Don’t Blink, or You’ll Miss Another Bailout

[HiPointDem]

MANY people became rightfully upset about bailouts given to big banks during the mortgage crisis. But it turns out that they are still going on, if more quietly, through the back door.

The existence of one such secret deal, struck in July between the Federal Reserve Bank of New York and Bank of America, came to light just last week in court filings.

That the New York Fed would shower favors on a big financial institution may not surprise. It has long shielded large banks from assertive regulation and increased capital requirements. Still, last week’s details of the undisclosed settlement between the New York Fed and Bank of America are remarkable. Not only do the filings show the New York Fed helping to thwart another institution’s fraud case against the bank, they also reveal that the New York Fed agreed to give away what may be billions of dollars in potential legal claims.

Late last Wednesday, the New York Fed said in a court filing that in July it had released Bank of America from all legal claims arising from losses in some mortgage-backed securities the Fed received when the government bailed out the American International Group in 2008. One surprise in the filing, which was part of a case brought by A.I.G., was that the New York Fed let Bank of America off the hook even as A.I.G. was seeking to recover $7 billion in losses on those very mortgage securities...

Let’s recap: For zero compensation, the New York Fed released Bank of America from what may be sizable legal claims, knowing that A.I.G. was trying to recover on those claims...

http://www.nytimes.com/2013/02/17/business/dont-blink-or-youll-miss-another-bank-bailout.html?pagewanted=2&_r=0&gwh=DA8F47EA82EBB5471C449B7FA1370E7C&ref=business

[Live and Learn]

1. Good grief, will it never stop? k & R nt

[quaker bill]

8. It generally takes 7 or 8 years

for all the litigation to run its course. This is a settlement of a small part of it.

[Fire Walk With Me]

2. K&R!

[blkmusclmachine]

3. Ugh.

[cantbeserious]

4. Ending The Fed Is The Only Answer

eom

[quaker bill]

9. A very bad idea

replacing the "fake" money with "real" money was the only hope. That said, alot more people should have gone broke and to jail over this.

[cantbeserious]

14. Why Should A Private Corporation Manage The US Economy?

eom

[quaker bill]

18. your handle is apt

Surely you understand that the FED is quasi governmental.

When do politicians name the board of directors of a "private corporation"?

Which other "private corporation" turns all its profits over to the US Treasury by law?

The FED is so close to being a government agency that you could not fit a razor blade in the gap.

There is some modest level of independence, but it is very narrow.

The level of coordination between the FED and the Treasury is huge, even larger than usual during recent years. Central banks are policy arms of government. There is no serious debate.

You should be thankful for the FED as it is the only thing not pressing the austerity button. ("printing" gobs of money is not "austerity" - it is the precise opposite)

[Octafish]

21. Save the condescension for the insiders who benefit from Fed policy.

Picking Our Pockets and Lining Theirs

Banksters Take Us to the Brink

by BILL MOYERS and MICHAEL WINSHIP
CounterPunch
Weekend Edition July 13-15, 2012

EXCERPT...

And what a business! You’ve most likely been hearing about the newest scandal in banking, centering on Barclays Bank in Great Britain and something called Libor. That stands for London Interbank Offered Rate and involves a group of bankers who set a daily interest rate affecting trillions of dollars of transactions around the world. Your home mortgage, your college debt, your credit card fees; all of these could have been affected by Libor.

Now you would think the rates would be set by market forces, right? Aren’t they what makes the world go ‘round? But it turns out some of those insiders were manipulating the index for their own gain, to make their banks look better off during the financial crisis, lower their borrowing costs, and raise their profits – by cheating. Picking our pockets and lining theirs.

SNIP...

“In testimony last week before the British Parliament, former Barclays chief executive Robert E. Diamond said the bank had repeatedly brought to the attention of U.S. regulators — as well as U.K. regulators — the problems that the bank was experiencing in the Libor market.

“He said the bank’s warnings to regulators that Libor was artificially low did not lead to action. Barclays’ regulator in the United States is the Federal Reserve Bank of New York, which was run at the time by current Treasury Secretary Timothy F. Geithner.”

