asterisk2a + fdic   32

The Fed Sends A Frightening Letter To JPMorgan, Corporate Media Yawns
At the top of page 11, the Federal regulators reveal that they have “identified a deficiency” in JPMorgan’s wind-down plan which if not properly addressed could “pose serious adverse effects to the financial stability of the United States.” Why didn’t JPMorgan’s Board of Directors or its legions of lawyers catch this?

It’s important to parse the phrasing of that sentence. The Federal regulators didn’t say JPMorgan could pose a threat to its shareholders or Wall Street or the markets. It said the potential threat was to “the financial stability of the United States.” [...] “…the default of a bank with a higher connectivity index would have a greater impact on the rest of the banking system because its shortfall would spill over onto other financial institutions, creating a cascade that could lead to further defaults. High leverage,
corporate  media  media  conglomerate  too  big  to  bail  too  big  to  fail  too  big  to  jail  TBTF  jpmorgan  jpmorganchase  USA  GFC  recovery  liquidity  trap  repo  liquidity  squeeze  economic  history  Financial  Stability  Board  FinancialCrisisInquiryCommission  crisis  crony  capitalism  Greed  shareholder  capitalism  profit  maximisation  profit  maximization  investment  banking  retail  banking  leverage  CDS  engineering  CDO  MBS  subprime  FDIC  complexity  Fed  Janet  Yellen  Wall  Street  reflate  reflation  derivatives  credit  bubble 
april 2016 by asterisk2a
Nomi Prins-Federal Reserve Transition to Destruction - YouTube
via - ||&! QE and ZIRP bad policy, bank and market cuddeling. no mainstreet recovery! trickle-down failed. Private sector can not carry existing minimal momentum forward. policy has not helped people on the ground. // many bubbles created: junk bond/zombie corps, car loans, student loans, property, ... // transition to destruction, volatility is first sign. // market manipulation! // inflated financial system // rise in NPL! where how will they cover that? another bailout? or bail-in. taking depositors haircut. FDIC can't cover that all.
ZIRP  NIRP  book  QE  reflate  reflation  equity  bubble  credit  bubble  Taper  Richard  Koo  BRIC  China  2015  junk  bond  trickle-down  economics  Super  Rich  1%  property  bubble  household  debt  UK  USA  BOE  Fed  mandate  Fed  Janet  Yellen  Mark  Carney  MPC  monetary  policy  monetary  transmission  mechanism  excess  reserves  retail  banking  secular  stagnation  wage  stagnation  disposable  income  income  distribution  income  inequality  Gini  coefficient  inequality  squeezed  middle  class  job  creation  job  market  labour  market  Niedriglohnsektor  Service  Sector  Jobs  recovery  GFC  benbernanke  alangreenspan  speculative  bubbles  bank  bailout  banking  crisis  leverage  margin  trading  Super  Cycle  debt  servitude  private  debt  debt  monetization  debt  monetisation  fiscal  policy  austerity  consumer  debt  credit  card  credit  card  debt  car  loan  debtoverhang  economic  history  zombie  banks  zombie  corporations  zombie  consumer  Wall  Street  profit  maximisation  shareholder  value  crony  capitalism  corporate  debt  bubbles  asset  bubble  correction  mortgage  market  libor  rigging  scandal  trust  Career  Politicians  neoliberalism  neoliberal  FX  reserves  hot-money  currency-war  currency  debasement  currency  war  balance  sheet  recession  Niall  Ferguson  financial  repression  distortion  Pr 
october 2015 by asterisk2a
The Chart Making The Fed Nervous | Zero Hedge "all too clear that part of the Dodd-Frank resolution authority guidelines, a bailout is no longer an option." Cyprus was the first, and will not be the last incident of bail-in solution for TBTF >> this whole this is a replay of Japan 90s and 2000s
monetary  policy  deposit  haircut  Europe  reflation  zombie  banks  BOE  banking  crisis  deflation  BOJ  Cyprus  deposit  levy  policy  folly  QE  SIFI  PIGS  UK  Error  bail-in  trustagent  austerity  greatdepression  zombie  consumer  inflation  expectation  deleveraging  IMF  balance  sheet  recession  GFC  monetary  theory  output-gap  haircut  derivatives  liquidity-trap  Troika  ECB  Insured  Bank  Deposits  political  folly  crisis  greatrecession  lostdecade  debtoverhang  FDIC  LTRO  OMT  Fed  trust  economic  history  confidence  sovereign  debt  crisis  ZIRP  USA  PIIGS  toobigtofail  POMO  Japan 
april 2013 by asterisk2a
Recovery – Who are We Kidding?
In our assessment, what we see unfolding is the latest chapter in the tug of war between inflationary and deflationary forces. During the “goldilocks” economy of the last decade, investors levered themselves up. Homeowners treated their homes as if they were ATMs; banks set up off-balance sheet Special Investment Vehicles (SIVs); governments engaging in arrangements to get cheap loans that may cost future generations dearly. Cumulatively, it was an amazing money generation process; yet, central banks remained on the sidelines, as inflation – according to the metrics focused on - appeared contained. Indeed, we have argued in the past that central banks lost control of the money creation process, as they could not keep up with the plethora of “financial innovation” that justified greater leverage. It was only a matter of time before the world no longer appeared quite so risk-free. Rational investors thus reduced their exposure: de-levered. ...
