You're about to bail out Bank of America. Again.

[greyforest]

http://www.bloomberg.com/news/2011-10-18/bofa-said-to-split-regulators-over-moving-merrill-derivatives-to-bank-unit.html


Bank of America Corp. (BAC), hit by a credit downgrade last month, has moved derivatives from its Merrill Lynch unit to a subsidiary flush with insured deposits, according to people with direct knowledge of the situation.

The Federal Reserve and Federal Deposit Insurance Corp. disagree over the transfers, which are being requested by counterparties, said the people, who asked to remain anonymous because they weren’t authorized to speak publicly. The Fed has signaled that it favors moving the derivatives to give relief to the bank holding company, while the FDIC, which would have to pay off depositors in the event of a bank failure, is objecting, said the people.

[Winehole23]

http://www.kansascity.com/2011/10/21/3221870/hoenig-appointed-to-no-2-spot.html

[boutons_deux]

RED ALERT: Biggest Bank Sweetheart Deals of All Time?

First case in point: the astonishing (and so far mostly unnoticed) little slight-of-hand that Bank of America pulled when it switched over its Merrill Lynch-derived toxic assets to a federally insured program. Read this and weep: Bank of America is moving $75 trillion of highly risky derivative contracts "from its Merrill Lynch unit to a subsidiary flush with insured deposits." The FDIC, which is the government agency that insures bank deposits, is screaming bloody murder, but the Federal Reserve wants to let them do it.

http://www.huffingtonpost.com/mike-lux/red-alert-biggest-bank-sw_b_1025806.html?view=print&comm_ref=false

IIRC, BoA was "forced" by Treasury to eat M-L. That's probably some leverage BofA has here vs recalctrant FDIC.

American taxpayers, and FDIC, are being setup by the Fed and Treasury (part of the financial 1% club) for another multi-$T bailout.

Where are the tea baggers dissenting against the financial sector? They've gotten very quiet after they elected the VRWC's candidates to Congress. Tea baggers are a total fraud (and the "sincere" ones are stupid, ignorant dupes).

[DMX7]

Banks are good pepople. - Mitt "The Shit" Romney

[boutons_deux]

Is Bank of America Headed for the Glue Factory?

according to Bloomberg, “the transfers (of derivatives) are being requested by counterparties.” Well, how do you like that? In other words, the investors on the other side of these contracts want Merrill to put them under an insurance umbrella provided by the FDIC.

“The GAO detailed instance after instance of top executives of corporations and financial institutions using their influence as Federal Reserve directors to financially benefit their firms, and, in at least one instance, themselves….

“The corporate affiliations of Fed directors from such banking and industry giants as General Electric, JP Morgan Chase, and Lehman Brothers pose ‘reputational risks’ to the Federal Reserve System, the report said. Giving the banking industry the power to both elect and serve as Fed directors creates ‘an appearance of a conflict of interest,’ the report added….

Joseph Stiglitz – former head economist at the World Bank and a Nobel-prize winner – said yesterday that the very structure of the Federal Reserve system is so fraught with conflicts that it is ‘corrupt’ and undermines democracy.

Stiglitz said, ‘If we [i.e. the World Bank] had seen a governance structure that corresponds to our Federal Reserve system, we would have been yelling and screaming and saying that country does not deserve any assistance, this is a corrupt governing structure.’”

“This move reflects either criminal incompetence or abject corruption by the Fed. Even though I’ve expressed my doubts as to whether Dodd Frank resolutions will work, dumping derivatives into depositories pretty much guarantees a Dodd Frank resolution will fail. Remember the effect of the 2005 bankruptcy law revisions: derivatives counterparties are first in line, they get to grab assets first and leave everyone else to scramble for crumbs. So this move amounts to a direct transfer from derivatives counterparties of Merrill to the taxpayer, via the FDIC, which would have to make depositors whole after derivatives counterparties grabbed collateral. It’s well nigh impossible to have an orderly wind down in this scenario…..This move paves the way for another TARP-style shakedown of taxpayers, this time to save depositors. No Congressman would dare vote against that. This move is Machiavellian, and just plain evil.”

