Demand To See Your Mortgage Note! -
Brand New Website Makes It Simple - Make The Bank Show Proof
By: Pitchfork
http://dailybail.com/home/demand-to-see-your-mortgage-note-brand-new-website-makes-it.html
Where's your note? Has it been lost somewhere along the way?
You can also verify your loan servicer with MERS online -- takes about 45 seconds.
An excellent resource - Send this one to friends
Federal Reserve Works To Strip A Key Mortgage Protection For Homeowners Against Predatory Lending
By: Pitchfork
http://dailybail.com/home/federal-reserve-works-to-strip-a-key-mortgage-protection-for.html
Fed moves to gut predatory lending protection
AP Washington - The Federal Reserve is pushing a new mortgage regulation that would effectively eliminate the most powerful federal remedy for predatory lending.
Under the Fed's new proposal, however, borrowers would be required to pay off the balance of the loan before the bank loses its right to foreclose -- that means borrowers could still lose their homes, even in cases where banks have broken the law.
MERS DEATH ZONE - Double Class Action
Lawsuits Filed Against Mortgage Registration Puppet
By: Pitchfork
http://dailybail.com/home/mers-death-zone-double-class-action-lawsuits-filed-against-m.html
We can only imagine the blood-curdling feeding frenzy as trial lawyers gash the bones and suck the marrow from the fraudulent banks.
http://sherriequestioningall.blogspot.com/2011/01/i-started-lawsuit-against-litton.html
Both lawsuits are detailed inside...
GOVERNMENT TOOK YOUR JOBS SO THE BANKS COULD TAKE YOUR HOMES TO COVER THE COSTS OF THEIR MORTGAGE-BACKED SECURITY FRAUD
http://www.youtube.com/watch?v=mtKqx0whZY0
There is no question that the banks have decided that looting the American people to keep themselves afloat is the only solution they have, and equally apparent that government at the state and Federal level are going to help them do it, as evidenced by the way in which Bank of America was let off the hook for foreclosure fraud by the US Government and all 50 states (in exchange for a piece of the action).
http://foreclosureblues.wordpress.com/2011/01/08/ibanez-decision-analyzed/
extract wealth from their fellow human beings by stealth and by force, which is pretty much what is happening here today. The bank robbers are the ones inside the banks.
http://uruknet.com/?p=m73701&hd=&size=1&l=e
Absent some draconian "solution" by the Federal Government, the US banking system has dug its own grave and will drag the US Government down with it. Draconian action by the government to allow the banks to evade the legal consequences of their short-cutting the mortgage system to expedite the looting of homes will provoke a Constitutional crisis.
Worse, when the government declares a "National Emergency" and is seen to activate the FEMA laws to save the very banks that created this mess, more than likely this will provoke the violent reaction that even now the military is being trained to deal with.
More than likely this spate of phony terror bombing in Maryland and Washington DC is a pathetic attempt to make it look like the "domestic terrorists" (i.e. Americans pissed off at being robbed at the point of a fountain pen) have struck the first blow.
But we know different. The US Government has drawn first blood.
http://www.shtfplan.com/headline-news/confirmed-were-literally-on-the-brink-of-catastrophic-collapse_01062011
Americans whose homes were taken by fraud are dying of the harsh winter we were told was not possible because of global warming. The number of American citizens murdered by the US Government rises every day. The war has already begun, and the bad guys have the initiative! There is no turnng back. IN the eyes of the enemy, strip-mining your lives to pay for their $100,000 watches is their only path to survival, under the religious rules they worship.
There are no innocent bystanders.
We are all targets for their greed.
We are all the resistance. We are all Palestinians.
In 1999 Congress repealed Glass-Steagal, triggering a reckless gambling binge on derivatives by banks using their customers (not their own) money.
One of the "products" created by Wall Street during this binge was the mortage-backed security. These were sold and "ponzied" to create the immediate impression of runaway profitability.
