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When The Big Banks Come Crawling Back, Screw 'Em! Talking Points for the Anti-Bank Bailout Revolution

When The Big Banks Come Crawling Back, Screw 'Em!  Punish The Bondholders Mercilessly, Sack Management Teams, And Prosecute For Fraud!

Talking Points for the Anti-Bank Bailout Revolution

Don't get slapped in the face by the irony.

As you find yourself rooting against the banks, be prepared when the too-big-to-fails come begging for taxpayer help, because as we've been warning, a hastened request for TARP v. 2.0 is on the way.  So let's see if we can get everyone following the same playbook before it happens.

This is the issue we need to remain aware of - the more banks suffer from mortgage putbacks and foreclosure fraud, the more likely it becomes that a second round of taxpayer assistance is requested next year by Geithner's replacement at Treasury.  Chris Whalen has been warning for weeks -- here, here, and here -- that 2011 will bring another round of bank bailouts.

  • The strategy is simple, and we've been screaming along these lines since we launched.  Punish the bondholders, sack managements, turn operations over to the FDIC, investigate fraud and prosecute.

Bill Black argued -- here and here -- that even our largest banks, that's you Citigroup (nyse:C), and Bank of America (nyse:BAC), could be successfully placed into government receivership, the same as Sheila Bair does for a half-dozen smaller banks every weekend.

  • Bill Black says that the FASB 157 Hour Of Power, and delusion, is over.  Banks are still insolvent, and the Federal Reserve is complicit in the delusion due to massive MBS holdings.  Put the banks with the most fraud into government receivership. 
  • "Foreclosure fraud is the only thing standing between banks and Armageddon.  The financial media treats Bank of America as if it were a legitimate bank rather than a "vector" spreading the mortgage fraud epidemic throughout much of the Western world."

Speaking of Sheila, she laid out a proposal just last week calling for bank bondholders to be punished in future bailouts.

And Janet Tavakoli made the argument in detail, before anyone else:

Joe Nocera recognized the irony earlier this week in the NYT:

I admit it: I want to see the banks feel some pain.  Most people do, I think.  Banks did terrible things during the subprime bubble, and they still haven’t paid any real price.  I find myself rooting for judges to rule against banks in foreclosure cases.  I would love to see these big investors put the serious hurt on Bank of America, which will encourage other investors to pile on.  I know this colors my thinking.  I can’t help it.

Yet I also know the flip side.  If the foreclosure lawyers start winning a lot of cases, if judges halt foreclosures on a widespread basis, if investors start to extract billions upon billions of dollars from the banks — and if banks become seriously weakened as a result — we’ll be right back where we were two years ago.  The banks will need to be saved for the good of the economy.  The taxpayers will have to come to the rescue.  That’s an appalling prospect too.

Here's more evidence:

Willem Buiter says bank bondholders must be held accountable - CNBC interview.  Not sure how he feels now that he works at Citigroup.

And Arthur Levitt says:

So the choice is simple - wait for the inevitable and get another Wall Street bailout jammed down your throat, or prepare wisely by circulating these basic talking points:

  • Punish the bondholders, sack managements, turn operations over to the FDIC, investigate fraud, find the balance-sheet bombs, then prosecute.


More proof that another bailout mind warp is on its way...

Watch this.  Clip runs 30 seconds.  Seminal quote.

  • "We can either have a rational resolution to the foreclosure crisis or we can preserve the capital structure of the banks.  We can't do both."

Let me repeat myself from above:

So the choice is simple - wait for the inevitable and get another Wall Street bailout jammed down your throat, or prepare wisely by circulating these basic talking points:

  • Punish the bondholders, sack managements, turn operations over to the FDIC, investigate fraud, find the balance-sheet bombs, then prosecute.

Repeat it over and over.  It's even kinda catchy.



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Reader Comments (87)

Re: the foreclosure/securitization mess: WWMcPD?

Seeing as McPalin is as clueless about this stuff as Obama, I suspect we'd be in the same boat here as well. But you know what I'd tell them to do:

Punish the bondholders, sack managements, turn operations over to the FDIC, investigate fraud, find the balance-sheet bombs, then prosecute.
Oct 28, 2010 at 11:41 PM | Registered CommenterDr. Pitchfork
What happened to Dr. Pepper? Wow, I feel like Katie Couric after she asked Palin what she reads to get her news.
Oct 28, 2010 at 11:43 PM | Unregistered CommenterZ
There you are Col. Jessup.
Oct 28, 2010 at 11:45 PM | Unregistered CommenterZ
Z, sometimes my Christianity gets the better of me. The truth: I didn't vote for Obama.
Oct 29, 2010 at 12:04 AM | Registered CommenterDr. Pitchfork
That's two for McCain, one for Obama.
Oct 29, 2010 at 12:11 AM | Unregistered CommenterZ
TDar...Use the king's english and I may be able to read some of it...

