Say It Ain’t So, Joe

I’ll believe it when I see it.  Supposedly BoA made noises today that it would support judicial cramdown of mortgages along with Citigroup.  Remember Dick Durbin’s bill?   Lazarus-like, it continues to rise from the ashes only to be stomped on again.  Here’s the article with video.

Also, here is the anonymous “14th Banker” talking about the crazy, bizarro world incentives that have turned depositary banks into replicas of investment banks with no real incentive to loan to the businesses that make up 75% of the American “Main Street” economy.  “Incentive is everything,” says the banking executive from a TBTF bank that took TARP money. “The same sort of ethical and questions and compromises seen at investment banks have that infected the whole organization.”

Also, have you seen those crazy WAMU hearings before the Senate Permanent Subcommittee on Investigations?   Here’s the Subcommittee’s site on the hearings, testimony and exhibits.

New documents released by a Senate panel show how entrenched Washington Mutual was in fraudulent and risky lending, and highlighted how its top executives received rewards as their institution was hurtling toward disaster.  From the NY Times article linked above, 

“The documents revealed an extensive pattern of lax underwriting and fraudulent lending that inevitably led to delinquency and foreclosure.

For example, one internal investigation found high rates of “confirmed fraud” in two top loan-producing offices in southern California. But the subcommittee said that “no steps were taken to address the problems, and no investors who purchased loans originated by these offices were notified.”


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