The Tonka Report

Real News In A Changing World

Pissed Off European ‘Lynch Mob’ Is Coming After Bank Of America

with 13 comments

October 25, 2010: Matt Schifrin / Forbes.com – October 25, 2010

I pity CEO Brian Moynihan and the 284,000 other employees of Bank of America Corp (BAC).  That includes 15,000 Merrill Lynch brokers who are still recovering from the financial crisis and now have to explain to their clients why they work for a firm that is at the epicenter of America’s housing crisis.

Not only have they seen $80 billion in stock market value evaporate since April but they also have to suffer the humiliation of having a parent company bone-headed enough to pay $4 billion for Countrywide, the financial firm created by subprime mortgage pimp Angelo Mozilo. That mess could wind up costing BAC $50 billion, excluding legal fees and brand value deterioration. Remember Countrywide originated  $1.4 trillion in mortgages from 2005 to 2007 alone.

The latest ugly news for Bank of America is actually coming from Europe, where big institutional money managers and other mortgage securities buyers are now beginning to organize for an assault. This information comes from  John Mauldin’s, Thoughts from the Frontline Weekly Newsletter. His e-letter is a must-read for many money managers and serious investors.

This week he devotes a lot of his letter to testimony that seems to prove that big banks like Citigroup (C) and BAC were negligent and even willfully careless in underwriting subprime mortgages. He also reports on some new ominous developments brewing overseas and that law firm Quinn Emanuel Urquhart & Sullivan , which specializes in going after money center banks, has been hired by Fannie Mae and Freddie Mac parent, the FHFA. Below  is an excerpt of his newsletter, if you want the full version, click here.

Mauldin: Investment banks large and small originated a lot of subprime garbage in the 2005-2007 era. This week PIMCO, Black Rock, Freddie Mac, the New York Fed, and – what I think is key and no one has picked up on – Neuberger Berman Europe, Ltd., an investment manager to a managed-account client, came together and sued Countrywide for not putting back bad mortgages to its parent, Bank of America. This is the first of what will be a series of suits aimed at getting control of the portfolio and peeking into the mortgages.

Basically, if buyers of 25% or more of a mortgage-backed security can come together, they have standing to sue the mortgage servicer to do its duty to the investors and make putbacks of bad mortgages, and if they fail to do so the plaintiffs can take control of the process and take the issuer to court directly (that’s a very simplistic description but roughly accurate).

There are two key take-aways. First, note that a European entity is involved. Hundreds of billions of dollars of this junk was sold to European banks and funds. And these guys get together at conferences (sometimes they even invite me to speak). So Helmut will be talking to Lars who will talk to Jean Pierre and they will realize they all own some of this junk. They will be watching with very real interest to see how the big boys at PIMCO and Black Rock and the New York Fed fare in their efforts. And then you can count on them all piling on (more later on this).

Second, little noticed this week was the fact that The Litigation Daily wrote that Philippe Selendy of Quinn Emanuel Urquhart & Sullivan has been retained by the Federal Housing Finance Agency (FHFA), which oversees Fannie Mae and Freddie Mac, to investigate billions of dollars in potential claims against banks and other issuers of mortgage-backed securities.

Who? Not on your celebrity list? Just wait. He will soon be getting the best tables everywhere. He and his firm are the guys representing MBIA in all their cases against Countrywide and Merrill Lynch. And they are kicking ass. Slowly to be sure, but very steady. That means Fannie and Freddie are getting ready to get serious.

They were sold well over $227 billion of the subprime garbage issued in 2006 and 2007. And the bad stuff started before then. But they have one advantage that the guys at PIMCO, et al. don’t have: they (or actually the FHFA) are a federal agency. That means they have subpoena power. The agency has sent 64 subpoenas to issuers of mortgage-backed securities, and although they have not said who they went to, they obviously include almost everyone and clearly all the big players. (They couldn’t have ignored Goldman, could they? Naah. Too obvious.)

From American Lawyer.com (I know, this website is probably already on your favorites list, but for those souls who actually have a life I provide the text):

“Through those subpoenas, the agency could gain access to the loan files for the mortgages that backed the securities it bought and thus establish whether the mortgages were what the issuers represented them to be in securities contracts. According to the Journal, the difficulty of obtaining loan files has been a big obstacle for investors trying to force issuers to repurchase bonds.

If it all plays out the way Mauldin is predicting, there is a lynch mob gathering and Bank of America and other big subprime pushers like Citigroup are firmly in their sights. It is no wonder John Paulson is apparently getting a bit nervous about BAC’s prospects [see article].

Since April, Bank of America has lost about $80 billion in stock market capitalization. Contrast this to the $67.5 million (not billion) punishment the SEC has arranged for former CEO Angelo Mozilo.  It’s kind of a joke considering that Countrywide is paying for $20 million of the settlement and Bank of America (current owner of Countrywide) is paying Mozilo’s legal fees.

