Forced To Read The Business Section!

I am compelled to give my late mother-in-law her due. I can only do this now and still save face, because it is a posthumous acknowledgement.

During our many protracted debates, I had always attempted to feign a complete knowledge of politics, based upon my two fancy degrees and a daily perusal of the newspaper’s main sections.

She (we will call her Shirley, because that was her name) always claimed that I was an idiot and reminded me (at least 4,357 times, by my last and final count) that any intel which was at all relevant to government, politics, and hence our daily lives, would first appear, if at all, in the business portion of the various news media. It was only after she went to her ultimate reward (Bloomingdales, I am certain) that I began to see that she was right and I was wrong.

As a hypothetical example, if you wanted to get to the heart of, say, why so many people are unemployed, you would first need to read the business section to learn that mega-corporation A, (instead of creating new jobs with the gobs of cash that they got in tax breaks, welfare subsidies, and bail-out money), took all that cash and bought up major corporation B, (merger/acquisition/buyout/hostile takeover) then fired ½ of the workers in the combined company, (restructuring/downsizing/optimizing capital) to inflate the stock value (uh, value of the stock); most of which they had already owned.

In reality, this is a consistently recurring scenario among the movers and shakers of big business and you can read all about it in the business section of your local newspaper. Of this information you may already be aware, if you have recently been restructured, downsized, or optimized.

Once you know about this all-too-common corporate strategy/business practice, then it makes sense why mega-corporation A (say the billionaire Koch Brothers) might give millions to political think-tank or front-group C (say, Americans For Prosperity) that might then bankroll the allegedly grassroots campaigns of certain politicians (say the Tea/GOP) who might then fight like rabid dogs to keep those tax breaks and welfare subsidies for the mega-corporations in place, while fighting with the same viral vigor against a payroll tax cut for the middle class.

After defining and then solving the entire equation, (corporate hegemony + ass-kissing politicians = we get screwed) only then may you fully appreciate why the politicians you elected don’t give a flying fandango about your lousy working conditions with no job security and no pensions and health insurance, or your lost job, or your discontinued unemployment insurance, or your usurious mortgage payments, or your kid that can’t go to college, or the million military vets who have come home after multiple tours of duty but can’t find work.

As intuitive as it seems to simply blame the politicians, it turns out that they are only the pawns, the toadies, the court jesters, or at most, the chorus in this little Greek tragedy. But you can read all about who’s really running the show in the business section!

On the top of page 8B of the business section of today’s Denver Post, there are three related business articles, which really involve political issues, which really answer a lot of questions about why things are so screwed up in this country today:  

Thanks to the Freedom of Information Act, you can read in the business section that Fed Chairman Ben Bernanke (appointed by W. and kept on by Obama) secretly loaned out $1.2 trillion of our tax dollars to 10 major U.S. banks and to banks all over the world.

And that is on top of the bailout money they got and roughly represents the amount of dough that the Tea/GOP wants to cut from government programs for the middle class and working poor and homeless people and old people and young people and sick people and veterans.

Why did Bernanke dole out $1.2 trillion? Well, because, since 2006, City Group and BofA and Morgan Stanley and seven other major American banks had all been raking in hundreds of billions a-piece by making really crappy sub-prime loans that they knew could never be re-paid.

After knowing full well that these loans were never worth the paper they were printed on, these banks bundled up all this crap and lied about the valuelessness to investors and then made more hundreds of billions selling this crap in bulk, but not before they insured the crap against being crappy, and so made more hundreds of billions off of the insurance claims.

Then the world found out when everything when to *%&$, but the big banks kept lying to congress about the scam anyway. Problem was, once everything went to *%&$, if we had allowed all of these  Diamond-Jim-criminal-banks to fail, the other banks would have tumbled too and the whole world would have tumbled into the Greatest Depression ever.

