ECON Want to get away with murder? Become a bank.

Want to get away with murder? Become a bank.

GMAC and BofA have now resumed foreclosures in some states. By the time you see this, J.P. Morgan may have done so too.

By Allan Sloan, senior editor-at-large

October 26, 2010: 5:40 AM ET

http://money.cnn.com/2010/10/25/new...ig_banks.fortune/index.htm?source=yahoo_quote

FORTUNE -- The biggest danger to the U.S. capitalist system doesn't come from communists or community activists or left-wing academics. It comes from some of the nation's biggest financial institutions. These companies, which helped create the financial meltdown that touched off the Great Recession, have now found yet another way to undermine the public's faith in capitalism and markets: the foreclosure fiasco.

Even before the foreclosure problem appeared, the level of public distrust of our financial and political systems was approaching the pathological. It's going to get even worse when the true lesson of this episode sinks in. To wit: If you screw up big-time when you deal with a giant bank, you're toast. If the giant bank screws up when it deals with you, it gets a do-over.

Sure, many -- probably most -- of the people whose mortgages are being foreclosed got in trouble because they overreached or lost their jobs, not because anyone cheated them. But if we're going to have rules, they ought to be binding on everyone. If I'm supposed to obey the law and pay my bills, the people I'm paying ought to have to obey the law too.

You miss a payment on your credit card or send it in a few days late, you get whacked. Forget to make a loan payment, your credit rating gets vaporized. But if a bank doesn't do its job properly -- for example, if you can't get a knowledgeable and competent human on the phone to deal with a loan modification or a paperwork screwup because the bank is holding down back-office costs to save money -- it ends up being your problem, not the bank's.

It's utterly shocking, even to a congenital skeptic like me, to see that giant institutions such as Bank of America (BAC, Fortune 500), GMAC, and J.P. Morgan (JPM, Fortune 500) were allegedly using misleading affidavits to oust people from their homes. Employees of these institutions -- the "robo-signers" -- repeatedly misled courts by saying they had examined documents they hadn't examined and had reviewed documents they hadn't reviewed.

If you or I as individuals did that, we'd be kicked to the curb by the legal system in about two seconds. If we said that we hadn't wanted to spend the money to do things right -- the real reason that robo-signers exist -- it would take only one second for the system to whack us.


But how will the system deal with the big outfits that are found to have filed false information in court? They'll be attacked, sued, and investigated, and you can bet that at some point their chief executives will be hauled in front of Congress for public show trials by posturing politicians. But in the end, I'm sure, these institutions and their CEOs will get what amounts to a slap on the wrist compared with what would happen to regular people who behaved the way these banks (and possibly other banks) did.

People in this country may be uninformed or misinformed -- but they're not stupid. They'll catch on to the message soon, if they haven't already: There's one deal for average people, but a different, far better deal for the really big and powerful.

Yes, you can make a case that there's rough justice here: People made up stuff on their mortgage applications to get into homes they couldn't afford, and banks made up stuff to get them out. But the whole thing just stinks.

GMAC and BofA, which had suspended foreclosures for a while, have now resumed them in some states. By the time you see this, J.P. Morgan may have done so too.

There's no way to tell at this point whether we're dealing with some overwhelmed back-office people in a few institutions who became robo-signers to meet their quotas and keep their jobs, or whether something more systemic and serious is wrong. My bet's on the latter.

Whatever happens, I hope that the bankers won't be as tone-deaf as they've been lately, and blame their problems on the Obama administration or plaintiffs lawyers or the news media rather than on themselves. We're already starting to hear the whining about how the big guys are being mistreated for minor paperwork errors. Poor babies. With friends like these, the capitalist system doesn't need enemies.

Additional reporting by Doris Burke

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VIDEOS

Money As Debt

Fiat Empire: Why the Federal Reserve Violates the U.S. Constitution

The Money Masters - Part 1 of 2

The Money Masters - Part 2 of 2

"Permit me to issue and control the money of a nation, and I care not who makes its laws." - Amschel Mayer Rothschild, 1838

"Banking was conceived in iniquity and was born in sin. The bankers own the earth. Take it away from them, but leave them the power to create money, and with the flick of the pen they will create enough deposits to buy it back again. However, take away from them the power to create money and all the great fortunes like mine will disappear and they ought to disappear, for this would be a happier and better world to live in. But, if you wish to remain the slaves of bankers and pay the cost of your own slavery, let them continue to create money." - Attributed to Josiah Stamp by Silas W. Adams in The Legalized Crime of Banking (1958); Said to be from an informal talk at the University of Texas in the 1920s, but as yet unverified.

