Housing costs are beyond the reach of many middle class earners. And while that is no news, housing has been the engine of past recoveries. So inflated home prices are part of why the economy will stay mired in low growth.
Read more...Several commentators picked up on the relationship between the events in Baltimore and the dearth of economic opportunity that leads to a sense of hopelessness. But precious few added the component of the foreclosure crisis, a dislocating event that has few parallels in American history. A new paper in the American Sociological Review by Matthew Hall (Cornell), Kyle Crowder (University of Washington) and Amy Spring (Georgia State) puts numbers to this, and shows that we really had a small-scale version of the Great Migration, the shift of African-Americans from the rural south to the big cities of the north. This migration hollowed out and segregated African-American and Latino communities to an even greater degree than where they already were.
Read more...Detroit is getting the same treatment as Latvia and Ireland, and we are already seeing similar results in Greece, with most people who have good foreign job prospects taking a hike. But while Latvia and Ireland stabilized at much lower levels of output and have started to recover from their, Detroit, like Greece, looks like a failed state. And this is perversely seen as acceptable in America.
Read more...A key principle of land use in the United States is that homeowners can often veto new buildings on nearby land that other people own. A trade agreement that’s currently in the works could have a huge impact on that long-established system of local control.
Read more...Many of the concerns about Big Data focus on the surveillance apparatus used to collect it, or on the naive modeling approaches, like attributing causality to mere correlations. Here Black addresses an established problem: that of deliberate abuse of models.
Read more...CFPB’s HDMA proposal includes no reporting requirements to determine whether mortgage servicers are treating distressed borrowers equally.
Read more...We regularly criticize government-subsidized lending as a terrible way to achieve policy goals. This interview with Sarah Quinn focuses on how Federal credit subsidies have grown and changed over time, with a major objective being to mask the extent of the support.
Read more...By Tom Adams, securitization professional for over 20 years and partner at Paykin, Krieg & Adams, LLP. You can follow him on Twitter at @advisoryA It’s been a while since I wrote here about Ocwen Financial Corporation http://www.nakedcapitalism.com/2015/02/tom-adams-ocwens-servicing-meltdown-proves-failure-of-obamas-mortgage-settlements.html , the large non-bank mortgage servicer, but things haven’t gotten any better for the company or its […]
Read more...How Citi ran into a buzz saw and lost a False Claims Act case when it tried stymieing whistleblower Sherry Hunt. But true to form, the DoJ took the easy way out.
Read more...How the FCIC not merely ignored but actually suppressed information that revealed what and more important, who, drove the crisis.
Read more...This is the second post in a devastating series on why major banks and their executives got away with large-scale, systematic fraud in the runup to the crisis. Bill Black uses Citigroup whistleblower Richard Bowen as a case example of how derelict the DOJ and SEC were in the performance of their duties.
Here, Black describes how historically frauds and criminal conduct were pursued primarily by regulators and the FBI. However, not only were regulations were weakened, but the Bush Administration ended criminal referrals: “References to the criminal referral coordinators disappeared or were removed from the bank examiners’ manuals.” FBI staffing for white collar crime was cut drastically as the war on terror was given precedence.
That meant, as Black describes, whistleblowers became more important than ever as not just a source of information for civil and criminal prosecutions, but as key witnesses. Yet in many cases they are problematic. They are often disaffected former employees who call out the bad conduct they saw after they were terminated, or were so badly roughed up by their former employer for becoming an internal dissident that they were traumatized and don’t hold up well on the stand. Hence, as Black explains, the failure to take advantage of a stellar whistleblower like Richard Bowen. As Bowen put it, “Not only did they bury my testimony, they locked it up.”
Read more...Get a cup of coffee. This important post gives an in-depth analysis that helps explain how bad conduct was covered up or glossed over by the FCIC, and how much of the media fell in line with the official, sanitized story.
Read more...In a bit of synchronicity, two new papers confirm the long-held suspicion that Wall Street is sucking the life out of Main Street.
Read more...#BlackstoneEvicts is one of the messaging vehicles for a loosely-organized groups of protestors in Spain and the US who oppose private equity kingpin Blackstone’s aggressive evictions and rental abuses.
Read more...Will we all end up living in shipping containers, and won’t that involve substantial demand destruction?
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