Yes, $1.2 trillion in additional loans to the same banks that we tax-payers had already bailed out; the same banks that are buying up other companies and firing employees all over the world; the same banks that are currently tightening any and all credit on the same Americans who bailed them out (apparently twice), while still enjoying a zero-percent rate on the loans they got from us without our knowledge or consent.

Mitt Romney (who says he is “unemployed,” but is currently bulldozing one of his four, $12 million homes, to make it four-times as large) says that corporations are people too. They may be people but these people get billions in welfare subsidies, pay zero taxes, ship jobs overseas, and then we are forced to give them a $1.2 trillion, interest-free payday loan when they lose at the track. Even the business section doesn’t try to justify our continuing co-dependent relationship with these gambling addicts, but I guess the right or wrong of that depends upon which team you are rooting for.

Also in today’s business news, Lloyd Blankfein, Goldman Sachs CEO has just hired a big-league criminal defense law firm because of the “multiple investigations and subpoenas on federal, state and local levels” about his role in the whole make, bundle, lie, sell, insure, lie again to congress, almost destroy the world economy, thingy that I described above.

Lastly, the business section reported today that Deven Sharma, the CEO of credit-rating company Standard & Poor’s has just abruptly resigned. The Standard & Poor’s chief had recently downgraded the U.S. credit rating, but enquiring minds still want to know how he failed to spot the worldwide game of Russian Roulette that his buddies at the major banks had been playing since 2006. As with the CEO of Goldman Sachs, the U.S. Justice Department is currently investigating.

Thanks, Shirley. I finally get it. I am sadder, wiser, and actually wish that you were still with us, so you could say “I told you so” and I could sit there quietly, with a pained smirk on my face and just take it!

J. Brandeis Sperandeo

Banker Integrity: An Oxymoron

I almost shot coffee through my nose with laughter while reading a Sunday Denver Post op-ed piece by Don Childears (President and CEO of the Colorado Bankers Association). His piece was written in response to two previously written op-ed pieces by columnist Mary Winter.

The subject of contention surrounds the dilemma of homebuyers, with jobs, who are about to default on their ARM (adjustable rate mortgages) or otherwise outrageously repressive mortgages, when their home is now worth less than what they owe on the loan.

Ms. Winters believes in what she describes as “strategic default,” or, more accurately put, walking away from the house and the loan. Banker CEO, and upstanding pillar of the community Childears warns against such skullduggery.

Ms. Winter believes that most home owners caught this position are dupes who have been set up by the whole realtor/mortgage lending racket; that glosses over shifting soil, ground water, shoddy workmanship and developer ponzi schemes; that employs unscrupulous property appraisers who (for a fee) grossly over-inflate housing values, so the developer/seller/realtor/lender can jack up the price; that uses blind, deaf and dumb home inspectors who couldn’t spot mold, if it was growing out of their noses; that falsifies credit scores to qualify folks for loans they have no business making; that hides the pitfalls of ARMs, within a mind-numbing mass of boiler-plate gobbledygook.

For Mr. Childears, it is all about that lack of integrity…of the borrower and those bad boys on Wall Street, from whom he now totally disassociates himself. Never mind that those thousands of toxic sub-prime (ARM) mortgages were bundled together and made into securities by numerous criminal bankers and then knowingly unloaded by bankers onto unsuspecting customers and then bankers insured the garbage against obvious collapse, so they could make more money when the toxic garbage became more generally known to be  toxic garbage, and then bankers lied about it to congress. Banks all across this country.

Every week, you can read about another bank that feels compelled to pay out a tiny percent of their ill-gotten gains in civil fines to the SEC for their part in the debacle, and they are not just Wall Street banks either, Mr. Childears. But Childears and his banks want us to know that they had nothing to do with the Big Fraud or with any unconscionable mortgages in general. Right. Uh, huh.

Yes, Fanny & Freddy were complicit or at least grossly negligent in the 2005-2009 criminal enterprise, but Mr. Childears, the conniving, conspiring offenders who thought up and put into motion the whole filthy shell game were banks, with bankers, who were banking, by means of bank fraud.