"The government should create, issue and circulate all the currency and credit needed to satisfy the spending power of the government and the buying power of consumers..... The privilege of creating and issuing money is not only the supreme prerogative of Government, but it is the Government's greatest creative opportunity. By the adoption of these principles, the long-felt want for a uniform medium will be satisfied. The taxpayers will be saved immense sums of interest, discounts and exchanges. The financing of all public enterprises, the maintenance of stable government and ordered progress, and the conduct of the Treasury will become matters of practical administration. The people can and will be furnished with a currency as safe as their own government. Money will cease to be the master and become the servant of humanity. Democracy will rise superior to the money power." - Abraham Lincoln (assassinated shortly thereafter)

"Whoever controls the volume of money in our country is absolute master of all industry and commerce...when you realize that the entire system is very easily controlled, one way or another, by a few powerful men at the top, you will not have to be told how periods of inflation and depression originate." - James Garfield (assassinated shortly thereafter)

"A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men ... [W]e have come to be one of the worst ruled, one of the most completely controlled and dominated, governments in the civilized world—no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and the duress of small groups of dominant men." - Woodrow Wilson, 1913

“Henry Ford thinks it's stupid and so do I, that for the loan of (its) own money... the United States should be compelled to pay...interest. People who will not turn a shovel of dirt nor contribute a pound of material will collect more money from the United States than all the people who supply all the material and do all the work...why must we pay interest to money-brokers for the use of our own money!” - THOMAS A. EDISON, re Congress borrowing from FED

“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.” - HENRY FORD

"When the Federal Reserve Act was passed, the people of these United States did not perceive that a world banking system was being set up here. A super-state controlled by international bankers and industrialists...acting together to enslave the world...Every effort has been made by the Fed to conceal its powers but the truth is--the Fed has usurped the government." - Congressman Louis McFadden, House Committee on Banking and Currency Chairman (1920-31)

More - http://wikiworld.com/wiki/index.php/Monetary_Reform_Act

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I wish everyone here could and would grasp the truth of this...

dd

ETA: cartoon

People in this country may be uninformed or misinformed -- but they're not stupid. They'll catch on to the message soon, if they haven't already: There's one deal for average people, but a different, far better deal for the really big and powerful.

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My jury is still out on whether or not they ARE stupid. I continue to be amazed at how strong the brainwashing is that this is all OK for the banking system, because we need it to keep our economy running smoothly, there's little inherently wrong with it, and those foolish borrowers just need to suck it up and go off the property.

These people refuse to see the bigger picture: bank ownership of huge tranches of houses was the end goal, which the Fed can eventually nationalize to get themselves out of hot water with their debt by selling the houses to our foreign creditors. This is high-level criminal behaviour.

You mentioned Jesus driving the money-changers out of the Temple yesterday, SoT. Most people in this country are conditioned, I fear, into the crazy presumption Jesus was doing something wrong. The moneychangers, after all, were entering into consent relationships with the people they were screwing over with their taking of increase for buying offerings and exchanging money for the Temple offering. Nobody forced the people coming to the Temple to enter into these agreements to get a skimmed exchange rate for Temple currency, so they should just take their medicine and shut up and go on in. A lot of them couldn't afford it, but hey, if you couldn't afford the skim, then don't come to the Temple to make an offering to God, would be their reasoning. But if you come and exchange and enter into the moneychangers' web, they would say, then you owe the skim - you promised ! But, annoyingly to these same people ( if they allowed themselves to think ), Jesus was looking at the bigger picture. Abomination trumps the poor not paying their bills every time, sorry to disturb peoples' nonscriptural Puritan hideboundedness. The criminals were running the game. Jesus did what was right in upsetting their entire "business model" and wrecking it.

Americans are siding with the moneychangers, or at least resigning themselves to passively accept their criminality and blame themselves, because they buy the naive and simplistic notion the evil borrowers shouldn't have been seduced by them. Then, assets get stripped en masse, and sold to our creditors, effectively enslaving us to foreigners. This isn't a childlike innocence. It's refusing to be wise. It's stupid. I rather despair of Americans dumping their pride and reconsidering what they must do to oppose evil, as Jesus clearly exemplified for us.