Dont Fu*k with me tonight, Z. I've had enought to "Smuck-Yr-Little-Ass" under the table, tonight. Yes, yr hot with the come backs, better than a long time.

But, I'll "Spit" in both of yr eyes for fuckking with me tonight. Piss, in them too. Read my post. You just may be the last one to belly up to the table, after we have done Et, the good food...........................

im in the Loft tonight, its late. You for one, just dont have a clue, most of the time. But when you do, yr right on................
Oct 29, 2010 at 12:15 AM | Unregistered CommenterTexas Dar
Speed bump reading for sure but I didn't slow down. It was a bit of a blur out of the corner of one eye. I saw ass and belly but no hot chick in jeans, no tat with deep meaning. Oh God, speaking like TDar makes me dizzy for shrizzle.
Oct 29, 2010 at 12:28 AM | Unregistered CommenterZ
kindly move the discussion to the next thread...


once we're past 50 comments...it's no fun to scroll...
Oct 29, 2010 at 12:57 AM | Registered CommenterDailyBail
And so we arrive at my very favorite biblical admonition: speak, so that I may see thee. Well done, comrades, well done. You are now officially a POI--person of interest. Carry on.
Oct 29, 2010 at 1:10 AM | Unregistered CommenterCheyenne
To Z as I go to bed--

I'm pegging you at 28. A young man with a lot to learn. You're a bright and unrewarded guy. Been there. It sucks bringing $3 into a grocery looking for a 6-er and eggs.

Here's a news flash, my brother: you suck. That's how the Criminals see it, so watch your back. Just sayin, Z. You got a long way to go, so protect yourself.
Oct 29, 2010 at 1:42 AM | Unregistered CommenterCheyenne
My spouse and I earned over $120K a year; both employed full time raising x2 children; had a home of 12 years; me attending night school for a business degree; she working in insurance and me working in social services; sounds like the the American dream.

She gets laid off; I take a for profit job to cover our costs; she has a car wreck; I lose my job; we spend savings to cover losses and pay off student loan. We fall behind on mortgage and ask for help through Countrywide but they won't help because our earnings decreased by more than half. Gave home back to Countrywide in 2008; moved into rental home with promise of raise and promotion with new for profit social service company. Social service company divested to non=profit company; no promotion; no raise; evicted from rental home; ,move family of four into 3 bedroom apartment; judgment against us on rental home; facing bankruptcy now.

Could Countrywide have worked with us; hell yes. Did they; hell no.

Did Wall Street and the Fed know about the outstanding debt being sold to China; hell yes. We even talked about it in business school in 2005-2006. Business professors heralded Wall Street and the Fed saying they would never let Americans down.

I want my money back from the business school that lied to me.

I want my house back.

I want to earn a living wage.

I want part of the $3.2 billion dollar bonus being paid out to Wall Street insiders this year.

What has been happening on Wall Street since the Arthur Anderson/Enron fraud, has been nothing short of financial terrorism levied against the American people.

Why isn't financial terrorism the same as walking a bomb laden vest into a crowd of people? The damage is the same. Loss of funds; loss of life; loss of a way of life.

Here's a joke for you: What's the difference between a Al Quid'a/Taliban terrorist and Wall Street? Nothing!
Oct 29, 2010 at 1:51 AM | Unregistered CommenterRandall

Big Wall Street Banksters created the Foreclose Economy because they are that greedy and "Too Big to Care" about the American Dream and basic Contract Law. It was done by design and with treasonous and willful intent strictly for power and profit.

The Illegal Securitized Mortgages that became the death blow to our economy actually bet on the foreclosure of the homeowner for as much as a 30 times return on investment. This is true financial terrorism. It is actually better for the investor to foreclose than to help someone stay in their home.

Want to know how easy it is to fix this problem? Crash all of the Big Banks now and fund local banks only that serve to enrich local economies only. Look at the example of the state owned banks in North Dakota, whose population has only a 4% unemployment rate.

