So the PSI 'inquest' is over, with Exhibits that seem to come directly from JPMC (Confidential treatment requested by JPMC nevertheless!). Not sure if PSI got them from JPMC directly or via FDIC, who got it from JPMC at some point..
The Office of Inspector General puts out a report, essentially bashing WaMu for shoddy lending practices and OTS for supporting WaMu. But, they decide that they should hold on to their 4th objective for now. What was the fourth objective you ask? See for yourself
Evaluation of Federal Regulatory Oversight of Washington Mutual
Bank (Report No. EV AL-l 0-002)
Attached for your information is a copy of an evaluation report that the Offices of Inspector General
(OIG) recently completed concerning the supervision of Washington Mutual Bank (WaMu). The
objectives of the evaluation were to (1) determine the cause of WaMu's failure, (2) assess the Office
of Thrift Supervision's (OTS) supervision ofWaMu including implementation of Prompt
Corrective Action, (3) evaluate the Federal Deposit Insurance Corporation's (FDIC) supervision and
monitoring ofWaMu as deposit insurer, and (4) assess the FDIC's resolution process for WaMu.
The fourth objective will be addressed in a later report after ongoing litigation is completed.
So, they are ready to put out everything that will attempt to influence the court case in the favor of FDIC/JPMC but, the cardinal question of IF WAMU WAS SEIZED LEGALLY AND WAS IT SOLD FOR FAIR VALUE, there is no answer. We have to wait till the court case is over. Call me paranoid, I have a feeling that report will be quite damaging to the FDIC/JPMC.
It is sad, really - the situation of our beloved USA
Saturday, April 17, 2010
Wednesday, January 20, 2010
Ms. Bair and her Congressional enquiry comments
Ms. Bair continues to harp Washington Mutual as a success story - all the while new information is making it clear that Washington Mutual was possibly brought down illegally and later sold for pittance.
To explain what Ms. Bair did id simple terms, think of your mortgage insurer. What if your mortgage insurer on hearing some rumors decides that you are having financial difficulties, and are at risk for foreclosure. He wants his company not to have a loss. He takes over your home and sells it to your neighbor who was the one spreading rumors about you in the first place.
That may be a success story to Ms Bair, but to the rest of us it isn't.
To explain what Ms. Bair did id simple terms, think of your mortgage insurer. What if your mortgage insurer on hearing some rumors decides that you are having financial difficulties, and are at risk for foreclosure. He wants his company not to have a loss. He takes over your home and sells it to your neighbor who was the one spreading rumors about you in the first place.
That may be a success story to Ms Bair, but to the rest of us it isn't.
Saturday, December 5, 2009
Ms. Bair wants to make sure that creditors share the cost of bank failures
Ms. Bair is not happy having frozen the credit markets for months after hurriedly seizing WaMu, she wants to make sure that she freezes it forever! Her latest idea is to let the secured creditors take the fall for bank failures.
With ideas like these, who needs enemies? Ms. Bair needs to read the dictionary - specifically the word secured.
It is FDIC's job to insure banks against failures, and that job includes timely collection of premiums. If you neglected your fiduciary duty, then take the responsibility and resign from your post. But for heaven's sakes don't spew any more grand ideas. People who purchase bonds are traditionally averse to risk. If you make lending to banks risky, they will simply lend elsewhere.
Monitor banks closely and make new rules to decrease leverage, but to say that someone else should pay the price for you not doing your job, is not going to hold water.
I realize that you are not seeking re-election, but really your record demands immediate removal from your position with a detailed investigation into your conduct during the worst financial crisis the country has faced since the great depression.
With ideas like these, who needs enemies? Ms. Bair needs to read the dictionary - specifically the word secured.
It is FDIC's job to insure banks against failures, and that job includes timely collection of premiums. If you neglected your fiduciary duty, then take the responsibility and resign from your post. But for heaven's sakes don't spew any more grand ideas. People who purchase bonds are traditionally averse to risk. If you make lending to banks risky, they will simply lend elsewhere.
