Denninger asks the correct questions again, as always, even if he is constantly abrasive in tone.
How does he do it and not suffer a blood pressure of infinity-over-275?
Well, anyway, this news brought my friend Billy The Banker to mind. He's now retired, happily, after working for the same county-seat bank for fifty years. High school diploma plus banking courses offered over the years. He advanced from junior teller to president. When all the chaos was going on in 2008, OS asked him what he thought, and he scratched his head and said, 'I don't know what to think, I've never seen anything like it. Our board of directors always wanted to make sure we had a strong equity base, and enough earnings to take care of the employees and pay a little dividend to the shareholders. That's what we did, concentrated on building the equity of the bank. It worked. I don't understand these other people at all.'
OS does know one thing: Had Billy behaved like the execs at BOA, his bank would have failed, and he'd be living out his retirement years in the state pen about thirty miles west of his present modest comfortable home.
Billy lived and worked in a context of reward for good behavior, and legal and moral culpability for bad behavior. His bank made money, his shareholders made money, the county is growing at a stable pace, and he's enjoying visiting his grandkids.
Showing posts with label Denninger. Show all posts
Showing posts with label Denninger. Show all posts
Wednesday, June 29, 2011
Tuesday, January 25, 2011
Bear-Stearns Traders Knowingly Selling Investor 'A Sack Of Shit': Lawsuit from 2008 Now Made Public
From Atlantic Magazine biz page:
Former Bear Stearns mortgage executives who now run mortgage divisions of Goldman Sachs, Bank of America, and Ally Financial have been accused of cheating and defrauding investors through the mortgage securities they created and sold while at Bear. According to e-mails and internal audits, JPMorgan had known about this fraud since the spring of 2008, but hid it from the public eye through legal maneuvering. Last week a lawsuit filed in 2008 by mortgage insurer Ambac Assurance Corp against Bear Stearns and JPMorgan was unsealed. The lawsuit's supporting e-mails, going back as far as 2005, highlight Bear traders telling their superiors they were selling investors like Ambac a "sack of shit."
Denninger has been on top of this all along, alleging that the frauds originate at the very beginning of the process--the creation of the individual mortgages themselves. Little wonder that so much of the paperwork has gone missing...
OS is no financial whiz, no economist.
But he does know this: If you bleach all the trust out of a culture, where no one has any idea whether or not he is dealing with an out-and-out crook--things grind to a halt. Perhaps slowly, but inevitably.
Former Bear Stearns mortgage executives who now run mortgage divisions of Goldman Sachs, Bank of America, and Ally Financial have been accused of cheating and defrauding investors through the mortgage securities they created and sold while at Bear. According to e-mails and internal audits, JPMorgan had known about this fraud since the spring of 2008, but hid it from the public eye through legal maneuvering. Last week a lawsuit filed in 2008 by mortgage insurer Ambac Assurance Corp against Bear Stearns and JPMorgan was unsealed. The lawsuit's supporting e-mails, going back as far as 2005, highlight Bear traders telling their superiors they were selling investors like Ambac a "sack of shit."
Denninger has been on top of this all along, alleging that the frauds originate at the very beginning of the process--the creation of the individual mortgages themselves. Little wonder that so much of the paperwork has gone missing...
OS is no financial whiz, no economist.
But he does know this: If you bleach all the trust out of a culture, where no one has any idea whether or not he is dealing with an out-and-out crook--things grind to a halt. Perhaps slowly, but inevitably.
Monday, January 10, 2011
Denninger Weighs In On The Leftist Rants
He even has facts at hand, something Leftists disdain.
The Arizona shooting was a tragedy, but increasingly it is evident that it was the act of a deranged individual, not a political act.
The Arizona shooting was a tragedy, but increasingly it is evident that it was the act of a deranged individual, not a political act.
Saturday, October 9, 2010
Well, Cut My Legs Off And Call Me Shorty: Obama Actually Vetoed HR 3808
...which would have given the banksters free reign to continue their fraudulent practices in the mortgage markets.
