Inside the $5.1B Goldman Sachs subprime mortgage settlement

By Dean Reynolds CBS News April 11, 2016, 7:09 PM

http://www.cbsnews.com/news/inside-the-5-billion-dollar-goldman-sachs-subprime-mortgage-settlement/?linkId=23337679

News of the $5 billion settlement thrust Goldman Sachs into the glare of the public spotlight, and the cross hairs of the presidential campaign.
Senator Bernie Sanders called it "a fraudulent organization," while Governor John Kasich said "the Wall Street firms engaged in greed, massive greed."

Play Video

Goldman Sachs reaches $5.1 billion mortgage settlement

In February, Morgan Stanley settled for $3.2 billion, Wells Fargo agreed to pay $1.2 billion, J.P. Morgan Chase paid $13 billion three years ago, and Bank of America coughed up a whopping $16.6 billion in 2014.
Goldman admitted that in bundling mortgages from subprime loan specialists like Countrywide Financial -- and then selling them to investors as bonds -- it largely failed to address financial problems it knew about.
In one period during August 2006, Goldman found what it called an "unusually high" percentage of loans with credit and compliance defects.
When one transaction manager was asked by Goldman officials "How do we know that we caught everything," he answered: "We don't."
Another responded it "depends on what you mean by everything." And when an outside analyst wrote a positive review of Countrywide, the head of due diligence at Goldman wrote in an e-mail: "if they only knew."
This was a civil case, so no one is going to jail. And that's likely to add to the anger, according to Robert Weissman of advocacy group Public Citizen.
"Millions of people were thrown out of jobs, millions of people lost their homes, communities were destroyed -- all because of their wrong doing. Yet they are escaping any criminal accountability, it seems."
While a $5 billion civil penalty is a lot of money, approximately half of it appears to be tax deductible -- meaning Goldman Sachs will be getting a tax break that could shave about a billion dollars off the total they've agreed to pay.

This Is The Real Reason For The War On Cash

Submitted by Tyler Durden on 02/18/2016 09:00 -0500
http://www.zerohedge.com/news/2016-02-18/end-economic-liberty-war-cash-wont-end-well
Originally posted Op-Ed via The Wall Street Journal,
These are strange monetary times, with negative interest rates and central bankers deemed to be masters of the universe. So maybe we shouldn’t be surprised that politicians and central bankers are now waging a war on cash. That’s right, policy makers in Europe and the U.S. want to make it harder for the hoi polloi to hold actual currency.
Mario Draghi fired the latest salvo on Monday when he said the European Central Bank would like to ban €500 notes. A day later Harvard economist and Democratic Party favorite Larry Summers declared that it’s time to kill the $100 bill, which would mean goodbye to Ben Franklin. Alexander Hamilton may soon—and shamefully—be replaced on the $10 bill, but at least the 10-spots would exist for a while longer. Ol’ Ben would be banished from the currency the way dead white males like him are banned from the history books.
Limits on cash transactions have been spreading in Europe since the 2008 financial panic, ostensibly to crack down on crime and tax avoidance. Italy has made it illegal to pay cash for anything worth more than €1,000 ($1,116), while France cut its limit to €1,000 from €3,000 last year. British merchants accepting more than €15,000 in cash per transaction must first register with the tax authorities. Fines for violators can run into the thousands of euros. Germany’s Deputy Finance Minister Michael Meister recently proposed a €5,000 cap on cash transactions. Deutsche Bank CEO John Cryan predicted last month that cash won’t survive another decade.

The enemies of cash claim that only crooks and cranks need large-denomination bills. They want large transactions to be made electronically so government can follow them. Yet these are some of the same European politicians who blew a gasket when they learned that U.S. counterterrorist officials were monitoring money through the Swift global system. Criminals will find a way, large bills or not.

