Nine Stories The Press Is Underreporting

[robdogbucky]

Nine Stories The Press Is Underreporting -- Fraud, Fraud And More Fraud

"If it wasn't already blindingly obvious that pervasive fraud was at the heart of the financial crisis and the ensuing foreclosure catastrophe, you would think that the latest news -- that banks have routinely been lying their heads off in the rush to kick homeowners off the properties they fraudulently induced them to buy in the first place -- would pretty much clinch it.

And yet the mainstream media still by and large hasn't connected the dots.

What we are seeing all around us are the continued effects of a vast criminal enterprise that has never been brought to account, employing a process that, as University of Texas economist James Galbraith explains, involved the equivalent of counterfeiting, laundering and fencing.

So the person with the right expertise to lead us here is a criminologist -- in particular William K. Black, one of the few effective regulators in recent history (during the savings and loan crisis of the late 1980s), a notorious knocker of heads and currently professor at the University of Missouri-Kansas City and author of the book, "The Best Way to Rob a Bank Is to Own One".

http://www.huffingtonpost.com/2010/10/20/nine-stories-the-media-is_n_769620.html


Points made in interview with Mr. Black include; The astonishing amount of mortgage fraud, The fact that these mortgage frauds were overwhelmingly due to consciously fraudulent lending practices, The disgraceful lack of prosecutions, The "echo" epidemics of fraud set off by the primary epidemic of accounting “control fraud," The massive foreclosure fraud we are seeing now as another "echo" epidemic, The ongoing massive cover up of losses on bad assets, The continued absence of effective regulation, The crises of state and local government and the lack of a rational basis for Republican and Blue Dog opposition to the proposed revenue sharing component of the stimulus bill, The insanity of accepting mass, long-term unemployment rather than having the government provide productive jobs for everyone willing to work (as the employer of last resort).


Does anyone care? Are we so blinded by the latest shiny object that we cannot see what is happening? Frog in slowly boiling water?


Can hardly believe almost no one seems to care, that the sheeple are so easily distracted while they are shorn.



rdb

[Smarmie Doofus]

1. Kick so I can find this later.

[mod mom]

2. Just these 2 points alone says volumes:

6. The ongoing massive cover up of losses on bad assets, particularly by the “too big to fail” institutions, which I call “systemically dangerous institutions” (SDIs). Those institutions, along with Federal Reserve Board Chairman Ben Bernanke and Congress (at the behest of the Chamber of Commerce and with no opposition from the Obama administration) in April 2009 forced the Financial Accounting Standards Board (FASB) to change the rules so that the banks do not have to recognize their losses unless and until they sell the bad assets. The implications of this cover up are large (and rarely reported). At the very least, it means that Treasury Secretary Timothy Geithner's propaganda campaign about TARP saving the world at virtually no cost (perhaps even a "profit") is nonsense -- despite its success in influencing the Washington Post and Los Angeles Times. Consider:

A) The repayment of TARP funds does not mean the banks are healthy. Their asset values are often grossly inflated, which means their net worth is grossly inflated. That means that the claims that we have increased net worth requirements (and that Basel III will further increase net worth requirements) are false. Net worth requirements have meaning only if the accounting is honest

B) The repayment of TARP funds does mean that the banks are freed from any meaningful restraint on senior officer compensation. Note that absent the accounting lies the banks would often be reporting losses (and failure to meet required capital requirements, or outright insolvency) and could not pay their senior officers bonuses and would be subject to mandatory closure under the Prompt Corrective Action (PCA) law.

C) No commercial entity would have ever signed the TARP deals on the terms that the U.S. drafted for itself. The U.S. provided not only fresh money but an unlimited de facto guarantee (along with permitting phony accounting). If the U.S. had negotiated competently it would have owned virtually all the shares of every TARP recipient (which, of course, was a political impossibility).

D) The accounting lies are stalling the recovery. Markets cannot clear promptly when one creates an incentive to hold massively overvalued assets for years.

E) The losses are still there, but the taxpayers are on the hook via Fannie and Freddie and the Fed (which has taken over a trillion dollars in toxic collateral at grossly inflated values).

7. The continued absence of effective regulation. It should be scandalous that President Obama left in charge, or even promoted, the anti-regulators who permitted the Great Recession. The (failed) anti-regulator of Fannie and Freddie, for example, remains FHFA's acting director. This is significantly insane as a matter of both economics and politics. (The administration doesn't even seem to realize the issue of integrity.)


:mad:

[spin]

3. The press does not report on important stories ...

Gee, I would have never believed it.

:rofl:

[SpiralHawk]

4. The ka dnd the r

k and r

[Greyhound]

5. K&R

[leftstreet]

6. K&R

[cutlassmama]

7. k&r. Thanks for putting these in the forefront for us.