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Wall Street

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A Wagonful of Crooks.

“Attorneys, forensic accountants and consumer advocates have long suspected that banks were systematically creating improper documents to prove ownership of loans. Foreclosure defense lawyers use the term ‘ta-da’ endorsement to describe situations in which they say a document appears, as if by magic, in the bank’s possession as needed in a foreclosure case…The manual…appears to provide step-by-step instructions for a Wells Fargo Home Mortgage ‘Default Docs Team’ and foreclosure attorneys if a blank endorsement is in a file and the attorney wants that note executed.”

In another example of banksters taking notes on a criminal f**king conspiracy, the NY Post get their hands on Wells Fargo’s How-To-Manual for ginning up fraudulent foreclosure documents. “Foreclosure experts called these procedures shocking. ‘It’s an explosive document,’ said forensic accountant Jay Patterson.” Hey, can somebody go to jail now?

Update: Nope, doesn’t look like it. “Four years after President Obama promised to crack down on mortgage fraud, his administration has quietly made the crime its lowest priority and has closed hundreds of cases after little or no investigation, the Justice Department’s internal watchdog said on Thursday.”

Revolving Doormen.

“One afternoon in San Francisco, Lehane explained his operating principle this way: ‘Everyone has a game plan until you punch them in the mouth. So let’s punch them in the mouth…In most situations,’ Lehane continued, ‘there are people who either have dirty hands or their own agendas. Whenever somebody complains that this stuff has happened to them, I say, “There’s a long line of people behind you.”‘”

Ever feel like maybe part of the problem with both our Party and our politics is that they tend to reward amoral, money- and power-driven, self-aggrandizing douchebags? Hey, you’re right! Exhibit A: Chris Lehane, previously Al Gore’s flak in 2000 (he also had a small part to play in Dean’s demise in 2004), who’s given the soft-focus treatment in this week’s New York Magazine. “‘You are only seeing 10 percent of what I do,’ Lehane said. The private clients have included Goldman Sachs, Michael Moore, the Weinstein Company and Boeing.”

And here’s Exhibit B: Peter Orszag, who’s currently trying to shield his big Citibank payday from public scrutiny. “Typically, documents in a civil-court proceeding are accessible to the public, but Orszag succeeded last year in quietly convincing a judge to seal financial records submitted in the case, including the salary he makes as a Citigroup vice president, from public view. In that request, Orszag worried that disclosure of his income might harm his career and ‘damage any eventual return to Federal Government service or other public office.'”

Yeah, because everybody’s clamoring for that. Sigh, This Town. Lehane’s right about one thing, tho’. Everywhere you look in DC, there are people who don’t know anything about anything strenuously clambering up the ranks, their only two skills of note shameless self-promotion and a brazen flexibility with regard to what should be basic Democratic principles. Or, as I put it more charitably a few years ago:

“That’s my rub too, and it dovetails with larger problems I have with DC political culture. More often than not, the people who tend to succeed here are the ones who keep their head down, play the DC game, stay resolutely non-ideological and unobtrusive in their opinions. never go out on a limb, never say or do anything that could hurt their bid to be a Big (or Bigger) Shot down the road. (Hence, the whole phenomenon of The Village.)The problem is, these plodding, risk-averse careerist types are exactly the type of people you don’t want making decisions in the end, because they will invariably lead to the plodding, risk-averse and too-often rudderless politics of the lowest common denominator.”

But I guess, as the The Wire made clear years ago, that’s pretty much the rule in any institution or industry, so there’s not much use in complaining about the way things are and have always been. Game’s the same, just got more fierce.

Rolling in the Deep.

“The Deep State is the big story of our time. It is the red thread that runs through the war on terrorism, the financialization and deindustrialization of the American economy, the rise of a plutocratic social structure and political dysfunction. Washington is the headquarters of the Deep State, and its time in the sun as a rival to Rome, Constantinople or London may be term-limited by its overweening sense of self-importance and its habit, as Winwood Reade said of Rome, to ‘live upon its principal till ruin stared it in the face.’ ‘Living upon its principal,’ in this case, means that the Deep State has been extracting value from the American people in vampire-like fashion.”

In very related news, and in a somewhat overwritten but otherwise worthy piece, former GOP Congressional staffer Mike Lofgren summarizes the problem of America’s Deep State (a term Lofgren did not coin, borrowed from Turkey.) Think the military-industrial complex, now infused with financial sector/Pete Peterson-style rent-seeking. “[This] is not an exposé of a secret, conspiratorial cabal; the state within a state is hiding mostly in plain sight, and its operators mainly act in the light of day.”

Those Socialists at Goldman Sachs.

“U.S. businesses have never had it so good. Corporate cash piles have never been bigger, either in dollar terms or as a share of the economy. The labor market, meanwhile, is still millions of jobs short of where it was before the global financial crisis first erupted over six years ago. Coincidence? Not in the slightest.”

Karl Marx? Try Goldman Sachs. Their chief economist, Jan Hatzius, recently argued that “strength (in profits) is directly related to the weakness in hourly wages. In fact, 2012 saw the highest corporate profits and lowest wages and salaries ever recorded, as a percentage of GDP. But, please, let’s hear more whining and ridiculously overheated Holocaust metaphors from the top 0.1%.

Banksters of America.

