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 New Deal 2.0
This just in: big oil companies and government ministers had discussions one year before invasion.
Read more...All the banks are fed up with regulation and they’re all going somewhere else.
Read more...It may seem churlish to pick on a specific, well intentioned liberal organization to illustrate a rampant pathology within what passes for the left in the US. Nevertheless, examples serve as important case studies and hopefully will help both the object of presumably unwanted attention and its broader constituency understand that many of their campaigns actually undermine the causes they purport to represent.
Let’s look at an example, an e-mail from the Progressive Change Campaign Committee to constituents of Alabama’s Spencer Bachus, the Chairman of the House Financial Services Committee and self-proclaimed Best Friend of Banks (“My view is that Washington and the regulators are there to serve the banks”):
Read more...Lender Processing Services has played a singularly destructive role in the mortgage servicing industry. The firm not only offered document fabrication services through DocX, a company it acquired and was forced to shut down after the Department of Justice started sniffing about, but is being revealed to be involved in more abuses as far as borrower records and legal process are concerned. Readers may recall that it is also the target of two national class action suits on illegal legal fee sharing which if successful will produce multi-billion-dollar damages.
This abuses matter due to the role that LPS has come to play. It is the biggest player in default services, meaning it acts as the de facto selector and supervisor of foreclosure mills via its system, LPS Desktop, which manages and oversees the work of local law firms on behalf of its bank servicer clients. It also provides the servicing platform for more than half of the servicing industry. And as our two latest examples show, the company clearly places its profits over integrity of records and due process.
Read more...Yves here. This post may strike readers as off topic, but it sits at the locus of several Naked Capitalism topics of interest: the Deepwater Horizon blowout and its aftermath, animals (particularly dolphins, which are more altruistic than people and quite likely as smart), Obama administration duplicity, and reading between the lines of media reports.
By a retired physician who worked several years in the medical communications and pharmaceutical industry who writes as Francois T
From a Reuters story yesterday, “Government tightens lid on dolphin death probe”:
Read more...The U.S. government is keeping a tight lid on its probe into scores of unexplained dolphin deaths along the Gulf Coast, possibly connected to last year’s BP oil spill, causing tension with some independent marine scientists.
Wildlife biologists contracted by the National Marine Fisheries Service to document spikes in dolphin mortality and to collect specimens and tissue samples for the agency were quietly ordered late last month to keep their findings confidential.
David Dayen, in a pointed article titled, “The Corruption of the Financial Press: A Look at Housing Wire” documents how that mortgage “news” site has extensive business and financial connections with firms and individuals at the frontlines of dubious mortgage industry practices and has repeatedly gone to bat for its biggest advertiser even in the face of criminal investigations.
Housing Wire’s proprietor, Paul Jackson, made this inquiry fair game in a recent post, “Follow the money: Interpreting U.S. Bank v. Congress” in which he took aim at the Alabama attorneys who tried defending a client against what they contended was a wrongful foreclosure, using the untested strategy we had mentioned on this blog, the so-called New York trust theory. The court rejected the case on narrow grounds (the suit was fighting the ejectment, a stage after the foreclosure; any precedent on ejectment actions will have limited applicability in Alabama and none in other states). But Jackson went further than arguing the issues of the case or the importance of the decision. Based on no evidence, he denigrated the attorneys involved, claiming they must have big money backers (and we separately dispatched his spurious charges):
Read more...Bloomberg’s Jonathan Weil, who is normally an effective critic of bank chichanery and weak regulatory oversight, may have missed the mark on a key issue in an article last week, “Moral for CEOs Is Choose Your Fraud Carefully“. In it, he criticizes the SEC for failing to attack accounting fraud:
It seems the Securities and Exchange Commission won’t be doing anything to challenge that pretense, either, and that this may be by design. The SEC for years has been bending over backward to avoid accusing major financial institutions of cooking their books, even when it’s obvious they did. So much for upholding financial integrity.
Weil cites a series of object lessons where the SEC has not gone after financial firms executives for accounting fraud: Fannie Mae’s Donald Mudd, Countrywide’s Angelo Mozilo, and three executives at Indy Mac. Weil charges them with “see no accounting evil”.
Let’s be clear: I’m no fan of the SEC’s actions in the wake of the crisis. The regulator has been kept resource starved. Under Arthur Levitt (hardly the most aggressive of SEC chiefs) any effort at enforcement led to threats from Congress of budget cuts (Joe Lieberman was particularly aggressive). Chris Cox was put in charge, as far as I can tell, to make sure the agency did at little as possible. So the SEC only knows how to do insider trading cases, and on any other type of action, it seeks to get a settlement, when a trial in some cases might have more value as a deterrent (plus you don’t get to be good at litigating if you never litigate).
Moreover, the SEC also seems to believe it needs to win pretty much all of its cases to be perceived as a threat. That isn’t true either. Look at the Green Bay Packers, who were correctly the favorites to win the Super Bowl despite having a lousy win/loss record prior to the playoffs. But all those losses had been close, in hard-fought, well-played games. In litigation, embarrassing revelations in discovery or on the stand can also have deterrent value, and can serve as building blocks for future cases.
Let’s deal with the misconstructions in Weil’s article. He argues:
Read more...By Richard Smith
The publication of a pamphlet from Demos, a British fauxgressive think-tank (unconnected with the American think-tank of the same name), is the latest visible move in a not-always-public epic battle between banks and regulators about bank reform. While Americans may assume that the time for regulatory intervention has passed, the preliminary findings of the Independent Banking Commission, a UK body whose output will put an important stake in the ground in the UK, is to be released on April 11th. Whatever mix of legislation, regulation and inaction is deemed appropriate by the politicians will follow the publication of the final IBC report in September.
