AIG to Sue Bank of America Over Mortgages

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- Vic_Romano
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NEW YORK—American International Group Inc. plans to sue Bank of America Corp. Monday in an effort to recover more than $10 billion it lost on mortgage investments, and intends to object to the lender's proposed settlement with other mortgage-bond investors.
AIG's lawsuit and its separate attempt to intervene in the much-publicized $8.5 billion settlement throw another obstacle in the way of Bank of America's efforts to put its mortgage woes behind it.
The suit over the $10 billion in losses alleges "massive fraud" by Bank of America and two units it acquired, Merrill Lynch and Countrywide, saying they packaged securities that were backed by "hundreds of thousands of defective mortgages," according to a copy of the legal action AIG representatives plan to file in New York Supreme Court Monday morning.
The suit says Bank of America and its subsidiaries inflated home appraisals, allowed borrowers to misstate their income, ignored internal warnings about shoddy underwriting and selected the riskiest mortgages for securitization. The lender knowingly misrepresented the underwriting process in its descriptions of the mortgage-backed securities purchased by AIG, the suit alleges.
AIG contends it lost more than $10 billion on about 350 residential mortgage backed securities that it initially bought from Bank of America for about $28 billion. The size of AIG's losses makes the suit one of the largest of its kind brought by an investor since the housing bubble popped.
Bank of America spokesman Lawrence Di Rita said the bank's disclosures on the quality of mortgage bonds were robust enough for sophisticated investors, and called AIG "the very definition of an informed, seasoned investor, with losses solely attributable to its own excesses and errors. We reject AIGs assertions and allegations."
The insurer "recklessly chased high yields and profits throughout the mortgage and structured finance markets," he said.
AIG spokesman Mark Herr said Bank of America was attempting "to blame others for its own misconduct.
"Investors, no matter how sophisticated, were entitled to rely on its numerous written representations about the securities it sold," Herr said. "Now that it is clear that those representations were false, Bank of America must be held to account."
http://online.wsj.com/article/SB10001424053111904007304576496101837999390.html
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- tags:
- Fraud, Skank of America
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ThirdSection
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Looks like a couple of corporate persons are having a shouting match with their, uh, free speech!!
- 10 months ago
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ThirdSection
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ThirdSection
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\But I thought we could bank rapaciously in a consequence-free environment, oh woe is me!!!\
- 10 months ago
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ThirdSection
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jonber
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Bank of America raped the whole country and is still doing it with the protection of the Koch brothers and Rupert Murdoch's News Corp.
MurdochKoch mafia owns America by mongering hate lies and fears.
- 10 months ago
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jonber
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Denica_Cassandra
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Can the American people have their homes back now?
- 10 months ago
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Denica_Cassandra
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CalgarC
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i guess the found out we have no more money to give them so they are feeding off them selves... does that make them parasites
- 10 months ago
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CalgarC
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Vic_Romano
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CalgarC:
"We have spawned our own savagery. Soon, it will consume us all. It is a horrible, hauntingly accurate vision of the excesses of a mindless society gone mad......When there is no more room in hell, the dead will walk the earth."
- 10 months ago
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Vic_Romano
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CalgarC
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the fuck... they are eating each other over money
- 10 months ago
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CalgarC
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percipi224
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CalgarC:
totally! I have stated this is what they would do after they feel there is no more to squeeze out of the rest of the population. No mention of giving me back the usurous fees they charged on my last refinance or lowering my interest. No mention of the mortgage payer at all!! Just trying to screw eachother now.
- 10 months ago
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percipi224
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keithponder
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Crooks robbing Gangsters...
Hmm....interesting.
- 10 months ago
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keithponder
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Frosty46
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Kind of like hanging a bag with two cats over a clothes line--not that I would but can't stop the visual from coming to mind---------
- 10 months ago
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Frosty46
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nikonwilly
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Bahahahaha.....the freaking greedy swine are going after each other !!
