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States Negotiate $26 Billion Agreement for Homeowners
NYT, February 8, 2012

Category: Credit, Legal, Real Estate, Really, really bad calls

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

27 Responses to “Mortgage Deal Breakdown”

  1. Petey Wheatstraw says:

    Looks like it will set things right.

    $25 Billion seems to be the magic number by which the government can fix virtually any problem created by big business.

  2. bear_in_mind says:

    Talk about a getting a “Get Out of Jail Free” card! Awful all around. The headline should read, “States Sell Out Homeowners in Effort to Protect Financial Fraudsters.”

    You want to see a FAIR settlement? Bring back Bill Black!!! We’d even see jobs created, building new federal penitentiary cells to house the criminals who belong behind bars.

  3. W T F says:


    What do you think about Dick Bove’s comments on the settlement:

    CNBC summary of interview:

    CNBC interview video:

    I suspect you aren’t a big fan of Bove in general. However some elements of his settlement critique ring true.

    W T F

  4. BennyProfane says:

    That graphic could just as well represent Mr. and Mrs. American taxpayer/saver bent over and ready to be given a little hope and change deep and strong. Again.

  5. bear_in_mind says:

    H/T to Dan Gillmor (@dangillmor)

    Federal and state governments tell the banks (again) that their fraud won’t be seriously punished
    By David Dayen

  6. Northeaster says:

    Laws? We don’t need no stinkin’ laws!

    The Rule of Law no longer exists, this “should” have removed any remaining doubts.

  7. b_thunder says:

    “Only fools meet their financial commitments. The non-payers are the truly enlightened.” – well said, Mr. Bove.

  8. BennyProfane says:

    @W T F

    Dick Bove comes off as an utter ass in that interview. My Lord. There are former and present bankers and mortgage peddlers who are rich beyond imagination from the bubble, and NOT ONE OF THEM IS IN JAIL. How in the world can he say the “banks” lost money? The banks are people, and hundreds and hundreds will have grandchildren snorting drugs with that money. good gawd.

  9. W T F says:


    I agree with you on the specific comments you mention. However Bove made other comments (homeowners who are up-to-date get nothing while homeowners who stopped paying get rewarded) about the settlement that I think ring true. What do you say about those comments?

    W T F

  10. Raleighwood says:

    I called my AG, twice, to say he shouldn’t go along and both times his staff implied that a quick settlement for the homeowners was a better alternative than putting criminals in prison.

    When I suggested there was no reason not to try for both I was told that wasn’t an option.

  11. Robespierre says:

    @Northeaster Says:

    “The Rule of Law no longer exists, this “should” have removed any remaining doubts.”

    You are so wrong try to defraud a bank and see how long you stay out of jail. The rule of law exits for the %99. The others? no so much

    BTW this clears any doubt that the AIG from NY didn’t sell out. I guess this is why silver has been going up. It is all those pieces needed to pay off our Judas AGs

    Oh in another news I bet a pretty penny that those RMBS that Goldman just bought yesterday from the Fed in a non public auction end up benefiting some how from this new bankers bailout. Talking about what goes around comes around in all the wrong ways…

  12. bear_in_mind says:

    @Raleighwood: The attitude of your AG’s office (and most of them, frankly) is the root of the problem. The lack of courage and degree of complicity with this fraud is mind-boggling. There’s no reason they can’t structure a civil settlement without exonerating the perpetrators from criminal charges. That’s the crux of why Judge Jed Rakoff raked the SEC over the coals for their failure to prosecute. Their collective approach is nothing more than a slap-on-the-wrist to the companies which will effect NO CHANGE in the behavior of the responsible individuals — who other than receiving smaller bonuses — have suffered no consequences for their actions.

  13. Doofus says:


  14. Futuredome says:

    lol, this “settlement” is overblown. Move on people and find the real facts. You never go by this path to get at the banks. Never. Much like the disaster that is the Lehman bankruptcy process.

