Slip(per)-slidin' Away

late afternoon

May 31, 2011

Peru, Maine

Quote for the Week, May 29-June 4, 2011

A mule will labor ten years willingly and patiently for you, for the privilege of kicking you once.
--William Faulkner

Dear Brian, WYADII

...which is text-speak for What You Are Doing Is Illegal.

Bank of America's CEO

Released earlier today: a letter from Utah's Attorney General to Brian Moynihan, President and CEO of Bank of America, informing him that "all real estate foreclosures conducted by ReconTrust [a unit of Bank of America] in the State of Utah are not in compliance with Utah's statutes, and are hence illegal." Not only that, but "ReconTrust's exercise of fiduciary powers in the State of Utah is a violation not only of State law, but also applicable federal law."

Other than that, Bro (er, Brian, or whatever), you run a squeaky-clean operation. MainePERS will stand by you to the end.

[update, 05-26-11:]

Go ahead, try it. Google "Bank of America settlement" and see what you get. Today there's this:

Bank of America Settles Illegal Overdraft Fees Lawsuit for $410 Million

And this:

Bank of America To Pay $20 Million for Military Foreclosures

In the first one, BofA was accused of recording ATM transactions to maximize overdraft fees. Specifically, the bank debited not in chronological order, but by transaction amount, largest items first. This way a customer skirting a zero balance would incur penalties sooner and more often. GOTCHA! In the second one, a BofA subsidiary illegally foreclosed on 160 military servicemembers in 20 states between January 2006 and May 2009. People joining the military are protected by the Servicemembers Civil Relief Act, which requires a court order for foreclosure on a home mortgage held by a serviceman or woman. In several cases cited by the Justice Department, BofA refused to delay foreclosures even after receiving documentation that the homeowners were on active duty.

If you believe you were improperly foreclosed on by Bank of America before the end of December 2010 (as per SCRA), call 1-800-896-7743, mailbox 6. There may be a check waiting for you.

Maybe Bank of America should be renamed Bank Against America. Something to think about as we remember veterans this weekend.

"Same Old Gong Show"

Looking for an adult discussion about the national debt? You won't find it in Washington, says former OMB Director David Stockman. The parties are too busy posturing. Budget management by default will lead to exactly that: DEFAULT.

Quote for the Week, May 22-28, 2011

Every election is a sort of advance auction of stolen goods.
--H.L. Mencken

Blooms Go Boom

Top brass monitor the Bin Laden hit from the Situation Room

"Obama's Reset:

Arab Spring or Same Old Thing?"

by Nick Turse

How the President and the Pentagon Prop Up Both Middle Eastern Despots and American Arms Dealers

[excerpt:]

"For decades, the U.S. has provided military aid, facilitated the sale of weaponry, and transferred vast quantities of arms to a host of Middle Eastern despots. Arming Arab autocrats, however, isn’t only the work of presidents past. A TomDispatch analysis of Pentagon documents finds that the Obama administration has sought to send billions of dollars in weapons systems -- from advanced helicopters to fighter jets -- to the very regimes that have beaten, jailed, and killed pro-democracy demonstrators, journalists, and reform activists throughout the Arab Spring.

The administration’s abiding support for the militaries of repressive regimes calls into question the president’s rhetoric about change. The arms deals of recent years also shed light on the shadowy, mutually supportive relationships among the U.S. military, top arms dealers, and Arab states that are of increasing importance to the Pentagon."

Complete article viewable here.

Duck, Duck, GOOSE!

Hedge-fund manager David Tepper [above] can't dump his Bank of America stock fast enough. In 2011's first quarter, his Appaloosa Management fund (according to its latest 13-F filed with the SEC) sold nearly 8 million shares of BAC, trimming its stake by almost a third. Appaloosa now holds 17.2 million shares, or 15 million fewer than what it had on January 1, 2010.

Meanwhile, super-investor John Paulson [above] sloughed off almost a quarter-million shares of BAC in Q1, after jettisoning over 27 million shares in 2010. Mega-super-investor George Soros [below] got rid of 1.2 million shares in Q1, leaving him with a small residual of 29,400 shares, which apparently no one wanted. Since September 30, twenty-five hedge funds have exited BAC completely.