Given the importance of this report, it should come as no surprise that the banks, or rather the bank that has most at stake, Barclays, is using every available channel to convey dire warnings about how terrible reining in the banks would be, particularly since the banks are really hardly at fault at all.
A curious centerpiece of this effort is this 100 page abortion of a pamphlet, penned by a fallen Labour MP (the usual expense account improprieties), Kitty Ussher.
Read more...I’m going to tell one on myself, and since I suspect my reflexes are atypical, I suggest you watch this video by a realtor, Leigh Brown, before reading the balance of the post:
Read more...We will probably see in the next few days whether the newspapers manage to get the super-injunction by Sir Fred Goodwin, the CEO of failed bank RBS, lifted. Since the facts of the matter, or “speculation” if you will, are now all over the Internet, keeping the super-injunction in place seems pretty pointless, as the Telegraph confirms in Sunday’s Links.
So what’s the real point of this circus? A demonstration of the superiority of the Web over the tabloid press as a mechanism for transmitting salacious tittle-tattle? A grandstanding MP working parliamentary privilege to get a bit of banker-bashing publicity? Naked Capitalism getting into the regulatory arbitrage game and thumbing its nose at the UK court order from the relative safety of its NYC-hosted web server? Or perhaps it is blogger Guido Fawkes sarcastically pointing out that the law is now officially an ass:
So there was this ****** bloke who worked closely with another ****** colleague, they apparently began an adulterous affair not long after the ****ing crisis of 2008. He went to Court to stop it getting out that he had been banging her. Because he is the most notorious ****** of his generation he also banned references to his profession lest he be identified. Guido would be in contempt of Court if he told you his name or profession…
Indeed, the law should not be mocked; but who’s mocking it? The UK certainly needs major overhauls of its privacy (and libel) laws, rather than the current abusive shambles, but in this particular case, one might contend that it’s Sir Fred who’s doing the mocking.
Read more...From this week’s “New Rules” section of the Bill Maher show. The relevant part starts at 2:10 (hat tip Helaine Olen via Gawker). It is gratifyingly brutal.
Another sign of the MSM’s descent into Pravda-like irrelevance is that the only mass audience venues that regularly provide commentary within hailing distance of reality are comedy shows.
Read more...…So the UK press aren’t allowed to call him a banker (!), or mention his infidelity with a married colleague.
However, since MP John Hemming mentioned the case under parliamentary privilege, you can get part of the story from the Telegraph:
He said: “In a secret hearing this week Fred Goodwin has obtained a super-injunction preventing him being identified as a banker.
Read more...By Richard Smith, a recovering capital markets IT specialist Housing Wire’s Paul Jackson has another post up continuing his row with Yves over securitization chain of title issues. It presents itself as a rebuttal of her previous post, about an Alabama trial court decision that Jackson deems to be a significant defeat, but which Yves […]
Read more...I thought readers would enjoy this program, which was broadcast late last year but is still relevant particularly now that the State Department has acknowledged that Aljazeera is beating US newscasters. From Hillary Clinton in testimony before the Senate Foreign Relations Committee, as reported by the Associated Press:
“Like it or hate it, it is really effective,” Clinton said. “In fact, viewership of Al-Jazeera is going up in the United States because it is real news.”
“You may not agree with it, but you feel like you’re getting real news around the clock instead of a million commercials and, you know, arguments between talking heads and the kind of stuff that we do on our news that is not providing information to us, let alone foreigners.”
This program focuses on how the Pentagon has been able to get Hollywood to, um, cooperate with its efforts to present a positive image of the military (hat tip reader Scott A). I must confess I enjoyed the action footage.
Read more...One of the dangers of framing stories as Manichean tales is the purported bad guys can take offense and try to get even. And if you do it in a book, the threshold for liability is low enough that they might indeed be able to inflict some real pain.
Michael Lewis, author of the bestseller The Big Short, along with his publisher, W.W. Norton and his source Steve Eisman, were sued today in Federal court for defamation by one Wing Chau. In case you are one of the five people in America who is interested in finance but has managed not to read The Big Short, there is a scene in the book in which FrontPoint’s Eisman, who is Lewis’ main subprime short hero, has asked to meet someone who is on the other side of his trade. That “someone” is a CDO which in practical terms means a CDO manager. Eisman and two of his employees have dinner with Wing Chau, who is the head of the CDO manager Harding. Needless to say, Lewis’ account makes it clear that he regards Chau as very much part of the problem.
Now we’ve written a LOT about CDOs; in fact, our book ECONNED broke the story of Magnetar and demonstrated how its CDO program, which it used to establish a risk-free short position, drove the demand for a large portion of the subprime market in the toxic phase. And we have taken issue with Lewis’ characterization of the shorts as heros.; Knowingly or not, the strategy that reaped them billions also distorted normal market pricing signals on a massive scale, not only allowing the subprime mania to continue well beyond its sell-by date but also by actively promoting the creation of the “spreadiest” or very worst mortgages.
Our reading of Lewis’ plight is that Chau’s claims seem to be a stretch, given that the facts are less on his side than a reading of his suit might suggest. But as we will discuss later on, litigation on books is so plaintiff friendly that even a weak claim can succeed in court.
Read more...