I asked Scott DeCarlo, chief statistician at Forbes, for the tally on Mozilo’s compensation from Countrywide alone. He figured that from 1999 through 2007 Mozilo took down more than $540 million in salary, bonus and stock options. Thus the SEC’s great settlement victory of $67.5 million won’t really affect Angelo day-to day. His fine is  like a slap on the wrist.  It won’t crimp the Mozilo family’s lifestyle for one minute while there are thousands of families devastated by this debacle. 

I think that super wealthy, rogue executives like Angelo should be forced to do mandatory jail time. A year or so inside of prison is a real punishment for a rich guy, and it is something they will never forget, or live down.

J Glenn Lowe: Die Banker Die

The Tonka Report Editor’s Note: The banksters not only need to be tried and sentenced for financial fraud, but for treason! And the penalty for that is?! Read the poem below by Jonathan Swift in 1720… – SJH

The Run Upon The Bankers: A Poem By Jonathan Swift [1720]

http://www.readbookonline.net/readOnLine/38875/

Link to original article below…

http://blogs.forbes.com/schifrin/2010/10/25/a-european-lynch-mob-is-coming-for-bank-of-america/?boxes=financechannelforbes

13 Responses

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  1. Thanks for the feature SJH. I just want a home that does not cost a million dollars when it is really only worth about $100,000.

    I don’t really want anyone to Die. But when the laws are written by Banksters and they put children in the streets to line their pockets…I guess it is time to hang a few of the from the lamp posts on Wall Street.

    J Glenn Lowe

    October 25, 2010 at 3:54 pm

  2. J,

    Indeed!

    – SJH

    Steven John Hibbs

    October 25, 2010 at 4:03 pm

  3. Hey Steven, Since I am new to all of this speaking out against Tyranny on a public level. I was wondering if you could give me some tips on how to deal with the stress that comes from putting your neck on the chopping block to distribute truth to those who need an awakening. After your ten years of doing this you must have some techniques that help you stay calm and be able to sleep at night knowing that you are a target of the crooked bastards that you are exposing.

    J Glenn Lowe

    October 26, 2010 at 2:50 pm

  4. Hello J,

    First and foremost… No Fear!!

    It took me awhile, to be sure. The sheer realization of the magnitude of corruption and evil in this world is incredibly overwhelming to comprehend at first. You must remain fearless in your convictions.

    In the beginning, many are frantic and angry in their delivery, mostly from fear of stepping into the previously unknown nightmare, combined with the embarrassment and guilt for having taken so long to finally see the truth.

    Once understood, you want to scream from the rooftops until you realize the sheer ignorance and denial that we’re up against, which tends to manifest itself as a feeling of hopelessness and despair.

    Knowing your facts like the back of your hand while delivering them with calm and authoritative confidence, as well as having a sense of humor when the inevitable “conspiracy theory“ label is thrown at you, is key to eventually gaining their trust and maintaining your sanity.

    Also, knowing when to simply walk away is imperative for those you instinctively sense are either establishment shills, or just lost in a virtual video game of deception. Family and friends are the most difficult to awaken, because to them, suddenly you’re out of character and must have lost your mind. Hang in there!

    In 2000 I wrote one of my brother’s a frantic email warning him of chemtrails. I received a rather scathing reply as to my priorities in life. The email I began to write back, which I never sent, became a 500 page manuscript a year later.

    Now he sees, as do other family members and friends who initially thought I had slipped off the deepend. After towing the line of truth for all these years, never wavering despite the cracks and criticism, they finally realize that my information is undeniable in the face of debate.

    In 2002, after calling the local radio station about chemtrails while demanding answers as to why they wouldn’t report on them, I was asked to do a live interview for WFLA 970 AM on a show called the Fisher Files. It’s the largest radio station in Florida spanning its airwaves to 5 million listeners.

    I was allotted the first 15 minute segment of the 1 hour show. After two years of study by this point, I blew them away with my information and easy delivery so that I took over the entire hour long program.

    Unbeknownst to me until after the show, and I had hung up the phone to tune in to the recap, Glenn Beck had been listening in the wings from Philadelphia. Beck and Fisher are friends and they had planned to ambush me on the show as a conspiracy nut. Never happened. My information was too solid and they knew I would easily destroy them one on one on live radio.

    Beck did make a flippant remark pertaining to sitting in his office flying a paper airplane spraying hairspray after my interview, but it was too late. The damage was done. That’s when I realized Beck was a globalist shill.

    The point being, it’s like anything else in life… it takes practice, knowledge, confidence, and belief in yourself, regardless of the opposition against you. The truth will prevail for those with eyes to see and ears to hear. The others? Move on to the next who shows a spark of life in their spirit.