Monitor banks closely and make new rules to decrease leverage, but to say that someone else should pay the price for you not doing your job, is not going to hold water.
I realize that you are not seeking re-election, but really your record demands immediate removal from your position with a detailed investigation into your conduct during the worst financial crisis the country has faced since the great depression.
Monday, August 3, 2009
Letter to Sen. Corker about S.1540 bill
Honorable Senator Corker,
I had the opportunity to review your bill that is meant to provide FDIC the power to unwind bank holding companies. On first look this is a great idea, provided FDIC is a fair organization that always obeys the law without prejudice.
However, as the case of Washington Mutual Bank's take over and later sale to JPM would demonstrate, FDIC has not always been transparent in its actions. WMB was placed on recievership while it was in a well capitalized state(1). Through a non transparent bidding process, FDIC sold it to JP morgan Chase for a mere 1.9 billion. All of its bondholders and shareholders including myself were left devastated.
Washington Mutual had $307B in assets, $188B in deposits, 2239 branches, 4,932 owned and branded ATMs, and 43,198 employees at the time of seizure. There was ample excess cash available in another subsidiary (WMBfsb -12 billion) which was also taken over. Washington Mutual Inc. (the holding company) is in chapter 11 and an extensive discovery process has been authorized by the court into the dealing behind the bank's seizure.
Small banks have lots to fear if your bill becomes the law. For the advantage of larger predators they may be taken over. Media frenzy is easy to create pushing smaller banks to the brim where FDIC can take them over and sell it to whom they please. This bill will permit lager banks to become even larger which actually worsens the 'moral hazard'.
Sheila Bair has felt the pressure under WMI's court action and is clearly using you to push forth this bill that gives her absolute power. She is clearly misleading you about this moral hazard cliche. She specifically wants to reverse Ch 11 actions, which should clearly expose her agenda to you. The saying 'power corrupts and absolute power corrupts absolutely' is very apt in this case.
I respectfully request you to reconsider this bill, or atleast review the court case between WMI and JPMC/FDIC(2)
(1)http://files.ots.treas.gov/730021.pdf page 2 last para(2)
I had the opportunity to review your bill that is meant to provide FDIC the power to unwind bank holding companies. On first look this is a great idea, provided FDIC is a fair organization that always obeys the law without prejudice.
However, as the case of Washington Mutual Bank's take over and later sale to JPM would demonstrate, FDIC has not always been transparent in its actions. WMB was placed on recievership while it was in a well capitalized state(1). Through a non transparent bidding process, FDIC sold it to JP morgan Chase for a mere 1.9 billion. All of its bondholders and shareholders including myself were left devastated.
Washington Mutual had $307B in assets, $188B in deposits, 2239 branches, 4,932 owned and branded ATMs, and 43,198 employees at the time of seizure. There was ample excess cash available in another subsidiary (WMBfsb -12 billion) which was also taken over. Washington Mutual Inc. (the holding company) is in chapter 11 and an extensive discovery process has been authorized by the court into the dealing behind the bank's seizure.
Small banks have lots to fear if your bill becomes the law. For the advantage of larger predators they may be taken over. Media frenzy is easy to create pushing smaller banks to the brim where FDIC can take them over and sell it to whom they please. This bill will permit lager banks to become even larger which actually worsens the 'moral hazard'.
Sheila Bair has felt the pressure under WMI's court action and is clearly using you to push forth this bill that gives her absolute power. She is clearly misleading you about this moral hazard cliche. She specifically wants to reverse Ch 11 actions, which should clearly expose her agenda to you. The saying 'power corrupts and absolute power corrupts absolutely' is very apt in this case.
I respectfully request you to reconsider this bill, or atleast review the court case between WMI and JPMC/FDIC(2)
(1)http://files.ots.treas.gov/730021.pdf page 2 last para(2)
Wednesday, May 13, 2009
Sheila Bair wants more power!!
Despite abusing her already excessive powers and destroying century old financial institutions such as Washington Mutual, Ms. Bair wants even more!