I'd love to see all these miserable parasites destroy themselves. - 10 months ago
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nikonwilly
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bluestranger
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There is no honor among thieves. Maybe all the crooks will turn on each other. This will create another dilemma. The lawyers will be richer.
- 10 months ago
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bluestranger
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TrishR
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But if ordinary citizens lose their retirement funds because of this same financial debacle, we're supposed to eat dog food when we retire...
Lovely
- 10 months ago
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TrishR
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artemis6
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Ha ha ha ha ha !
- 10 months ago
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artemis6
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telcod
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Let the jackals feed on each other. Cry havoc.
- 10 months ago
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telcod
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HarukoHaruhara
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It's kind of hard to cheer for either side.
- 10 months ago
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HarukoHaruhara
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TrishR
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HarukoHaruhara:
As I once heard attorney Mickey Sherman say, "It's like being forced to choose your favorite Menendez brother."
- 10 months ago
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TrishR
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EdJoyProductions
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TrishR:
LOL! Good one.
- 10 months ago
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EdJoyProductions
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TrishR
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EdJoyProductions:
Thanks, edjoy
- 10 months ago
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TrishR
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Vic_Romano
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TrishR:
Best comment EVER!!!!
- 10 months ago
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Vic_Romano
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CalgarC
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TrishR:
coca-cola or pepsi...
- 10 months ago
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CalgarC
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attilatheblond
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Lessee, greedy seller bundled bad product they foolishly acquired (from other greedy sellers) and sold to greedy buyer wanting to make a fast buck.
Can't feel sorry for anyone but the consumers, too many of whom lost homes they should not have been approved to buy, and the working class taxpayer. Banks do not absorb losses, even when they have it coming. They pass the cost on to us in many ways.
- 10 months ago
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attilatheblond
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percipi224
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attilatheblond:
deal is, many who were approved had jobs that they lost during the same period the banks were screwing us all on their massive ponzi scheme. The kicker is too many of these foreclosed were folks who were flipping with arms to make profit when they sold it. The wanna be rich not the working class did this.
- 10 months ago
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percipi224
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attilatheblond
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percipi224:
That, I know. But it is also a fact that lenders bent their own standards for approving loans. A few loan officers have even been hauled to court.
Hey, I know whole neighborhoods in N.M. where houses that sold for 1.5 Million + are now bank owned and short sale priced between 400K-500K. I know a lot of people bought into houses they really should have avoided, and did so because they got such 'good rates' that they foolishly thought would last forever, like their jobs.
Partly consumer, big part unscrupulous lenders & the industry that shuffles the paperwork to extract their fees, and major part: pols who didn't give a fig about the economy for the mass of the population.
- 10 months ago
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attilatheblond
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attilatheblond
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attilatheblond:
I think a lot of school boards can be indicted as part of the problem For decades, they kept cutting hours./ class requirements (to save that precious buck). Result: WAY too many kids got out of school without and econ or civics classes.
- 10 months ago
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attilatheblond
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bailey78
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yet some how the American public will foot the bill.
- 10 months ago
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bailey78
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Frosty46
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bailey78:
Or we could wise up, wait in the hedge at night and shoot them in the ass-----------just dreaming.
- 10 months ago
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Frosty46
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CalgarC
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Frosty46:
but its not wabbit season tehehe
- 10 months ago
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CalgarC
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bailey78
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Frosty46:
But it is of course a nice dream. What we would like to see done and what happens is two very diffrent things
- 10 months ago
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bailey78
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squarethecircle
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They are just handing the money back and forth. Like BP suing the owners of the Deepwater Horizon. By the way Goldman Sachs got paid big from their insurance on their investment in BP when the spill occurred. The lessee of the twin towers got paid big after only holding the building a brief time and raising their terror attack insurance shortly before. No conspiracy just facts. Now AIG wants 10 Billion for helping to topple the global economy? I think we are seeing a new form of business.