Demand was so great for this new product that there was a shortage of new mortgages to put into the MBS. This launched the availability of the sub-prime mortgages, and Congress, themselves invested in the Wall Street firms trading the MBS, dangled an $8000 home-buyer tax credit before Americans to lure more of them in, to "front load" the bubble machine. Demand for mortgages for the MDS was so great that some brokers, either intentionally or possibly due to a goof within MERS (itself created to short circuit the title transfer process), sold the same mortgages into multiple MBS; a clear case of fraud.
Then the wheels came off the bandwagon and the purchasers across the world who invested in the MBS started to realize that many of those mortgages in the MBS were no good, already in default, and/or oversubscribed. Wall Street banks were forced to repurchase those fraudulent securities, attempting to do so quietly lest word of the colossal fraud escape to the general public.
The banks' losses were staggering and hundreds of banks began to fail despite massive cash infusions from the US taxpayers, again courtesy of that same Congress whose members were themselves invested in the Wall Street firms that created this mess.
In order to recapitalize and avoid collapse, the banks started foreclosing on homes in order to take them and place the value of the asset (inflated under mark-to-market accounting practices declared legal again despite the ENRON disaster) on their books.
Speed was life, the rush to foreclose was on. The so-called mortgage modification program was a polite fiction to convince the voters that the same government that had baited them into the scam with that $8000 tax credit was now on their side. But people trying to use mortgage modification were told they had to be in default, and were tricked into withholding payments, which allowed the banks to initiate more foreclosures. More homes were lost in the mortgage-modification program than were saved.
Foreclosure fever dripped the banks, and abuses started to pile up. Homes that were not delinquent on their mortgages were foreclosed. Homes without mortgages were foreclosed. Banks were selling homes without actually owing the title.
Finally, as the scandal became public the courts demanded the paperwork at least have the semblance of proper form and legality. But the use of MERS had severed the link between the mortgage and the note. Both are required legally to foreclose a property.
Lenders who had the note had no idea where the actual title was located, so the "foreclosure mills" were born; legal offices specializing in "recreating" missing paperwork to expedite the foreclosure process.
Documents were forged and robo-signed. This is criminal felony fraud!
http://www.creditwritedowns.com/
While the banks may get a free pass from the US and state governments, civil cases and class-actions are piling up alongside lawsuits from foreign banks that will not be cowed by threats from Washington DC.
The shock waves from the Ibanez case are rippling through the banks and I have no doubt there are emergency meetings going on today on boardrooms across America. Tens of millions, possibly hundreds of millions of foreclosures have just been invalidated, foreclosures already counted on the books as income-to-be-received.
The too-big-to-fail banks may already be insolvent as I type this.
http://revolutionarypolitics.tv/video/viewVideo.php?video_id=13536
The panic is on.
http://globalresearch.ca/index.php?context=va&aid=22672
http://www.doctorhousingbubble.com/beverly-hills-foreclosure-16-million-90201-foreclosure-correction-beverly-hills-50-percent-off/
The fangs are out.
http://poorrichards-blog.blogspot.com/2011/01/six-zionist-companies-own-96-of-worlds.html
Guess whose blood the bankers hunger for.
http://foolscrow.wordpress.com/2011/01/04/irish-leaders-castigated-as-greatest-traitors-of-all-time/
http://saladin-avoiceinthewilderness.blogspot.com/2011/01/please-pay-climate-change-tax-on-your.html
http://globalresearch.ca/index.php?context=va&aid=22690
Saturday, January 8, 2011
Friday, January 7, 2011
show me the ORIGONAL.title..[in court]..or you loose
EU wants bondholders to share bank bailout costs
By: UKSecrets
Tags: ECONOMY EUROPE
http://news.yahoo.com/s/ap/20110106/ap_on_bi_ge/eu_eu_bank_bailouts%3B...
BRUSSELS – The European Union is moving ahead with plans to shield taxpayers from having to bail out big banks in the future, but there are substantial obstacles to making bondholders share losses.
The EU's executive Commission on Thursday presented plans that could give national regulators the power to force the owners of bank bonds to accept so-called haircuts — a reduction in the amount of money they are owed.
