Way Too Big to Save
March 9, 2010 by admin · Leave a Comment
Simon Johnson, Huffington Post
Listening to US officials, talking to legal experts, and waiting for an intense Senate debate on financial reform to begin, you can easily form the impression that “too big to fail” adequately describes our most serious future systemic banking problems. It does not.
In September 2008, the large banks and quasi-banks at the heart of our financial system faced failure — and they were saved in the most immediate sense through actions taken by the Federal Reserve, but TARP (passed by Congress and run Treasury) also played a significant supporting role.
The Bush administration threw a small fiscal stimulus into the mix in early 2008, hoping to stave off recession; the Obama administration committed a much larger package at the start of 2009, aiming to prevent anything like a Second Great Depression. This fiscal policy response was in direct reaction to problems caused by the overextension and near failure of the financial system
Do not make the mistake — for example of Secretary Geithner, talking to the New Yorker — of thinking (or implying) that “saving the financial system” did not involve spending a lot of taxpayer money to support the real economy. Remember that if the economy crashes, asset prices fall, and banks’ problems become even more severe.
And try to avoid three further mistakes that are currently common.
Read more hear: http://www.huffingtonpost.com/simon-johnson/way-too-big-to-save_b_491325.html
Long Island Judge Hammers Wells w/ $155K Tab For Kicking Out Homeowner Before Foreclosure Is Completed
March 9, 2010 by admin · Leave a Comment
From: www.homeequitytheft.blogspot.com
In a court ruling issued March 5, 2010, Suffolk County, New York Supreme Court Justice Jeffery Arlen Spinner clobbered another rogue foreclosing lender for its improper conduct in connection with the carrying out of a foreclosure action. This time, it was Wells Fargo, who felt the wrath of Justice
- $200 in damages for the trespass to homeowner’s possessory interest in the property,
- $4,892 in damages representing the value of the personal possessions lost as a direct result of Wells Fargo’s actions in trespass,
- $150,000 in exemplary damages, which, in effect, serves as a reminder to Wells Fargo and any other lender to refrain from engaging in this kind of crap in the future.
A couple of excerpts from Justice Spinner’s ruling follows [my emphasis added, not in the original]:
- In the matter before the Court, it is apparent that Plaintiff [ie. Wells Fargo] has perpetrated a trespass against the real property of Defendant [homeowner facing foreclosure], which is actionable and subjects Plaintiff to liability for damages. Distilled to its very essence, trespass is characterized by one’s intentional entry, with neither permission nor legal justification, upon the real property of another, [citation omitted].
***
- Here, the Court is constrained to find that the conduct of Plaintiff in this matter was both willful and wanton, as evidenced by not one but two unauthorized entries into Defendant’s dwelling, occurring in complete derogation of Defendant’s right of possession. This conduct becomes even more glaring when consideration is given to the fact that Defendant affirmatively notified Plaintiff that he had secured the property and that it was not abandoned and still contained his personal property.
- Even so, Plaintiff maintains that it has entered the property under a color of right, which turns out to be illusory under the circumstances. In spite of these declarations, Plaintiff willfully took it upon itself to enter the property on more than one occasion, doing so unreasonably and without notice, in direct contravention of the terms of its mortgage promulgated to Defendant by its assignor. This is even more distressing when it is considered that Plaintiff breaches its obligations to Defendant under the mortgage, running roughshod over Defendant’s rights with a specious claim that it is acting to protect its rights and the property. In short, the conduct of Plaintiff was nothing short of oppressive and would best be described as heavy handed and egregious, to say the very least.
- Certainly, the trespass was willful and calculated and was not accidental in any way and the Court finds that Plaintiff did not act in good faith. Under these circumstances, an award of both actual and exemplary damages is necessary and appropriate in order to properly compensate Defendant for the losses he has sustained by way of Plaintiff’s shockingly wrongful conduct as well as to serve as an appropriate deterrent to any future outrageous, improper and unlawful deeds.
- The Court finds the appropriate measure of damages for the trespass to Defendant’s possessory interest in the property to be in the amount of $200.00. The Court further finds that Defendant is entitled to recover $4,892.00 representing the value of the personalty lost as a direct result of Plaintiff’s actions in trespass. Finally, the Court finds that Defendant is entitled to recover exemplary damages from Plaintiff in the amount of $150,000.00.
For the entire ruling, see Wells Fargo v Tyson, 2010 NY Slip Op 20079 (NYS Supreme Court, Suffolk County, March 5, 2010).
Fed Audit Bitterly Opposed By Treasury
March 9, 2010 by admin · Leave a Comment
Sam Stein, Huffington Post
The Treasury Department is vigorously opposed to a House-passed measure that would open the Federal Reserve to an audit by the Government Accountability Office (GAO), a senior Treasury official said Monday. Instead, the official said, the Treasury prefers a substitute offered by Rep. Mel Watt (D-N.C.), and would like to see it enacted as part of the Senate bill.
The Watt measure, however, while claiming to increase transparency, actually puts new restrictions on the GAO’s ability to perform an audit.
Secretary Tim Geithner, Assistant Treasury Secretary Alan Krueger and Gene Sperling, a counselor to the secretary, held a briefing Monday with new media reporters and financial bloggers during which they discussed the Fed audit and other topics. Under the briefing’s ground rules, the officials could be paraphrased but not quoted, and the paraphrase could not be connected to a specific official.
HuffPost reporter Sam Stein lodged what he called a “formal complaint” against the ground rules. The complaint was noted and the briefing began.
Are TARP Funds Being Used To Fund Cheap Overseas Call Centers?
March 8, 2010 by admin · Leave a Comment
Yesterday afternoon a client of mine and I had to call JP Morgan Chase about the whereabouts of his file MFI-Miami requested 2 months ago. After being told quite adamantly that my client would have to pay $10 per document we were requesting (that’s a subject for another article I’m working on) and after I threatened this customer service agent with everything short of telling him he was one phone call away from getting a human booster shot from a guy named Jamie, we realized we were calling a call center in the Philippines and the guy was unaware of who Jamie was.
As soon as I got back to the office to brief my assistant about the client’s file and she hands me the phone to help her talk to a customer service person at Citimortgage. After talking to this heavily accented woman for about 10 minutes, I asked her where she was located and she tells me the Philippines. I talked to other members of my staff and they tell me they get the same thing except Wells Fargo and American Home Servicing routes the calls to India. American Home Servicing Agents in India get angry pretty fast when you demand to speak to someone at an American call center in Texas or California. I had one guy lose it and scream at me in Bengali or Hindi, I couldn’t tell which. The women in my office say the only major bank that doesn’t route their calls to Asia is Bank of America.
The experiences my office has had with dealing with these call-centers mirrors the complaints that I have heard from my clients on a daily basis for the past 18 months. Complaints that have become more and more frequent since congress passed TARP in September of 2008.
So at the risk of sounding like I come from the nether regions of Glennbeckistan, I have to ask, are TARP funds that were given to these banks by you and I, the American taxpayer, being used to employ cheap labor in developing nations and are these call-centers using child labor? Why aren’t Americans being employed to fill these positions?
I contacted both Citigroup and J.P. Morgan – Chase’s press office and surprisingly enough my calls did not get forwarded to the Philippines. I had to leave messages and have not heard back. I would say the chances of me getting a return phone call are about as likely as a customer service manager calling me back from a mortgage servicer.
I find it odd that no one in Washington has asked these questions especially someone like John Dingell or Tom Harkin. You would think members of congress especially pro-union members would be fighting and clamoring to get these call-centers in their districts in this economy just for bragging rights. Is it just another sign that congress is out of touch with what is going on outside the beltway?