mandate  monetarism  monetary  theory  economics  economic-thought  economic  history  paulvolcker  2012  deflation  inflation  Leverage  policy  folly  policy  error  QE  reflation  fiatmoney  fiat  currency  money  creation  process  oversight  WallStreet  regulation  FDIC  SEC  Fed  alangreenspan  benbernake  monetary  policy  greatrecession  GFC 
april 2012 by asterisk2a
TARP Watchdog: Big Banks Got Unfair Advantage -
The federal rescue of the financial system in 2008 has provided large financial institutions with an unfair advantage in the form of cheaper access to credit, a bailout watchdog warned Thursday. “Absolutely and unambiguously the financial markets believe more than ever that the United States government will step in and save the ‘too big to fail’ institutions should there be another financial shock,” Neil M. Barofsky, the special inspector general for the Troubled Asset Relief Program, said at a hearing of the Senate Banking Committee.
toobigtofail  TARP  2011  regulation  reform  SEC  CFTC  FDIC  bailout 
march 2011 by asterisk2a
F.D.I.C. Approves 'Too Big to Fail' Rules -
A top banking regulator approved a plan to seize and unwind big banks — a proposal that will help address those “too big to fail” firms whose collapse could imperil the financial system.
The board of Federal Deposit Insurance Corporation voted unanimously on Tuesday to approve a set of proposed rules intended to create an orderly process to unwind large financial institutions. The rules outline how creditors can file a claim and how those claims will be addressed, hopefully bringing some clarity to a previously murky situation.
toobigtofail  2011  FDIC  reform  regulation  Dodd-Frank 
march 2011 by asterisk2a
For the S.E.C., Problems of Time and Money -
The budget battle in Washington may constrain funding for the Securities and Exchange Commission as it tries to implement new rules required by the Dodd-Frank Act while dealing with a growing number of whistle-blower complaints and complex insider trading cases. A recent federal court decision in Texas in an options backdating case highlights the danger posed by a possible freeze or even cutbacks in the S.E.C.’s budget if it results in slowing down investigations of possible securities fraud.
SEC  politics  fdic  regulation  oversight  2011  budget  presidency  barackobama  Dodd-Frank  fraud 
february 2011 by asterisk2a
F.D.I.C. Said to Weigh Suing Ex-WaMu Executives -
F.D.I.C. officials have discussed seeking damages of up to $1 billion, but the talks are still continuing and the agency could decide to drop its claims against all or some of the former executives, this person added.
It was unclear when any final decision would be made. An F.D.I.C. spokesman, Andrew Gray, declined to comment on Monday.
The bank’s critics argue that Kerry Killinger, Washington Mutual’s longtime chief executive, oversaw an aggressive push into risky subprime mortgage lending that ultimately drove the bank to the brink. But Mr. Killinger and other WaMu officers denied any wrongdoing, insisting that they acted prudently but fell victim to the turbulent markets of 2008.
WashingtonMutual  2011  2010  FDIC  fraud  SEC 
february 2011 by asterisk2a
Jamie Dimons Biggest Disaster Is Waiting: Simon Johnson - Bloomberg
Jamie Dimon’s Biggest ‘Disaster’ Is Waiting (WSJ)“Dimon himself has argued that we can’t deal with too-big- to-fail until we have a way to manage the orderly liquidation of big banks. Yet even with the Dodd-Frank overhaul enacted, we still have no process for handling the failure of a big cross- border bank like JPMorgan. There is no framework — either through the courts or directly between governments — to deal with such a collapse, other than through a Lehman-type bankruptcy. So when a big bank next gets into trouble, the choice will be between allowing a meltdown, with presumably awful financial consequences, and providing a bailout, which can have big fiscal impact.”
toobigtofail  2011  fraud  Dodd-Frank  politics  lobby  finance  power  bailout  TARP  SEC  CFTC  FDIC 
february 2011 by asterisk2a
Barclays to Pay $298 Million for Violating Trade Law -
Barclays has agreed to pay $298 million to settle accusations that the bank facilitated illegal transfers of dollars for countries that were sanctioned by the United States including Iran, Cuba, Libya, Sudan and Myanmar, according to documents filed Monday in federal district court in Washington.
For more than a decade, Barclays would strip information from wire transfers funneled through the United States that identified the money as coming from sanctioned countries and entities, according to the court complaint.
Barclays would follow instructions from banks in the sanctioned countries not to use the banks’ names in messages that traveled through the United States. It also routed the payments to conceal the connection to sanctioned countries, amended messages to remove information that identified sanctioned entities, and used a less transparent method of payment messages.
Barclays funneled about $500 million in illegal payments from 1995 through 2006
Barclays  fraud  banking  2010  banks  UK  SEC  FDIC 
august 2010 by asterisk2a
Merrills Downfall Provides Disclosure Lesson -
Only after the housing bubble began to deflate did Merrill and other banks begin to clearly divulge the many billions of dollars of troubled securities that were linked to them, often through opaque vehicles like Pyxis.

