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Wells Fargo's cooked books
This story concerns their massive $84B Home Equity Line/Loan portfolio, of which much is now under water due to massive house price depreciation. Technically (and realistically) these have become unsecured. This is a real problem for banks. By my estimates, Wells Fargo wildly under-reserved on their home equity exposure.
Not only did Wells change the time line for placing a loan into “default” by extending the term out 60 days, essentially hiding 60 days of defaults, but they are also using AVMs to determine value from March of 2008, even though the median home price has fallen 5.4% since then. This story concerns their massive $84B Home Equity Line/Loan portfolio, of which much is now under water due to massive house price de... more -
Will Your Bank Fail?
Here is a nifty little tool allowing failed bank customers the ability to verify whether their account is fully insured or they need to contact FDIC.
Sure there is only one bank in the drop down list at the moment but they would not have designed a drop down list if they didn't have plans to use it. The key word here is "LIST." Here is a nifty little tool allowing failed bank customers the ability to verify whether their account is fully insured or they need t... more -
Counting down on America’s self destruct sequence
The only nation that can destroy America is America, and never let it be said Americans don't have a can-do attitude.
I read this article by my old co-blogger Barry Ritholz and I laughed, and laughed and damn near cried:
There is a choice to be made: Either we regulate the Banks, or leave it to the vagaries of the free markets to punish those who trade with, or place their assets in the wrong institutions. But for God's sake, do not give us the worst of both worlds -- do not allow banks the freedom to make horrific but preventable mistakes (i.e., only lending money to those who can pay it back), but then expect the taxpayers to foot the trillion dollar bill.
That's not capitalism, its not socialism, its not regulation, and its sure as hell isn't what free markets are. Our language is insufficient to describe this hodge-podge system, other than to call it a random patchwork of quasi-capitalism, quadrennial-socialism, and politics as usual. Ideological idiocy is the only phrase I can muster that has any resonance with the daily insanity.
We have entered into a fit of Orwellian madness: The American Capitalists, long the globe's leading advocates for free markets, have become near Socialists.
I don't think it's too hard to explain. Ideology is part of it, but the folks from the Chicago school were always the useful idiots of the movement, so caught up in the beauty of their pretty models and meaningless numbers that they never noticed that the models didn't correspond to the real world in any meaningful way. Rather what happened was simple enough—there was a lot of money to be made by getting rid of regulation of financial institutions, privatizing government operations, offshoring production and engaging in various highly leveraged financial games with no oversight.
So the money spigots were turned on, the politicians were bought, and the rules were changed. This was possible simply because the people who lived through the Great Depression were mostly gone, so the folks who knew why the rules were there and understood that they were meant to stop a repeat, couldn't stop their repeal. Since almost no one learns from anything other than swift kick to the nads, and since politicians are required to be greedy in order to be successful in the US, gravity took its course. Crony capitalism, where profits are privatized, losses are socialized and rules are made to go away if they interfere with the bottom line and are created if they help it, took over the US.
What was hilarious about it was all the lecturing of every other country about transparency when even back in the 90s it was widely known by those who cared to know that corporations were cooking the books on a large scale (about 10% more profits were reported in the 80s than the economy could support, about 20% more in the 90s). And that's before we get to the government cooking the books on statistics like inflation. The only nation that can destroy America is America, and never let it be said Americans don't have a can-do attitude. ... more -
Does Your Bank Have Your Money?
Recent Failed Bank AfterMath:
"About 200 anxious, embittered and sometimes angry customers swarmed an IndyMac bank branch in the San Fernando Valley, creating a Depression Era-like scene as they demanded their money just four days after the failing bank was seized by federal regulators.
Meanwhile, as the wait stretched into hours, people donned baseball caps or carried umbrellas to shield themselves from the sun. Some fanned themselves with their bank documents as they sweated in temperatures that were already in the 80s by midmorning."
Basically they are giving people vouchers and appointments to recover their lost money. WTF?!? Can you imagine not being able to get the money that was in your bank?
