Happens all the time, been going on forever. At every level of govt from municipal to federal.

Legislators not following the law? Well, Americans do have a poor reputation around the globe for misunderstanding irony.

Want more irony? Malik Nadal Hasan specialized in traumatic stress.

What a country!

Courtesy of Jesse at the Café Américain.

1. The Treasury and the Fed rewarded some aggressive risk takers and failing business models at the expense of those who followed sound business practices. Those who followed conservative practices have been penalized twice; first on the way up and again on the way down. Those companies that did fail appear to have been ‘targeted’ by insiders.

2. Much of the process was done in secret with minimal transparency, debate, or disclosure by people who have obvious conflicts of interest.

3. The stated objectives of freeing up credit for the real economy and stemming foreclosures have not been achieved.

4. Trillions in taxpayer money were provided with few strings attached and at minimal stipulated rates of return. Furthermore, several of these institutions are using their taxpayer money to lobby against reform and award themselves pre-crisis salaries and record bonuses.

5. Bailout actions were arbitrary, inconsistent, ad hoc, and without an apparent guiding principles of justice.

6. The banking, rating, “insurance”, and regulatory systems have not been reformed and the perpetrators of the collapse and their enablers are remain in charge, now overseeing the “recovery.”

7. Criminal investigations are minimal; few people are facing indictments or even serious regulatory scrutiny for actions that are highly questionable. Official finds are whitewashes.

8. Regulations, regulatory structures, and other safeguards were implemented, revised or swept aside in chaotic and reckless fashion. [discount window participation and collateral, short selling rules, bank holding companies, mark-to-market]

9. The insider advantages, speculative excess, and extreme leveraging of the perpetrators has been allowed to continue; in fact, allowed to expand. There is a taint of insider trading and corruption that permeates the process.

10. Wall Street is bailed out; Main Street is not. Efforts to subsidize the incomes and balance sheets of failing firms have been massive and were implemented with minimal debate, requirements, or oversight; efforts to shore up taxpayer incomes and balance sheets have been comparatively minimal, subject to extensive debate and tinkering, highly selective, and incomplete.

Thanks to Cafe patron Malcolm McMichael

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“The States racked up some serious debt in keeping the world safe for democracy in the Second World War. On a percentage basis, it has recently spent a significant amount keeping its financial sector safe from productive effort and honest labour. They will raid the Treasury, take their fill, and then compel the government to confiscate the savings of a generation by defaulting on its obligations, its sovereign debt.” -Jesse at the Café Américain

TBTF will be the law of the land for the chosen few:

Too small to be bailed-out? Prepare to be absorbed.

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Benron et al gorge themselves at the taxpayers trough

Fortunately, the Federal Reserve never took a dime of TARP money. So when Fed Chairman Ben Bernanke, who’s been worried about the federal deficit, went to speak Oct. 19 at the San Francisco Fed conference on Asia and the global financial mess, he was obliged to travel to the spectacular Bacara Resort and Spa near Santa Barbara, where suites in high season can run up to $2,000 a night. (We’re told the resort discounted the rooms — it’s off-season — to a mere $300 a night, though it’s unclear whether that included the primo suites.)

Where better for conferees to worry about saving more than at the uber-swanky Bacara?

[ WaPo ]

Those Federated guys live in a fantasyland. So might as well mark everything to fantasy:

Fed Raises Value of Its AIG Assets, Reversing Potential Loss

Oct. 29 (Bloomberg) — The Federal Reserve increased its estimated value of investment portfolios acquired in the rescue of American International Group Inc., reversing potential losses to taxpayers.

The net holdings of three corporations set up by the Fed for the mortgages and securities it took on in bailing out AIG and Bear Stearns Cos. rose by $4.35 billion, or 7.1 percent, to $65.5 billion, the Fed said today in a quarterly revaluation of the assets. The Bear Stearns investments fell by $116 million to $26.3 billion, while the two AIG portfolios gained $4.46 billion to $39.2 billion, the central bank said.

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Head, meet pike: The guilty

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A Blast from the past

In 2005 the question is asked: should I buy a home?

The answer and subsequent commentary are for the most part a gallery of truth-tellers (excepting the trolls of course). Be emlightened.
[ Should I buy or wait? ]

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Fact file-

Almost 50% of Option Arms +30 Days Late
[ acrossthecurve ] [ wsj ]

Almost 19 million homes sit empty
[ .gov ] [ cnbs ]

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Do we henceforth refer to it as the collapse of the middle class, or the destruction of the middle class?