Foreclosure-fraud class action lawsuits are starting to pile up against major banks across the country, threatening a besieged industry with billions more in potential losses.
http://ftalphaville.ft.com/blog/2011/01/07/452081/a-court-case-to-challenge-securitisation-standards/
Webmaster's Commentary:
Actually, about $16 trillion divided equally among Americans, and the return of all those stolen homes, might just return us all to status quo anti.
Anything less, it;s time for the tar and feathers. I have had enough of this "we'll steal a dollar and give you back a dime/if you forgive us" crap!
BANKERS GONE WILD - HOW THE US GOVERNMENT HELPED WALL STREET
GANG-RAPE AMERICA'S MIDDLE CLASS
http://whatreallyhappened.com/WRHARTICLES/wildbankers.php
The mortgage bundlers had stuck key financial institutions with fraudulent mortgage-backed securities, and Congress voted to loot the public to purchase the useless paper and hide it from public scrutiny. Why? Because the members of the US Congress had their own fortunes invested in those fraudulent mortgage-backed securities.
This is why, even though the public opposed TARP, members of Congress were so happy when the bill finally was forced through the Congress.
WALL STREET'S MORTGAGE-BACKED SECURITY FRAUD
DESTROYED BOTH THE US AND EU ECONOMIES!
As cash left the nations financial system to cover the repurchase of the fraudulent mortgage backed securities, banks found their balance sheets slipping into the red.
The banks were being driven into insolvency making good on the bad paper and this is what triggered the epidemic of fraudulent foreclosures. Banks needed real assets on their balance sheets as quickly as they could to get their balance in the black and their banks out of insolvency.
http://whatreallyhappened.com/es/content/ever-wonder-why-european-banks-were-so-angry-us-something-about-not-making-good-some-toxic-g
So shortcuts were taken which became known as "foreclosuregate".
US Bancorp and Wells Fargo & Co. lost a foreclosure case in Massachusetts’s highest court that will guide lower courts in that state and may influence others in the clash between bank practices and state real estate law. The ruling drove down bank stocks.
The state Supreme Judicial Court today upheld a judge’s decision saying two foreclosures were invalid because the banks didn’t prove they owned the mortgages, which he said were improperly transferred into two mortgage-backed trusts.
“We agree with the judge that the plaintiffs, who were not the original mortgagees, failed to make the required showing that they were the holders of the mortgages at the time of foreclosure,” Justice Ralph D. Gants wrote.
Anatomy of Foreclosure Fraud
Awesome slideshow presentation - Takes 2 Minutes
You will see several examples of ACTUAL fraudulent documents that were submitted by large, well known banks in court proceedings.
We're talking crazy-ass, over the top, ridiculous fraud here -
Fake people, fake signers, fake documents, false notaries,
fake affidavits and EVEN fake banks...
STOP - DO NOT SKIP THIS ONE - CHECK OUT THESE PICS
http://dailybail.com/slideshows/foreclousre-fraud-documents/8167464
U.S. Bank Completes Acquisition of Securitization Trust
Administration Business..from Bank of America, N.A.
http://phx.corporate-ir.net/phoenix.zhtml?c=117565&p=irol-newsArticle&ID=1512648&highlight
U.S. Bancorp (NYSE: USB) announced today that its lead bank, U.S. Bank National Association, has completed the acquisition of the domestic and European-based securitization trust administration businesses of Bank of America, N.A. The transaction closed on December 30, 2010.
Webmaster's Commentary:
Looks like BofA dumped the whole securitization mess on US Bankcorp just before the Massachusetts Supreme Court dropped the bomb on the fraudulent mortgages!
And JUST in time to distract the corporate media from today's Massachusetts Supreme Court Decision invalidating all foreclosures whose mortgages were sold into mortgage-backed securities!
A piece of mail ignited Friday at a U.S. Postal Service distribution center in Washington, a day after several suspicious letters "flared up" at state government buildings in Maryland, authorities said.
Police said no one was injured.
aint it all just too predictable..?
