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In total, the FHFA has launched 17 suits against major banks that sold nearly $200B in MBS to...

In total, the FHFA has launched 17 suits against major banks that sold nearly $200B in MBS to the GSEs. No word yet on the value of the losses the agency is trying to recover. (PR) (individual filings)
Comments (14)
  • Old Trader
    , contributor
    Comments (5724) | Send Message
     
    It looks like even fair-haired boy Jamie Dimon isn't going to be capable of dodging this particular bullet. For the life of me, I don't understand why anybody would be holding bank stocks in the current environment, unless they're just trading 'em.
    2 Sep 2011, 04:57 PM Reply Like
  • Angel Martin
    , contributor
    Comments (1291) | Send Message
     
    Old T, I don't own bank stocks but I think the logic is: if the game is rigged, bet on the players with an unfair advantage...

     

    I think these lawsuits are PR only and are happening because Obama is polling so badly. He's looking to beat up on someone more unpopular than himself, and the Republicans (for once) are not co-operating.

     

    here's one set of lawsuits that I hope both sides lose... GSE's are a democrat playpen with significant culpability for the housing bubble.

     

    The TBTF banks, the less said the better...
    2 Sep 2011, 05:10 PM Reply Like
  • Old Trader
    , contributor
    Comments (5724) | Send Message
     
    Angel Martin,

     

    You just may correct in your supposition that the "play" is betting on those with the edge.
    2 Sep 2011, 05:14 PM Reply Like
  • Papaswamp
    , contributor
    Comments (2178) | Send Message
     
    ..and F&F just took $73 Billion in non-paying loans from BoA…WTF? The GSE knew exactly what was going on at the time. I hope the banks out the govt.
    2 Sep 2011, 05:05 PM Reply Like
  • Tom Armistead
    , contributor
    Comments (5217) | Send Message
     
    This is going to finally clear the air. Every financial institution that holds RMBS trades at a discount because of questions about the value. Meanwhile the banks responsible trade at a discount because of the uncertainty about their legal liability.

     

    So the losses are discounted twice.

     

    When the courts finally sort this out, or the parties settle, with the losses born by the responsible party, all financials will trade higher.

     

    The result will be a cleansing of the financial system, purging out the fraud, greed and dishonesty, and restoring some faith about the value of assets. Long overdue.
    2 Sep 2011, 05:09 PM Reply Like
  • Old Trader
    , contributor
    Comments (5724) | Send Message
     
    Tom,

     

    Agreed that its long overdue, but I suspect that a part of the "cleansing" process is going involve at least a couple of "sacrificial lambs". So, one's effectively wagering that one knows just which members of the flock should be avoided.
    2 Sep 2011, 05:18 PM Reply Like
  • Richard Mackenzie
    , contributor
    Comments (453) | Send Message
     
    Tom, your last paragraph is a wonderful dream. It glows with pixie dust. When it actually comes to pass the news will be delivered by a faery riding a unicorn (i.e. in our dreams). We can only wish...
    2 Sep 2011, 05:31 PM Reply Like
  • Tom Armistead
    , contributor
    Comments (5217) | Send Message
     
    OT,

     

    I kind of suspect GS has been annointed. Congress marked them for punishment, Blankfein has hired a criminal lawyer, the SEC has already counted coup on them, so on and so forth.

     

    DB was also fingered by Congress, maybe they take a hit too. The fair-haired boy will skate through unscathed, buy JPM if you must invest in the area.

     

    I'm planning to stay away.
    2 Sep 2011, 05:57 PM Reply Like
  • Tom Armistead
    , contributor
    Comments (5217) | Send Message
     
    Richard,

     

    I've been on this for about three years, the R&W issue, etc., slowly it has come out of nowhere and is now moving center stage. I suspect that OT is correct, there will be some scapegoating.

     

    Wall Street is amoral, and you really can't cast the discussion in terms of lying, cheating, stealing etc., they don't see what they do as actual stealing, it's just being smarter than the other guy.

     

    When it's over, the whole thing will be about data being factually accurate and fully disclosed, correct and complete, rather than really coming out and trying to talk morality or ethics to Wall Street, those people are ethically challenged, it's a BFOQ.
    2 Sep 2011, 06:03 PM Reply Like
  • Rookie IRA Investor
    , contributor
    Comments (2537) | Send Message
     
    "Wall Street is amoral, and you really can't cast the discussion in terms of lying, cheating, stealing etc...."