    Last, but not least, faith in the Truth and Light of God. They may be able to destroy my body, but not my soul… Whereas, they lose both!

    Peace and God bless… No Fear!!

    – SJH

    PS: A peace pipe, good bottle of red wine, and solemn prayer always helps for those inevitable sleepless nights… 🙂

    Steven John Hibbs

    October 26, 2010 at 4:02 pm

  5. Thank you Steven,

    I have always been pretty fearless. But now that I have jumped off of this cliff it is a little scary adjusting to the free fall. I thought long and hard about the potential consequences of looking the dragon directly in the face and calling it what it is and then decided I had to do it for my own peace of mind and to try to reach those few are ready for a reality check.

    When shithead CEO Brian Moynihan lied to the world ten days ago on national TV, I knew it was the turning point in my life where I had to take a stand and speak out about the things (publicly) that I know to be true. Like the way the Banksters rig the system in their favor and keep everyone fighting each other so that they are too distracted to know who is really screwing up the world.

    “Divide and Conquer” really works well for them. It’s a shame that more people don’t realize that they are being played like puppets. I do believe that we are reaching a turning point in our young society where that game will not work for them very much longer.

    It is actually a great feeling to finally be communicating with those who “get it” versus beating on the brick wall that is most of the morons around us who have that look like cattle in a herd who won’t, or can’t see the truth because their brains are just to small to absorb it all.

    I really appreciate your story about going on the Fisher Files. That really helps me get a handle on the nervousness that comes from this free fall I am in. I feel pretty confident about being able to give some precise rebuttals myself because I have been reading up on the real news for so long.

    Anyway, I really appreciate you taking the time to respond. I will continue to carry this torch to those who can handle the light.

    No Fear!!

    J Glenn Lowe

    J Glenn Lowe

    October 26, 2010 at 5:11 pm

  6. J,

    And that is really all we can do at this point, short of a violent revolution, which is to pass the torch of knowledge and truth to those who seek freedom, who have taken the red pill, who understand the tyranny avalanching upon the lives of humanity, and who see the freight train of slavery barreling toward them on the dark and decrepit tracks of globalism, to let them know, they’re not alone…

    – SJH

    Steven John Hibbs

    October 26, 2010 at 9:13 pm

  7. That was eloquently said Steven.

    When people realize that “Too big to fail” actually means “Too big to succeed” We can finally get on with the ugly business of crashing these big banks and starting over with an economic system of local banks that actually helps communities thrive instead of sucking the life out of them.

    Going down the rabbit hole.

    J Glenn Lowe

    October 26, 2010 at 9:24 pm

  8. J,

    Good point. 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!

    – SJH

    Steven John Hibbs

    October 26, 2010 at 9:32 pm

  9. J,

    I got thrown off-line there for a moment. We’re dealing with 50-60 mph winds here in Chicago…

    – SJH

    Steven John Hibbs

    October 26, 2010 at 9:37 pm

  10. J,

    Anyway, I’m out to do some research before I call it a day. Continue to carry that torch, brother. You’ll need it in the rabbit hole. Until next time…

    – SJH

    Steven John Hibbs

    October 26, 2010 at 9:39 pm

  11. With his sentencing day drawing near, Bruce Karatz, former CEO of KB Home Inc., has asked the federal judge in charge of his case to ignore prosecutors’ demands that he serve at least 14 years in prison for stock options backdating. http://www.akbhomesucks.com Just Google KB Home Sucks. Mozila and Karatz invented the balloon mortgage.

    LemonMeister

    November 3, 2010 at 8:57 pm

  12. Hello Again,

    I just posted another rebellion song aimed at crashing JPMorgan Chase over their Naked Silver Shorts Ponzi Scheme.

    It is called:
    Eat My Naked Silver Shorts – Crash JPMorgan Chase by J Glenn Lowe.

    It has been submitted to Max Keiser’s Crash JPMorgan Chase Video Contest on YouTube and I expect it will show up on the site in a few days -http://crashjpm.com/

    I have requested an interview on his show. Can you help me get the attention him and Jeff Rense, Alex Jones, etc..???

    Please help me fan the flames of this fire while it is hot!

