him for Chappaquiddick. Or Mary Jo Kopeckne's family that received hundreds of thousands of dollars in hush money. True. http://en.wikipedia.org/wiki/Mary_Jo_Kopechne

That small town cops have been looking the other way when the Mayor drives home drunk is not news. That shit has been going on everywhere for years. I am also not referring to people like OJ Simpson who was able to evade conviction by throwing his whole fortune at his defense. I mean after all, they at least put him on trial.

Now I'd like to put out a clip I nabbed this a.m. from the International Forecaster.

...mortgage scandal in process, which could drag on for years. It will be interesting to see if any bankers are charged criminally. In all probability none will, they just pay fines, or their corporations do, which is all the government is interested in.

It is hard to escape the idea that we are no longer a nation of laws. This writer doesn't believe it either. The Savings and Loan scandal of the 80's put over 1000 bankers behind bars.

Here's a snip. Note how many politicians were prosecuted. Notice the name McCain. Note also he consorts with democrats. Not lost as many have pointed out his RINO lean for years.

Lincoln Savings and Loan

The Lincoln Savings led to the Keating five political scandal, in which five U.S. senators were implicated in an influence-peddling scheme. It was named for Charles Keating, who headed Lincoln Savings and made $300,000 as political contributions to them in the 1980s. Three of those senators—Alan Cranston (D-CA), Don Riegle (D-MI), and Dennis DeConcini (D-AZ)—found their political careers cut short as a result. Two others—John Glenn (D-OH) and John McCain (R-AZ)—were rebuked by the Senate Ethics Committee for exercising "poor judgment" for intervening with the federal regulators on behalf of Keating.[15]



Justice and the law are no longer important. Legally extracting fines, stealing money, is all that matters. Government has no problem attacking some idiot schmo like Bernie Madoff- naked with thousands of angry NY elite and charities calling for his head. But when the government-banking mob rips off the world, nothing happens.

This 1.5 quadrillion worldwide mortgage catastrophe has netted precisely ZERO prosecutions. In fact, I still believe that transferring my money to bail out private banks is illegal. I have not been able to find a single law that permitted Hank Paulson to use our tax money to lend to automakers, insurers, or banks.

I don't give a shit whether that administration or this one thought it was absolutely necessary or not. It was not permitted by law. That is not the spirit of the law. When you are supposedly the role model for the world, you simply cannot break laws as you see fit. Then turn around and expect your citizens to obey the law while you break it. That the FED and it's member banks, with the aid of government and bought off politicians accomplished this defies belief. Les fete complet.

Remember my drunk driver experience? His alternative to driving his wife to the hospital while under the influence was to try and deliver a baby at a campsite and hope for no complications.

What were the alternatives to obeying the law during the bank meltdown? We don't really know- nobody told us. We didn't have a choice because we were not given any information. On purpose.

You simply can't enforce the "spirit" of the law or possibly break it if you absolutely have to- without knowing the alternatives and the consequences. That is the crux of this piece.

(2) no one is above the law and everyone is equal before the law regardless of social, economic, or political status

Pure bullshit. The Tea Party is coming. These bastards ought to be thankful we are not 17th century France, sharpening guillotines in the square.

Tuesday, October 19, 2010

Why Both Parties Suck or How I Became a Libertarian

I was almost three years old when JFK met eternity in Dealey Plaza. I was too young to know him then. I would study his brief Presidency later on in my life. Kennedy, despite the failings of his personal life, may have been the last American hero. I mean that. They say a part of America died that day in Dallas. I'm not sure that America didn't die that day along with him. That was 1963.

And so I've watched this 5 decade parade of scandals, Chappaquiddick, Watergate, Iran-Contra, Monica. I've watched crooked politicians with rap sheets. Drunken- ness and sex scandals. I've seen all of the crooked activities of our public servants. I've seen a few good things like Reagan, who probably stands out as the best human being of the Presidents. He was a straight shooter. So was Nancy. I have a friend, a cop, that provided the police detail for Reagan in California when he was Governor. He says Reagan was a great guy and well thought of.

Scandals come and go. The frailty of human nature plagues us all. That isn't what bothers me. What bothers me most is the willingness of both parties to over extend the reach of government into our lives.

Government exists only for the health, safety and orderly movement of it's citizens. That was the job description. It was not designed to subsidize students. Or to provide housing. It was not designed to provide retirement benefits. Or to create a tax code that can arbitrarily punish success. Give tax relief to cronies. To beat up on the wealthy. Or tell us what to buy. Or ignore laws that enforce the health, safety, and order of this country. Loan to or buy private corporations at our expense. To order us to buy products that we may not want or need.