Bank analyst Christopher Whalen at Reuters thinks that the transfer could be a sign that B of A is getting ready to throw in the towel. Here’s an excerpt from the article:

“…. the move to put the derivatives exposures of Merrill Lynch under the lead bank could be preparatory to a Chapter 11 filing by the parent company. The move by Fannie Mae to take a large junk of loans out of BAC, the efforts to integrate parts of Merrill Lynch into the bank units earlier this year, and now the wholesale shift of derivatives exposure all suggest a larger agenda.

“I don’t have any access to inside skinny, but what I see suggests to this investment banker that a restructuring may impend at Bank of America.” (“Is Bank of America planning for a Chapter 11″, Reuters)

http://www.counterpunch.org/2011/10/21/is-bank-of-america-headed-for-the-glue-factory/print

=======

Bankruptcy would mean not only that BoA/M-L has raped taxpayers with incredible risk (risk becomes $100Bs taxpayers loss if BoA goes bankrupt, but that stockholders would be wiped out.)

So the Fed is protecting the BoA capitalists/investors(counterparties) by assuring that FDIC (taxpayers) cover their losses.

Capitalists' loss, taxpayers payout

And Yoni STILL blames, as the VRWC propaganda machine dictates, that the financial crisis and Banksters' Great Jobs Depression on CRA and F&F, while denying that many $10Ts of derivatives even exist. :lol

[boutons_deux]

Which Bank Is the Worst for America? 5 Behemoths That Hold Our Political System Hostage

http://images.alternet.org/images/managed/storyimages_1318378771_slide3.jpg

http://images.alternet.org/images/managed/storyimages_1318378675_slide4.jpg

http://images.alternet.org/images/managed/storyimages_1319047173_slide1.jpg

http://images.alternet.org/images/managed/storyimages_1319047335_slide2.jpg

the five, from winner down:

Citigroup
JP Morgan Chase
Bank of America
Goldman Sachs
Wells Fargo

http://www.alternet.org/module/printversion/152686

[ChuckD]

The banks were stupid to pay back the TARP funds as quickly as they did. They were too greedy, not wanting to pay the govt their share of the profits, and now they're too weak to survive, at least some of them.

[admiralsnackbar]

The banks were stupid to pay back the TARP funds as quickly as they did. They were too greedy, not wanting to pay the govt their share of the profits, and now they're too weak to survive, at least some of them.
The problem isn't the bank's stupidity, it's that of their shareholders not minding their companies' board activity. The TARP was paid back on time because failure to do so would have meant the officers and board-members would have endured govt. claw-backs on their salaries/bonuses.

The bank management was very intelligent from the perspective of self-interest even if their actions on behalf of the bank's financial health could be construed as stupid. That's a major problem with Wall St. in a nutshell: management is strip-mining companies for personal gain instead of being ethical stewards of their companies, and the Dodd-Frank is too toothless to effectively protect consumers.

[boutons_deux]

"shareholders not minding their companies' board activity."

what crap. CEOs put in friendly board members. Stockholders have almost no control, and exercise little power. All the stockholders (capitalists) care about is dividends and stock price rises, no matter how the company produces them.

"Dodd-Frank is too toothless to effectively protect consumers"

because the graph above shows how the finance sector spent $Ms de-toothing D-F, just like BigPharma and BigInsurance spent $Ms screwing up ACA.

[admiralsnackbar]

"shareholders not minding their companies' board activity."

what crap. CEOs put in friendly board members. Stockholders have almost no control, and exercise little power. All the stockholders (capitalists) care about is dividends and stock price rises, no matter how the company produces them.
Right, and I described a situation in which bank execs and boards are making stock prices fall while enriching themselves -- behavior that rightly pisses off stockholders, and should have done so years ago were they even slightly vigilant and organized.

It's a given that many of these corrupted exec/BODs are criminal based on their actions thus far, and it's also a given that laws and regulation will protect/favor corporations with lobbyists long before they protect that corporation's individual stockholders... I'm not arguing that. I'm asking who is ultimately at fault if not the "stockholders (capitalists)"? If they don't care how their money is spent, who else is left to?