Are You Middle Class? Maybe Not For Long

“[Those in the] middle class suddenly discover that they are overqualified for the jobs they can find and have to settle for anything they can obtain, therefore unemployment sky rockets: too much to offer, too little demand. You see they prepare, study for a job they are not going to get. You kids, you are studying Architecture because you simply wish to do so. Only 3 or 4 percent of you will actually find a job related to architecture.

“When one considers how much work can be replaced now by accounting software, electronic sales presentations, flatter organizational structures, and ‘ news persons ‘ filing reports for free on the Internet via blogs, it is obvious that vast numbers of middle-class Americans teeter on the precipice of unemployability, not just unemployment.

“This time it really is different. The final stages of that blind denial included fiscal imprudence that bordered on insanity. The mirage economy can’t return until after the pendulum has swung its full travel to the other side of the arc. That path leads through the valley of a crushing economic depression, one that will radically and permanently alter the lives of middle-class Americans who are almost universally unaccustomed to hardship.

[ lewrockwell.com ]

Also,

Frontline: Close to Home

“ ‘ I’m a Columbia University graduate. I’m smart. I should be able to stand on my own two feet. ‘ Sitting in a hair salon, Emma looks at herself in the mirror. Her husband Andy sits behind her, nodding. They have a young child, and their personal training company, recently thriving, has fallen on hard times, with business dropped some 40 to 50%. Emma has gone back to school, she says, but in the meantime, her mother, Emma says, is ‘ still working because she’s helping us financially with our kids. Of course I feel guilty. She worked her whole life. ‘ Emma sighs, unable to phrase her thoughts exactly. ‘ Why am I even talking about my mother? I’m 40 years old. With this economy, I feel like a child. ‘ “

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“Their strength is their weakness. The focus which permits some people to succeed also gives them a ‘tin-ear’ for the effects of their greed. In other words, they always go too far, and begin to blatantly start breaking the law, and acting in ways that are obvious wrong. And when there is a public revulsion to their deformity, they just do not get it.” -Jesse’s Café Américain

Old but still relevant.

A good question, asked and expounded upon by Dr. Housing Bubble:

“95 percent of the mortgage market is now backed by the government. As we know, a large part of this growth also occurred with highly risky FHA insured loans that are now imploding at record levels. Last month in Southern California 36 percent of mortgages were FHA insured loans. Now applying the Stockholm syndrome, it would appear that many instead of being angry and calling out the banking fraud for what it is, are starting to believe in what the abductors are pushing. They say things like, ‘ see, the banks are now holding off on the shadow inventory to help the market. Prices are now going up! ‘ As if the banks are concerned about the average American with some banks charging 79.9 percent on credit cards before dealing with the tougher legislation coming in 2010. As you can see from the above chart, the mortgage market is the government which raises the question, why do we even need banks if 95 percent of the mortgage market is directly subsidized by the government?.“

His very graphic graphic (not for the squeamish):

“In fact, there have been a few articles talking about the ‘ brain drain’ because of compensation limitations on Wall Street! You have got to be out of your damn mind! People mistake ‘ intelligence ‘ in kleptocracy, cronyism, and financial engineering with actual smarts. They are smart at screwing over our economy so this brain drain argument is absolute insanity. It would be one thing if they were creating life saving drugs or consumer goods but instead, they are an albatross on the rest of the economy sucking taxpayer dollars into their balance sheets. Yes, let us feel sorry for our financial kidnappers. How can they live on a few million dollars (note: read DeanBaker’s rant) a year after all the good they have done? Let us allow them to have the same system that gave them the key to drive our economy off the financial edge.”

That last paragraph was directed at the so-called “brain-drain” by Hank Greenberg’s new firm from the pool of ready able and willing AIG co-conspiratorshorts, which as you know like GMAC is having trouble paying back the taxpayer bailout that saved their nasty-asses (the perpetual bailout that is never gonna take, they’ll keep coming back for more and more throwing good money after bad, until we realize the only solution is to take ‘em out back and shoot the poor old mangy critters).

Ever get the feeling that you’re being gamed?

“Oh no! Our top commanders are leaving the ship. As it turns out, they were on their laptops all day ignoring the financial iceberg ahead. When it came time to jump ship however, they were the only people with lifesavers.”

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“Children need encouragement. If a kid gets an answer right, tell him it was a lucky guess. That way he develops a good, lucky feeling. ” -Jack Handy

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