The Fed and their complicit banks must be abolished to save the Republic!

It's the only thing we can do. CRASH THE BIG BANKS NOW "Too Big Too Fail" apparently means "Too Big To Succeed" and "Too Big for their own Wallets"

The sooner the better. Why don't we ask a 3rd grade math student what he thinks? The real problem is that a politician who could do something about it has his own mathematical challenges about healthy economies. "Bite the hand that feeds him" (by indicting Banksters), or make millions putting children in the streets for power and profit.

Apparently ALL politicians are going to make the same choice over and over again. They have always sold the souls of your children and their future and they always will. Take the big Banksters out of the picture. Build a local banking system that cares about its community and helps it thrive instead of sucking the life out of it by bribing and fixing the entire system for itself, taking us all of a cliff with it.

Crash all the big banks now. Create new local Banks only = No more Wall Street Banksters.

Problem Solved! J Glenn Lowe

Die Banker Die - A Tribute to the Wall Street Banksters that suck the life from all of us and our economy just to get a nice Christmas Bonus - http://www.youtube.com/watch?v=YGFZ1Jj3ui8
Oct 29, 2010 at 1:51 AM | Unregistered CommenterJ Glenn Lowe
Could Countrywide have worked with us; hell yes. Did they; hell no.

and that right there, ladies and gentlemen, is the truth.
Oct 29, 2010 at 2:09 AM | Unregistered CommenterCheyenne

What the heck are you talking about? Why does everyone in here revert to babble when they can’t talk about the facts and the truth? It is like some abbreviated code for nitwits. For a lady, you have some strange ideas, so protect yourself???
Oct 29, 2010 at 2:24 AM | Unregistered CommenterZ
cheyenne is not a chick z...
Oct 29, 2010 at 3:31 AM | Registered CommenterDailyBail
Baby Girl Name...Not Baby Boy Name...

I don't think so DB, a guy would not use the name Cheyenne. It does mean people of alien speech so that makes some sense.

Cheyenne - The Name Origin and Meaning of Cheyenne
Gender: Female
Origin: Native American
Meaning: The Native American name Cheyenne means - Tribal name from Siouan Dakota Shahiyena, meaning "people of alien speech" (literally "red-speak, red-come").
Oct 29, 2010 at 6:07 PM | Unregistered CommenterZ
How about a truck name? The Cheyenne has been around a long time.

Oct 29, 2010 at 7:54 PM | Unregistered CommenterS. Gompers
Yes, as you can see...to appeal to chicks with families. Thanks Gomp.
Oct 29, 2010 at 8:09 PM | Unregistered CommenterZ
Some people are actually interested in those silly notions Gobie, while others find it offensive to their alternative lifestyles.

Try not to be to offended. It is kinda petty.
Oct 30, 2010 at 4:52 AM | Unregistered CommenterS. Gompers

Not saying this is why his name is what it is Gobie, just that there is more than one reason for a name.

But again, don't be offended.
Oct 30, 2010 at 5:19 AM | Unregistered CommenterS. Gompers
Cheyenne is a character in Once Upon a Time in the West.
Oct 30, 2010 at 1:01 PM | Unregistered CommenterCheyenne
There you go Gobie, now you do not have to be all offended by a picture of a truck with a woman and a child in it.
Oct 30, 2010 at 2:23 PM | Unregistered CommenterS. Gompers
Fascinating choice by the way Cheyenne.
Oct 30, 2010 at 2:45 PM | Unregistered CommenterS. Gompers
How do you spell Gomp… g u l l i b l e .
Oct 30, 2010 at 7:16 PM | Unregistered CommenterZ
@Oct 29, 2010 at 1:51 AM | Randall

Nice to see someone else like me not ashamed to admit we did everything Right, and are fighting for our lifes to hang on to our cabin. Mommy is now a K-Mart, just to save us. Vet bills got way out of hand in the last 5 mo. and you do what you got to do.

Im not alone. It takes a shit load of "Pride" to admit yr down and working to hang on. Were not alone, either. My hat is off to you.................!


What the heck are you talking about? Why does everyone in here revert to babble when they can’t talk about the facts and the truth? It is like some abbreviated code for nitwits. For a lady, you have some strange ideas, so protect yourself???

z, your realy showing yr colors this time. Yr an Aragant little bastared, some times, but I realy do like you most of the time. I will not stoop to yr new Low, of atacking someone you have no clue about. "How Dare You".........................?