CONTINUED...

http://www.counterpunch.org/2012/07/13/banksters-take-us-to-the-brink/

[quaker bill]

23. The libor scandal is not the FED

It is a real scandal. There are plenty of folks in the banks and elsewhere that should go to jail. This is one thing, changing the monetary system is another.

[Octafish]

24. They do business, which is the point.

Until Bernie Sanders got the audit written into the bailout, We the People had no idea to the extent of insider crony capitalism going on in the Fed, Wall Street and Washington. Trillions for the connected. Austerity for the rest of us.

[cantbeserious]

22. Your Criticism Of My User Name Is Taken As An Ad Hominen Attack Which Is Counter To DU Rules

eom

[ProfessionalLeftist]

26. private corporation(s) are already managing the US Economy

and the U.S. gov't. That's one of the huge problems we now have. Not advocating for abolishing Fed though, just think it ought to be scrubbed of Wall St. vermin.

[cantbeserious]

27. Stating The Obvious - Corporations Have To Much Power

eom

[dtom67]

5. QE is a bailout...

In my opinion; the assets that the fed purchases are toxic and everyone knows it. They will never be able to unwind their balance sheet.
Hell, QE2 printed out 600 billion dollars. Just to bail the banks out.
Yet, we can't afford social programs?
A system that does not take care of its people is worthless. We have advanced technologically, now it is time to advance socially.
End the Fed?
Why not just end Money?
Yes; it can be done....

[quaker bill]

10. I propose chickens

You can trade with them, and they are tasty. I am just not clear how I would carry enough of them to pay for an HD TV.

[rhett o rick]

15. I know but they taste like chicken. nm

[hfojvt]

19. I propose leaves

then I will really have the money tree that all the political candidates and charities seem to think I have. Several of them, in fact.

[Demo_Chris]

6. What is there to say? n/t

[King_Klonopin]

7. This crap won't end until we hold all of these players accountable

and throw the bums out. I fantasize about firing squads. They
send a clear message.

Until we get angry (really angry, not indignant), active, and start
electing politicians who serve public interests, nothing will change.
They have our tacit permission and are running with it as far and
as long as they can / we let them.

If this country ever does succumb, the cause of death will listed
as "CORRUPTION SECONDARY TO APATHY".

[ProfessionalLeftist]

12. We have not come this far without a struggle & I assure you we cannot go further without a struggle

. . .

"We had to struggle with the old enemies of peace--business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering.

They had begun to consider the Government of the United States as a mere appendage to their own affairs. We know now that Government by organized money is just as dangerous as Government by organized mob.

Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me--and I welcome their hatred."

http://docs.fdrlibrary.marist.edu/od2ndst.html

We need FDR.

[Agony]

25. We failed to watch his back on this part....

"When they imply that the reserves thus created against both these policies will be stolen by some future Congress, diverted to some wholly foreign purpose, they attack the integrity and honor of American Government itself. Those who suggest that, are already aliens to the spirit of American democracy. Let them emigrate and try their lot under some foreign flag in which they have more confidence."

eternal vigilance and all...

[SamKnause]

11. GREED

Until the corrupt and greedy people who rule this entire planet are held accountable and jailed for this blatant in your face bullshit the thievery will continue.

IT TRULY SICKENS ME !!!!!!

[ananda]

13. Why am I not surprised?

So sad.

[Fire Walk With Me]

16. Kick!

[Octafish]

17. The Life and Loves of Tim Geithner

Gee. It was just the other day Timmy was getting 100-cents on the dollar for AIG.

http://www.realclearmarkets.com/articles/2010/01/13/goldman_sachs-aig_its_likely_worse_than_you_think_97587.html

Correct me if I'm wrong, but didn't there used to be a political party that once put the interests of the American people ahead of banks, property and the wealthy? Maybe I just dreamed it.

[hfojvt]

20. I am not sure why AIG should have legal claims

when it was itself bailed out.

Given that the dispute is between one corporation (BOA) and another corporation (AIG) is one of those corporations on the side of "we the people"? Should "we the people" really care about which corporation gets the money?