Tuesday, October 18, 2011

Bank of America Takes Sleaze To A New Level

If you keep your money at Bank of America, you are an idiot.  BAC quietly moved $53 trillion in derivatives from its holding company to its subsidiary that holds $1 trillion in customer deposits and is insured by the FDIC.  If any part of these derivatives blow up, the Taxpayer will then be on hook for the $1 trillion in deposits. 

I said 8 years ago that we would eventually see things go on in this country that blow your mind.  This is one of them. Although this kind of move is permitted to a very limited degree by the Federal Reserve Act, there is no way in hell that the loophole was intended to permit $53 trillion of shit to affect FDIC-insured deposits.   Of course, the watchdogs who are supposed to prevent this kind of abuse are the same people who benefit from allowing it to occur.

That the BAC upper managment would be so completely devoid of ethics and do something like this is a tragedy.  That Bernanke, Geithner and Obama would allow BAC to do this is a testament to the fact that our system is collapsing.

You can read the details HERE


  1. So, I am currently an idiot, because I have a BAC account primarily out of convienence (BAC ATM on about every corner in California). What other regional banks do you suggest that are not in the same boat as BofA, Citi, Chase, Wells Fargo, etc.?

  2. (Dave)

    find some regional/local bank

  3. The Bank of Posturepedic and trust works just fine for me. That and my Local Credit union as a bill paying apparatus and check cashing apparatus only.

    The rest can Fuk off.

  4. (Quinn)

    Bank of America is now right up there with Government of America when it comes to screwing tax payers.

  5. Find a credit union

    Audit the Fed. H.R. 459 has 185 co-sponsors.

  6. Hi - the last few write ups are very disturbing but I guess foreseen.

    Your comments about the CFTC meeting. First off the limits are still very generous! Second the 60day compliance period! Third what about shell companies all belonging to the instigators?

    So now - according to Bix Weir - there are these supposed good guys who are going to take this down. Well now is the time, but I don't believe there is a white Knight!

    My main question is how can the cartel now create such volatility in order to get out of more of their shorts? They cannot add to them? The COT report is low.

    I would have thought that now would be a good time to squeeze?

    Thanks for your input.

  7. Hi - I am sure one could take Morgan Stanley apart as well!

    Another thing - I do think that all earnings cannot be trusted anymore - good or bad. Trust is a concept which has left the station fast - to gain it back takes much much more effort!

    To that somehow I have this feeling, but not the skill, that Goldman Sachs numbers are as they are to influence perception too! ie I think they purposefully disappointed. There are many reasons to do that.

    As always your comments will be appreciated.

  8. Chris Hedges: "This one could take them all down."


  9. Notice how they love their paper assets...?why can't gold trade to $10,000? everybody else pulls numbers out of their asses...and gold holds its value better in a fire.

    Steinhardt Pledging Picassos for Stock Exchange Shows Appeal of Art Loans

    “Going through the downturn in 2008, a lot of people realized that art
    weathered that storm very well and is a stable form of collateral,”
    said Gyorgy at Citi Private Bank. “When you look at our client base,
    its savvy business people that for the most part are using the
    liquidity from the art loan to invest back in their businesses.”


  10. Hmmm....someone didn't get their envelope...

    EU Raids Banks in Probe of Possible Collusion in Interest-Rate Derivatives

    European Union regulators raided banks that offer financial derivatives linked to the Euro Interbank Offered Rate, saying they were investigating possible collusion.

    The European Commission said it had “concerns that the companies concerned may have violated EU antitrust rules that prohibit cartels and restrictive business practices.” It didn’t name the businesses involved.

    Joaquin Almunia, the EU’s competition commissioner, has made financial markets one of his priorities and said last month that they required “really close scrutiny.” In April, he started a separate probe into Goldman Sachs Group Inc. (GS), JPMorgan Chase & Co. (JPM) and 14 other investment banks over agreements in the market for credit-default swaps that may harm competition.

    “All the products we are talking about belong to the category of interest rate derivatives in euros,” said Amelia Torres, a spokeswoman for the commission.

  11. got gold?

    Global systemic crisis – First half of 2012: Decimation of the Western banks

    Already on Wall Street in 2008, Goldman Sachs, Morgan Stanley and JP Morgan had to suddenly turn themselves into "bank holding companies" to be saved. In the City, the British government had to nationalize a whole swathe of the country's banking system and to this day the British taxpayer continues to bear the cost because the banks’ share prices have collapsed again in 2011 (22). This is also one of the Western banking system’s characteristics as a whole: these private financial players (or market listed) are worth practically nothing. Their market capitalization has gone up in smoke. Of course this creates an opportunity for nationalization at low cost to the taxpayer from 2012 because it’s the choice that will be imposed on States, in the United States as in Europe or Japan. Whether it be, for example, Bank of America (23), CitiGroup or Morgan Stanley (24) in the United States, RBS (25) or Lloyds in the United Kingdom (26), Société Générale in France, Deutsche Bank (27) in Germany, or UBS (28) in Switzerland (29), some very large institutions "too big to fail" will fail. They will be accompanied by a whole swathe of medium or small banks such as Max Bank which has just filed for bankruptcy in Denmark (30).


  12. Sprott on silver: An attractive time to buy
    Guest Expert10/19/2011

    Jim welcomes Eric Sprott of Sprott Asset Management back to Financial Sense Newshour for a wide-ranging interview on precious metals. Eric sees the gold to silver ratio eventually contracting, with silver to outperform gold.


  13. Denial... http://www.youtube.com/watch?v=_UXESSkYcD0

    Derivatives Breaking With Bonds as PrimeX Falls: Credit Markets

    Not ‘Prescient’

    “I don’t view PrimeX as being particularly prescient in terms of what collateral performance will do because I don’t think there’s enough people involved to look at it that way,” said Glenn Schultz, the head of residential-mortgage bond research at Wells Fargo’s securities unit.

    Mark Hanson, a consultant to money managers who worked in the mortgage industry as housing boomed, disagreed, saying the drops have come because “you had managers kicking their feet up on the desk and wrongly thinking they’ve got prime mortgages.”

    About 12 percent of jumbo mortgages in securities are now at least 60 days delinquent, according to Amherst Securities Group data.

    The PrimeX market was vulnerable because bond buyers were underestimating the extent of weakness in the underlying mortgages, said Hanson, the San Francisco-based consultant who said he recommended in February that clients pair bearish bets through the swaps and Treasury purchases.

    Incomes for about half of PrimeX borrowers weren’t fully documented, between 40 percent and 64 percent of homeowners now owe more than their properties’ values, and much of the debt is interest-only loans with potentially rising payments, he said.





  15. Can't catch what they don't look for...white collar crime!

    William K. Black on OWS as a Reaction to White Collar Fraud

    #3) Me: Do you feel that your outspoken views preclude you from future government appointments?

    Mr. Black: My crucial CLGs (“career limiting gestures”) were being a serial whistleblower and helping to cause two presidential appointees (i.e., my bosses) to resign in disgrace. I also played some role in Speaker Wright’s decision to resign in disgrace and the embarrassment of the Keating Five. Pointing out that Geithner was selected because he was a perennial failure and moral cripple, not despite these defects, pales in comparison to those CLGs.


  16. What a nonsense.

    There is no reason whatsoever for these derivatives to "blow up".

    Wouldn't want a bit of honesty to get in the way of a bullshit story, would we now ?