Bailout Revenge: Florida AG Suing Angelo Mozilo For Fraud (Video)

Florida attorney general, Bill McCollum has brought civil charges against former Countrywide CEO Angelo Mozilo for deceptive and unfair trade practices.  McCollum charges that Countrywide and Mozilo put thousands of borrowers into fraudulent mortgages. Countrywide had a massive footprint in Florida mortgage origination at the height of the insanity and former Congressman McCollum is essentially suing Mozilo personally for the fraud of the entire company. Nice.

The news is that the federal court judge has remanded the case back to the state courts of Florida which is exactly what McCollum's office requested. He's looking for a large cash settlement and a ton of publicity, he probably wants to be Governor.

The clip is David Faber with Florida AG Bill McCollum (7:03).

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William Buiter Says Bank Bondholders Must Be Held Accountable

Former UK central banker and current professor at the London School of Economics, William Buiter, was an interview guest of David Faber this morning.  Clip runs approximately 7 minutes.

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Another Funny AIG Commercial; Cramer Loses it On Air; Larry Summers Snoozes

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A new reality for the smart-ass AIG kids from Jimmy Kimmel Live.

See also:

Original Collection of AIG Kid Commercials

Tip to Nicholas Carlson from Clusterstock:

CNBC had Dan Solin, the author of The Smartest 401k Book You'll Ever Read on as a guest today. After the host asked him what people could do better to save for retirement, Solin answered:

"One of the things that you could do is to give us more 'In Bogle we Trust' and much less 'In Cramer we Trust'."

Moments later, Cramer barged on to the set to respond.

"The S&P is flat literally for ten years. That's John Bogle's world. If you were to sell at 11,000 like I told you in September, 10,000 like I told you in December, and then get back in at 6,500, who wins? Is that so bad? Is that worth not trusting in? I've had it with the people who tell me about the index fund. For ten years they've done nothing! For ten years! When do they get called on the carpet? When are they ever wrong? Do we have to wait another ten years? Enough of this! I've said my piece. Happy 20th!"

Lawrence Summers asleep at the wheel during a White House meeting with credit-card providers.

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Janet Tavakoli Talks About Banks, Derivatives, And Financial Meth Labs (C-SPAN Video With Brian Lamb)

Ms. Tavakoli found our site recently and contacted me about Elizabeth Warren. We decided to present one of Janet's recent media appearances. It's a rather long clip but quite interesting nonetheless. It's from an April 19th interview on C-Span with Brian Lamb.

Janet Tavakoli is founder and president of Tavakoli Structured Finance, a Chicago-based firm that provides consulting to financial institutions and institutional investors. . Her new book is called "Dear Mr. Buffett: What an Investor Learns 1,269 Miles from Wall Street." Its the story of her meetings with Warren Buffet prior to the economic downturn and how that impacted the way she views investing. She is a former adjunct professor of derivatives at the University of Chicago's Graduate School of Business. She has also worked for Westdeutsche Landesbank in London, Bank One in Chicago, Merrill Lynch, PaineWebber, and Bear Stearns.

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Of Lies, Damn Lies, and Bank Stress Tests (Santelli & Liesman Video)

Updated on Apr 24, 2009 at 5:31 PM by DailyBail

Damned If They Do, Damned If They Don't...

The process of conducting economic stress tests on the 19 largest US banks enters a crucial phase Friday: regulators will begin to share their conclusions with bank executives, and there will be the first public disclosure of the specific criteria utilized in the determination of the health of the individual institutions.

That's the meat.  How rigorous were the modeling assumptions for economic deterioration?  It has leaked that the worst-case scenario for unemployment for '09 used in the tests has already been surpassed. The assumptions are the story tomorrow.

In the short CNBC clip, Laurel and Hardy, Santelli and Liesman have a decent discussion about pitfalls, tightropes, and landmines associated with the much ballyhooed tests.

Updated: the test assumptions have been released. Just as we surmised, the criteria are not especially stringent, in some cases they have already been met or surpassed by the worsening economy since the tests were launched.  Read Yves Smith's thoughts as well as those of Calculated Risk for a through understanding and honest assessment of the information released yesterday from the Fed.

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Who Is Most Heinous...Paulson, Lewis Or Bernanke?

Pretty solid CNBC video discussing Ken Lewis, Henry Paulson and the Bank of America takeover of Merrill Lynch. They pose the question: who's the bad guy?

Ken Lewis is guilty of having the most-hated face in all of failed banking.  He should be indicted for ugly.  And for insulting my intelligence everytime he's on TV.  His purchases of Countrywide and Merrill Lynch, both at substantal premiums, makes him the stupidest CEO in recent memory. 

Paulson is guilty of leading the effort to have the SEC grant Wall Street an exemption to the leverage cap in 2004.  Paulson is also the most likely to trash your house, screw your wife and steal your job while you are on vacation.  Ask Corzine.

Bernanke is guilty of turning the Fed's balance sheet into a cesspool. Bloomberg and Mark Pittman reported today that the Fed will still NOT release details on the more than $2 trillion in loans it has made to the various and sundry.