Caught By MISTAKE
In Web Of Foreclosure
http://dailybail.com/home/caught-by-mistake-in-web-of-foreclosure.html
Tags: CURRENT EVENTS DICTATORSHIP ECONOMY VIDEO
Christopher Marconi was in the shower when he heard a loud banging on his door. By the time he grabbed a towel and hustled to his front step, a U.S. marshal's sedan was peeling out of his driveway. Nailed to Marconi's front door was a foreclosure summons from Wells Fargo, naming him as a defendant. But the notice was for a house Marconi had never seen — on a mortgage he never had.
Tom Williams was in his kitchen thumbing through the mail when he opened a letter from GMAC. It informed him that the bank would confiscate his house unless he immediately paid off his mortgage balance of $276,000. But Williams had never missed a mortgage payment. And his loan wasn't due to mature until 2032.
And we're just getting started...
Robo-Signing Is Child's Play Compared To This -
http://www.youtube.com/watch?v=t7qTBkA8X_E&feature=player_embedded
Bank Of America Allegedly LYING To State & Federal Courts
About Fraudulent Foreclosures In Kentucky
http://dailybail.com/home/robo-signing-is-childs-play-compared-to-this-bank-of-america.html
This sort of abuse
http://dailybail.com/home/lenders-selling-foreclosed-homes-without-obtaining-title.html
is far more serious than robo signing.
The steps undertaken here look to be a deliberate, concerted effort for the bank to get its way, the law be damned.
This means the odds are awfully high that Bank of America committed MULTIPLE frauds on the court, first on the state court in the foreclosures process, and now on the Federal bankruptcy court.
Details are inside...
By: UKSecrets
Tags: ECONOMY EUROPE
http://news.yahoo.com/s/ap/20110106/ap_on_bi_ge/eu_eu_bank_bailouts%3B...
BRUSSELS – The European Union is moving ahead with plans to shield taxpayers from having to bail out big banks in the future, but there are substantial obstacles to making bondholders share losses.
The EU's executive Commission on Thursday presented plans that could give national regulators the power to force the owners of bank bonds to accept so-called haircuts — a reduction in the amount of money they are owed.
Foreclosure-fraud class action lawsuits are starting to pile up against major banks across the country, threatening a besieged industry with billions more in potential losses.
http://ftalphaville.ft.com/blog/2011/01/07/452081/a-court-case-to-challenge-securitisation-standards/
Webmaster's Commentary:
Actually, about $16 trillion divided equally among Americans, and the return of all those stolen homes, might just return us all to status quo anti.
Anything less, it;s time for the tar and feathers. I have had enough of this "we'll steal a dollar and give you back a dime/if you forgive us" crap!
BANKERS GONE WILD - HOW THE US GOVERNMENT HELPED WALL STREET
GANG-RAPE AMERICA'S MIDDLE CLASS
http://whatreallyhappened.com/WRHARTICLES/wildbankers.php
The mortgage bundlers had stuck key financial institutions with fraudulent mortgage-backed securities, and Congress voted to loot the public to purchase the useless paper and hide it from public scrutiny. Why? Because the members of the US Congress had their own fortunes invested in those fraudulent mortgage-backed securities.
This is why, even though the public opposed TARP, members of Congress were so happy when the bill finally was forced through the Congress.
WALL STREET'S MORTGAGE-BACKED SECURITY FRAUD
DESTROYED BOTH THE US AND EU ECONOMIES!
As cash left the nations financial system to cover the repurchase of the fraudulent mortgage backed securities, banks found their balance sheets slipping into the red.
The banks were being driven into insolvency making good on the bad paper and this is what triggered the epidemic of fraudulent foreclosures. Banks needed real assets on their balance sheets as quickly as they could to get their balance in the black and their banks out of insolvency.
http://whatreallyhappened.com/es/content/ever-wonder-why-european-banks-were-so-angry-us-something-about-not-making-good-some-toxic-g
So shortcuts were taken which became known as "foreclosuregate".
US Bancorp and Wells Fargo & Co. lost a foreclosure case in Massachusetts’s highest court that will guide lower courts in that state and may influence others in the clash between bank practices and state real estate law. The ruling drove down bank stocks.
