First the banks committed massive fraud in originating and packaging mortgages, leaving the country littered with millions of little mortgage time bombs set to explode in the years after they lined their pockets and made their get-away. The poster child for this unconscionable conduct is Countrywide (now owned by Bank of America) and its CEO Angelo Mozilo, but they were just one of many, many culprits.
Then when those mortgage time bombs exploded a few years later, those very same banks committed more massive fraud, this time by improperly charging homeowners fees and other costs, commencing unjustified foreclosures, and knowingly and intentionally filing false documents in court to foreclose on people when they never even bothered to check to see if they owned the mortgage they were trying to foreclose on.
That is lying, cheating and stealing that would get anyone else in this country thrown in jail for many years. And, this was even worse than that because they filed falsely sworn documents in courts throughout the country as a routine practice. That is perjury (not that any of this is called criminal; no, these crimes are covered up with euphemisms). This is very, very serious criminal conduct that was engaged in for years by the biggest banks in this country as a routine business practice. People go to prison for many, many years for crimes much less serious than that and these crimes merit long prison sentences and crippling fines. But, not if you're a big bank.
That is why people are so mad in this country. There is one standard for hard-working people and there is another standard for the wealthy, well connected, powerful, and, almost always, the big campaign contributors. The law gets applied to the former, often mercilessly and ruthlessly, but the law doesn't apply to the latter, who get off time and again for nothing, next to nothing or by paying a window-dressing fine usually with other people's money.
As if that isn't enough insult and injury to the American people, almost always you have politicians, prosecutors and sundry others racing to the microphones to claim a great victory for "punishing" those wealthy, well connected, powerful, and, almost always, the big campaign contributors. It is as if they think the country is populated by idiots who cannot see through the transparent PR political fraud that they spin to cover the fact that the big shots and their buddies are getting away with it again.
Yesterday was no different as 49 state AGs, the U.S. AG and the White House all raced to the cameras to tout their claims that the mortgage settlement with 5 banks was a great victory for victimize homeowners. $26 billion, they all blared, coming to a neighborhood near you. Wahooo! Finally, relief, justice and help to beleaguered homeowners and other victims across the country.
The problem is that the facts, the actual terms of the deal, as near as they can be determined from what little information was disclosed, suggest that this great victory isn't going to help hardly anyone. True, it does appear to be better than nothing, but is that really the standard? And, none of those politicians said it was merely better than nothing. No, they claimed that this is going to help millions of homeowners across the country.
First, only $5 billion of the settlement was cash (a mere $1 billion from each mega-bank, which is nothing to them) and the other $21 billion will come in the form of mortgage modifications, which isn't anything like cash and will cost them almost certainly less than half of that cost.
Second, as many have pointed out, $26 billion (even if it was real) isn't much and won't help much. For example, as a New York Times story today shows, even if all $26 billion was actually used as claimed, it will help, at most, 10 percent of the 20 percent of homeowners under water and even those homeowners aren't likely to be helped much. Don't miss the graph. Nothing beats seeing how little the help will be. There are approximately 11 million homes under water by an average of $50,000. The huge victory will help at most 1 million for an average amount of $20,000. So, nothing for 10 million and the 1 million will get to reduce the amount underwater on average to $30,000. It's like saying rather than drowning in a lake 50 feet deep, you get to drown in a lake that is only 30 feet deep. And, people are taking victory laps?
You don't believe any of that and still think what the politicians said about punishing the banks was true? If this was a real punishment, then the stock of those banks would have taken a hit. They did not. The announcement had no effect. You could say that was because the settlement had been talked about for some time so the cost was already priced into the stock days before, but there wasn't any hit during that time either.
Thus, the markets confirm the facts of the settlement and rip the PR spin off the political fraud that compounds the banks' fraud and, once again, victimizes the American people by falsely raising their hopes for relief and dashing -- again -- the claims that the criminals, liars, cheaters and scammers were finally going to be held accountable. Sadly, this is yet another example of the double standard that has been so painfully obvious to everyone in this country since the 2008 financial crisis: pain on Main Street, bonuses, bailouts, and arrogant whining on Wall Street, and nothing but PR spin from Washington, D.C. and elected officials.
BRAVO Dennis, bravo! Thank you for saying what politician mouthpieces/shills for banker/corporate greed, theft & fraud will not!
"There is one standard for hard-working people & there is another standard for the wealthy, well connected, powerful, &, almost always, the big campaign contributors".
That is the reality, campaign-contributions are bribes that corrupt our revolving-door elected representatives (it’s no trick to feed fish to a seal) direct public policy & legislation; notions of true justice are "compromised" away in a charade of "deals", phony accountability & further de-regulation; the few champions of justice are diverted from their integrity & sense of honor by those whose moral compass has ceased to function, replaced by the corrupting power of money & lust for re-election. Our electoral system controlled by money is destroying our republic! When 10% control 75% of our nation’s wealth, they control 75% of our electoral process; that’s NOT “democracy”!
The people are fed Pablum of phony “news” & info hiding the true enormity & extent of official corruption & collusion; consistently lied to & deceived by the power of money & those it buys. We’re controlled by two political parties both feeding at the same trough of campaign-contribution cash; one tells us to our face they represent the rich & powerful, the other does so behind our backs. The mechanisms of wealth intentionally keep the vast majority wage-slaves beholden to & dependent on an intentionally larcenous “financial sector” that’s too big to hold accountable; prison is too-good for them!
http://www.thenakedemperor.com/oligarch/angelo-mozilo
and more on Greed and Corruption in Wall Street and Politics in the US, go to:
www.thenakedemperor.com
The only just answer is criminal prosecution for the executives. Lots and lots of them. Bankers breaking rocks in the sun is what is called for here. It's ok for the high and mighty to hate the proletariat, as long as they fear too.
Which - looking at yesterday's bank stock activity - might also say that the Market sees very little (if any) pain for the financial criminals in the future either...
The state AG's did at least one really good thing when they allowed for civil liability even with this settlement. Originally the banks completely refused to even discuss anything that didn't come with blanket immunity for all past and future legal issues relating to the mortgage crisis, but luckily there were enough bitter and angry AG's that didn't completely cave to twist a deal out.
Kelleher is correct that there are two classes in the country: the politically connected (politicians and big campaign cash contributors) and the rest of us. The politically connected are using the force of government to steal from the rest of us.