The real reason the war on cash is gearing up now is political: Politicians and central bankers fear that holders of currency could undermine their brave new monetary world of negative interest rates. Japan and Europe are already deep into negative territory, and U.S. Federal Reserve Chair Janet Yellen said last week the U.S. should be prepared for the possibility. Translation: That’s where the Fed is going in the next recession.
Negative rates are a tax on deposits with banks, with the goal of prodding depositors to remove their cash and spend it to increase economic demand. But that goal will be undermined if citizens hoard cash. And hoarding cash is easier if you can take your deposits out in large-denomination bills you can stick in a safe. It’s harder to keep cash if you can only hold small bills.
So, presto, ban cash. This theme has been pushed by the likes of Bank of England chief economist Andrew Haldane and Harvard’s Kenneth Rogoff, who wrote in the Financial Times that eliminating paper currency would be “by far the simplest” way to “get around” the zero interest-rate bound “that has handcuffed central banks since the financial crisis.” If the benighted peasants won’t spend on their own, well, make it that much harder for them to save money even in their own mattresses.
All of which ignores the virtues of cash for law-abiding citizens. Cash allows legitimate transactions to be executed quickly, without either party paying fees to a bank or credit-card processor. Cash also lets millions of low-income people participate in the economy without maintaining a bank account, the costs of which are mounting as post-2008 regulations drop the ax on fee-free retail banking. While there’s always a risk of being mugged on the way to the store, digital transactions are subject to hacking and computer theft.
Cash is also the currency of gray markets—amounting to 20% or more of gross domestic product in some European countries—that governments would love to tax. But the reason gray markets exist is because high taxes and regulatory costs drive otherwise honest businesses off the books. Politicians may want to think twice about cracking down on the cash economy in a way that might destroy businesses and add millions to the jobless rolls. The Italian economy might shut down without cash.
By all means people should be able to go cashless if they like. But it’s hard to avoid the conclusion that the politicians want to bar cash as one more infringement on economic liberty. They may go after the big bills now, but does anyone think they’d stop there? Why wouldn’t they eventually ban all cash transactions much as they banned gold and silver as mediums of exchange?
Beware politicians trying to limit the ways you can conduct private economic business. It never turns out well.

Pope Francis encyclical calls for end to fossil fuels

• 1 hour ago
• From the section Europe
• http://www.bbc.com/news/world-europe-33182065 

The Pope calls for a radical change in behaviour to save the planet for future generations

The Pope has issued an encyclical, calling for fossil fuels to be "progressively replaced without delay".

Pope Francis urges the richer world to make changes in lifestyle and energy consumption to avert the unprecedented destruction of the ecosystem.
Environmentalists hope the message will spur on nations ahead of the UN climate conference in Paris in December.
But parts of the document, leaked earlier this week, have already been criticised by some US conservatives.
It has been dismissed by two Republican presidential candidates.

Humans to blame

The encyclical, named "Laudato Si (Be Praised), On the Care of Our Common Home", aims to inspire everyone - not just Roman Catholics - to protect the Earth.
The 192-page letter, which is the highest level teaching document a pope can issue, lays much of the blame for global warming on human activities.
Pope Francis writes that: "We have come to see ourselves as her lords and masters, entitled to plunder her at will.
"The violence present in our hearts, wounded by sin, is also reflected in the symptoms of sickness evident in the soil, in the water, in the air and in all forms of life."

The letter highlights the loss of biodiversity in Amazonian rainforests and the melting of polar glaciers

He criticises what he calls a "collective selfishness", but says that there is still time to stop the damage, calling for an end to consumerism and greed.

'Moral approach'

Vatican spokesman Federico Lombardi launched the pontiff's second encyclical at a news conference on Thursday.
The teaching is more evidence of a pontiff determined to act as a catalyst for change, and a powerful diplomatic player on the world stage, says the BBC's religious affairs correspondent Caroline Wyatt.
The release comes six months before international leaders gather in Paris to try to seal a deal to reduce carbon emissions.

Metropolitan of Pergamon Joannis Zizioulas (left) became the first high-ranking Orthodox Church official to present a papal document

It has been widely welcomed by environmental groups, with WWF president Yolanda Kakabadse saying it "adds a much-needed moral approach'' to the debate on climate change.
Greenpeace leader Kumi Naidoo highlighted passages calling for policies that reduce carbon emissions, including by replacing fossil fuels with renewable energy.
But a leak of the document, published by Italy's L'Espresso magazine on Tuesday, got a frosty response from sceptical conservatives in America, including two Roman Catholic presidential candidates.
Jeb Bush said he did not get his economic policy from his bishops, cardinals or pope - so why his policy on the environment?
Meanwhile Rick Santorum questioned whether the Pope was credible on the issue of climate science.
However, many academics have welcomed the pontiff's input.
Prof Myles Allen, Professor of Geosystem Science at the University of Oxford in the UK, said: "If Pope Francis can't speak up for our unborn grandchildren, then God help us all."

Will Pope sway Americans? - Roger Harrabin, BBC News environment analyst

Jeb Bush dismissed a leaked draft of the encyclical

The UN's climate change chief Christiana Figueres says the Pope's message will influence talks in Paris this year on a deal to tackle global warming.
Developing countries are demanding firmer promises of financial help from rich countries so they can adapt to inevitable changes in the climate and get clean energy to avoid contributing to further warming.
Ms Figueres said their position would be strengthened by the Pope's insistence that this was the clear moral responsibility of the rich.
The encyclical will be welcomed by poor countries in Africa and Latin America.
The big question is how it will play in the USA, where it has already been dismissed by a Republican presidential candidate Jeb Bush, who is a Catholic.
Leading Republicans have warned the UN that they will undo President Barack Obama's climate policies - so if the encyclical sways any of the conservative Catholics in Congress that could prove significant.