The state Supreme Judicial Court today upheld a judge’s decision saying two foreclosures were invalid because the banks didn’t prove they owned the mortgages, which he said were improperly transferred into two mortgage-backed trusts.
“We agree with the judge that the plaintiffs, who were not the original mortgagees, failed to make the required showing that they were the holders of the mortgages at the time of foreclosure,” Justice Ralph D. Gants wrote.
Anatomy of Foreclosure Fraud
Awesome slideshow presentation - Takes 2 Minutes
You will see several examples of ACTUAL fraudulent documents that were submitted by large, well known banks in court proceedings.
We're talking crazy-ass, over the top, ridiculous fraud here -
Fake people, fake signers, fake documents, false notaries,
fake affidavits and EVEN fake banks...
STOP - DO NOT SKIP THIS ONE - CHECK OUT THESE PICS
http://dailybail.com/slideshows/foreclousre-fraud-documents/8167464
U.S. Bank Completes Acquisition of Securitization Trust
Administration Business..from Bank of America, N.A.
http://phx.corporate-ir.net/phoenix.zhtml?c=117565&p=irol-newsArticle&ID=1512648&highlight
U.S. Bancorp (NYSE: USB) announced today that its lead bank, U.S. Bank National Association, has completed the acquisition of the domestic and European-based securitization trust administration businesses of Bank of America, N.A. The transaction closed on December 30, 2010.
Webmaster's Commentary:
Looks like BofA dumped the whole securitization mess on US Bankcorp just before the Massachusetts Supreme Court dropped the bomb on the fraudulent mortgages!
And JUST in time to distract the corporate media from today's Massachusetts Supreme Court Decision invalidating all foreclosures whose mortgages were sold into mortgage-backed securities!
A piece of mail ignited Friday at a U.S. Postal Service distribution center in Washington, a day after several suspicious letters "flared up" at state government buildings in Maryland, authorities said.
Police said no one was injured.
aint it all just too predictable..?
Caught By MISTAKE
In Web Of Foreclosure
http://dailybail.com/home/caught-by-mistake-in-web-of-foreclosure.html
Tags: CURRENT EVENTS DICTATORSHIP ECONOMY VIDEO
Christopher Marconi was in the shower when he heard a loud banging on his door. By the time he grabbed a towel and hustled to his front step, a U.S. marshal's sedan was peeling out of his driveway. Nailed to Marconi's front door was a foreclosure summons from Wells Fargo, naming him as a defendant. But the notice was for a house Marconi had never seen — on a mortgage he never had.
Tom Williams was in his kitchen thumbing through the mail when he opened a letter from GMAC. It informed him that the bank would confiscate his house unless he immediately paid off his mortgage balance of $276,000. But Williams had never missed a mortgage payment. And his loan wasn't due to mature until 2032.
And we're just getting started...
Robo-Signing Is Child's Play Compared To This -
http://www.youtube.com/watch?v=t7qTBkA8X_E&feature=player_embedded
Bank Of America Allegedly LYING To State & Federal Courts
About Fraudulent Foreclosures In Kentucky
http://dailybail.com/home/robo-signing-is-childs-play-compared-to-this-bank-of-america.html
This sort of abuse
http://dailybail.com/home/lenders-selling-foreclosed-homes-without-obtaining-title.html
is far more serious than robo signing.
The steps undertaken here look to be a deliberate, concerted effort for the bank to get its way, the law be damned.
This means the odds are awfully high that Bank of America committed MULTIPLE frauds on the court, first on the state court in the foreclosures process, and now on the Federal bankruptcy court.
Details are inside...
Thursday, January 6, 2011
too big to fail...not on a goldman asax
Why Are Taxpayers Subsidizing Facebook,
and the Next Bubble?
By SIMON JOHNSON
Simon Johnson, the former chief economist
at the International Monetary Fund,
is the co-author of “13 Bankers.”