If people spent more time learning about the companies they invested in instead of looking at puffed-up performance stats on e-trade and/or assuming they can "set and forget" their investments, we wouldn't be in this mess. Stockholders ceded most of their oversight because decades of prosperity lulled them into the assumption that they would get a good ROI no matter what, but it hasn't always been this way, and it won't always be this way.

[101A]

http://www.kansascity.com/2011/10/21/3221870/hoenig-appointed-to-no-2-spot.html

Potentially good news, however he is not the boss; in a position to be kept quiet. I remember reading about him in '09. Refreshing.

[boutons_deux]

(Barry should have fired the Repug asshole (in fact ALL Repug appointees) at OCC who the Repugs used to block 19 states (including Spitzer whom the Repugs took down for going after Wall St) from going after predator lenders. The Repugs were directly responsible for permitting and extending the sub-prime mortgage scam, not CRA, F&F)

[admiralsnackbar]

(Barry should have fired the Repug asshole (in fact ALL Repug appointees) at OCC who the Repugs used to block 19 states (including Spitzer whom the Repugs took down for going after Wall St) from going after predator lenders. The Repugs were directly responsible for permitting and extending the sub-prime mortgage scam, not CRA, F&F)

And yet the banks overwhelmingly backed Democrats in campaign donations on the last few go-arounds.

Dying for some strict regulatory activity, no doubt.

[hater]

"you mad at the wrong people. Blame yourself" - GOP candidates

[boutons_deux]

And yet the banks overwhelmingly backed Democrats in campaign donations on the last few go-arounds.

Dying for some strict regulatory activity, no doubt.

Financial and other sectors were simply buying the influence of the more and very probable winner, and they obtained it. They'll bribe whomever, Dem or Repug, that they think will have the power.

[admiralsnackbar]

Financial and other sectors were simply buying the influence of the more and very probable winner, and they obtained it. They'll bribe whomever, Dem or Repug, that they think will have the power.
So you see why getting all partisan about it is beside the point, I expect.

[boutons_deux]

"false equivalence"

Repugs have pushed hard for VRWC strategy (cut taxes, war on employees, kill regulations) all along, since 1975.

Repugs screwed up ACA obtained all kinds of compromises, then voted against it.

Repugs gutted Dodd-Frank

Repugs gutted CFPB

Repugs blocked Liz Warren

Repugs are trying to kill paid sick leave nationwide.

Repugs says banks are over regulated

Repugs plan to kill Medicare and SocSec

Repugs plan to kill EPA, and defund the IRS.

What where are the Dems in the above pushes? nowhere

[RandomGuy]

Moody’s Downgrade
The Moody’s downgrade spurred some of Merrill’s partners to ask that contracts be moved to the retail unit, which has a higher credit rating, according to people familiar with the transactions. Transferring derivatives also can help the parent company minimize the collateral it must post on contracts and the potential costs to terminate trades after Moody’s decision, said a person familiar with the matter.

The counterparties to the derivatives are getting skittish.

Interesting.

I would say let them do it, but charge them some VERY hefty FDIC premium hikes, enough to make it felt come executive bonus time.

[RandomGuy]

Hoenig also called for breaking up America’s biggest banks. Hoenig has contended they have an unfair funding edge over smaller lenders precisely because the 2008 economic downturn showed policymakers don’t have the stomach to let them go under.

Predictably, smaller financial institutions are sympathetic to his outlook.

“Our economy in the U.S. would be drastically different if we had five big banks and no community banks,” said Linda Hanson, the regional president for Enterprise Bank & Trust in Kansas City. “It’s important for our country to sponsor entrepreneurship.”


Read more: http://www.kansascity.com/2011/10/21/3221870/hoenig-appointed-to-no-2-spot.html#ixzz1biammS00

Interesting. Too bad he isn't the chairman...

[boutons_deux]

Repugs will kill any such move to break up the TBTF, even if they are all technically bankrupt, even after unloading $1T+ toxic obligation to Geithner.