By putting someone down, Me Inclued'ed, just to build your self up, only makes you the "New Low Bastared" amungest us, Think About It...............Sorry DB, he got the best of me Again....maby Dar has no place here....?
Oct 30, 2010 at 9:10 PM | Unregistered CommenterTexas Dar

You got it wrong. Cheyenne is Murdock and I am Rambo. You know what that means, I didn't draw first blood (scroll up TDog)but...well...it always ends the same...

Oct 30, 2010 at 10:33 PM | Unregistered CommenterZ
I spell gullible G-O-B-I-E. You could never be Rambo, though with your cinematic background you could probably be Tugg Speedman.

Oct 30, 2010 at 11:04 PM | Unregistered CommenterS. Gompers

Cheyenne would've been livid over all these bailouts--"and a fired up Cheyenne ain't a nice thing to see."
Oct 31, 2010 at 12:02 AM | Unregistered CommenterCheyenne
You all seem to know everything...what does this mean...there is a subliminal message but I can't find it...

Oct 31, 2010 at 12:30 AM | Unregistered CommenterZ
I left Nashville Recording Arttis "Bla-Bla-Bla".........and went on my own. My self, at first, after 25 years playing drums, then it grew to 10 people on my tour bus.........

Top Notch, stage show, Grand-Ol-Oppry".. Goo-Goo, Cluster candy bars, & all...................

Ya Know What,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,I did 2 years with a Indian Band, in Cnt. WIS. from the Momomiee Indian Res.......I was the only White Guy, in the band..........................."Holy-Crap".....

"Dont Piss Off an Indian".............they get realy mad.......?

How dare you put down people you have no clue, as to who they are. I gotta go............................?
Oct 31, 2010 at 12:42 AM | Unregistered CommenterTexas Dar
Tell me about it Cheyenne, I used to have a 69 Cheyenne short bed with a 427 in it that would get fired up about anything, especially Fords, LOL. I don't think it would have liked bailouts neither, it pretty much accepted that everything tasted like chicken.

As I said, excellent choice.
Oct 31, 2010 at 12:44 AM | Unregistered CommenterS. Gompers
I have seen the movie, and loved it. The truck references are for Gobie, since he don't like trucks, especially if there are women and children around them.
Oct 31, 2010 at 1:46 AM | Unregistered CommenterS. Gompers

Z's a punk. Well meaning, smart, but a punk. He's probably 28. But forgive his sins. Ut's hard to slay old heroes. Z is definitely on his way despite current delusions.

Goddamnit, he's here. I sure as shit wasn't at his age. I was in a fucking cave then.

He ain't.
Oct 31, 2010 at 1:57 AM | Unregistered CommenterCheyenne
I don't know what your issue is, Z, but I watch closely.

Tonight I had dinner and multiple drinks with Ozzie Guillen Jr., a minor league All Star, and a pro trader (which according to my def means he gets paid win or lose)--we were watching Game 4 of the World Series. I got burned bad.

These people listen to me because I do not yield. And they keep score, otherwise I ain't invited. I never led these heads wrong.

All I can tell you is this: denial is an incredible force. Best of luck, man. But with this I think I'm checking out, as in for good.
Nov 1, 2010 at 12:01 AM | Unregistered CommenterCheyenne
Nov 1, 2010 at 12:01 AM | Cheyenne

You, for one, know better than to pull out on the rest of us....................? Just becouse of a little Punk-Shit-Head, You are forced to pull out of the groop........"How DareYou"....?????

I have put up with the "No-Body-Likes-"Z" Anymore" for over a year now. He is the little "PUNK" at the party, that you cant "Spit" out of yr mouth, becouse he cant "Shut-the-Fuck-Up".....................

Please dont let one "Low-Life" keep you away from the most fun on the Internett..........DB Rocks....!

The more you Shun Z Down, the more the little bastared loves it..................??? Reamber, the "Little-Guy" will bring you down to hid ground..............................Only if you let the little guy do it to ya..........

If you leave us, "You Lose"............................"Z" Wins..........................Its yr choice. Join us, or let a "Why Dont Anybody Like Z Anymore".............Win...!

If you let Z scare you away, you will miss the "Whole-Point".........................................."Tex" !
Nov 1, 2010 at 11:23 PM | Unregistered CommenterTexas Dar

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