When you are told no one could see this crisis coming, ask them about the subprime crisis of 1990 to 1991. It’s a trick question. As all good things do in the world of fraud, this one started in Orange County, where you had significant people making liars loans. Now, remember, it is the lenders who put the lies in liars loans, not the borrowers. We know this empirically. And we stopped that—because it was insane—as regulators. And guess what happened? The leading folks making liars loans gave up their federal charter, gave up federal deposit insurance, and became a mortgage bank for the sole purpose of escaping regulation. And they changed their name. Some of you will recognize this name—to Ameriquest. Ameriquest was the leading predatory lender that in addition to making liars loans every day of the week targeted minorities to destroy that wealth you just heard about. They targeted Latinos, they targeted Blacks, and they were caught. They were caught three times doing this and the justice department refused to prosecute. Instead they settled for four hundred million dollars and guess what happened to the head of Ameriquest? Did he: a) resign in disgrace, b) was he indicted, or c) did we make him our ambassador to the Netherlands? Got it and won. How hard is this to figure out? Why do you think we made him our ambassador to the Netherlands? Because he was the leading political contributor to president of the United States of America. And that’s bad but what comes next is far worse. Remember, this is the most notorious fraud in the nation. It targets minorities. Everybody knows it does so. Two entities rushed to acquire these personnel and this business and their names—Citicorp and Washington Mutual—who become two of the most notorious frauds in all of this.
So timewise I’ll stop here but the case is, when we prosecuted, we had a ninety-percent conviction rate when they had the best criminal defense lawyers in the world and they spent money like water to protect the CEO from going to prison. So when they tell you no one can stop this, it is utter nonsense. I’ll leave you with these statistics: the FBI warned of this in September 2004. In open testimony, it warned expressly that there was an epidemic—I’m quoting—an “epidemic of mortgage fraud” and it predicted it would cause a financial crisis. If that’s not enough, the industry own anti-fraud experts in 2006, in writing, went to every mortgage banker in America and virtually every other lender and said three things: 1) stated income loans are an open invitation to fraudsters, 2) the incidence of fraud in such loans is 90%, and 3) these loans deserve the phrase—used by the industry behind closed doors—they are liars loans because they are pervasively fraudulent. How big did they get? Well, what did the industry do after it was warned? Did it stop making these loans? No! It massively increased the amount of these loans such that by 2006, one out of every three home loans in America was a liars loan. And that’s why we have a crisis and it came from the very top of these organizations, and it went through—as the FHFA said in its complaint—the largest banks in the world were endemically fraudulent. It is not a few rotten apples. It is an orchard of one percenters who are rotten to the core.
Millions are protesting in Britain, and it’s no wonder — the government is making an already sick economy even sicker. Paul Krugman provides a good analogy. More here.
Oh, and fuck you, Deutsche Bank.
Of England protesting austerity cuts:
Glenn Greenwald eviscerates the Washington Post’s Ruth Marcus:
Marcus — last seen in this space three years ago demanding that Bush officials be fully shielded from all accountability for their crimes (the ultimate expression of “respect for authority”) — wants everyone to learn and be guided by extreme deference to political officials and to humbly apologize when they offend those officials with harsh criticism. In other words, Marcus wants all young citizens to be trained to be employees of The Washington Post.
UPDATE: Charles Pierce has more.
Matt Taibbi smacked down the SEC regarding its slap-on-the-wrist penalty against Citigroup, but so-called objective reporters seem to think the SEC is a victim! More here.
They told me at the ER that I had to get a family doctor, something I’ve been putting off because it’s expensive and there’s a lot of paperwork to deal with. So this morning I went to see a guy who pretty much nodded his head and said, “I understand” no matter what I said (I don’t believe he did – understand, I mean) and wrote me a gazillion scripts I have no intention of filling.
I already told him that. I said I wasn’t interested in taking statins or anything for high blood pressure — blood pressure that’s spiked by the ER visits and lack of sleep. Once I lost weight, my blood pressure reverted to its normal low status. It’s high right now from being sick and the lack of sleep.
There were a couple of other things, too. But basically, I wasn’t thrilled. It’s nice when you have a doctor you can trust, but this guy doesn’t strike me as one of those. The big plus in his favor? He’s right down the street.
It’s not unheard of that people facing incarceration sometimes kill themselves. But there’s no question that Tracy Lawrence was a huge threat to some powerful interests:
A notary public who signed tens of thousands of false documents in a massive foreclosure scam before blowing the whistle on the scandal has been found dead in her Las Vegas home.
NBC station KSNV of Las Vegas reported that the woman, Tracy Lawrence, 43, was scheduled to be sentenced Monday morning after she pleaded guilty this month to notarizing the signature of an individual not in her presence. She failed to show up for her hearing, and police found her body at her home later in the day.
It could not immediately be determined whether Lawrence, who faced up to one year in jail and a fine of up to $2,000, died of suicide or of natural causes, KSNV reported. Detectives said they had ruled out homicide.
Lawrence came forward earlier this month and blew the whistle on the operation, in which title officers Gary Trafford, 49, of Irvine, Calif., and Geraldine Sheppard, 62, of Santa Ana, Calif. — who worked for a Florida processing company used by most major banks to process repossessions — allegedly forged signatures on tens of thousands of default notices from 2005 to 2008.
Trafford and Sheppard were charged two weeks ago with 606 counts of offering false instruments for recording, false certification on certain instruments and notarization of the signature of a person not in the presence of a notary public. You can read a .pdf version of their indictment here.
Police said at the time that the alleged scam had thrown into question the legality of most Las Vegas home foreclosures in the past few years, leaving many people living in foreclosed-upon homes that they unknowingly don’t actually own.
John Heilmann has a really good piece in New York magazine about parallels between 1968 and 2012 re: the Occupy movement. It’s long, but worth reading the whole thing:
What Obama may not understand so well is the degree of frustration inspired by him specifically among the protesters and their prime movers. Or the extent to which OWS and its energy is, as one liberal strategist puts it, is “the rotten fruit of Obamaism”—an army of young people, many of them inspired and mobilized by his campaign in 2008, who feel betrayed by his performance since he has, er, occupied the Oval Office.
“He cheated,” says Husain, who volunteered for the campaign on the belief that Obama could be a transformative president. “He ran on a platform he never intended to push. He made promises he never intended to keep. I was just amazed in his inaugural speech how little transformative there was. And then Tim Geithner—what the hell was that? And then the bailouts. It doesn’t take a brain surgeon to figure out what was going on. It was a continuation of the same bullshit.”
Then there are others who never put any faith in Obama in the first place. “The new boss is ever the same as the old boss,” says Sandy Nurse. “I think if either political party or politician thinks they have any credibility to come down here and tap into this energy, they’re gravely misinformed.”
The last point is one I heard again and again from OWSers about Team Obama’s talk of channeling the movement. “They don’t have a fucking clue what they are talking about,” says Berger. “These [protesters] aren’t out here because they’re offended that they haven’t been spoken to nicely. They’re out here because they owe shitloads of money in student-loan debt and can’t find a job. Or they can’t afford their mortgage. And if Obama thinks that they’re gonna be able to divert this energy by talking about doing something, he’s got another think coming.”
[…] Fourth and finally, OWS will need to navigate the fork in the road between radicalism and reformism. “I don’t think it’s an either-or,” says Marom. “People who only want reforms are probably just handicapped by cynicism. And if you don’t want reforms as a revolutionary, then you’re not a revolutionary, because people need the foundations on top of which to survive. And people need to win things, to feel like it’s possible to win.”
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