If you haven't checked out Washington's Blog, here's some of what you're missing...

Profits Über Alles?

Posted on December 19, 2013 by WashingtonsBlog

By Gonzalo Lira.
Neoliberal economics has been a wonderful driving force for progress and material prosperity—but it cannot be the single ruling principle of our lives, of our government, or of our society.
If we allow the profit motive to be the only motive, then we and our society are doomed.
We are already seeing the shape of that doom, in our health care, our government, and our industry.

Isn’t this blasphemous? Dear God, is this us???

So this morning, I woke up to a piece by Michael “Mish” Shedlock—a piece that, being a fellow middle-aged man, scared the ever-living shit out of me.
Mish opens his piece describing how last October 2012, he took a standard prostate cancer test and came up positive. What follows is his no-nonsense journey of beating his cancer. The whole piece is a must-read; here is the link.
(Refreshingly, Mish doesn’t inflict the needless emotional bullshit on us. I’m sure he felt scared out of his wits, and I’m sure he had quite a few dark-nights-of-the-soul, especially as he had only recently lost his wife. I have nothing but compassion for him as a human being—but as a reader, I’m so glad he didn’t roll around in the emotional muck, which is such the fashion today.)
The thing that struck me about Mish’s piece was how one of his doctors, the surgeon who performed the initial biopsy, wanted to do surgery right away. Mish adopted a wait-and-see approach, coupled with a cocktail of drugs, to see if this counteracted the cancer. And rather than another biopsy, Mish wanted more and more-frequent blood tests. The surgeon, “Dr. G.”, insisted on biopsies instead of blood tests—he wanted to perform surgery so badly that he effectively gave Mish an ultimatum: My way (biopsies/surgery) or the highway.
read more here - http://www.washingtonsblog.com/

'Not to share wealth with poor is to steal': Pope slams capitalism as 'new tyranny'

Published time: November 26, 2013 14:34
Edited time: November 28, 2013 13:51

Pope Francis (Reuters/Giampiero Sposito)

hare on tumblr

The existing financial system that fuels the unequal distribution of wealth and violence must be changed, the Pope warned. Pope Francis has taken aim at capitalism as "a new tyranny" and is urging world leaders to step up their efforts against poverty and inequality, saying "thou shall not kill" the economy. Francis calls on rich people to share their wealth.

"How can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points?" Pope Francis asked an audience at the Vatican. 

The global economic crisis, which has gripped much of Europe and America, has the Pope asking how countries can function, or realize their full economic potential, if they are weighed down by the debts of capitalism. 

“A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules,” the 84-page document, known as an apostolic exhortation, said. 

"To all this we can add widespread corruption and self-serving tax evasion, which has taken on worldwide dimensions. The thirst for power and possessions knows no limits", the pope’s document says. 

He goes on to explain that in this system, which tends to devour everything which stands in the way of increased profits, whatever is fragile, like the environment, is defenseless before the interests of a deified market, which has become the only rule we live by.

Shameful wealth 

Inequality between the rich and the poor has reached a new threshold, and in his apostolic exhortation to mark the end of the “Year of Faith”, Pope Francis asks for better politicians to heal the scars capitalism made on society. 

"Just as the commandment 'Thou shalt not kill' sets a clear limit in order to safeguard the value of human life, today we also have to say 'thou shalt not' to an economy of exclusion and inequality. Such an economy kills," Francis wrote in the document issued Tuesday. 

His calls to service go beyond general good Samaritan deeds, as he asks his followers for action“beyond a simple welfare mentality".

"I beg the Lord to grant us more politicians who are genuinely disturbed by the state of society, the people, the lives of the poor,” Francis wrote. 

A recent IRS report shows that the wealth of the US’s richest 1 percent has grown by 31 percent, while the rest of the population experienced an income rise of only 1 percent. 

The most recent Oxfam data shows that up to 146 million Europeans are at risk of falling into poverty by 2025 and 50 million Americans are currently suffering from severe financial hardship. 

"As long as the problems of the poor are not radically resolved by rejecting the absolute autonomy of markets and financial speculation, and by attacking the structural causes of inequality, no solution will be found for the world's problems or, for that matter, to any problems," he wrote.

Named after the medieval saint who chose a life of poverty, Pope Francis has gone beyond general calls for fair work, education, and healthcare. 

Newly-elected Pope Francis has stepped up the fight against corrupt capitalism that has hit close to home - he was the first Pope to go after the Vatican bank and openly accused it of fraud and shady offshore tax haven deals. 

In October, Pope Francis removed Vatican bank head Cardinal Tarcisio Bertone, after revelations of alleged mafia money laundering and financial impropriety.
http://rt.com/news/pope-francis-capitalism-tyranny-324/