There was no single defining moment. It was a slow creep. It spanned 50 years. It didn't matter who was in charge, Democrats or Republicans. Government morphed into this giant, all powerful Frankenstein that ravages our lives. It started out simple and then something went horribly wrong. Maybe it started in 1963.

Those two parties morphed as well. They formed a monopoly. They desperately try to convince us that they alone are the solution. Yet, as I examine those 50 years of promises, I see no solution. In fact, all I've seen is deterioration. And so it was, that I quit trying to sort one party from the other. I quit believing. I actually came to grips with the facts. Acceptance. I accept that as long as we have only these two parties, we are screwed. They are equally as bad. I can no longer ignore the facts and evidence of the last 50 years.

And on the eve of the upcoming elections, we are going to oust the bad and install the future bad. They will rejoice initially as we rid ourselves of some of the greatest statists I have yet to see. We will install new statists. The new statists will be just as bad as the old ones. Until we eventually get tired of them and replace them with some fresh new statists. Trying the same old thing, expecting different results.

A few years ago, it was awfully hard for me to deny the facts any longer. Any good risk manager will tell you that the best predictor of future performance is past behavior. It's also very hard for me to believe anyone under 50 has lived long enough to grasp the point. They still cling to the archaic belief system that one of these two miscreant parties is the right one. I like to think of them as the Dahmer twins. They are hostage takers and guess who the hostages are?

So a few years ago, I took a hard look at third parties. I knew that an ever expanding, over reaching government is the problem. The only solution was to find a party that wanted to reduce the size of government and get them the hell out of our lives and pocketbooks. The Libertarian Party was the obvious choice. Restore liberty and freedom, personal choice. I thought that was a no brainer and I still do. Yes, I am a huge Ron Paul fan.

Think you are "wasting" your vote when you vote for a third party? Let me put it to you this way. You've been wasting votes for 50 years. Your vote for either of the Dahmer twins ensures we get the same old results. And while you might take a little short term ego satisfaction in Nov., the sad truth is that you are simply perpetuating the same cycle that the Dahmer twins want you to take. The same trajectory we've been on for 50 years. The one they created for you. So if your vote for the twins gets you the same results, just what the hell did you win? Barnum said there is a sucker born every minute.

The big knock on the Libertarian party is the legalizing drug thing. We've been fighting that war for about 50 years too. Guess where that has gotten us? We are the biggest penal colony on the planet. We house 25% of the world's prison population yet we only account for 2% of the world's population. Our court systems are clogged, our enforcement agencies are bursting at the seams, and I can walk three blocks from here and get any illegal drug I want, right now. Drugs are here to stay. Embrace that fact and accept it. Or continue to waste billions indefinitely.

If you are waiting for hope and change from either of the Dahmer twins, good luck with that. If you want to embrace what is, I call that reality, then it's time to embrace the concept that a third party is our only hope. I have no knocks on the Tea Party. They just weren't around a few years ago. A third party that recognizes that more government and freedom are mutually exclusive concepts.

More Mozilo Magic

Well after the Feds took 67.5 million in lieu of prison time for Mr Mozilo, Bank of America reported a 10 billion dollar write down today. They attributed the loss to revenue that the financial reform bill clipped from them. This is credit card revenue they receive from retailers.

Being the dumb shit that I am, I am still trying to figure out how you can charge off money that you haven't earned yet. It's not like the reform package is retroactive.

Now, the latest news from Bank of America;

Pacific Investment Management Co., BlackRock Inc. and the Federal Reserve Bank of New York are seeking to force Bank of America Corp. to repurchase soured mortgages packaged into $47 billion of bonds by its Countrywide Financial Corp. unit, people familiar with the matter said.

The bondholders wrote a letter to Bank of America and Bank of New York Mellon Corp., the debt’s trustee, citing alleged failures by Countrywide to service the loans properly, their lawyer said yesterday in a statement that didn’t name the firms.

Investors are stepping up efforts to recoup losses on mortgage bonds, which plummeted in value amid the worst slump in home prices since the 1930s. Last month, BNY Mellon declined to investigate mortgage files in response to a demand from the bondholder group, which has since expanded. Countrywide’s servicing failures, including insufficient record keeping, may open the door for investors to seek repurchases by bypassing the trustee, said Kathy Patrick, their lawyer at Gibbs & Bruns LLP.

Like I said in the last piece, Mozilo and Countrywide are the kiss of death. And now, Bank of America if forced to comply, might need TARP II to bail them out again. It just never ends. Government-the FED-and Too Big to Fail Banks. The Washington Cartel.