In the third quarter of 2007, for instance, Merrill reported that its potential exposure to certain subprime investments was $15.2 billion. Three months later, it said that exposure was actually $46 billion. At the time, Merrill said it had initially excluded the difference because it thought it had protected itself with various hedges.

But many of those hedges later failed, and Merrill, the brokerage giant that brought Wall Street to Main Street, soon collapsed into the arms of Bank of America.

“It’s like the parable of the blind man and the elephant: you had some people feeling the trunk and some the legs, and there was nobody putting it all together,”
merrylllynch  bankofamerica  BofA  subprime  hedge  bubble  property  2007  2008  2009  fraud  practice  banking  SEC  FDIC  disclosure  shadowbanking 
august 2010 by asterisk2a
Fair Game - In the Mortgage Drama, One Role Is Enough -
Banks are back office for mortgage lending industry. their tasks are fairly simple: they take in monthly mortgage payments&distribute them 2 whoever owns the loans. ie large institutions like pension funds or mutual funds own the mortgages, and servicers are obligated to act in their interests at all times.

defaulting loan servicing becomes much more complex and laborious. Servicers must chase delinquent borrowers possibly into foreclosure.

conflict of interest
the same bank that services a primary mortgage owned by another institution also owns a second mortgage or home equity line of credit on the same property. When that borrower has trouble meeting both payments, the servicer has an interest in making sure that amounts owed on the second lien, which it owns, continue to be paid even if the first loan, which it has no interest in, slides into delinquency. About two-thirds of primary mortgages are serviced by banks who do not own them but hold the accompanying seconds.
BankofAmerica  BoA  jpmorgan  citibank  citigroup  wellsfargo  conflict  fraud  2010  mortage  lending  practice  usa  housing  bubble  SEC  FDIC  FHDA 
august 2010 by asterisk2a
Dealbook - Paulson Likes What He Sees in Overhaul -
In the end, though, Mr. Paulson said that regulation on its own would not be enough to prevent another crisis. No, that will come down to people.

