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A banking system is supposed to serve society, not the other way around.

— Economist Joseph Stiglitz, discussing a Great Depression reprisal. (via vanityfair)

(via theamericanprospect)

mohandasgandhi:

Former Chase Banker Admits His Bank Pushed Minorities Into Subprime Mortgage Loans and Tried to Cover It Up

A former Chase banker spoke with The New York Times’ Nick Kristof about how Chase pushed subprime loans to minorities for big commissions. The Young Turks host Cenk Uygur breaks it down.

From Kristof’s article:

One memory particularly troubles [James] Theckston. He says that some account executives earned a commission seven times higher from subprime loans, rather than prime mortgages. So they looked for less savvy borrowers — those with less education, without previous mortgage experience, or without fluent English — and nudged them toward subprime loans.

These less savvy borrowers were disproportionately blacks and Latinos, he said, and they ended up paying a higher rate so that they were more likely to lose their homes. Senior executives seemed aware of this racial mismatch, he recalled, and frantically tried to cover it up.

Just how disproportionately? The people receiving these bad loads were 16% white, 33% Latino, and 50% Black. According to Think Progress:

These disparities help explain why, according to a new report from the Center on Responsible Lending, Latinos and blacks are twice as likely to have been impacted by the housing crisis as whites. In fact,approximately one quarter of all Latino and African-American borrowers have lost their home to foreclosure or are seriously delinquent, compared to just under 12 percent for white borrowers.”

According to the Republicans and weak Democrats, we need to deregulate the banks anyway because these are the “professionals” Alan Greenspan referred to that are so brilliant, only they can trick minorities into taking bad loans so they can make money and we need to let them so they can get the economy back up and running again!

These people have no morals. Yeah, we need to deregulate an industry where its employees are throwing minorities out onto the street so they can make a quick buck.

(via pantslessprogressive)

I don’t like it, but there it is. … If they think it’s too complicated, they have no one to blame but themselves.

— Former Fed chairman Paul Volcker, commenting to the New York Times on how the proprietary trading ban he originally proposed to rein in banks’ risk-taking — once a simple 3-page letter to the president — has ballooned into 298 pages of complex regulations after Wall Street firms lobbied for many exemptions.  (via officialssay)

(via missbananafish)

The Top Five Reasons To Move Your Money From Bank Of America

1. Bank of America Just Unveiled A Shocking New Debit Card Fee: Late last month, BOA announced that it would start charging a $5-a-month fee simply for consumers to use their debit cards for purchases. Although a few of its competitors have started using similar fees in recent times, BOA’s presence as America’s largest banking chain means that if it successfully enacts such a fee, it may be able to set a trend in the industry to make such charges the norm. More than 137,000 Americans have signed an online change.org petition protesting the fee. Most credit unions do not charge for using one’s debit card, and one credit unions, Delta Credit Union based in Atlanta, is even holding a “Switch Day” to encourage BOA’s customers to switch over to its services instead.

2. Bank of America Has Spent Millions Lobbying To Gut Reforms With Your Tax Dollars: Despite being bailed out to the tune of billions of dollars by the federal government, Bank of America has still had the gumption to spend millions of dollars in Washington battling new reforms meant re-regulate the financial sector. It spent nearly $4 million hiring a double-digit number of lobbyists in 2010, mostly aimed at gutting legislation related to banking regulations. Meanwhile, it spent a million dollars on campaign contributions in the 2010 electoral cycle.

3. Bank of America’s Practices Are At The Nexus Of The Foreclosure Crisis: Bank of America CEO Brian Moynihan raised eyebrows recently when he excitedly cheered for faster foreclosures of Americans’ homes. Despite being found to be a major user of error-ridden “robo-signing” foreclosure practices last year, the mega-bank only briefly halted its foreclosure proceedings nationwide. It is also facing lawsuits by multiple states over its mortgage practices.

4. Bank of America Just Announced That It Was Laying Off 30,000 People: The “firm’s 30,000 job cuts are more than double what any other U.S.-based employer has announced so far this year, according to a employment tracking group.” The layoffs come after a decision by Bank of America, JP Morgan, and Citigroup earlier this year to “outsource IT and back office projects worth nearly $5 billion this year to India, as they seek to lower costs.”