The memo is here.
The memorandum is both civil in tone and unequivocal in meaning. That's a first for any Democrat politician for decades. Remember, Bill (It depends upon what the meaning of the word 'is' is.) Clinton is a major hero to these folks.
Had Obama signed it into law, heaven only knows what may have resulted. Thanks to people like Karl Denninger who raise holy hell about this stuff on a daily basis.
The memo is here.
The memorandum is both civil in tone and unequivocal in meaning. That's a first for any Democrat politician for decades. Remember, Bill (It depends upon what the meaning of the word 'is' is.) Clinton is a major hero to these folks.
Had Obama signed it into law, heaven only knows what may have resulted. Thanks to people like Karl Denninger who raise holy hell about this stuff on a daily basis.
Monday, October 4, 2010
Denninger And Charles Schwab Explain Why The Fed Is Corroding The Culture
Denninger points to a recent op-ed by Charles Schwab
The most striking quote to OS was this:
The Fed's super-loose policy has driven down the security and spending power of savers, particularly those in retirement who played by the rules during their working years and now depend on the earnings from their savings for a decent quality of life. As a result, savers and investors are being forced to take more risk with their money as they hunt for higher yields.
'The ones who played by the rules' for all those decades--the ones who stayed married, raised the kids, worked and worked and worked, often serving in the military (and sending their kids off to do the same), attended and supported their churches and synagogues, saved and scrimped and delayed gratification so they wouldn't be a burden to their kids in adulthood, to have something to spend on the grandkids, maybe even pay school tuition so the grandkids wouldn't have to go to public schools--those folks.
Those folks have been treated shabbily. They kept their money in CD's and Treasury securities, or in muni bonds, for safety of principal, for the insurance on their accounts. Now, not only have their income streams from the principal saved over the years dried up, but the value of those dollars themselves are now being deliberately eroded.
So, what does this mean for the culture? OS believes it breeds cynicism, and erodes hope. Virtue is its own reward, to be certain. Those folks who live virtuous lives have better lives than those who don't--such as meth addicts, to cite an extreme example. But if the end result of all that virtue and saving and investing is a worrisome old age of borderline poverty, it becomes more difficult to make the argument for virtue, thrift, ambition, self-improvement, etc. If the banksters always win, and are the only ones who prosper, the social glue of shared values begins to melt away.
OS listens to hip-hop urban radio a few times a week, not because he likes it, but because he wants to listen in on what is being said. It's not pretty. It is dark music and darker poetry, focused on raw materialism and hedonism, usually degrading to women, and always focused on short-term gratification. The sub-message seems always to be: What the hey, there is no future, and virtue is for chumps. Live for today, and for yourself.
Visit the neighborhoods from which this music emerges, and it is obvious the glue of shared values melted away long ago.
Unless we wish that cultural rot to spread, we would do well to pay attention. And we'd better be prepared to talk once again of virtue as its own reward. It will be a tough sell in this climate.
And, if you don't believe OS, or Charles, or Karl--then maybe Robert Reich will tell you what you need to hear. Same message, from a far different part of the ideological spectrum.
The most striking quote to OS was this:
The Fed's super-loose policy has driven down the security and spending power of savers, particularly those in retirement who played by the rules during their working years and now depend on the earnings from their savings for a decent quality of life. As a result, savers and investors are being forced to take more risk with their money as they hunt for higher yields.
'The ones who played by the rules' for all those decades--the ones who stayed married, raised the kids, worked and worked and worked, often serving in the military (and sending their kids off to do the same), attended and supported their churches and synagogues, saved and scrimped and delayed gratification so they wouldn't be a burden to their kids in adulthood, to have something to spend on the grandkids, maybe even pay school tuition so the grandkids wouldn't have to go to public schools--those folks.