“As I’ve thought about it, this is very people-driven,” he said. “A lot of this is about the people who have the responsibility for the regulation when there isn’t a crisis and the people who have the responsibility during a crisis. Unless you believe that the big financial institutions were intentionally trying to blow themselves up, they were unable to spot a number of the issues.”

He continued: “I think it is asking a lot for regulators to be perfect — because they won’t be. But what you h
henrypaulson  financial  regulation  reform  crisis  creditcrunch  depression  greatrecession  usa  regulators  timgeithner  larrysummers  paulvolcker  VolckerRule  2010  2011  presidency  barackobama  Fed  treasury  fdic 
july 2010 by asterisk2a
Editorial - America’s Uncertain Recovery -
intractable unemployment, currently 9.9 percent, or 15.3 million people, nearly half of whom have been jobless for more than six months. Even if last month’s strong job growth is sustained — a big if — it would take five years to get back to a more tolerable unemployment rate of 5 percent.

state budgets are collapsing, with governments facing a collective budget hole of $112 billion in the fiscal year that starts for most of them on July 1. Closing the gaps will mean tax increases and spending cuts, which will provoke more layoffs, both among public employees and businesses that contract with state and local gov

more house price declines are likely, foreclosures distressed homes sales. small business credit will continue to be tight, as potentially hundreds of small banks fail, most of them weakened by souring loans on commercial real estate. FDIC - 775 banks were on its watch list

Any one of those issues would be worrying. Collectively, they constitute an emergency.
double-dip  FDIC  housing  housemarket  unemployment  long-term  usa  economy  budget  deficit  federal  california  state  2010  2011  presidency  barackobama  europe  EMU  PIIGS  bailout  banking  austerity 
june 2010 by asterisk2a
If We Broke Up Standard Oil, We Can Break Up the Giant Banks | zero hedge
Indeed, even the FDIC mentions Continental Illinois in the same breadth as "too big to fail" banks.

And William K. Black - the senior regulator during the S&L crisis, and an Associate Professor of both Economics and Law at the University of Missouri - says that the Prompt Corrective Action Law (PCA), 12 U.S.C. § 1831o, not only authorizes the government to seize insolvent banks, it mandates it, and that the Bush and Obama administrations broke the law by refusing to close insolvent banks. And see this. Whether or not the financial giants can be broken up using the PCA, no one can doubt that the government could find a way to break them up if it wanted.
toobigtofail  bank  banks  alangreenspan  larrysummers  FDIC  SEC  break-up  2010  law 
may 2010 by asterisk2a
Lehman Used ‘Alter Ego’ to Transfer Risks -
The firm, called Hudson Castle, played a crucial, behind-the-scenes role at Lehman, according to an internal Lehman document and interviews with former employees. The relationship raises new questions about the extent to which Lehman obscured its financial condition before it plunged into bankruptcy.

While Hudson Castle appeared to be an independent business, it was deeply entwined with Lehman. For years, its board was controlled by Lehman, which owned a quarter of the firm. It was also stocked with former Lehman employees.

None of this was disclosed by Lehman, however.

Entities like Hudson Castle are part of a vast financial system that operates in the shadows of Wall Street, largely beyond the reach of banking regulators. These entities enable banks to exchange investments for cash to finance their operations and, at times, make their finances look stronger than they are.
lehmanbrothers  hudsoncastle  banking  financial  market  regulation  regulators  reform  FDIC  SEC  bankruptcy  accounting  moody's  shareholder 
april 2010 by asterisk2a
Lobbying for More Time
Given these circumstances, it might be that the Fed must keep this "extended period" language in their lexicon until just before raising interest rates. To envision this, imagine how investors will react once this language is dropped.