     

    I suppose so, but there were an awful lot of people in communities and small-town America all over the US who were making a heap of money in commissions selling mortgages when the game was at its height a few years ago and who must have known perfectly well that the whole racket was crooked, because it was just a case of "sign 'em up, collect the commission, and be happy while it lasts--that's the American way."

     

    It has been going on for hundreds of years in one form or another. Author Charles Dickens was particularly angry about this aspect of the US in American Notes (1842). He commented that Americans admired rather than despised people who made money this way, because it was the smart thing to do.

     

    Not surprising that Dickens noticed this tendency, because he himself had lost money (a lot) by investing in a land swindle in Cairo, at the junction of the Mississippi and Ohio rivers.

     

    "In every stockjobbing swindle every one knows that some time or other the crash must come, but every one hopes that it may fall on the head of his neighbour, after he himself has caught the shower of gold and placed it in safety. [Karl Marx, Capital, Volume I, Chapter 10 (1867)]
    2 Sep 2011, 07:33 PM Reply Like
  • Boxed Merlot
    , contributor
    Comments (1583) | Send Message
     
    In every stockjobbing swindle every one knows that some time or other the crash must come..

     

    "The Vision of the Flying Scroll"

     

    I looked up again and saw a flying scroll.

     

    The angel asked me, "What do you see?"

     

    I answered, "I see a flying scroll, thirty feet long and fifteen feet wide."

     

    And he said to me, "This is the curse that will go all over the land. One side says every thief will be taken away. The other side says everyone who makes false promises will be taken away.
    The Lord All-Powerful says, 'I will send it to the houses of thieves and to those who use my name to make false promises. The scroll will stay in that person's house and destroy it with its wood and stones.' "

     

    Zechariah 5:1-4
    3 Sep 2011, 11:07 AM Reply Like
  • User 487974
    , contributor
    Comments (1105) | Send Message
     
    This is insanity! Why not bring back "Mark to Market", you want to kill the system? Get on with it you idiots!
    Obama wants to collapse the system, pure and simple. Its the progressive playbook. Look at all the "Big Government" policies we are getting jammed down our throats! In all honesty to Mr. Obama, his rejection of Lisa Jackson and the EPA today was a step in the right direction. But he is the one who did the end run around {a democratically controlled congress who voted against the cap and trade bill} to begin with. Obama is fine with going against congress and the American people, {Obamacare}. If the jobs numbers weren't so horrific, EPA would have snuck this through just like all the midnight tomfoolery already passed. Fannie / Freddie on Christmas eve a few years back, we don't forget sir!

     

    Buckle up, it will be an all out onslaught from here on out. The Cloward and Piven system is going into hyper drive. Saul Alinsky is already in full Force, Maxine Waters, The C.B.C and all the rest of the media attack dogs.
    Tea party?
    Racists?
    Yeah, OK, and I am the next President of the United States!
    God help us all! Its going to get much worse before it gets better. Look to God! Look to each other, be good to each other. We are America! We are Americans, we will overcome anything this progressive / socialist government try's to foist on us! We have the power of good on our side, good always triumphs over evil, every single time!

     

    Obedience to God is rebellion to tyrants
    Jerry
    2 Sep 2011, 06:19 PM Reply Like
  • DianeLee
    , contributor
    Comments (346) | Send Message
     
    Regardless of how we arrived at this point, and bypassing all of the oversimplifications of argument, we can still be astounded that this Administration still has no concept whatever of unintended consequences.
    Sue the 17 largest banks? Well, that's where the money is. The incurious portion of the populace will jump on the Bash-the-Banks bandwagon, and it will be a political diversion of sorts in the ongoing BlameGame.
    However, could there be a worse time to destabilize the entire financial system of the United States, and for that matter the world? Is it careless and amateurish, or intentional, and for what purpose? Think.
    3 Sep 2011, 08:07 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Where's my Plavix, Where's my Plavix,.........Where's my freakin' Plavix.

     

    Did you guys hide my Plavix?

     

    You know, I'm beginning to think I could get off this stuff if I'd quit listening to you people!!!!!!
    7 Sep 2011, 11:08 PM Reply Like
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