Yes, Mr. Childears, we know! Your colleagues, your friends, your business partners. And PUHLEEZE don’t try to tell me that you didn’t make your own little private stash in the Caymans without crappy mortgages.

Ms. Winter naively assumes that every homebuyer eventually caught in the above Hobson’s scenario is a neophyte or otherwise blameless paragon of virtue who has been swindled into the crappy home, with a crappy loan. Right. Uh, huh. Yeah, like no one knowingly lives beyond their means (livin large!) on the tenuous promise of better times ahead. If Ms. Winter were correct, we would have no stock market or any market for most of the crap that people currently rush out to buy on credit.

I almost forgot the funny part:

This banker mucky-muck guy Childears spent almost the entire article trying to scold/ shame/threaten homeowners into sticking with their crappy home/mortgages. He didn’t mention the thousands of folks who really were swindled by the time-honored caveat emptor scam that is designed by bankers/lenders to put the entire onus on the homeowner and none on the lender/bank. Master & Commander Childears did not mention the thousands of borrowers who, as actual human beings, were having to choose between making the recently ballooned monthly mortgage payments and buying groceries for the family.

For Childears, his banker’s appeal to integrity consisted of threatening those home- buyers, who are currently in debt up to their eyeballs, that defaulting on their mortgage might prevent them from qualifying to get in debt up to their eyeballs in the future. I kept reading and kept laughing, until I almost fell victim to the aforementioned coffee aspiration. On the planet where which Mr. Childears resides, life-long-debt is the Spice! The Spice is life! We must protect the Spice!

No, I am not saying that everybody who has gotten into serious debt should simply skip town, nor am I saying that everybody who finds themselves in that position, is a victim of the system. It was always a devil’s bargain before it became a Hobson’s choice. On the other hand, guess who plays the devil in my little scenario?

But it is an interesting truth that the power of the lender is only assured if the borrower continues to pay the debt. As a people, we are enamored and in awe of these American titans of banking and finance, but we forget that their titanic status depends entirely upon the continued cooperation of the American serfdom (i.e. us), that they have created and seek to propagate. I am reminded of the old adage that “you can’t get blood out of a turnip,” or perhaps better said, “when you got nothing, you go nothing to lose.”

Childears came down from Mt. Olympus just long enough to tacitly acknowledge this truth. He neglected to mention it, but power people only resort to open threats, when they are experiencing unaccustomed perspiration. He and his ilk are hoping like hell that nobody will make the connection.

If more homebuyers walked away from their worthless houses with unconscionable mortgages, the banking/mortgage industry would discontinue their present practice of bamboozling. Right. Uh, huh. I am sure that banks would then simply write off all of the bad loans, resell the homes at the actual value, with a full discloser as to any and all defects going to express or implied warranties of habitability, with low, easily comprehensible, fixed 30-year mortgages, and to well-qualified homebuyers only.

Okay, now I just made a funny joke. Feel free to resume sipping your coffee as soon as you stop laughing.

J. Brandeis Sperandeo

P.S. Please feel free to express your thoughts on this issue, whether they agree with mine or not. It will make for an interesting discussion, I think.

JBS

P.S. As of last week, (one day after Mr. Childears tried to characterize his banker buddies as a bunch of stand-up, regular folks) credit card companies (banks) changed their financing policies.

The interest that you pay for item purchased on credit (APR) had always varied wildly, depending upon the bank’s calculation of your “credit worthiness,” a big part of which included your total family income. But now you can no longer combine you and your spouse’s household income on the application.

This means that the banks will count your entire monthly mortgage bill against your “credit worthiness,” but only part of your actual household income to support it. This little accounting gimmick assures that millions of credit card users will now pay a much higher APR to the banks, as soon as they start a line of credit, while the banks get double-covered.