Recent Failed Bank AfterMath: ... more -
150 banks could fail by next year
The nation’s banks are in far less danger than they were in the late 1980s and early 1990s, when more than 1,000 federally insured institutions went under during the savings-and-loan crisis. The debacle, the greatest collapse of American financial institutions since the Depression, prompted a government bailout that cost taxpayers about $125 billion.
But the troubles are growing so rapidly at some small and midsize banks that as many as 150 out of the 7,500 banks nationwide could fail over the next 12 to 18 months, analysts say. Other lenders are likely to shut branches or seek mergers. Many investors are on edge after federal regulators seized the California lender, IndyMac Bank, one of the nation’s largest savings and loans, last week. With $32 billion in assets, IndyMac, a spinoff of the Countrywide Financial Corporation, was the biggest American lender to fail in more than two decades.
Now, as the Bush administration grapples with the crisis at the nation’s two largest mortgage finance companies, Fannie Mae and Freddie Mac, a rush of earnings reports in the coming days and weeks from some of the nation’s largest financial companies are likely to provide more gloomy reminders about the sorry state of the industry.
The future of Fannie Mae and Freddie Mac is vital to the banks, savings and loans and credit unions, which own $1.3 trillion of securities issued or guaranteed by the two mortgage companies. If the mortgage giants ever defaulted on those obligations, banks might be forced to raise billions of dollars in additional capital.
The large institutions set to report results this week, including Citigroup and Merrill Lynch, are in no danger of failing, but some are expected to report more multibillion-dollar write-offs.
But time may be running out for some small and midsize lenders. They vary in size and location, but their common woe is the collapsed real estate market and souring mortgage loans. Most of these banks are far smaller than the industry giants that have drawn so much scrutiny from regulators and investors. The nation’s banks are in far less danger than they were in the late 1980s and early 1990s, when more than 1,000 federally insured in... more -
Analysts Say More Banks Will Fail
As home prices continue to decline and loan defaults mount, federal regulators are bracing for dozens of American banks to fail over the next year.
But after a large mortgage lender in California collapsed late Friday, Wall Street analysts began posing two crucial questions: Just how many banks might falter? And, more urgently, which one could be next?
The nation’s banks are in far less danger than they were in the late 1980s and early 1990s, when more than 1,000 federally insured institutions went under during the savings-and-loan crisis. The debacle, the greatest collapse of American financial institutions since the Depression, prompted a government bailout that cost taxpayers about $125 billion.
But the troubles are growing so rapidly at some small and midsize banks that as many as 150 out of the 7,500 banks nationwide could fail over the next 12 to 18 months, analysts say. Other lenders are likely to shut branches or seek mergers.
“Everybody is drawing up lists, trying to figure out who the next bank is, No. 1, and No. 2, how many of them are there,” said Richard X. Bove, the banking analyst with Ladenburg Thalmann, who released a list of troubled banks over the weekend. “And No. 3, from the standpoint of Washington, how badly is it going to affect the economy?”
Many investors are on edge after federal regulators seized the California lender, IndyMac Bank, one of the nation’s largest savings and loans, last week. With $32 billion in assets, IndyMac, a spinoff of the Countrywide Financial Corporation, was the biggest American lender to fail in more than two decades.
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The F.D.I.C. has $53 billion set aside to reimburse consumers for deposits lost at failed banks. IndyMac will eat up $4 billion to $8 billion of that fund, the agency estimates, and that could force it to raise more money from the banks that it insures.
The agency does not disclose which banks it thinks are troubled. But analysts are circulating their own lists, and short sellers — investors who bet against stocks — are piling on. In recent weeks, the share prices of some regional banks, like the BankUnited Financial Corporation, in Florida, and the Downey Financial Corporation, in California, have stumbled hard amid concern about their financial health. A BankUnited spokeswoman said the lender had largely avoided risky subprime loans.
In his “Who Is Next?” report over the weekend, Mr. Bove listed the fraction of loans at banks that are nonperforming, meaning, for example, that the assets have been foreclosed on or that payments are 90 days past due. He came up with what he called a danger zone, which was a percentage above 5 percent. Seven banks fell in this category.
