Matt Taibbi has a must-read article with a great rundown of the “Armageddon” of lawsuits banks face from states, counties, and investors due to their sale of fraudulent Mortgage Backed Securities [MBS].
[I]f you add up all of the MBS-related liability out there, the banks as it stands are facing an Armageddon of claims from all sides. It can’t possibly be less than a trillion dollars, and it’s probably much, much more.
This is important to know because, in Washington, Obama is busy working on a deal to sell us out to the bankers.
But the Obama administration’s current plan [the foreclosure settlement deal] is to let them all walk after paying a few shekels apiece into a $20 billion kitty.
That’s $20 billion combined from all the big banks, by the way — not $20 billion from each.
At a bare minimum, the Obama administration needs to push for strong regulations to stop this kind of Wall Street excess from happening again. Personally, I wouldn’t mind seeing big banks broken up into smaller, not-too-big-to-fail banks so this ridiculous merger graph can, again, be seen in reverse:
Indeed, going back to Taibbi:
If the Obama administration was serious about helping actual human beings through this settlement, then it would be fighting for homeowners to get the same bailout the banks would get. If the banks are getting a trillion or more dollars of legal immunity, why shouldn’t homeowners get that much debt forgiveness? Or, half that much? A quarter?
For anyone who wonders why activists are occupying Wall St., and dozens of other locations, look no further. And who anyone who wonders if this movement will benefit the Obama administration, again, look no further.
And for anyone who accuses common sense proposals like regulation and antitrust actions against the current banking system is somehow “socialist” or even from the political left, screw you. Get a couple brain cells to fucking rub together.
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