And all three are guilty of not anticipating the global financial crisis.  Once it began to show itself in 2007, each miscalculated the severity. Contained. Sub-prime only. Move along. Nothing to see here.

Hey geniuses, when a condo in Santa Monica goes from $300k in 2000 to $1.1M in 2006, then we are gonna have banks with problems.  Capisce, you friggin' idiots.

Let's see what you got.

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A Good Day For The Good Guys

I remember the weekend in question last September very clearly.  Fannie and Freddie had failed. AIG was teetering.  A meeting was called, ostensibly to find a buyer for Lehman Brothers (Barclays ultimately balked at the absence of Fed assistance-sharp Brits!), but the surprise was Ken Lewis hooking up with John Thain, and Bank of America buying the tangled morass that was Merrill Lynch.

BAC paid a huge premium for Merrill and that outrage notwithstanding, the purchase itself was the most idiotic in the banking space since Wachovia gorged on Golden West Financial at the peak of the bubble in May 2006.  Every soul on the street outside of Bill Miller knew Lewis overpaid and that Merrill's balance sheet was a radioactive nightmare. The criticism was so uniform in the days that followed that we assumed that it had to have been an 'encouraged marriage.'  Lewis couldn't be so dense as to believe he struck a good deal.

I think the jury is still out on whether Lewis was prodded to do the deal, or even whether he was offered future assistance from the FedTreas if he agreed to take on Merrill's liabilities.  Regardless, Lewis still overshot massively. Granting a premium for Merrill at the time was a low point in bank deal-making history, and offered a hint that he had lost his mind. He and his board should not be approved by shareholders when they vote next month. 

And then there was today.  A day of rare, exquisite joy as the 'he-said, he-said, he-said' romp around the Cuomo subpoena was played out before millions of smiling viewers.  Cuomo, Lewis, Bernanke and Paulson.  It couldn't get any better for payback junkies.  But then it did. There were rebuttals, contradictions, restatements, and denials. It was a good day for the home team, a day for laughing and smirking and feeling that maybe, just maybe, the guilty will be punished after all. 

Without polling, I believe most of us desire intense social and psychological pain for one man in particular, Henry Paulson.  And for once, we got what we wanted. 

Here's a toast to today's circus and to the dream that Bernanke is not re-appointed, that Paulson is indicted, and that Ken Lewis loses his motherfreakin'  J-O-B.

Harrruuuumppphhhh.  

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The Banking Oligarchy Attacks Elizabeth Warren And STSS

The attacks on TARP Oversight Chairwoman Elizabeth Warren have begun. We have been waiting for the backlash since she started making noise in January.  Executives at Citigroup and Bank of America dispatched their agent of misinformation Wayne Abernathy.  First he went to Politico and, today, it was Thomas Cooley at Forbes who picked up the knife. The rapid appearance of three negative articles (Megan McArdle chimed in uselessly as well) regarding Warren is a sign that she has begun to frighten the powerful banking oligarchy and their K Street machine.

Most surprising about the attacks is their weakness.  The criticisms amount to claims she has swayed beyond her charter (wrong), that she's a liberal (meaning what exactly?), and that her solution to the banking crisis is ideologically biased.

Those are fighting words so let's do this thing.

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The Angel & The Anti-Christ (Warren Vs. Geithner Video)

Treasury Secretary Tim Geithner testified Tuesday before the TARP Congressional Oversight Panel (COP) headed by Harvard professor Elizabeth Warren. Questions focused on AIG, accountability of bank executives, bailout transparency, and future bank bailouts.

Youtube clips are after the jump.

See also:

Geithner's Prepared Letter

Warren Slams Geithner Again

Elizabeth Warren Suggests The Bailout Road Less Traveled

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TARP Prosecutor Neil Barofsky Gets His Day In The Sun (Video)

Treasury Special Inspector General for the TARP, Neil Barofsky, made public his long-awaited report Tuesday morning.  It's a dense 250 page document that wiped out my entire Tuesday.  Among the more interesting assertions: the Geithner PPIP could facilitate money laundering by organized criminal enterprises; Barofsky and staff are pursuing 20 criminal investigations into various forms of bailout fraud; and a report addendum from Treasury agency lawyers argues that firms participating in the Geithner bank bailout program (PPIP) would likely be subject to compensation restrictions.

Links and video after the jump.

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Fed Prez Hoenig Breaks From Bernanke: "Let Insolvent Banks Fail"

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Roubini: "Suckers Rally --The Market Will Retest The March Lows"

Roubini is occasionally hilarious. "Green shoots? I see only yellow weeds."

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David Faber & Art Cashin On Regional Banks, TARP And Stress Tests

Two short clips after the jump.

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The Political & Financial Cartoons Of Steve Breen: Winner 2009 Pulitzer Prize (Slideshow)

Yesterday Steven Breen of the San Diego Union Tribune won the 2009 Pulitzer Prize for 'Editorial Cartooning.'  And our angry intern built a slide show in his honor.  Click here to start the show.

See also:

Financial Cartoon Collection

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