“‘Everyone knew that we weren’t helping people,’ said Erik Schnackenberg, a customer-service manager who left Urban Lending in 2011…’They were giving us all the pressure and none of the power to change anything. It was this absurd, self-contained ecosystem of worthlessness.'”

Bloomberg‘s Hugh Son delves into Urban Lending, the fraudulent front group/vendor that serial offender Bank of America worked with to profit from families facing foreclosure. “Instead of helping homeowners as promised under agreements with the U.S. Treasury Department, Bank of America stalled them with repeated requests for paperwork and incorrect income calculations…Tens of thousands of HAMP modifications were improperly denied by Bank of America and Urban Lending since April 2009.” Sure would be nice if somebody went to jail for this. (Image via Rolling Stone.)

Update: “As Judge Jed Rakoff recently wrote in a scathing essay in the New York Review of Books, the failure to prosecute those responsible for the biggest financial crisis since the Great Depression ‘must be judged one of the more egregious failures of the criminal justice system in many years.'” In very related news, David Dayen makes the case for Jamie Dimon’s long-overdue perp walk. “Open the business pages at random and they often read like the police blotter.”

Trolling the House of Morgan.

“JPMorgan’s bankers are getting used to business deals with young men who communicate in emojis and text-message abbreviations…Yet, when the bank devised the promotional Q&A, it may not have fully grasped the extent to which new media has transformed how people share information, and how this has tipped existing structures of power.”

Er…let’s not overdo it. Existing structures of power haven’t changed at all, and, after a bad week’s press, JP Morgan is still laughing all the way to the bank. Still, I was proud to get in early on the co-opting of JP Morgan’s inane #AskJPM forum on Twitter last week, which got tweets of mine mentioned in BusinessWeek, WaPo, The New Yorker, and various other venues — undoubtedly the strangest being a somber tweet-reading by the venerable Stacy Keach. In any case, if any of those links have led you back here to GitM this week, welcome, and thanks for dropping by.

Still Too Big to Jail.

“‘I think that there is a great sense of frustration and a sense of injustice that the laws have not been enforced in the way most Americans think they should have been,’ said Miller, who wrote the report’s chapter on regulatory enforcement. He notes that 79% of Americans ‘think more bankers and other financial executives should have been criminally prosecuted for their role in the financial crisis.'”

A welcome new report drafted by Americans for Financial Reform and Mike Konczal and championed by Senator Elizabeth Warren makes the much-needed case for further financial reform.“Today, the four biggest banks are 30% larger than they were five years ago. And the five largest banks now hold more than half of the total banking assets in the country.”

At the moment, Hillary Clinton’s 2016 ascendancy to the Democratic nomination, and subsequently the presidency, is looking like a virtual lock. But if Clinton really wants to nip a serious 2016 primary challenge in the bud, she’d start moving to the left on these matters. I’m not holding my breath. (Striking Guy Fawkes Day “Million Mask March” pic above via the OWS Twitter feed.)

Yes, the Game is Rigged.

“Well, the plutocrat class — that’s the top 16,000 households in this country — are where all the gains have been going since the end of the recession. Thirty-seven cents out of every dollar of increased income between 2009 and 2012 went to these 16,000 households — in a country of 314 million people…[Meanwhile] The average income of the bottom 90 percent of us has fallen 20 percent below where it was in the year 2000 — it fell from about $36,000 to $30,000. It has fallen back to the level of 1966, when Mustangs were new, Lyndon Johnson was president and we were prosecuting a war in Vietnam. 1966.”

In an interview with Joshua Holland, journalist and tax expert David Cay Johnston discusses how our current tax code, among other things, is fueling inequality. For example:

1) “Very, very wealthy people…are not required to report most of their economic gains and legally they can literally live tax-free or nearly tax-free by borrowing against their assets. You can borrow these days, if you’re very wealthy, against your assets for less than 2 percent interest and the lowest tax rate you could pay is 15 percent…[I]f you’re a billionaire and you borrow, let’s say, $10 million dollars a year to live on, you pay $200,000 interest, but your fortune through investing grows by $50 million. At the end of the year you pay no taxes, your wealth is up almost $40 million dollars and your cost was just the interest of $200,000.”

2) “Well, one of the reasons some Americans feel they’re being taxed to death is that if you add up our taxes, which are low compared to other modern countries, and then you add in private expenditures for things the tax system pays for in other countries — a lot of our health care costs, higher education costs, admissions and fees and tickets and licenses for a lot of things — lo and behold, we end up being a relatively high-tax country.”

Jamie Dimon, meet the New Day Co-op.

“The hiring-as-bribery in China charges against the bank took a turn for the worse late last night after Dawn Kopecki of Bloomberg News reported the Justice Department and SEC’s investigation has ‘expanded to countries across Asia’ and JPMorgan has itself flagged 200 of its own hires for an internal investigation. What’s worse is that the review has uncovered an ‘internal spreadsheet that linked appointments to specific deals pursued by the bank.'”

N***a, is you takin’ notes on a criminal f**king conspiracy?Buzzfeed‘s Matthew Zeitlin explains what the banksters at J.P. Morgan could learn from Stringer Bell and the New Day-Co-Op. “[S]pelling out in a spreadsheet your exact intentions about hiring specific people for their parents’ help for specific deals is probably not considered best practices.”

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