In a savvy move, the new Consumer Financial Protection Bureau launched its first website today. The CFPB was created by the passage of the Dodd-Frank Wall Street reform bill in July 2010 and is headed on an interim basis by well-known consumer advocate, Elizabeth Warren.
In a response to the Financial Crisis Inquiry Commission releasing its final report on the financial crisis today, the U.S. Chamber of Commerce pitched a classic hissy fit calling the report an "abuse of the process" that would create "more job-killing lawsuits." (So much for the new tone in Washington.)
Word is beginning to leak out about the contents of the Financial Crisis Inquiry Commission's (FCIC) final report, a 576-page official analysis of the causes of the crisis. The Commission, which got off to a slow and rocky start, managed to hold 19 days of hearings and interviewed 700 witnesses. According to the New York Times, the report puts blame where blame is due, on reckless Wall Street gambling, but also on the colossal failure of government.
Today, with unemployment in almost the double digits and foreclosure unabated, President Obama decided that America needed more of the same. The President announced the appointment of JPMorgan Executive William M. Daley as White House Chief of Staff, replacing Rahm Emanuel. Tomorrow, news reports indicate that he will announce that Goldman Sachs adviser Gene B. Sperling will be appointed head of the National Economic Council, replacing Larry Summers.
About Daley the Center for Public Integrity reports:
At JPMorgan, Daley’s portfolio has included supervising government lobbying for a bank with $2 trillion in assets that has fought efforts to limit the size of megabanks. Daley co-chaired a U.S. Chamber of Commerce commission that urged the federal government to revise the 2002 Sarbanes-Oxley corporate reform law and protect corporate auditors from lawsuits and investigations.
According to the publication Domain Name Wire, Bank of America (BofA) is buying up hundreds of domain names such as BankofAmericaSucks.com and BrianMoynihanBlows.com. The megabank is prepping for the possible release of damaging information from Wikileaks founder Julian Assange. Assange is promising to unleash a cache of secret documents from the hard drive of a big bank executive. In 2009, he told Computer World that the bank was Bank of America. In 2010, he told Forbes it was significant enough to “take down a bank or two.” The New York Times recently reported that BofA is now moving into high gear on damage and spin control tasking dozens of people to a Wikileaks "war room." BofA is already under the gun, defending itself from multiple lawsuits demanding that the bank buy back billions worth of toxic mortgages it peddled to investors. The firm is also at the heart of the robo-signing scandal, having wrongfully kicked many American families to the curb. Assange may have more information on the controversial merger of BofA and Merrill Lynch, which spawned fraud charges. Or he may have more dirt on BofA subsidiary Countrywide. Countrywide's Angelo Mozilo has been the subject of insider-trading charges. Stay tuned and learn more about these scandals in our Sourcewatch profile of America's largest bank.
Citizens of Nash County, North Carolina have hired the Raleigh-based public relations firm Campaign Connections to help stop Sanderson Farms from building a chicken processing plant in their community. Citizens call the slaughtering plant an "industry of yesterday" and say locating the plant in Nash County will make it harder to lure higher-tech businesses to the area, like biotech, pharmaceutical and alternative energy companies. Campaign Connections says citizens sought their help to correct misinformation, like the notion that they oppose bringing jobs to the area. Citizens say they aren't opposed to jobs, or to Sanderson Farms, but feel the company is not a "good match" for their community. As part of a strategy to oppose the plant, some Nash County citizens have bought stock in Sanderson Farms so they can be included in the company's Board of Directors meetings.
With a $4.7 trillion dollar bailout under their belts with no harm done to their billion-dollar bonuses, don't expect Wall Street bankers to be chastened by the 2008 financial crisis. Below we list eight things to watch out for in 2011 that threaten to rock the financial system and undermine any recovery.
1. The Demise of Bank of America
Wikileaks founder Julian Assange is promising to unleash a cache of secret documents from the troubled Bank of America (BofA). BofA is already under the gun, defending itself from multiple lawsuits demanding that the bank buy back billions worth of toxic mortgages it peddled to investors. The firm is also at the heart of robo-signing scandal, having wrongfully kicked many American families to the curb. If Assange has emails showing that Countrywide or BofA knew they were recklessly abandoning underwriting standards and/or peddling toxic dreck to investors, the damage to the firm could be irreparable.
Last week, the Senate refused to approve the DREAM Act, a bill that would have offered a path to citizenship for children brought into the country illegally if they attend college or serve in the military. Opponents stated that no immigration reform will happen without first "securing" the 1,951 mile U.S. border with Mexico. America's current approach to border security is wasteful and ineffective, and "securing the border" will never be achieved until we redefine our approach to, and definition of, border security. With many in Washington expressing concern about fiscal responsibility, reining in the billions wasted annually on current border security policies should really be a priority. But America's xenophobic preoccupation with an "invasion" by brown-skinned "illegals" may keep us pursuing an expensive and unreasonable approach to border security.
Today's Wall Street Journal has a stunning exposé on a publicly-traded company called Life Partners Holdings. Are you ready for this? Life Partners creeps around asking the unemployed, the elderly and the sick (especially people with HIV/AIDS) to sell them their life insurance policies for cash. Then they bundle these policies into securities and sell them to vultures -- oh, I am sorry, "investors." Then the "investors" sit around and wait for people to die -- the sooner the better for the purchasers of these death bonds. The future of this industry "looks bright," chirps National Underwriters.
Reminds you a little of those Death Eaters in Harry Potter, doesn't it?
The White House and many Congressional Democrats recently caved to Republicans in a deal extending all of the Bush tax cuts for two years in exchange for a 13-month extension of unemployment benefits. The deal reverses stated opposition by many Democrats to an extension of tax cuts for the top income bracket, with 25 percent of the savings from the deal going to benefit the richest one percent of Americans. While Democrats who supported the bill claimed to do so begrudgingly, the plan has many avid supporters who justify its lopsided benefits by insisting that tax cuts for the rich and for businesses create jobs and benefit the economy. This is a big myth.