Public documents(OTS report) clearly show that Washington Mutual bank was well capitalized through the date of its seizure. However, in collusion with JP Morgan Chase - which was infact in deep finacial trouble with its derivative exposure - Ms. Bair seized the bank anyway, damaging our credit markets for a long long time.
Washington Mutual Inc., the holding company for WaMu is challenging this abuse of power through the legal system. This is bound to be damaging to FDIC and Ms. Bair's credibility. So guess what power she wants now?
You guessed it! Now she wants the power to `resolve' bank holding companies! So that no one can challenge her corrupt ways anymore. She believes that in the pretext of avoiding financial `melt down' the Congress will fall for anything.
I hope President Obama will remove this devious and manipulating dictator from office before she can do any more damage to our financial system or worse our constitution..
Public documents(OTS report) clearly show that Washington Mutual bank was well capitalized through the date of its seizure. However, in collusion with JP Morgan Chase - which was infact in deep finacial trouble with its derivative exposure - Ms. Bair seized the bank anyway, damaging our credit markets for a long long time.
Washington Mutual Inc., the holding company for WaMu is challenging this abuse of power through the legal system. This is bound to be damaging to FDIC and Ms. Bair's credibility. So guess what power she wants now?
You guessed it! Now she wants the power to `resolve' bank holding companies! So that no one can challenge her corrupt ways anymore. She believes that in the pretext of avoiding financial `melt down' the Congress will fall for anything.
I hope President Obama will remove this devious and manipulating dictator from office before she can do any more damage to our financial system or worse our constitution..
Say it isn’t so Bair…
Say it isn’t so Bair…
Say you didn’t use the numbers provided by JPM instead of those offered by your sister agency, OTS?
Say you didn’t communicate confidential WaMu data that lead to a leak of your agencies desire?
Say you didn’t fire-sale a company worth between 300 to 400 billion for 1.88 billion?
Say you didn’t allow the bidder to pick-n-choose assets and liabilities?
Say you didn’t allow the winning bidder to take any asset that wasn’t a deposit?
Say you didn’t refuse other bidders based on pre-arranged rules to prevent equal bidding?
Say you didn’t know that JPM was attacking WaMu in the media for the purpose of devaluing?
Say you didn’t snicker when Paulson said “You should’ve sold…you should do so now..”?
Say you didn’t hint to JPM to be ready – we’re about three weeks out?
Say you didn’t take advantage of confidential information to fast-track TARP?
Say you didn't need WaMu to fail because your agency didn't have the money to cover deposits?
Say you didn't communicate via electronic documents that may have been found by Quinn and IM?
Say there isn't a smoking gun with your prints on the trigger.
Say it isn’t so Bair… Say it isn't so...
Say that none of the above contains a shred of truth.
(thanks to vnertia , yahoo message board)
Say you didn’t use the numbers provided by JPM instead of those offered by your sister agency, OTS?
Say you didn’t communicate confidential WaMu data that lead to a leak of your agencies desire?
Say you didn’t fire-sale a company worth between 300 to 400 billion for 1.88 billion?
Say you didn’t allow the bidder to pick-n-choose assets and liabilities?
Say you didn’t allow the winning bidder to take any asset that wasn’t a deposit?
Say you didn’t refuse other bidders based on pre-arranged rules to prevent equal bidding?
Say you didn’t know that JPM was attacking WaMu in the media for the purpose of devaluing?
Say you didn’t snicker when Paulson said “You should’ve sold…you should do so now..”?
Say you didn’t hint to JPM to be ready – we’re about three weeks out?
Say you didn’t take advantage of confidential information to fast-track TARP?
Say you didn't need WaMu to fail because your agency didn't have the money to cover deposits?
Say you didn't communicate via electronic documents that may have been found by Quinn and IM?
Say there isn't a smoking gun with your prints on the trigger.
Say it isn’t so Bair… Say it isn't so...
Say that none of the above contains a shred of truth.
(thanks to vnertia , yahoo message board)
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