Monday, June 9, 2008
The MSM Begins to Understand
"Vandals regularly comb the neighborhood, sometimes setting fires. ... This was once the sort of 'product' that dazzled Wall Street, feeding the subprime-mortgage bubble. ... Now, hundreds of lenders, securitizers and brokers like Kellogg are being investigated by the FBI, IRS, state attorneys general and county authorities nationwide for their respective roles in this global confidence game, which authorities are just beginning to piece together. ... But Cuyahoga County prosecutor Bill Mason tells Newsweek that Kellogg, who is still licensed as a loan officer in Cleveland, is a 'target' of a state task force on alleged mortgage fraud that is expected to return numerous indictments in the next few months. ... But by 2006, 44.7 percent of all securitized mortgages in the county were stated income or no-document loans, according to Patrick Madigan, an Iowa assistant attorney general. ... Now the investigations are going all the way up the pipeline--to Wall Street. ... Among the targets are 'major subprime lenders' and investment banks, [FBI spokesman Bill] Carter says. 'We're going after people right at the top,' says another FBI spokeman, Steve Kodak. ... An astonishing 80 percent to 85 percent of the Cleveland loans bought up by Wall Street from 2003 to 2007 went into foreclosure. ... 'We asked them to step up and take action,' the county treasurer [Jim Rokakis] recalls in his office in downtown Cleveland. 'But here's what I learned about the Fed. They do wonderul lunches. But the Federal Reserve Bank is not there to protect us. It's there to protect the banks'. ... But within a year, the state, heavily lobbied by Ohio banks like National City, stepped in to void the local law, saying authority lay with the governor and legislature in Columbus. Then the U.S. [OCC] issued a preemption order saying the states did not have the authority to enforce laws against national banks. ... Rokakis says, ... 'in the old days, people robbed banks. Now the banks were robbing the people'," my emphasis, Michael Hirsh at Newsweek, 2 June 2008.
Ah, the federal supremacy doctrine. It's time a way was found to incarcerate OCC clowns who protect banks. Are they bank co-conspirators? Rokakis, find a way to embarass the Bushites into throwing some OCC guys under the train with the doctrine you can't use sovereign immunity to perpetrate a crime. Either the OCC guys knew what was going on, in which care they're criminals, or else they were fools and should be fired. With enough publicity, you might be able to force the issue. Sovereign immunity, end it. The WSJ wants to extend sovereign immunity to drug companies based on FDA actions. Crazy. Will the FBI take down senior executives at say: Citibank, JPMorgan, Goldman Sachs, etc., as well as the banks themselves? Don't hold your breath.