[RandomGuy]

The problem isn't the bank's stupidity, it's that of their shareholders not minding their companies' board activity. The TARP was paid back on time because failure to do so would have meant the officers and board-members would have endured govt. claw-backs on their salaries/bonuses.

The bank management was very intelligent from the perspective of self-interest even if their actions on behalf of the bank's financial health could be construed as stupid. That's a major problem with Wall St. in a nutshell: management is strip-mining companies for personal gain instead of being ethical stewards of their companies, and the Dodd-Frank is too toothless to effectively protect consumers.

Bingo.

I strongly suspect that managment of large companies work more to protect their own interests, to the detriment of the stockholders. Getting a rein in on executive pay that distorts objectives would be a good start to fixing that.

[boutons_deux]

" ethical stewards of their companies"

where in the employment contract or in the corp's articles of incorporation is there ANYTHING about ethics or morals?

where are the owners (stockholding capitalists) demanding a corp be ethical or moral? all they want is stock price rises and dividends.

[CosmicCowboy]

Bingo.

I strongly suspect that managment of large companies work more to protect their own interests, to the detriment of the stockholders. Getting a rein in on executive pay that distorts objectives would be a good start to fixing that.

They need to ban stock options as compensation. Go to performance incentives instead and make the corporations put in their annual statements "we just gave the CEO a 40 million dollar bonus".

[TDMVPDPOY]

lookout for the bailout

and the management rewards themselves with bonuses and wage increases for doing nothing

[boutons_deux]

"They need to ban stock options as compensation."

aka government intervention and regulation of private enterprise. won't EVER happen

[vy65]

Stock options are performance based incentives.

[boutons_deux]

UCA has beaten (bought) Congress and FASB into permitting all kinds of accounting fraud so stock prices are supported with non-existent fundamentals or performances. There's all kinds of book-cooking at the end of quarters to support stock prices.

[admiralsnackbar]

" ethical stewards of their companies"

where in the employment contract or in the corp's articles of incorporation is there ANYTHING about ethics or morals?

where are the owners (stockholding capitalists) demanding a corp be ethical or moral? all they want is stock price rises and dividends.
First off, I'm not talking about guidance according to some extra-commercial moral covenants, I'm talking about the execs/BOD job description, namely to advance the interests of the company. If making a bunch of bets that might pay off short-term but might also bust the company long-term is accompanied by either-way enrichment for execs, you might well have what the kids like to call a conflict of interest and (under those circumstances) a breach of contract, which is (wait for it) unethical according to set organizational rules.

As for where you would find the contractual terms which define not only the duties and expectations of all company positions, but also the terms by which infractions or failures will be managed? They're called bylaws. All corporations have them.

[boutons_deux]

investors only care about stock price today, about dividends this year, none GAF about long-term strategy. "short termism" has been bemoaned for decades.

[admiralsnackbar]

investors only care about stock price today, about dividends this year, none GAF about long-term strategy. "short termism" has been bemoaned for decades.
Thanks for the newsflash. That's kinda been my point from the go, hasn't it?

[boutons_deux]

147 Banks and Super-Companies that Run The Entire World Economy

a new study of the global economy and wealth concentration has identified a complex system of only 147 banks and corporations around the world which share in the largest chunk of the change

The work, to be published in PLoS One, revealed a core of 1318 companies with interlocking ownerships (see image). Each of the 1318 had ties to two or more other companies, and on average they were connected to 20. What's more, although they represented 20 per cent of global operating revenues, the 1318 appeared to collectively own through their shares the majority of the world's large blue chip and manufacturing firms - the "real" economy - representing a further 60 per cent of global revenues.

When the team further untangled the web of ownership, it found much of it tracked back to a "super-entity" of 147 even more tightly knit companies - all of their ownership was held by other members of the super-entity - that controlled 40 per cent of the total wealth in the network. "In effect, less than 1 per cent of the companies were able to control 40 per cent of the entire network," says Glattfelder. Most were financial institutions. The top 20 included Barclays Bank, JPMorgan Chase & Co, and The Goldman Sachs Group. [...]