An important issue for the regional and community banks will be whether they have managed to sell their riskiest loans to Wall Street firms.
And the government may have fewer failures than in the past because private investment funds might buy some troubled lenders. Regulators are considering rule changes that would allow private equity firms to buy larger shares of banks, and several prominent investors, like Wilbur Ross, have raised funds to leap in.
As home prices continue to decline and loan defaults mount, federal regulators are bracing for dozens of American banks to fail over t... more -
US Treasury to bail out Fannie Mae, Freddie Mac
US Treasury Secretary Henry Paulson has unveiled measures to bolster housing finance organisations Fannie Mae and Freddie Mac, stressing their key role in the US housing market.
US Treasury Secretary Henry Paulson has unveiled measures to bolster housing finance organisations Fannie Mae and Freddie Mac, stressi... more -
How US banks are destroying the American economy
US banks are parasitically feeding on the debt problems of America.
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IndyMac Bank seized by Feds; 2nd-largest bank failure in US history
The federal government took control of Pasadena-based IndyMac Bank today, in what regulators called the second-largest bank failure in U.S. history.
The Office of Thrift Supervision in Washington, the chief regulator of IndyMac, said it transferred control of the $32-billion bank to the Federal Deposit Insurance Corp.
Regulators said depositors would have no access to banking services online and by telephone this weekend, but could continue to use ATMs, debit cards and checks. Online banking and phone banking services are to resume operations Monday.
Federal authorities said based on a preliminary analysis, the takeover of IndyMac would cost the FDIC between $4 billion and $8 billion.
ndyMac's failure had been widely expected in recent days, as regulators said it was not well-capitalized. Its stock has plummeted to mere pennies a share and some nervous depositors have been pulling their funds. The bank has been reeling from losses on defaulted mortgages made at the height of the housing boom.
"The OTS has determined that the current institution, IndyMac Bank, is unlikely to be able to meet continued depositors' demands in the normal course of business and is therefore in an unsafe and unsound condition," the agency said in a statement today.
IndyMac's failure is second only to the 1984 failure of Continental Illinois Bank, which had assets of $40 billion at the time.
The federal government took control of Pasadena-based IndyMac Bank today, in what regulators called the second-largest bank failure in... more -
40 year and zero down mortgages are out
In an announcement released today, the government said government-backed mortgages would require a minimum down payment of five per cent and a maximum amortization period of 35 years. The borrower would have to have a consistent minimum credit score and there would be new loan documentation standards. In an announcement released today, the government said government-backed mortgages would require a minimum down payment of five per ce... more
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Fed ready to aid investment banks
The Federal Reserve may extend into next year a facility that gives investment banks access to emergency cash if the financial turmoil persists.
The lending facility was put in place in March to stabilise the financial system as Bear Stearns collapsed.
Fed chairman Ben Bernanke also called on Congress to give the central bank more authority to supervise markets.
The Fed will issue new rules next week aimed at cracking down on dubious lending practices.
(End of excerpt)
Full article at link by BBC News
Photo: AP The Federal Reserve may extend into next year a facility that gives investment banks access to emergency cash if the financial turmoil... more -
Chase bank teller stole 300,000 dollars from 86-year-old woman's life savings
A Chase bank teller was discovered to have stolen close to 300,000 dollars from the life saving of an 86-year-old woman. Jessie McDonald and her husband (who died last year) saved 400,000 dollars. The theft was discovered in 2007 and the teller fired but no attempts have been made to pay Mrs. McDonald back.
This is a clear case of elder abuse and I'm surprised that this case hasn't received more attention. A Chase bank teller was discovered to have stolen close to 300,000 dollars from the life saving of an 86-year-old woman. Jessie McDon... more -
Hackers crack cash machine PIN codes to steal millions
Millions of bank customers face a new threat to their money after it emerged yesterday that hackers had cracked PIN codes used in cash machines.