As for me, I will be one the side of those who sigh and that cry for all the abominations that be done in the midst of the land.

UncurledA said:

You mentioned Jesus driving the money-changers out of the Temple yesterday, SoT. Most people in this country are conditioned, I fear, into the crazy presumption Jesus was doing something wrong. The moneychangers, after all, were entering into consent relationships with the people they were screwing over with their taking of increase for buying offerings and exchanging money for the Temple offering. Nobody forced the people coming to the Temple to enter into these agreements to get a skimmed exchange rate for Temple currency, so they should just take their medicine and shut up and go on in. A lot of them couldn't afford it, but hey, if you couldn't afford the skim, then don't come to the Temple to make an offering to God, would be their reasoning. But if you come and exchange and enter into the moneychangers' web, they would say, then you owe the skim - you promised ! But, annoyingly to these same people ( if they allowed themselves to think ), Jesus was looking at the bigger picture. Abomination trumps the poor not paying their bills every time, sorry to disturb peoples' nonscriptural Puritan hideboundedness. The criminals were running the game. Jesus did what was right in upsetting their entire "business model" and wrecking it.

Americans are siding with the moneychangers, or at least resigning themselves to passively accept their criminality and blame themselves, because they buy the naive and simplistic notion the evil borrowers shouldn't have been seduced by them. Then, assets get stripped en masse, and sold to our creditors, effectively enslaving us to foreigners. This isn't a childlike innocence. It's refusing to be wise. It's stupid. I rather despair of Americans dumping their pride and reconsidering what they must do to oppose evil, as Jesus clearly exemplified for us.

As for me, I will be one the side of those who sigh and that cry for all the abominations that be done in the midst of the land.

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Well stated.

If I'm not mistaken, Jews had to make mandatory payments to the temple in its own coinage and the money changers thus exploited the currency differential for personal gain at the expense of the poor and needy:

Ched Myers makes the claim that Jesus may have been calling for an end to the entire cultic system—symbolised by his overturning of the stations used by lepers[Mk. 1:44]) and women.[5:25–34] They represented the concrete mechanisms of oppression within a political economy that doubly exploited the poor and unclean. Not only were they considered second class citizens, but the cult obliged them to make reparation, through sacrifices, for their inferior status—from which the marketers profited. Jesus utterly repudiates the temple state, which is to say the entire socio-symbolic order of Second Temple Judaism. His objections have been consistently based upon one criterion: the system's exploitation of the poor.

http://en.wikipedia.org/wiki/Cleansing_of_the_Temple

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It is believed that Christ's resistance to this injustice may have sown the seeds for his eventual crucifixion.

Money is essential for trade and thus it is the most highly valued "commodity". The notion of the "money changers" has morphed into the notion of those who have monopolized control over issuance of money and credit for private gain and the rent of usury.

America had resisted monopolistic pursuits by those who have historically privately controlled "money making" (i.e., credit creation) through the public issuance of currency and credit, but in 1913, with the establishment of the Fed, the struggle was lost, the Constitution abandoned and an era of theft of value from the productive efforts of We The People began.

As long as the general prosperity has continued to expand, the American people have gone along with the status quo unwitting of the underlying looting underway. However, we are now in a historical crisis that presents an opportunity to remove the value-siphoning "money changers" from the system of trade as popular outrage to the ongoing fleecing develops and the public's attention centers on the true, unnecessary source of our economic undoing and suffering.

“A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all of our activities are in the hands of a few men. We have become one of the worst ruled, one of the most completely controlled and dominated governments in the civilized world...no longer a government of free opinion...but a government by the opinion and duress of small groups of domineering men.” PRESIDENT WOODROW WILSON, 1916, when he realized his gigantic mistake in supporting the Banksters with the Federal Reserve Act in 1913.

“This [Federal Reserve] Act establishes the most gigantic trust on earth. When the President signs this bill the invisible government by the Monetary Power will be legalized...the worst legislative crime of the ages is perpetrated by this banking and currency bill. The caucus and party bosses have again operated and prevented the people from getting the benefit of their own government.” CHARLES LINDBERGH, Sr., U.S. Congress

President Andrew Jackson, wrote: "The bold effort the present bank had made to control the government, the distress it had wantonly produced...are but premonitions of the fate that awaits the American people should they be deluded into a perpetuation of this institution or the establishment of another like it."