"It's disconcerting to see how connected things really are," agrees George Sugihara of the Scripps Institution of Oceanography in La Jolla, California, a complex systems expert who has advised Deutsche Bank.

http://www.alternet.org/newsandviews/article/684864/the_147_banks_and_super-companies_that_run_the_entire_world_economy/

[TDMVPDPOY]

147 Banks and Super-Companies that Run The Entire World Economy



no shit, they have so much influence on the market cause they direct the flow where funds go...i dont like it when certain individuals who have alot of wealth can play mind games on the market and speculate the share price, they can make iti go up n down easy...buffet is example...

govts want hedgefunds n superfunds to bail them out....

[boutons_deux]

Grandstanding Alert!

Whitewash Alert!

Lawmakers Probe $75T Derivatives Dump by Bank of America

Bank of America is being probed by lawmakers over their multi-trillion dollar liability dumponto the public's dime:

Eighteen lawmakers signed onto letters from Representative Brad Miller and Senator Sherrod Brown seeking information about whether agencies consulted on the transfer considered the potential impact on the bank's health and customer accounts.

"Because of the favored treatment of derivative contracts in receivership, it appears highly likely that losses on derivatives would result in losses to insured deposits ultimately borne by taxpayers," Miller wrote in his letter, which was signed by eight House Democrats. The transfers were first reported by Bloomberg News on Oct. 18.

http://www.alternet.org/newsandviews/article/688245/lawmakers_probe_$75t_derivatives_dump_by_bank_of_a merica/

[boutons_deux]

related news about how the financial sector regards itself so highly:


Hubris Watch: US Bank CEO Sniffs About Breaking Rules When His Bank Has Huge Trustee Liability


annual meeting of the Minnesota Chamber of Commerce by US Bank’s CEO, Richard Davis. Even though Occupy Minnesota was protesting outside, Davis chose to ignore them. His speech made clear that the business community does not care about long-term self interest, let alone social responsibility. Housing and the foreclosure crisis were absent from the 2012 legislative priorities. But tax reform, which is code for shifting even more of the cost of government on to the small fry? Yeah, that’s a big deal.

Davis’ apparent lone comment on the public ire against the banks was dismissive:

“‘Everybody’s breaking the rules, blah blah blah,” Davis said at one point, mocking the general sentiment behind the public outrage before admonishing them to “Get over it.”

Davis’ arrogance no doubt seems justified, since only rulebreakers who aren’t in the corporate elite club, like Bernie Madoff, have been brought to justice. And he stole from rich people, which made him a prime target. By contrast, US Bank on Davis’ watch, is a recidivist rulebreaker, but he clearly regards that as a matter of no import. (Davis was US Bank’s president starting in October 2004, was promoted to CEO in December 2006, and became chairman in December 2007).

US Bank is one of the four biggest securitization trustees, along with Bank of New York, Deutsche Bank, and Wells Fargo. That, sports fans, means his bank has massive liability on mortgage backed securitizations. We discussed this issue recently as far as Bank of New York is concerned. The same logic applies to US Bank:

What has gotten less attention is the implication of the probable derailment of this deal for the Bank of New York, and its vulnerability to mortgage litigation. If you think, as banking expert Chris Whalen does, that BofA is a goner by virtue of the odds of very large damages in the various mortgage cases that are in progress, Bank of New York is a goner even faster if (and we really mean when) investors start saddling up to target the bank.

http://www.nakedcapitalism.com/2011/11/hubris-watch-us-bank-ceo-sniffs-about-breaking-rules-when-his-bank-has-huge-trustee-liability.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capi talism%29

[hater]

sad thing is humans have better chance to topple the alien goverment in the planet Nibiru than toppling the 1% of multibillionaires that run the world. Maybe the CEO was right. Things will not change, get over it.

[boutons_deux]

"Things will not change"

Nope, as I've been saying all along.

tri-cornered/musketed tea baggers' legislators changed nothing for the better and left the financial/UCA untouched, unchallenged.

OWS won't even elect anybody.

[Winehole23]

Bank of America, carrying water for DJT?