While investors are playing the same game — make no mistake, they are — they will interpret the dropping of this language to mean interest rate hikes are on the way very soon. This will cause them to trade out of fixed income securities, driving market-based yields upward and immediately tightening credit on term borrowers.

The Fed will have tightened simply by dropping the phrase "extended period" and without actually increasing any interest rates.

Realizing that simply dropping this language creates a very real and effectual tightening itself, the Fed will wait until the underlying economy begins to grow and potential perceived inflation occurs before even changing this language. ....
Fed  interestrate  2010  FDIC  usa  insurance 
march 2010 by asterisk2a
Obama's Big Sellout : Rolling Stone
Then he got elected.

What's taken place in the year since Obama won the presidency has turned out to be one of the most dramatic political about-faces in our history. Elected in the midst of a crushing economic crisis brought on by a decade of orgiastic deregulation and unchecked greed, Obama had a clear mandate to rein in Wall Street and remake the entire structure of the American economy. What he did instead was ship even his most marginally progressive campaign advisers off to various bureaucratic Siberias, while packing the key economic positions in his White House with the very people who caused the crisis in the first place. This new team of bubble-fattened ex-bankers and laissez-faire intellectuals then proceeded to sell us all out, instituting a massive, trickle-up bailout and systematically gutting regulatory reform from the inside.
BobRubin  bailout  corruption  barackobama  presidency  government  usa  politics  economy  JosephStiglitz  AIG  bonuses  citigroup  campaign  TARP  history  lobby  wallstreet  lobbyist  Lobbying  larrysummers  timgeithner  goldmansachs  RahmEmanuel  barofsky  CDS  derivatives  regulation  reform  barneyfrank  LTCM  SEC  CFTC  ConsumerFinanceProtectionAgency  CFPA  coruption  FDIC  treasury 
february 2010 by asterisk2a
Euro Pacific Capital
FDIC blames fed, fed says no. rates were ok, fed blames gov and regulation, govt blames banking in general.
blamegame  fed  FDIC  regulation  FinancialCrisisInquiryCommission 
january 2010 by asterisk2a
Geithner Pressures Regulators on Banking Rules -
The Obama Team wants a new agency to protect the consumer, Consumer Financial Protection Agency (CFPA), under leadership of Elizabeth Warren.
Well - current regulators like the Fed, FDIC and SEC are not for it. And Tim raised his voice because previously they failed.
Banks and regulators have resisted a proposal to create a new agency to regulate credit cards, mortgages and other consumer debt. Ben S. Bernanke, the chairman of the Fed, has told Congress that it would be better policy for the central bank to continue to write the consumer product rules. Sheila C. Bair, the head of the Federal Deposit Insurance Corporation, and John C. Dugan, the comptroller of the currency, have said that bank examiners at their agencies should continue to be the primary enforcer of consumer protection laws at those banks they already regulate for safety and soundness issues.
Industry lobbyists could not be happier about the regulators’ opposition.
fed  FDIC  timgeithner  regulation  SEC  maryschapiro  sheilabair  benbernanke  lobbyist  supervision  oversight  CFPA 
august 2009 by asterisk2a
Sheila Bair, FDIC, and the financial crisis : The New Yorker
Bair was recognized for her early, though ultimately futile, attempt to get the Bush Administration to address the subprime-mortgage crisis before it became a threat to the entire economy. One of her fellow-recipients was Brooksley Born, a former Clinton Administration official who had tried, unsuccessfully, to persuade her colleagues to regulate derivatives such as credit-default swaps.
sheilabair  FDIC  creditcrunch 
august 2009 by asterisk2a
The Ladies Of The Financial Crisis
Bair was the first regulator to sound alarm bells about the coming crisis, and she's been speaking out about the dangers of unregulated derivatives since a stint on the CFTC in 1993.
sheilabair  FDIC  creditcrunch  history 
august 2009 by asterisk2a

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