Those folks have been treated shabbily. They kept their money in CD's and Treasury securities, or in muni bonds, for safety of principal, for the insurance on their accounts. Now, not only have their income streams from the principal saved over the years dried up, but the value of those dollars themselves are now being deliberately eroded.
So, what does this mean for the culture? OS believes it breeds cynicism, and erodes hope. Virtue is its own reward, to be certain. Those folks who live virtuous lives have better lives than those who don't--such as meth addicts, to cite an extreme example. But if the end result of all that virtue and saving and investing is a worrisome old age of borderline poverty, it becomes more difficult to make the argument for virtue, thrift, ambition, self-improvement, etc. If the banksters always win, and are the only ones who prosper, the social glue of shared values begins to melt away.
OS listens to hip-hop urban radio a few times a week, not because he likes it, but because he wants to listen in on what is being said. It's not pretty. It is dark music and darker poetry, focused on raw materialism and hedonism, usually degrading to women, and always focused on short-term gratification. The sub-message seems always to be: What the hey, there is no future, and virtue is for chumps. Live for today, and for yourself.
Visit the neighborhoods from which this music emerges, and it is obvious the glue of shared values melted away long ago.
Unless we wish that cultural rot to spread, we would do well to pay attention. And we'd better be prepared to talk once again of virtue as its own reward. It will be a tough sell in this climate.
And, if you don't believe OS, or Charles, or Karl--then maybe Robert Reich will tell you what you need to hear. Same message, from a far different part of the ideological spectrum.
Thursday, September 16, 2010
Denninger Shares A Win For The Good Guys
Remember OS's previous screed about heeding the commandments about not lying and stealing?
Well, Denninger shares one refreshing episode in which a judge realizes that a bank and its law firm were attempting to steal a home from a family through foreclosure by lying to his court, and attempting to use his court as the means to commit fraud.
The judge, blessedly, was not amused.
Now, the question remains: Why aren't disbarment proceedings underway? Why isn't law firm under scrutiny by the Florida Attorney General, to see how many times they got away with this before being caught? Why hasn't one lawyer or banker been cuffed, perp-walked for the cameras, had his prints and mug shots taken, and been forced to cool his heels before making high bail?
Denninger's correct in this one point: Until that happens on a regular basis, the fraud will continue.
Well, Denninger shares one refreshing episode in which a judge realizes that a bank and its law firm were attempting to steal a home from a family through foreclosure by lying to his court, and attempting to use his court as the means to commit fraud.
The judge, blessedly, was not amused.
Now, the question remains: Why aren't disbarment proceedings underway? Why isn't law firm under scrutiny by the Florida Attorney General, to see how many times they got away with this before being caught? Why hasn't one lawyer or banker been cuffed, perp-walked for the cameras, had his prints and mug shots taken, and been forced to cool his heels before making high bail?
Denninger's correct in this one point: Until that happens on a regular basis, the fraud will continue.
Friday, April 2, 2010
The Punch Bowl Is About To Be Taken Away: The Fed Meets Monday To Talk About Interest Rates
Denninger shares the news.
It was a former head of the Fed who said the crux of his job was 'knowing when to take away the punch bowl'--i.e. tighten down the money supply before inflation has a chance to take hold, or bubbles are created. One main means of doing this is to raise interest rates they charge to the banks they serve.
With a DJIA touching 11,000 with almost zero, zippo, nada in the real economy that normal humans live in justifying it, and ObamaCare about to suck up any spare dollar that isn't nailed down, it may be time to pack that sucker up, and send the partiers home to sober up. Is that black coffee we smell brewing?
It was a former head of the Fed who said the crux of his job was 'knowing when to take away the punch bowl'--i.e. tighten down the money supply before inflation has a chance to take hold, or bubbles are created. One main means of doing this is to raise interest rates they charge to the banks they serve.