Please remember that these are the same banks that currently pay virtually zero interest, when they borrow from other banks or from the government, because those banks that we bailed out have really great “credit worthiness.”

JBS

What About The Rest Of Us?

To my way of thinking, the demographics of the Them v. the Rest Of Us, break down this way:

2% = rich, super rich, and mega-corporations

20%  = so addlebrained that they believe anything that the 2%ers tell them

78%  = the Rest Of Us

The Rest Of Us come from both sides of the political spectrum and the middle. The Rest Of Us want to work and get paid a decent wage for it. We want a safe and secure work environment. We want to be healthy, but don’t think it’s fair for us to go broke, if we get sick. The Rest of Us want some social security when we retire and are still faithfully paying into various pension plans that are about to be raided by the U.S. House, so that the 2%ers can buy more solid gold toilets for their third homes in the Cayman Islands.

The Rest Of Us who have been trying to invest a little extra money for retirement are watching as our nest eggs are tanking. Nervous smaller 401K folks are pulling their money out of stocks, and the market plunges. The big investors (2%ers) pick up the leavings at bargain basement prices and the market rallies…for them only; because the Rest Of Us are now either already out of the market or never were in to begin with. Most of the Rest Of Us (if we still have a job) have been living from paycheck to paycheck, for quite some time.

The Rest Of Us who were lucky enough to finish college and are just starting to pay off our loans have no jobs. If we apply for graduate school, we will find that U.S. House just passed a bill requiring students to pay back these student loans while we are going to school, not after.

The Rest Of Us who might be recently unemployed, (because the mega-corps used the extra cash from their tax breaks to buy up other companies, fired workers by the thousands, to bring up their company’s stock value, and shipped 2.4 million jobs overseas), will find that the U.S. House cut off long-term unemployment benefits.

The Rest Of Us who might want to take a train or a plane anywhere better know that there is no more FAA, because the U.S. House will not fund the agency until the those 75,000-90,000 employees (now out of work anyway) agree to forgo any collective bargaining rights. No more airline/train inspectors; no more rules; great for the corporations…even after a bunch of the Rest Of Us get killed in a plane crash or literally run off the rails.

The Rest Of Us now have to take our chances on tainted meat, pesticide-filled veggies, and chemical-laced water, because the U.S. House cut funding for the FDA and the EPA.  Now they have no way to inspect agribusiness products and keep the water clear of pesticides, pharmaceuticals, and harmful chemical byproducts.

The Rest Of Us, who are not blonde haired and blue eyed, can now expect law enforcement in several states to stop us on the street and demand that we show them papers to prove that we have a right to live in our own country.

In 23 different states, The Rest Of Us, (college students, old people, the working poor, minorities) who may not have a state-issued photo ID, or are using an ID from another state, will be prevented from voting out the bastards who are currently doing all of the above to the Rest Of Us.

But, isn’t 78% more than 2% and more than 20%, or even 22%? Isn’t it time that the Rest Of Us got our noses out of our iCrap and start talking with each other about stuff other than what we had for dinner or Justin Bieber’s haircut? What do you say, folks. The Rest Of Us are already indentured servants, if we are lucky. Want to sit around watching football or Dancing With The Stars on your only day off while it gets worse? Of course you do, but they can and will take that away too and right out from under the La-Z-Boy on which you sit.

The 2%ers are just doing what they can get away with. The 20%ers are waiting for the Apocalypse to make everything right.  Things are getting worse daily because the Rest Of Us are letting it happen. Isn’t it time for the Rest Of Us to start paying attention? Acknowledging our common ground? Forming opinions? Talking with each other about December, maybe? Don’t you think?

J. Brandeis Sperandeo

P.S. The Rest Of Us have suffered many, many more major setbacks and indignities than I have listed here, but the above is a rant, not a research paper. Feel free to think about your own personal pet screwage and log on to tell me about it. Or better yet, tell your friends. Might make for a more interesting discussion than Kim Kardasian’s wedding registry. Might not.

JBS