Goldman Sachs is investing $450 million of its own money in Facebook, at a valuation that implies the social-networking company is now worth $50 billion. Goldman is also creating a fund that will offer its high-net-worth clients an opportunity to invest in Facebook...
the joke being goldman has many shareholder
but it counts only as one...lol
thus facebook needs not fill in..re[port..those normal things..
public listed companies..must do
its a perversion..but goldman makes it own rules
google the rolling stone magazine goldman sax revealation
On the face of it, this might seem just like what the financial sector is supposed to be doing – channeling BAILOUT..accredited..fiat money into productive enterprise.
The Securities and Exchange Commission is reportedly looking at the way private investors will be involved,...but hey goldman owns them..but there are more deeply unsettling factors at work here.
Remember that Goldman Sachs is now a bank-holding company – a status it received in September 2008, at the height of the financial crisis, in order to avoid collapse (see Andrew Ross Sorkin’s blow-by-blow account in “Too Big to Fail” for the details.)
This means that it has essentially
unfettered access to the Federal Reserve’s discount window –
that is, it can borrow against all kinds of assets in its portfolio,
effectively ensuring it has government-provided..liquidity at any time.
so there you go we are further shareholders
but we are only there to cop the cost/..shaft
Any financial institution with such access to such government support is likely to take on excessive risk – this is the heart of what is commonly referred to as the problem of “moral hazard.”
If you are fully insured against adverse events,
you will be less careful.
but goldman has allways had govt underwriting..
or rewriting any law they chose..its a professional govt teat sukking leach
Goldman Sachs is undoubtedly too big to fail – in the sense that if it were on the brink of failure now or in the near future, it would receive extraordinary government support and its creditors (at the very least) would be fully protected.
in ever lower value fiat dollars
lest we forget the natzies experience with their hyperinflating deutchmark
where a million marks count buy a stamp...[banker's finance both sides of all wars]
In all likelihood, under the current administration and its foreseeable successors, shareholders, executives, and traders would also receive generous help at the moment of duress.
No one wants to experience another “Lehman moment.”
This means that Goldman Sachs’s cost of financing..is cheaper than it would be otherwise – because creditors feel that they have substantial “downside protection” from the government.
How much cheaper is a matter of some debate, but estimates by my colleague James Kwak (in a paper presented at a Fordham Law School conference last February) put this at around 50 basis points (0.5 percentage points), for banks with more than $100 billion in total assets.
which they reionvest half into govt bonds reaping in two percent
nett clear proffit..all from you tax payers..1.5 percent just doing nuthing
In private, I have suggested to leading members of the Obama administration and Congress that the “too big to fail” subsidy be studied and measured more officially and in a transparent manner that is open to public scrutiny – for example, as a key parameter to be monitored by the newly established Financial Stability Oversight Council....[multiple sghareholders dont count apparently
loll a new way of washing away corperate accountability
aint govt grand...ya elect your people into power
and privatise the fed reserve..or licence bankers to print all the paper they wish
or the bailouts..or unlimited credit
bailout govt...and make govt pay intrest on huge sums
no worry we shall get a new tax..[recall when ghandi complained about a tax on salt
or the tea party when a tax was put on tea...lol
you fools pay income tax on wages
wages isnt income...[income is proffit earned on investments]
wage isnt income...so stop signing documents saying it is..stop taxing wage as income
Unfortunately, so far no one has taken up this approach.
ie audit the fed...and the pentupigram[sorry pentagone]..who have lost 2 trillion..according to dick cheeney..announcment..9 hours before he pulled off 911
[that pushed that headline out of the news...lol]
However, there is consensus that the implicit government backing afforded to Fannie Mae and Freddie Mac in recent decades allowed them to borrow at least 25 basis points (0.25 percent) below what they would otherwise have had to pay – a significant difference in modern financial markets.
In “13 Bankers,” Mr. Kwak and I refuted the view that these government sponsored enterprises were the primary drivers of subprime lending and the 2007-8 financial crisis – that debacle was much more about extreme deregulation and private-sector financial institutions seeking to take on crazy risks.
Nonetheless, Fannie and Freddie were badly mismanaged – and followed the market in 2005-7 with bad bets based on excessive leverage – in large part because they had an implicit government subsidy. Those institutions should be euthanized as soon as possible.