    Die Banksters Die!!!
    Glenn

    J Glenn Lowe

    December 5, 2010 at 2:34 pm

  13. Re: Department of Homeland Security (DHS) and that agencies preparation for war against citizens of the United States of America

    by Terry Michael Hestilow on Saturday, March 23, 2013 at 10:10am

    Dear friends, the following is a copy of my correspondence with Senator Cornyn concerning the arming of the DHS for war against the citizens of our nation. You are each encouraged to copy and properly amend this letter to send to your own senators and members of the U.S. House. Further, I am somewhat overwhelmed at the response to my posts leading up to this letter on this issue. At this point almost 3,000 of you have shared my original post, I have 994 new friends requests, 61 messages, and 70 new comments to process. Please be patient with me and pray that this window of communication remains open to all of us as we respond to this threat against our Constitution and our people. I am awed by you, by your positive response, and your wonderful support. We each have a role to play in standing against this present tyranny. Part of that proper response is sending them a letter like this from YOU, and following it up to make sure it remains a “hot button” issue that must be resolved. God bless you as you honor your oaths and your obligations as citizens of this free nation. May we once again know honorable leadership and peace at home. With all sincerity and respect–Resolved, Captain Terry M. Hestilow, United States Army, Retired.

    The Honorable Senator John Cornyn, State of Texas
    United States Senate 517 Hart Senate Office Building Washington, D.C. 20510

    Re: Department of Homeland Security (DHS) and that agencies preparation for war against citizens of the United States of America.

    Dear Senator Cornyn,
    It is with gravest concern that I write to you today concerning the recent appropriation of weapons by the Department of Homeland Security (DHS) that can only be understood as a bold threat of war by that agency, and the Obama administration, against the citizens of the United States of America. To date, DHS has been unwilling to provide to you, the elected representatives of the People, justification for recent purchases of almost 3,000 mine-resistant ambush-protected (MRAP) armored personnel carriers, 1.6 billion rounds of ammunition (with associated weapons), and other weapons systems, when, in fact, the DHS has no war mission or war making authority within the limits of the United States of America.

    Significant is the fact that at the same time the Obama administration is arming his DHS for war within the limits of the United States against the People of the United States in accordance with his 2008 campaign speech claiming,

    “We cannot continue to rely only on our military in order to achieve the national security objectives that we’ve set. We’ve gotta (sic) have a civilian national security force that’s just as powerful, just as strong, just as well funded [as the United States military]”–Candidate Barack Obama, 2008.

    the Obama administration is deliberately defunding, overextending, and hollowing the Department of Defense; the only legitimate agency of the U.S. government with a war mission.

    This act of the Obama administration stands as a glaring threat of war against our nation’s citizens! This act of the Obama administration can only be understood as a tyrannical threat against the Constitution of the United States of America! If left unresolved, the peace loving citizens who have sworn to defend the United States Constitution “against all enemies, both foreign and domestic” are left no option except to prepare to defend themselves, and the U.S. Constitution, against this Administration’s “coup” against the People and the foundations of liberty fought for and defended for the past 238 years. We have no choice if we honor our oaths.

    The only proper response to this threat against the American people is for the representatives of the People, the members of the U.S. House and Senate, to demand in clear terms that the Administration cannot ignore, that the Department of Homeland Security immediately surrender their newly appropriated weapons of war to the Department of Defense (DoD). Further, since the DHS has assumed a position in the Administration to enforce the tyrannical acts of this president against the People of the United States against the limits of the United States Constitution, it remains for the United States Congress to exercise its limiting power in the balancing of powers established by our founding fathers, to disestablish and dissolve the DHS as soon as possible. One needs only to look to the rise of Adolf Hitler, and his associated DHS organizations, the SA and the SS, of 1932-1934, to see the outcome of allowing an agency of government this kind of control over the free citizens of a nation. The people of Germany could not have imagined, until it was too late, the danger of allowing a tyrant this kind of power. We must not be so naïve as to think it will not happen to us as well if we remain passive toward this power grab by the Marxist Obama administration!
    Finally, for more than two centuries the nation has lived in peace at home because of the protections of our legitimate military and the many appropriate state and federal law enforcement agencies, supported by Constitutional courts. We stand today at a cross-road. Will we allow this present Administration to overthrow our United States Constitution and its legal processes to amend injustices, or, will we honor our obligations to defend the Constitution against a “domestic” enemy? Our Constitution lays out the proper methods of resolving our differences; and it does not include its overthrow by a rogue agency of a Marxist leadership at home. You, sir, are our constitutionally elected agent to defend our Constitution at home. We are counting upon you. We remain aware, however, of this present threat and will not expose ourselves as an easy prey to the authors of the destruction of our nation.

    I know that this letter demands much of you. We elected you because we, the citizens of the State of Texas, believe that you are up to the task at hand and will, against all threats, honor your oath and office. We are also writing to your fellow members of the House and Senate to stand in integrity with the Constitution and against this present threat by the Obama administration and his DHS.
    We refuse to surrender our Constitution or our nation!
    Resolved,

    Captain Terry M. Hestilow
    United States Army, Retired
    Fort Worth, Texas
    March 23, 2013

    J Glenn Lowe

    April 9, 2013 at 10:04 pm


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