MainePERS, going its own way, is holding tough at 2.5 million shares. But recent headlines about Bank of America suggest that Tepper, Paulson, Soros et al. are right to bail and that MainePERS should be following suit. The Huffington Post reports that BofA is one of five mortgage companies audited by the federal Department of Housing and Urban Development and accused of defrauding taxpayers while foreclosing on homes purchased with government-backed loans. According to HuffPost:

"The audits conclude that the banks effectively cheated taxpayers by presenting the Federal Housing Administration with false claims: They filed for federal reimbursement on foreclosed homes that sold for less than the outstanding loan balance using defective and faulty documents."

Bank of America got the inspector general's first-ever Foot-Dragging Award for failing to remediate its foreclosure practices even after announcing a temporary moratorium on foreclosures last October to clean up its act.

Over the weekend, Gretchen Morgenson of the New York Times reported on an investigation by an arm of the U.S. Justice Department that, despite the cartel's stonewalling, has gathered extensive evidence of the abusive loan-servicing practices of Bank of America, among others. An official in the the United States Trustee Program, which monitors the bankruptcy system, cites the industry-wide imposition of improper and inflated default servicing fees, including charges for legal work, property inspections, insurance, and appraisals. The same official estimates that the error rate may well be ten times higher than what has been represented in sworn testimony to Congress by the banksters.

Bank of America's stock price has retraced most of its year-end Santa Claus rally [below]. Unfortunately, MainePERS forgot to redeem its gift card.

BAC share price ($)

Michael Moore,

"Some Final Thoughts on the Death of Osama bin Laden"

[excerpt:]

"We did exactly what bin Laden said he wanted us to do: Give up our freedoms (like the freedom to be assumed innocent until proven guilty), engage our military in Muslim countries so that we will be hated by Muslims, and wipe ourselves out financially in doing so. Done, done and done, Osama. You had our number. You somehow knew we would eagerly give up our constitutional rights and become more like the authoritarian state you dreamed of. You knew we would exhaust our military and willingly go into more debt in eight years than we had accumulated in the previous 200 years combined....

If we really want to send bin Laden not just to his death, but also to his defeat, may I suggest that we reverse all of that right now. End the wars, bring the troops home, make the rich pay for this mess, and restore our privacy and due process rights that used to distinguish us from any other country. Right now, our democracy looks like Singapore and our economy has gone desperately Greek."

Complete commentary viewable here.

Quote for the Week, May 15-21, 2011

Emergencies have always been the pretext on which the safeguards of individual liberty have eroded.
--Friedrich von Hayek

Musings

Rolling Stone Readers

Pick the Best Ballads

of All Time

Cued up here.

Come On, Baby, Light My Water

Scientific Study Links

Flammable Drinking Water

to Fracking

ProPublica has the story.

Quote for the Week, May 8-14, 2011

[The accumulation of debt] is perhaps the NATURAL DISEASE of all Governments. And it is not easy to conceive anything more likely than this to lead to great and convulsive revolutions of Empire.
--Alexander Hamilton, first U.S. Treasury Secretary

Jobs? What Jobs?

Boing!

[click to enlarge]

Unemployment claims do their pogo-stick thing.

The Labor Department just reported that initial claims for unemployment benefits jumped last week to 474,000, a number not seen since last August. Furthermore, last week's figure was revised upward from 429K to 431K. Upward revisions have been the norm, so this week's eye-popper could end up even higher. The bump was attributed largely to "temporary" layoffs in the auto industry, where domestic manufacturers (particularly GM) spent the first quarter of 2011 stuffing channels. Just how temporary depends on how quickly that inventory moves off dealer lots.

The 4-week moving average of initial claims climbed to 431K, the highest since November. The average had dipped under 400K late this winter, leading to hopes that the economic recovery in the U.S. might be self-sustaining. Today's number puts a damper on that thinking. Look for confirmation in tomorrow's monthly employment report from the Bureau of Labor Statistics. While you're waiting, consider the structural trends demonstrated by these two graphs:

From Zero Hedge:

[click to enlarge]

From Calculated Risk:

[click to enlarge]

[update, 05-06-2011:]

This morning's BLS release shows an upside surprise of 244,000 nonfarm jobs added in April, at least according to the Establishment Survey. But the Household Survey tells a different story. According to Table A-1, there were 190,000 fewer people employed in April compared to March. And Table A-8 tells us that there were 210,000 more part-time workers in nonfarm industries. McDonalds may be hiring, but is anyone else?

More on McJobs here.

Quote for the Week, May 1-7, 2011

If the present Congress errs in too much talking, how can it be otherwise in a body to which the people send one hundred and fifty lawyers, whose trade it is to question everything, yield nothing, and talk by the hour?
--Thomas Jefferson, U.S. President (1801-09)