- 10 months ago
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squarethecircle
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squarethecircle
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squarethecircle:
What happens when they have every last cent...every single resource...and a free workforce? Off to the next planet? Guess we better get packin. We are almost there are we not? Should we debate and point fingers some more friends?
- 10 months ago
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squarethecircle
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bailey78
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squarethecircle:
I found My card.
- 10 months ago
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bailey78
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bailey78
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squarethecircle:
The thing is They will get the Money. The Government will end up paying the bill. Guess what We are the ones that are paying the Govenment our tax dollars are whats going to pay for the big corps to get tax breaks. Again and Again till the end of time. Well unless things are taken back by the People. Whats the chance of that happening
- 10 months ago
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bailey78
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Vic_Romano
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bailey78:
Yep. They'll cry "the end of the world" to Congress and get their bailouts while another 10% of us lose their jobs. But then again, we may all have a job soon...
- 10 months ago
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Vic_Romano
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squarethecircle
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bailey78:
We are gonna need some help I think
- 10 months ago
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squarethecircle
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squarethecircle
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bailey78:
Insane, yes?
- 10 months ago
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squarethecircle
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squarethecircle
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Vic_Romano:
I like the three different 9/11 scenarios all drawn up in 1990. The weather control. The earthquake machine. On and on it goes. What kind of people got together to destroy the world for fun and what did Steve Jackson know?
- 10 months ago
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squarethecircle
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bailey78
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squarethecircle:
I think we should ask the Mexicans for some help.
- 10 months ago
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bailey78
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bailey78
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squarethecircle:
Sort of maybe in a way but I don't see it.
- 10 months ago
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bailey78
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attilatheblond
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squarethecircle:
Any wonder the REAL economy is in shambles when this is what passes for 'business'? No real goods, no real services, just shuffle the papers and charge fees for it.
- 10 months ago
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attilatheblond
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squarethecircle
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attilatheblond:
It's a beautiful thing on the other side and ugly as hell on this one.
- 10 months ago
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squarethecircle
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squarethecircle
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bailey78:
we all are legion
- 10 months ago
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squarethecircle
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Vic_Romano
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squarethecircle:
We'll see what happens this September 11. I never really bought into conspiracy theories, but there's just too many coincidences now to write off the possibility.
- 10 months ago
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Vic_Romano
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squarethecircle
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Vic_Romano:
Watch 9/10/11 too....I never bought into any of that either...call it what you will you have to look for truth
- 10 months ago
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squarethecircle
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Schnookums
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Nice. A counter-party credit crisis in-the-making to accompany the contraction in the money supply already well underway.
- 10 months ago
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Schnookums
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Vic_Romano
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Schnookums:
This is not looking good.
- 10 months ago
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Vic_Romano
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Leen61
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I like the fact that the rich are eating each other. I would prefer they go to jail but that never happens in this country.
- 10 months ago
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Leen61
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ithink
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Leen61:
Right on leen61 I compare them to the oil eating microbes when the oil is gone they eat each other and the last one dies
- 10 months ago
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ithink
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attilatheblond
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Leen61:
Problem is, the uber rich use us peasants as proxy chow.
- 10 months ago
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attilatheblond
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Leen61
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ithink:
I like that analogy, ithink!
- 10 months ago
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Leen61
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Leen61
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attilatheblond:
Yep. We always wind up being the soylent green in the end.
- 10 months ago
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Leen61
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Richard_Wyatt
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For once I hope only the lawyers win this one.
- 10 months ago
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Richard_Wyatt
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EdJoyProductions
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Richard_Wyatt:
LOL. Rooting for the lawyers, you do not hear that very often.
- 10 months ago
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EdJoyProductions
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JustZ
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Please...TAKE YOUR MONEY OUT OF BOA. This is the only thing you can do now.
- 10 months ago
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JustZ
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kennymotown
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The rich eating each other, I love it!
- 10 months ago
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kennymotown
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JustZ
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kennymotown:
If only. Guys; this can't be good for average Americans.