With a DJIA touching 11,000 with almost zero, zippo, nada in the real economy that normal humans live in justifying it, and ObamaCare about to suck up any spare dollar that isn't nailed down, it may be time to pack that sucker up, and send the partiers home to sober up. Is that black coffee we smell brewing?
| Government in the Sunshine Meeting Notice |  |
| Advance Notice of a Meeting under Expedited Procedures | ||||
| It is anticipated that a closed meeting of the Board of Governors of the Federal Reserve System at 11:30 a.m. on Monday, April 5, 2010, will be held under expedited procedures, as set forth in section 26lb.7 of the Board's Rules Regarding Public Observation of Meetings, at the Board's offices at 20th Street and C Streets, N.W., Washington, D.C. The following items of official Board business are tentatively scheduled to be considered at that meeting. Meeting date: April 5, 2010 <!-----------This is the bordered table------------------------->
| ||||
Monday, January 11, 2010
Robert Reich Sez: Do The Math
Although OldSouth is certainly not a Democrat, he does not think that they all sport horns, cloven feet, and are irredeemable infidels rightly doomed to a warm Perdition. (A few notable ones, yes, but that's for another time.)
He reads Robert Reich regularly, because Reich provides balance, has an academic's demeanor, and has reasoned views, even if they are sometimes wrong. Reich is also not mean-spirited, which helps, and he's not afraid of disagreeing with the HopeAndChange crowd, which really helps.
With his economist's training, he thinks numbers (like words) have meaning.
And Reich's views are beginning to coincide with AngryMan Denninger. They both urge everyone to Do The Math, because simple math in historical context generally sheds the light of truth. 2+2 always equals 4, regardless of how one votes. It is one of God's gifts to His creation, imho.
In his most recent post, Reich does the math. It is not cheering, especially if one is a Democrat Member of Congress who voted for all the TARP, stimulus, health care, etc. Unemployment statistics, lately at 10%, mask the ugly reality that an increasing proportion of the work force is simply dropping off the governmental radar. Which means they'll drop off the income tax radar as well, sooner or later.
Here's an an excerpt, and I'll highlight a few phrases:
The most painful political truth for Democrats is the nation won’t possibly be out of this jobs hole by the presidential election of 2012, even if the recovery is vigorous. Do the math. In order to get out of the hole, we’d need an average monthly increase of 400,000 jobs between now and then. But even at the peak of the 1990s jobs boom, the highest we ever got was 280,000 jobs a month. At the peak of the last recovery, in 2005, we got no higher than 212,000 jobs a month. Bottom line: Obama will be going into an election year with a higher total level of unemployment than before the Great Recession. He will have to argue that, were it not for his policies, things would be even worse. Counter-factuals like this do not sit well on bumper stickers.
Almost 40 percent of the jobless have been without work for over six months. That’s a record. People who have been out of the labor force for more than six months have a particularly hard time getting back in. Many never do.
What worries me most about all this is the trend line. If we were coming out of a recession with any potential strength in the job market, we’d at least see growth in the length of the average workweek. But there’s no sign of any growth. The average workweek held steady in December at 33.2 hours. Employers aren’t even giving their own workers more hours.
This is what Denninger is saying. Just slide over to 'The Market Ticker' to your right, and begin to sample his work. It is enlightening.
A convergence of opinion is beginning to take shape, which is really good news. The realities are now undeniable, and the Obama White House cannot effectively tar-and-feather anyone who disagrees with them, as the Clintons did. (And Bush isn't around to blame anymore.) Robert Reich served on the HopeAndChange transition team, and teaches at Berkley, for mercy's sake. He doesn't live his mom's basement, either...
Now, Reich thinks the Feds should be spending a LOT more money(e.g. printing even more), which OldSouth thinks is a terrible idea. But we're making progress, with everyone recognizing the nature of the problem and speaking in a more civil tone. Was it Dr. Johnson who opined about the prospect of being hanged?
If you're looking in on us from overseas, remember us in your prayers. This is going to take a long time to fix, and there is pain ahead.