Goldman Sachs now enjoys exactly the same kind of unfair, nontransparent and dangerous subsidy: it has effectively become a new form of government-sponsored enterprise. Goldman is not a venture capital fund or primarily an equity-financed investment fund. It is a highly leveraged bank, meaning that it borrows through the capital markets most of the money that it puts to work.
As Anat Admati of Stanford University and her colleagues tirelessly point out, the central vulnerability in our modern financial system is excessive reliance on borrowed money, particularly by the biggest players.
Goldman Sachs is a perfect example. Most of its operations could be funded with equity – after all, it is not in the retail deposit business. But issuing debt is attractive to shareholders because of the subsidies associated with debt financing for banks and to bank executives because their compensation is based on return on equity — as measured, that increases with leverage.
If banks have more debt relative to equity, this increases the potential upside for investors. It also increases the probability that the firm could fail — unless you believe, as the market does, that Goldman is too big to fail.
Social-networking companies should be able to attract risk capital and compete intensely. They do not need subsidies in the form of cheaper financing, or in any other form.
Social networking is a bubble in the sense that e-mail was a bubble. The technology will without doubt change forever how we communicate with each other, and this may have profound effects on the nature of our society. But investors will get carried away, valuations will become too high and some people will lose a lot of money.
If those losses are entirely equity-financed, there may be negative effects, but they are likely be small – in the revised data after the 2001 dot-com crash, there isn’t even a recession (there were not two consecutive negative quarters for gross domestic product).
But if the losses follow the broader Goldman Sachs structure and are largely debt-financed, then the American taxpayer will have helped create another major financial crisis.
And if you think that sophisticated investors at the heart of our financial system can’t get carried away and lose money on Internet-related investments, remember Webvan: “During the dot-com bubble, Goldman invested about $100 million in Webvan, the online grocer that never got off the ground and eventually collapsed in bankruptcy.”
and the Next Bubble?
By SIMON JOHNSON
Simon Johnson, the former chief economist
at the International Monetary Fund,
is the co-author of “13 Bankers.”
Goldman Sachs is investing $450 million of its own money in Facebook, at a valuation that implies the social-networking company is now worth $50 billion. Goldman is also creating a fund that will offer its high-net-worth clients an opportunity to invest in Facebook...
the joke being goldman has many shareholder
but it counts only as one...lol
thus facebook needs not fill in..re[port..those normal things..
public listed companies..must do
its a perversion..but goldman makes it own rules
google the rolling stone magazine goldman sax revealation
On the face of it, this might seem just like what the financial sector is supposed to be doing – channeling BAILOUT..accredited..fiat money into productive enterprise.
The Securities and Exchange Commission is reportedly looking at the way private investors will be involved,...but hey goldman owns them..but there are more deeply unsettling factors at work here.
Remember that Goldman Sachs is now a bank-holding company – a status it received in September 2008, at the height of the financial crisis, in order to avoid collapse (see Andrew Ross Sorkin’s blow-by-blow account in “Too Big to Fail” for the details.)
This means that it has essentially
unfettered access to the Federal Reserve’s discount window –
that is, it can borrow against all kinds of assets in its portfolio,
effectively ensuring it has government-provided..liquidity at any time.
so there you go we are further shareholders
but we are only there to cop the cost/..shaft
Any financial institution with such access to such government support is likely to take on excessive risk – this is the heart of what is commonly referred to as the problem of “moral hazard.”
If you are fully insured against adverse events,
you will be less careful.
but goldman has allways had govt underwriting..
or rewriting any law they chose..its a professional govt teat sukking leach
Goldman Sachs is undoubtedly too big to fail – in the sense that if it were on the brink of failure now or in the near future, it would receive extraordinary government support and its creditors (at the very least) would be fully protected.
in ever lower value fiat dollars
lest we forget the natzies experience with their hyperinflating deutchmark
where a million marks count buy a stamp...[banker's finance both sides of all wars]
In all likelihood, under the current administration and its foreseeable successors, shareholders, executives, and traders would also receive generous help at the moment of duress.
No one wants to experience another “Lehman moment.”