- 10 months ago
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JustZ
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kennymotown
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JustZ:
These days nothing Corporations do is good for the average citizen!
- 10 months ago
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kennymotown
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Vic_Romano
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kennymotown:
Just leave us a few scraps!!!
- 10 months ago
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Vic_Romano
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attilatheblond
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JustZ:
Yep, they are the gods on Olympias, bickering and using us as surrogates in their battles. But, hey, they must have their amusements. Makes them feel like they actually do something, poor power drunk sots.
- 10 months ago
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attilatheblond
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Vic_Romano
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Here's my favorite: From none other than Jim Cramer on January 6, 2011.
Investors who want to bank on America’s return to greatness, Cramer said during Thursday’s “Mad Money,” should buy Bank of America.
He believes that job growth will return. He believes in stabilizing and then climbing home prices. He believes in even a rising standard of living and the inevitable return of investors to the market. Put simply, he’s bullish on America. And if you are, too, he thinks Bank of America is the way to play it.
Here are 10 reasons why you should get on board with Cramer:
Look at BAC’s chart going back to January 2007. Cramer said he’d heard more negativity about the bank and more downgrades of the stock between its move up to $14 from $12 than during its decline to $3 from $50. “This chart is screaming, ‘Buy me! Buy me! Buy me!’” Cramer said, “yet the bears are growling that Bank of America is the most dangerous bank to own in the world.”
Point two is directly related to point one in that BAC is not dangerous at all, Cramer said. The bank is well capitalized. So much so that there’s no need for it to raise more money. Certainly in what Cramer described as “a world full of dangerous banks,” Bank of America does not rank among them.
Reason three is the fact that Bank of America is about to reinstate its dividend, Cramer said. Investors seemed to love the stock until the dividend was cut, and now they hate BAC when the payout’s coming back? Cramer doesn’t get it, especially when you consider capital the bank is sitting on. He thinks that means dividend boosts are on the way.
Then there’s the huge market share that Bank of America captured during the downturn. The company now controls, thanks in part to the addition of Countrywide Financial, 20 percent of the mortgage market. That should translate into a huge windfall once the housing market improves.
Speaking of housing, Cramer said Bank of America owns the most houses in the U.S. Admittedly, that was a result of some pretty bad underwriting. Regardless, though, this so-called shadow inventory will turn into a boon in 2011 as job growth gives rise to housing demand, and BofA serves as home supplier to the nation.
Reason number six is Ben Bernanke, who wants American banks strong and healthy. By keeping the interest rate that banks pay you for your deposits low, Bernanke has allowed Bank of America and others to make more from the interest rate they charge for loans. And when you factor in this company’s huge deposit base, Cramer said, BAC makes money “simply by turning the lights on everyday.”
Merrill Lynch, meanwhile, offers what Cramer called “the most powerful network of high-net-worth advisors in the country,” which is perfect now that investors look ready to leave bonds and move back into stocks. And unlike Countrywide, Merrill’s reputation was never tarnished.
Number eight here is jobs. Steady employment leads to increased credit and borrowing, and that means more profits for Bank of America. Cramer said he almost hopes that Friday’s job number will be weak just so investors can get into BAC on a dip, because the employment trend in America is headed in the right direction.
And don’t forget that the Republicans now control the House of Representatives. So say hello to a hands-off approach to regulation, regardless of the reform bill that was passed this year. Of course, consumers will be paying higher fees for their checking accounts, but that’s some great no-risk income for the banks.
Finally, the company’s put-back mortgage exposure to Fannie Mae and Freddie Mac has turned out to be miniscule compared to what the bears thought. “And now that that risk is taken off the table,” Cramer said, “this is big.”
http://www.zerohedge.com/news/date-january-10-2011-source-jim-cramer-title-10-re...
- 10 months ago
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Vic_Romano
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EdJoyProductions
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Vic_Romano:
Cramer is either a paid spokesperson for corporations and Wall Street or an absolute idiot. He should have been prosecuted for his "advise" on several occasions.