Citibank machines in 7-Eleven convenience stores across America were the target of the biggest and most effective remote PIN code theft scam in US banking history between last autumn and this spring when at least $2 million (£1 million) was stolen.
Details of the fraud have only now been made public, as the case makes its way through the US District Court for the Southern District of New York.
The alleged hackers — Yuriy Rakushchynets, Ivan Biltse and Angelina Kitaeva — are accused of stealing at least $2 million through the PIN scam and have been indicted on two counts each of conspiracy and fraud. It is thought that a much larger sum of money might have already been transferred to Russian bank accounts — and there are suggestions that the actual hacking was performed by another party, with the defendants simply using second-hand information to make cash withdrawals. The wording of the indictment against them is vague.
Millions of bank customers face a new threat to their money after it emerged yesterday that hackers had cracked PIN codes used in cash... more -
Wachovia'$ Way2$ave-The Day!(FinalCut)
$ign up for Wachovia'$ Way2$ave and improve your life!
Cast-Mohammed Ali, Maili Nõmm, Tene Sommer, Tamara O'Connell, Fernanda Tapia.
Director/Producer/Edit- Catherine Fingal. Director of Photography/Editor -Walter Rodriguez
Production Manager/Producer-Eliza Brownjohn. Make-Up-Sylvia L. Ugent.
PA's-Jade Fingal and Alexa Randolph. Special thanks to Ilias Petropoulos.
$ign up for Wachovia'$ Way2$ave and improve your life! ... more -
Way2Save - Imagine
Imagine...
Producers: Chris Whitman, Ryan Ho, Ashley Louis
Director: Chris Whitman
Composer: Ryan Ho
Castn (in order of appearance): Timal Mcken, Mandee Nguyen, Bert James, Ashley Hester, Lenny Tim
Note: Creative can flexibly be molded into :30 and :15 spots highlighting and/or elaborating upon each or multiple characters. In house score will reflect any changes client wants to address. Imagine... Producers: Chris Whitman, Ryan Ho, Ashley Louis Director: Chris Whitman Composer: Ryan Ho ... more -
United Kingdom Talk Saturday 21st June 2008
Saturday's edition of my three times a week talk show. Watch the show here on Current TV on Tues, Thurs & Sats.
In today's show :
The bank story - at last !
Snakes.
The hole in the wall machine.
Welcome new viewer Matt.
Letting the cat out of the bag.
Cannibals have to eat !
A Banana & grapes instead of an ice cream.
Did you see the dog ?
Working with new managers.
Picking up the rubbish.
An insult list ?
Chop the hands off - well - give 'em one chance maybe ?
Cousin Helen.
Pass that lady a chair !
Are buildings made as strong as they used to be ?
They lost the keys.
Romy wins a toaster at "Bingay" - picture to the right !
I know that you're there.
Free drinks tickets.
Noise troubles on a Friday night - which voice don't they like ?
Strange men in woods ! LOL.
http://unitedkingdomtalk.forums4free.org/
Email :
chris@unitedkingdomtalk.co.uk
wWWW.UNITEDKINGDOMTALK.CO.UK Saturday's edition of my three times a week talk show. Watch the show here on Current TV on Tues, Thurs & Sats. ... more -
From Ashy to Classy - Living the Fabulous Life in Hollywood!!! Yes, Darling!!
A starving artists...future filmmaker and dreamer is destined for fame, fortune and a life filled with Fabulosity!! How can I make my dreams come true? With Wachovia's way to save program...I'm living my dreams and more!! A starving artists...future filmmaker and dreamer is destined for fame, fortune and a life filled with Fabulosity!! How can I make my ... more
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A serious message about financial uncertainty
In this sober examination of the challenges that face tomorrow's investors, I got this guy whose wife I know to eat a bug on camera. Twice. Then I used the first take. In this sober examination of the challenges that face tomorrow's investors, I got this guy whose wife I know to eat a bug on camera. T... more
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Wachovia: Every Dollar Counts
Way2Save from Wachovia: Because every dollar counts...
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