5. Despite The Poor Economy, Bank Of America Continues To Reward Its Executives With Multi-Million Dollar Salaries: Despite blaming economic woes for layoffs of employees and its new debit card fee, the mega-bank continues to deliver huge paydays to its executives. The bank just announced that two of its former executives, Sallie Krawcheck and Joe Price, will receive a salary of $850,000 and a payment of $5.15 million and a salary of $850,000 and a payment of $4.15 million respectively. Meanwhile, BOA maintained its CEO’s salary of $950,000 plus $9.05 million in performance-based stock awards this year.

Bank of America to pay ousted execs $11 million in severance

(Reuters) – Bank of America Corp (BAC.N) will pay $11 million to ousted executives Joe Price and Sallie Krawcheck, a large payout at a time when banks face protests over pay but smaller than the eight-figure packages some executives received before the financial crisis.

[…]

The Charlotte, North Carolina, bank last month eliminated their positions as part of a cost-cutting initiative called Project New BAC. Chief Executive Brian Moynihan assigned their duties to two executives promoted to co-chief operating officers.

Bank of America expects to cut 30,000 jobs as part of its efficiency program, which is designed to reduce costs as the mortgage crisis, new regulations, and low loan demand crimp revenue.

While a large amount, the payouts to Price and Krawcheck were in line with severance packages for executives of their stature and pay grade, said a compensation consultant.

That’s right—Bank of America agreed to pay executives they fired a combined $11 million in severance even as they cut 30,000 lower-level jobs in the name of ‘efficiency’. Not to mention the fact that they will impose new fees on debit card users starting in 2012.

Lesson: The rich stay rich; the rest of us get laid off and charged for using our own money.

(Source: Yahoo!)

"Citibank will soon charge $15 a month for checking accounts with less than $6,000. Finally someone is sticking it to those people with less than $6,000. About time. Great job." —Jimmy Kimmel, monologue 10/3/11

Probably not so well known, but up until the mid-nineteenth century, the Catholic Church had a prohibition on charging interest, and this had tremendous significance. For instance, at that time in France, conservative Catholics often compared investment houses to bordellos and viewed financial operations as a form of prostitution. There are some great political cartoons from that era that satirize this. One I used in Paris: Capital of Modernity depicts a young woman trying to entice this older and quite horrified man into this investment house, saying, “My rate of return is good for whatever amount you wish to invest. I’ll treat you very gently.”

— Harvey, David (2010). A Companion to Marx’s Capital (Kindle Locations 1876-1880). Verso. Kindle Edition. I am howling with laughter. (via thenoobyorker)

(Source: genericlatino)

The new "Let them eat cake!" →

kateoplis:

10 shocking, illuminating moments that prove just how out of touch the powerful really are.

Number 2: The Palaces That Taxpayers Built

In Louisville, Ky., as the city struggles with high unemployment, Goldman Sachs engineered a scheme to construct a huge new sports arena that is now siphoning millions of dollars of public money into the investment bank’s coffers. In Jefferson County, Ala., Goldman orchestrated the construction of what’s been called “the Taj Mahal of sewer-treatment plants” — a massive boondoggle that has bankrupted the county and, once again, made Goldman huge money. And in New York, where public budgets are being gutted, Goldman just opened a monstrous $2 billion headquarters, financed by what Bloomberg News calls “unprecedented” aid from taxpayers. []

Definitely click through to the link. This will get your blood boiling. This isn’t a democracy; it’s a fucking plutocracy.

Number 4: For Me, but Not for Thee

 One of the hallmarks of Let Them Eat Cake-ism is an absolute lack of self-awareness mixed with a complete disregard for hypocrisy or personal responsibility. The end result is an especially nauseating “for me, but not for thee” attitude.

In this recession, that has manifested itself as bankers walking away from their obligations to cover their own losses and happily vacuuming up public bailout dollars — all while lecturing strapped homeowners about their moral responsibility to pay their bills.

Recall that in February 2009, Jamie Dimon — the $17-million-a-year CEO of the bailed-out JP Morgan — went on CNBC to deliver a sermon about the moral obligation of covering one’s own losses and not running to someone else for help.

"I don’t think just because someone’s underwater [in their home], they say, I don’t have to stay there," he said. "They’re supposed to pay the mortgage, and we should teach the American people, you’re supposed to meet your obligations, not run from them."

(via pantslessprogressive)