Author Archives: Matt Stoller

This post is by investigative reporter Lee Fang.  Fang knows the ins and outs of DC corruption better than almost anyone else I’ve met.  Here he has documented one of the little noticed but important ways that money sluices in and out of our political system, and heavily influences policy.

One of the biggest problems with lobbying in Washington D.C. is the extent to which so many influence peddlers work behind closed doors, refusing to disclose their clients or register their work with the ethics office. Newt Gingrich became the poster boy for this phenomenon with the revelation that he was paid $1.6 million by Freddie Mac’s lobbying office, a fee the former Speaker laughably tried to downplay as part of a contract for “history” lessons. But Gingrich isn’t the only politician working as an unregistered lobbyist.  I have uncovered video that shows liberal icon Howard Dean discussing his government affairs work for corporate interests.

Matt Stoller is a fellow at the Roosevelt Institute.  You can follow him on twitter at http://www.twitter.com/matthewstoller

Over the past four years, we’ve watched as public officials pushed financial and legal power to the large banks – the latest episode in this saga was the mortgage settlement between state officials, Federal regulators, and the banks themselves.

So what comes after the mortgage settlement? Will there be yet another multi-billion dollar transfer of wealth from taxpayers to banks in the near future? If I’m reading the tea leaves correctly, I suspect the answer is, yes. This time, it will flow through Fannie and Freddie, government entities that are responsible for trillions of dollars of mortgages. There’s been a deeply bitter fight over this giant pot of money, centering around Federal Housing Finance Agency (FHFA) acting head Ed DeMarco. DeMarco controls Fannie and Freddie, and so far, he has refused to write down principal for homeowners on GSE controlled mortgages. But Treasury has been attempting to get DeMarco to change his mind, using the prospect of simply paying off Fannie and Freddie with bailout funds.

Matt Stoller is a fellow at the Roosevelt Institute.  You can follow him on twitter at http://www.twitter.com/matthewstoller If you ask a homeowner who has tried to get a government-certified mortgage modification from a bank, half the time you’ll hear a story of lost paperwork, incompetence, and interminable phone calls to call centers with unhelpful staffers. Recent […]

By Satyajit Das, derivatives expert and the author of Extreme Money: The Masters of the Universe and the Cult of Risk Traders, Guns & Money: Knowns and Unknowns in the Dazzling World of Derivatives – Revised Edition (2006 and 2010) Part I; Part II. A significant part of China’s growth has been an illusion. Since […]

This is wonderful news. “The banks are paying $95 million, for example, to settle a case brought by Lynn Szymoniak, a homeowner who was featured on CBS’ “60 Minutes” last year for uncovering details about banks’ so-called robo-signing of foreclosure documents. Szymoniak will get $18 million from the settlement.” Most people don’t know Lynn Symoniak, but […]

Matt Stoller is a fellow at the Roosevelt Institute.  You can follow him on twitter at http://www.twitter.com/matthewstoller

Matt Taibbi has a good piece on the important and public resignation of a former Goldman executive, Greg Smith.

The essence of Smith’s piece is devastating. He points to one simple, specific problem in the company: the fact that Goldman routinely screws its own clients.

Paul Volcker has already referred to Smith’s op-ed, blaming Goldman for the change in the culture of Wall Street.  Taibbi argues that having an insider come out and blast the culture of Goldman is “the endgame for reforming Wall Street.”

Matt Stoller is a fellow at the Roosevelt Institute.  You can follow him on twitter at http://www.twitter.com/matthewstoller

There’s a rule of thumb in politics, which is that you cannot fight for someone who won’t fight for himself.  The players missing from the financial fraud fight are the investors, or in Wall Street parlance, on “the buy side”.  These are the entities getting routinely ripped off by the big banks through a variety of means, and at least the pension and insurance industry folks are temperamentally more passive than the more predatory banks.  They are also the ones holding the mortgage backed securities whose value is being pillaged by the big bank servicers.  But you can see how they are being punked by the way the Obama administration treats them.

Alison Frankel has the goods on Shaun Donovan, who thinks nothing of lying to the investor community.

Matt Stoller is a fellow at the Roosevelt Institute.  You can follow him on twitter at http://www.twitter.com/matthewstoller.

I’ve read most of the mortgage settlement documents, and it’s a wide-ranging and very confusing.  There is plenty to criticize, and David Dayen has done a wonderful job going through the nitty gritty.  Abigail Fields has a spectacular review of the, er, problems with the servicing standards.  I’ll make a few criticisms of my own below.  But I think the most interesting parts of the document release were the HUD Inspector General reports on the five banks and the DOJ complaint.  What these prove is what we’ve always known – the law enforcement community knew exactly what these banks were doing, and chose not to prosecute.  There was intent to defraud, fraud, and frankly, according to HUD, it’s not clear that the past tense is the correct tense to use.

Take it away, HUD OIG.

At the time of our review, affidavits continued to be processed by these same signers, who may not have been qualified, and these signers may not have adequately verified certain figures because they accessed a computer screen of data showing a compilation of figures instead of verifying the data against the information through review of the books and records kept in the regular course of business by the institution.

By Satyajit Das, derivatives expert and the author of Extreme Money: The Masters of the Universe and the Cult of Risk Traders, Guns & Money: Knowns and Unknowns in the Dazzling World of Derivatives – Revised Edition (2006 and 2010). Part I is here.

China’s recovery from the initial effects of the GFC was no miracle. Like the rest of the world, it was the result of “Botox economics”. Using the advantages of a centrally controlled, command economy, Beijing boosted output through government spending and directed bank lending to maintain growth.

Unfortunately, China now faces significant problems. The weakness of its two major trading partners (US and Europe) means export demand is likely to remain subdued. Domestically, the side effects of debt driven investment are now emerging.

China’s ability to sustain high growth levels is questionable. Specifically, its capacity for further stimulus is uncertain. In 2009, Premier Wen Jiabao admitted that the “stabilisation and recovery of the Chinese economy are not yet steady, solid and balanced”.

By Thomas Ferguson, Professor of Political Science at the University of Massachusetts, Boston. He is the author of many books and articles, including Golden Rule: The Investment Theory of Party Competition and the Logic of Money-Driven Political Systems. Cross posted from Alternet

Right now the political world is buzzing with speculation over a New York Times report that President Obama recently had lunch with New York City Mayor Michael Bloomberg. Most commentary focuses on how a thaw in the two men’s often rocky personal relationship might advance the President’s reelection campaign. As the Times story put it: a reconciliation between the two men could help Obama garner support from “centrist, independent voters drawn to Mr. Bloomberg’s brand of politics.”

Look again. This story is a case study in how scrutinizing the news in light of some basic facts about political money can change your view of what is really afoot.