Thomas Jefferson wrote: "The Central Bank is an institution of the most deadly hostility existing against the principles and form of our Constitution."

Felix Frankfurter, Justice of the Supreme Court (1939-1962), said: "The real rulers in Washington are invisible and exercise power from behind the scenes."

Congressman Louis McFadden, House Committee on Banking and Currency Chairman (1920-31), stated: "When the Federal Reserve Act was passed, the people of these United States did not perceive that a world banking system was being set up here. A super-state controlled by international bankers and industrialists...acting together to enslave the world...Every effort has been made by the Fed to conceal its powers but the truth is--the Fed has usurped the government."

"Whoever controls the volume of money in any country is absolute master of all industry and commerce." - James A. Garfield

"Money power denounces, as public enemies, all who question its methods or throw light upon its crimes." - Wm. Jennings Bryan

http://wikiworld.com/wiki/index.php/Monetary_Reform_Act

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We gave them powers that the founders warned us not to give them. Now, as with so many things, we're along for the ride because major change would be too much pain all at once.

dissimulo said:

We gave them powers that the founders warned us not to give them. Now, as with so many things, we're along for the ride because major change would be too much pain all at once.

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Just added this to the bottom of my blog before reading this:

"...one day, some great opportunity stands before you and calls upon you to stand up for some great principle, some great issue, some great cause. And you refuse to do it because you are afraid. You refuse to do it because you want to live longer. You’re afraid that you will lose your job, or you’re afraid that you will be criticized or that you will lose your popularity, or you’re afraid that someone will stab you or shoot at you or bomb your house. So you refuse to take the stand. Well, you may go on and live until you are ninety, but you are just as dead at thirty-eight as you would be at ninety. And the cessation of breathing in your life is but the belated announcement of an earlier death of the spirit. You died when you refused to stand up for right. You died when you refused to stand up for truth. You died when you refused to stand up for justice." - Martin Luther King

Click to expand...

Money is essential for trade and thus it is the most highly valued "commodity". The notion of the "money changers" has morphed into the notion of those who have monopolized control over issuance of money and credit for private gain and the rent of usury.

America had resisted monopolistic pursuits by those who have historically privately controlled "money making" (i.e., credit creation) through the public issuance of currency and credit, but in 1913, with the establishment of the Fed, the struggle was lost, the Constitution abandoned and an era of theft of value from the productive efforts of We The People began.

As long as the general prosperity has continued to expand, the American people have gone along with the status quo unwitting of the underlying looting underway. However, we are now in a historical crisis that presents an opportunity to remove the value-siphoning "money changers" from the system of trade as popular outrage to the ongoing fleecing develops and the public's attention centers on the true, unnecessary source of our economic undoing and suffering.

Click to expand...

A better First Principles summary of what has occurred, I have never read.

UncurledA said:

A better First Principles summary of what has occurred, I have never read.

Click to expand...

Think of it this way. Expanding unemployment compensation to 99 weeks for the millions of Americans dislodged from their work because of the malfeasance of the financial elite has cost the government ~$100 billion. Wall Street is set to pay itself bonuses of $144 billion this year in bonuses off of what is effectively fictional income derived from Creative Regulatory Accounting Principles (CRAP) and the after effects of the multi-trillion dollar bailouts and backstopping by taxpayers during the acute crisis period in 2008-2009. Thus, the money being siphoned from the financial system - where banksters effectively are gambling with America's wealth in a Fed-rigged casino - by Wall Street elite for private compensation could more than cover the costs for millions who are jobless, going bankrupt and losing their homes thanks to prior "bad bets". This economic predicament is so absurdly unconscionable and unjust as to be a historical caricature of what has long been considered the problem with our capitalist system. Think of what the Founding Fathers of America would think of this situation and how to resolve it. There is nothing wrong with freedom, whether in trade or politics, but there is a problem when freedom has been abused to hijack the systems of trade and politics by unscrupulous sorts that apparently lack any moral conscience and virtue. The solution is to remove the power of such persons and to punish them in a meaningful manner that will prevent future such dereliction of social responsibility by others in the future. It is now in the hands of the American people to make this judgment, return government to its proper owners and mete out justice accordingly.

....is so absurdly unconscionable and unjust as to be an historical caricature of what has long been considered the problem with our capitalist system. Think of what the Founding Fathers of America would think of this situation and how to resolve it.

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Again, good stuff, that. The caricature is forming into full flesh right before our eyes.