The big banks and the government have become one. Regulation has been completely captured and now banks and government do what is little more than a PR dance for the public whenever anything goes wrong.
Freddie and Fannie completely destabilize the economy? Still owe the taxpayers of the US $180 billion? Ok, we’ll wind them down. Er, I mean give them more power and more money.
Countrywide gave sweetheart deals to members of Congress? Nothing to see here.
Goldman Sachs was leveraged 50 to 1? Shorted the CDO market with its own money while encouraging clients to play the long side? No big deal. Lloyd Blankfein is a friend of the president. The Goldman guys aren’t such a bad lot. Let’s give them billions in taxpayer dollars so they can pay themselves enormous bonuses.
JP Morgan evaporates $2 billion through what appears to be “unethical” trading? Just bring the CEO to Washington for a photo op. We’ll tell him how great he is even though this horrible and completely unforeseen event happened. We’ll tell him to be more careful. Then he can show us his presidential cufflinks at drinks later.
Blow up a hedge fund and take client money to pay your creditors even though this is completely illegal? That’s OK, Mr. Corzine was both a senator and a governor, and a good earner on top of that. We can’t send him to jail. Exile in the Hamptons is penalty enough.
And it goes on and on.
So when we hear that the big banks are going to settle on mortgage fraud issues in such a way that it makes the administration look good, without sending anyone to jail, while also saving the big banks billions on the necessary review of mortgage files, we should not be surprised. It’s a win, win, win.
It’s a lose, lose, lose, for the American people. But let’s be honest, most of them don’t have 2 dimes to rub together.
(From The Washington Examiner)
Based on figures in the Times report, initial estimates suggested that the review would cost $8 billion, but “the costs of the reviews have ballooned” such that it could cost $20 million if it were to be carried out. And that’s just the cost of the review — it doesn’t account for what the banks would then have to do to ameliorate any problems uncovered by the review.