  15. A says:

    Just reinforces the American reality: if you’re rich, powerful and, most of all, well connected, you can do practically anything you wish. Remarkable how correct Mark Twain was regarding the rhyming of history.

  16. BennyProfane says:

    @W T F

    “(homeowners who are up-to-date get nothing while homeowners who stopped paying get rewarded)”

    Sir, the only people who are going to get rewarded out of this deal are (a) the AG’s who capitulated to the deal, and will be on a faster track to higher office soon, if they are a Democrat, (b) Obama and his gang, who now have more Bread and Circus for the masses to chew on until November (talk about empty calories), and (c) the bankers, of course, who will get away with very serious crimes by just writing a check again. The rest of us are screwed. Especially taxpaying savers like myself, and, I’m guessing you, who would love a normal housing market to buy into with our down payment cashed out of 5% CDs. Don’t give me that modified welfare queen argument Bove is pushing – we’re talking about pocket change for the millions who are stuck in their underwater homes. Do you actually think this will re-inflate this market? Nothing can. It was one of the greatest asset bubbles in history, and, never has a bubble like that been re-inflated.

  17. GeorgeBurnsWasRight says:

    Summary: we’ve agreed their prostitutes, and now we’ve agreed that the price is $25 billion.

  18. GeorgeBurnsWasRight says:

    They’re, not their. Sorry.

  19. rktbrkr says:

    So the penalty for breaking the law is to make the perps promise not to break it again? Talk about rewarding bad behavior!

    PS – I’m a Dem but I bet there are some super PACs being stuffed with bankster cash right now as a “thank you” to O’B. He gets to posture about helping downtrodden homeowers and the banksters get their modern day ” get out of jail free” card. Life is good!

  20. rktbrkr says:

    The banksters will get their just deserts if the underwater homeowers who have been struggling to stay current see the brilliance of Bove’s comments and stop paying their mortgages to position themselves for some of this financial goodness.

  21. Robespierre says:

    All of this is just another free pass to the bankers. So remember come election time to think hard and long before you vote for your chosen Capo for the next 4 years…

  22. theexpertisin says:

    Law abiding taxpayers and those that pay their financial obligations (a decreasing number by the day)are left to foot the bill for shyster banks and mortgage delinquents who blame everyone but themselves for being greedy (and stupid in many instances).

    Aside, I wonder when a sales pitch, usually puffed, to sell a product became anything more than buyer beware. Vehicle salespersons and real estate agents, your day’s are numbered.

  23. Sechel says:

    So now mortgage servicers have a huge conflict of interest. I wonder how they navigate it …..

  24. “…The attitude of your AG’s office (and most of them, frankly) is the root of the problem. The lack of courage and degree of complicity with this fraud is mind-boggling…”


    care to Rate the Probability of a Smart “County” DA willing to indict the “State” AG as a ‘co-conspirator’ in a RICO-Suit, inter alia, against ‘All of Them’..?

  25. flocktard says:

    @ WTF – The problem with Bove’s commentary is that he falls for the line that low down payments caused foreclosures. If this serial fool would crank up his Bloomberg terminal and look up some CMO and private label securitizations, he would see that default rates for 65% LTV loans can run as high as 10%, an astounding figure for that kind of equity. Then he can see how many fall into the 90 day late bucket. This guy is on TV so much, I wonder when he does any actual research.

    Its just another component of the “Big Lie,” told by a man who is completely clueless about the mortgage business. But this WAS the guy who told you to buy Lehman “on weakness” in the summer of 2008, and duplicated this wisdom by telling us MF Global’s problems were overblown.

    A lousy check for two grand after you’ve been foreclosed on. With liberty and justice for all.

  26. hdoggy says:

    This info graphic is misleading in one way. They use circles to show volumes of equity but they place the negative equity circle within the homeowner equity circle. It should be on top like a snowman.

    Liberty and Justice For all