Friday, September 2, 2011

FHFA Set to Sue Big Banks and Wall Street Firms

Explosive News.…. or …........Flash Bang … decide 

UPDATE: Friday 9/2/2011
17 Financial Institutions named in Lawsuit Filed in Manhattan Federal Court
According to  HEADLINE the
Something is NOT right! This "Announcement" of lawsuits (NOT yet filed) filed on Labor Day Friday simply DOES NOT pass the smell test. Something is really wrong here! I guess we'll find out the "real reason" for this explosive (news? lawsuit? diversion?) in the coming:
1) Days (from the Federal Housing Finance Agency - Really!) or intertwined in Obama's "Job Creation" speech being allowed next Wednesday?, or Thursday by John Boehnor
2) Weeks (When we see the 50 state {46} AG settlement {forgiveness figure})
3) Months (When the bloggers, pundits, & non "Bank Speak" media tell us the real reason)
HELLO  - Matt Taibbi - of Rolling Stone...can you take my call? and give me the real story! Regardless, I'll post your full article with the TRUTH (for this major smokescreen) Hopefully you will be releasing it in the September...oh darn...I mean... October issue.
HELLO  - Yves Smith - of Naked Capitalism please post the truth....ASAP

UPDATE: Friday 9/2/2011
17 Financial Institutions named in Lawsuit Filed in Manhattan Federal Court
The institutions are listed alphabetically below:
  1. Ally Financial Inc (formally GMAC, LLC )
  2. Bank of America Corporation
  3. Barclays Bank PLC
  4. Citigroup, Inc.
  5. Countrywide Financial Corporation (KNA Bank of America Corp.)
  6. Credit Suisse Holdings (USA), Inc.
  7. Deutsche Bank AG
  8. First Horizon National Corporation
  9. General Electric Company
  10. Goldman Sachs & Co.
  11. HSBC North America Holdings, Inc.
  12. JPMorgan Chase & Co.
  13. Merrill Lynch & Co. (AKA - First Franklin Financial Corp.)
  14. Morgan Stanley
  15. Nomura Holding America Inc.
  16. The Royal Bank of Scotland Group PLC
  17. Société Générale
According to the reporter - Nelson Swartz: "the suits" will argue the banks, which assembled the mortgages and marketed them as securities to investors, failed to perform the due diligence required under securities law and missed evidence that borrowers’ incomes were inflated or falsified. (REALLY!)
MORE SHOCKING:......Besides the "angry investors" (Say Who?) the long asleep at the wheel and paid-off 50 state attorneys generals (zzzzzzz) are in the final stages of negotiating a settlement (soft landing - minuscule payout) to address abuses, crimes and out right fraud perpetrated by the largest mortgage servicers, including Bank of America, JP Morgan and Citigroup. The attorneys general, as well as federal officials, are pressing the banks (to make political donations or have) to pay at least (a paltry) $20 billion, with much of the money earmarked to reduce mortgages of homeowners facing foreclosure. (Not a fuxxing chance!...who are they the banks will look hard to find that homeless family..... and give them their $85 settlement check!)
Bank officials also counter that further legal attacks on them will only delay the recovery in the housing market, which remains moribund, hurting the broader economy. Other experts (who are these experts?) warned that a series of adverse settlements costing the banks billions raises other risks, even if suits have legal merit. YES YOU READ IT RIGHT - LET THE CRIMINALS GO FREE - OTHERWISE -THE ECONOMY WILL SUFFER!
Bank Speak: “While I believe that F.H.F.A. is acting responsibly in its role as conservator, I am afraid that we risk pushing these guys off of a cliff and we’re going to have to bail out the banks again,” said Tim Rood, (who worked at Fannie Mae until 2006 and is now a partner at the Collingwood Group, which advises banks and servicers on housing-related issues) FOX IN SHEEP'S CLOTHING ASKED TO COMMENT  - ON THE HEN HOUSE  - HE USED TO HELP WATCH OVER (WOW!)

3 Insiders responsible for timely leak : “according to three individuals briefed on the matter" [T]he suits stem from subpoenas the finance agency issued to banks a year ago. (Yawn !)

The "Bad Economy" Excuse and Phony Fraud "Cover-Up" language: ..But privately, financial service industry executives argue that the losses on the mortgage-backed securities were caused by a broader downturn in the economy and the housing market, not by how the mortgages were originated or packaged into securities. (Are you Fuxxing kidding me!..What insiders...said this!!) In addition, they (who?) contend that investors like A.I.G. as well as Fannie and Freddie were sophisticated and knew the securities were not without risk.

Some sobering Numbers from the two companies taxpayers own - As of June 30, 2011:
FREDDIE MAC holds more than $80 billion in mortgage backed securities
(backed by "crappy" and "Shxxy" sub prime mortgages, Option ARM and Alt-A loans). 
FANNIE MAE holds $38 billion of mortgage securities
(backed by Alt-A and sub prime loans)
The combined $120 BILLION portfolios - expect $35 BILLION (29%) to be worthless

I have to go now ...I'm "throwing up" in my mouth (as my daughter describes this nausea)
Below is more coverage of this "NEWS"

Forbes: Banks Face Painful New Mortgage Lawsuits, U.S. May Seek Up To $30 Billion In Losses

ZERO HEDGE BLOG : Tyler Durden  (He too... questions this..suspect announcement!)

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