This means that Goldman Sachs’s cost of financing..is cheaper than it would be otherwise – because creditors feel that they have substantial “downside protection” from the government.
How much cheaper is a matter of some debate, but estimates by my colleague James Kwak (in a paper presented at a Fordham Law School conference last February) put this at around 50 basis points (0.5 percentage points), for banks with more than $100 billion in total assets.
which they reionvest half into govt bonds reaping in two percent
nett clear proffit..all from you tax payers..1.5 percent just doing nuthing
In private, I have suggested to leading members of the Obama administration and Congress that the “too big to fail” subsidy be studied and measured more officially and in a transparent manner that is open to public scrutiny – for example, as a key parameter to be monitored by the newly established Financial Stability Oversight Council....[multiple sghareholders dont count apparently
loll a new way of washing away corperate accountability
aint govt grand...ya elect your people into power
and privatise the fed reserve..or licence bankers to print all the paper they wish
or the bailouts..or unlimited credit
bailout govt...and make govt pay intrest on huge sums
no worry we shall get a new tax..[recall when ghandi complained about a tax on salt
or the tea party when a tax was put on tea...lol
you fools pay income tax on wages
wages isnt income...[income is proffit earned on investments]
wage isnt income...so stop signing documents saying it is..stop taxing wage as income
Unfortunately, so far no one has taken up this approach.
ie audit the fed...and the pentupigram[sorry pentagone]..who have lost 2 trillion..according to dick cheeney..announcment..9 hours before he pulled off 911
[that pushed that headline out of the news...lol]
However, there is consensus that the implicit government backing afforded to Fannie Mae and Freddie Mac in recent decades allowed them to borrow at least 25 basis points (0.25 percent) below what they would otherwise have had to pay – a significant difference in modern financial markets.
In “13 Bankers,” Mr. Kwak and I refuted the view that these government sponsored enterprises were the primary drivers of subprime lending and the 2007-8 financial crisis – that debacle was much more about extreme deregulation and private-sector financial institutions seeking to take on crazy risks.
Nonetheless, Fannie and Freddie were badly mismanaged – and followed the market in 2005-7 with bad bets based on excessive leverage – in large part because they had an implicit government subsidy. Those institutions should be euthanized as soon as possible.
Goldman Sachs now enjoys exactly the same kind of unfair, nontransparent and dangerous subsidy: it has effectively become a new form of government-sponsored enterprise. Goldman is not a venture capital fund or primarily an equity-financed investment fund. It is a highly leveraged bank, meaning that it borrows through the capital markets most of the money that it puts to work.
As Anat Admati of Stanford University and her colleagues tirelessly point out, the central vulnerability in our modern financial system is excessive reliance on borrowed money, particularly by the biggest players.
Goldman Sachs is a perfect example. Most of its operations could be funded with equity – after all, it is not in the retail deposit business. But issuing debt is attractive to shareholders because of the subsidies associated with debt financing for banks and to bank executives because their compensation is based on return on equity — as measured, that increases with leverage.
If banks have more debt relative to equity, this increases the potential upside for investors. It also increases the probability that the firm could fail — unless you believe, as the market does, that Goldman is too big to fail.
Social-networking companies should be able to attract risk capital and compete intensely. They do not need subsidies in the form of cheaper financing, or in any other form.
Social networking is a bubble in the sense that e-mail was a bubble. The technology will without doubt change forever how we communicate with each other, and this may have profound effects on the nature of our society. But investors will get carried away, valuations will become too high and some people will lose a lot of money.
If those losses are entirely equity-financed, there may be negative effects, but they are likely be small – in the revised data after the 2001 dot-com crash, there isn’t even a recession (there were not two consecutive negative quarters for gross domestic product).
But if the losses follow the broader Goldman Sachs structure and are largely debt-financed, then the American taxpayer will have helped create another major financial crisis.
And if you think that sophisticated investors at the heart of our financial system can’t get carried away and lose money on Internet-related investments, remember Webvan: “During the dot-com bubble, Goldman invested about $100 million in Webvan, the online grocer that never got off the ground and eventually collapsed in bankruptcy.”
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