Although, anyone that took advise from this man should have their head examined.
- 10 months ago
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EdJoyProductions
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Vic_Romano
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EdJoyProductions:
Which leads right into what Jon Stewart had to say....
Something about that "disingenuous at best and criminal at worst" that says so much.
http://www.thedailyshow.com/watch/thu-march-12-2009/jim-cramer-pt--2
- 10 months ago
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Vic_Romano
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JustZ
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Vic_Romano:
Indeed; Cramer has been wrong about everything.
- 10 months ago
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JustZ
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JustZ
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EdJoyProductions:
I vote idiot... albeit with a very fat bank account.
- 10 months ago
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JustZ
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Schnookums
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EdJoyProductions:
Cramer knows exactly what he's doing......
- 10 months ago
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Schnookums
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Vic_Romano
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Schnookums:
It's so obvious!
- 10 months ago
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Vic_Romano
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EdJoyProductions
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Vic_Romano:
That was a very good Daily Show! It is a shame that we have to depend on Jon Stewart to call these charlatans out.
- 10 months ago
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EdJoyProductions
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EdJoyProductions
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Schnookums:
Thanks, I had not seen that before but it confirmed my suspicions. Anyone that depends as much on literal bells and whistles on a program that is supposed to be news and information is something I immediately turn off. That is why I have never paid any attention to this asshole. He should be castrated with a rusty butter knife.
- 10 months ago
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EdJoyProductions
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Frosty46
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Vic_Romano:
The stock market is a scam--the stock market is a scam--the stock market is a scam--the stock market is a scam------------------I fall asleep--zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz
- 10 months ago
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Frosty46
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Frosty46
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Schnookums:
Scum sucking parasite that lies with honest conviction--a true Republican!
What I love most about all these experts is the way not one fucker of them saw the Bush Crash coming--not one! I'd love to put a round though his gourd! - 10 months ago
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Frosty46
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warman1138
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Interesting... sort of like sharks feeding off one another. How come nobody goes to jail?
- 10 months ago
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warman1138
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JustZ
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warman1138:
Indeed? That is the million dollar question isn't it! "Why aren't these crooks going to jail?"
The US economy is nothing short of the biggest ponzi scheme in the history of the modern world.
- 10 months ago
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JustZ
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Frosty46
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warman1138:
The invoices for the politicians prevent that action.
- 10 months ago
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Frosty46
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warman1138
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Frosty46:
Campaign contribution, another way to say bribe.
- 10 months ago
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warman1138
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EdJoyProductions
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Ain't that the pot suing the pot because it is corrupt?
- 10 months ago
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EdJoyProductions
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Vic_Romano
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EdJoyProductions:
Basically.
- 10 months ago
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Vic_Romano
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Vic_Romano
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From ZeroHedge:
With Bank of America investors finally realizing it is game over for the company as a going concern, at this point there are just two options for Brian Moynihan: the spin off of CFC as a bad bank, backstopped by the Fed, or, well, Chapter 11, which for a bank is essentially liquidation (and with CDS trading up 50 bps to 260 a bankruptcy seems increasingly inevitable). It also means that another TARP is on the way. And once America realizes that another several trillion have to be put into its insolvent banking sector, it will get quite violent. The biggest irony: it is AIG which takes down the financial system for the second time after its lawsuit against BAC filed last night kills Bank of America.
http://www.zerohedge.com/news/here-comes-tarp-2-bank-america-implodes-687-bac-cd...
- 10 months ago
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Vic_Romano
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JustZ
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Vic_Romano:
TAKE YOUR MONEY OUT OF BOA. This is the only thing you can do now.
- 10 months ago
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JustZ
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Vic_Romano
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JustZ:
I don't know what's going to happen, but it's not looking good. At least I'm poor, so I won't lose a whole lot in all of this. But banking at any of the big banks is just stupid.
- 10 months ago
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Vic_Romano