In recent months, Bank of America has been accused of freezing or threatening to freeze customers’ accounts after asking about their legal status in the U.S. In July, the Kansas City Star reported (https://www.kansascity.com/news/business/article215688615.html) on a couple who had been locked out of their accounts after Bank of America questioned whether the account holders were U.S. citizens or dual citizens.



Tennessee native David Lewis says he received the same suspicious-looking letter as Collins. In an interview with the Miami Herald, Lewis said he has maintained an account with Bank of America for about 30 years. In the letter, the bank inquired about his citizenship, income, and Social Security number.


When he called Bank of America, he was told his account would be frozen if he did not fill out the forms. That phone conversation led him to cancel his account, he said. “One would think a national bank would be careful about looking stupid after Wells Fargo,”https://www.miamiherald.com/news/business/article217095125.html

[RandomGuy]

Bank of America, carrying water for DJT?




https://www.miamiherald.com/news/business/article217095125.html

Credit unions. Never looked back, perfectly happy.

[boutons_deux]

Bank of America is asking customers to prove citizenship to access their own money (https://www.dailykos.com/stories/2018/9/11/1794968/-Bank-of-America-is-asking-customers-to-prove-citizenship-to-access-their-own-money)

"Bank of America said it was standard practice to ask about citizen status when opening a new account or updating customer information on an existing one.


“Like all financial institutions, we’re required by law to maintain complete and accurate records for all of our customers and may periodically request information, such as country of citizenship and proof of U.S. residency.

This type of outreach is nothing new,” Bank of America said in a statement July 28.

“This information must be up to date and therefore we periodically reach out to customers, which is what we did in this case.”"


Josh Collins (born in USA) said that when he received a paper asking for this information, he assumed the piece of snail mail—which wasn’t printed on the same paper that he had received previous Bank of America correspondence—was some kind of scam. (https://www.washingtonpost.com/business/2018/08/01/are-you-us-citizen-this-question-locked-kansas-couple-out-bank-account/?utm_term=.3ab40acf701e)

Then there were the questions, addressed specifically to Josh.

What’s your Social Security number?

Your address?

Do you have any offshore accounts?

And then:

Are you a U.S. citizen? Do you have dual citizenship?


“I knew they already had my Social Security number and my address," said Josh Collins, 39, who is a photographer for a local news station. "But it was also asking things they’d never asked before, like if I was a citizen.”



The Collins held onto the mailer for a couple of weeks, figuring it was spam because they hadn’t heard anything else from their bank on the matter.

They had banked with Bank of America since 2000.

Then, out of the blue, Jessica Collins had her credit card rejected at a Jack in the Box drive-thru.

The couple spoke with KCUR TV about how humiliating and idiotic the experience was. (http://www.kcur.org/post/kansas-couple-s-account-frozen-after-they-didn-t-answer-citizenship-question-legal#stream/0)

the requirements for financial institutions to have more up-to-date personal (and verified) information on their clients have been in place for decades—

it’s that the environment surrounding immigration has changed in recent years.

Citizenship is not federally mandated for people to open accounts.

Just ask people like Paul Manafort and Donald Trump and Michael Cohen. (https://www.dailykos.com/stories/2018/5/8/1762645/-We-re-not-saying-Donald-Trump-is-a-money-launderer-but-the-evidence-sure-is-whispering-it)


But banks seem to think they are allowed to over reach in their powers

the same way the federal government has been overreaching with their immigration gestapo forces.

https://www.dailykos.com/stories/2018/9/11/1794968/-Bank-of-America-is-asking-customers-to-prove-citizenship-to-access-their-own-money

Can't get your money? auto-payments and other stuff all blocked, mortgage, rent delinquent, etc, etc.


The Brutality of American Life Under Fascist Trash and his racist, ethnically cleansing Schutzstaffel

[ducks]

so I can go to other countries and pour my millions into their banks

[ducks]

if they do not like a private company go someplace else just like the baker boutons

[ElNono]

so I can go to other countries and pour my millions into their banks

yes, you can

[dabom]

yes, you can

:lol