He reads Robert Reich regularly, because Reich provides balance, has an academic's demeanor, and has reasoned views, even if they are sometimes wrong. Reich is also not mean-spirited, which helps, and he's not afraid of disagreeing with the HopeAndChange crowd, which really helps.
With his economist's training, he thinks numbers (like words) have meaning.
And Reich's views are beginning to coincide with AngryMan Denninger. They both urge everyone to Do The Math, because simple math in historical context generally sheds the light of truth. 2+2 always equals 4, regardless of how one votes. It is one of God's gifts to His creation, imho.
In his most recent post, Reich does the math. It is not cheering, especially if one is a Democrat Member of Congress who voted for all the TARP, stimulus, health care, etc. Unemployment statistics, lately at 10%, mask the ugly reality that an increasing proportion of the work force is simply dropping off the governmental radar. Which means they'll drop off the income tax radar as well, sooner or later.
Here's an an excerpt, and I'll highlight a few phrases:
The most painful political truth for Democrats is the nation won’t possibly be out of this jobs hole by the presidential election of 2012, even if the recovery is vigorous. Do the math. In order to get out of the hole, we’d need an average monthly increase of 400,000 jobs between now and then. But even at the peak of the 1990s jobs boom, the highest we ever got was 280,000 jobs a month. At the peak of the last recovery, in 2005, we got no higher than 212,000 jobs a month. Bottom line: Obama will be going into an election year with a higher total level of unemployment than before the Great Recession. He will have to argue that, were it not for his policies, things would be even worse. Counter-factuals like this do not sit well on bumper stickers.
Almost 40 percent of the jobless have been without work for over six months. That’s a record. People who have been out of the labor force for more than six months have a particularly hard time getting back in. Many never do.
What worries me most about all this is the trend line. If we were coming out of a recession with any potential strength in the job market, we’d at least see growth in the length of the average workweek. But there’s no sign of any growth. The average workweek held steady in December at 33.2 hours. Employers aren’t even giving their own workers more hours.
This is what Denninger is saying. Just slide over to 'The Market Ticker' to your right, and begin to sample his work. It is enlightening.
A convergence of opinion is beginning to take shape, which is really good news. The realities are now undeniable, and the Obama White House cannot effectively tar-and-feather anyone who disagrees with them, as the Clintons did. (And Bush isn't around to blame anymore.) Robert Reich served on the HopeAndChange transition team, and teaches at Berkley, for mercy's sake. He doesn't live his mom's basement, either...
Now, Reich thinks the Feds should be spending a LOT more money(e.g. printing even more), which OldSouth thinks is a terrible idea. But we're making progress, with everyone recognizing the nature of the problem and speaking in a more civil tone. Was it Dr. Johnson who opined about the prospect of being hanged?
If you're looking in on us from overseas, remember us in your prayers. This is going to take a long time to fix, and there is pain ahead.
Tuesday, December 1, 2009
I Just Love Denninger!
Really, truly.
He mounts the podium, states that math is the voice of God, and rails against the idiots who have denied that obvious truth.
If you don't read him, begin here, with today's latest post.
The best moment is:
He mounts the podium, states that math is the voice of God, and rails against the idiots who have denied that obvious truth.
If you don't read him, begin here, with today's latest post.
The best moment is:
And by the way, those who try to claim that this was "impossible to foresee" are lying. Fraudie and Phoney were running with leverage ratios of anywhere from 80:1 to 200:1, depending on how you computed it. At 80:1 you need just a bit over a 1% loss to go bankrupt, and at 200:1 you need only a 0.5% loss.
There is no business in this land that is safe to lend to at these leverage ratios, nor is there any reasonable expectation in any business that you will never suffer a loss of JUST ONE PERCENT - yet such a loss was and is sufficient to bankrupt the firm long before they were taken into conservatorship.
If only some brave soul who sits behind a desk that makes decisions would hear and heed him.
If only some brave book publisher would find a way to make him sit down and edit it all together in a form that can live on our shelves.
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