Tag Archives: Glass-Steagall

crap disseminated from an American Banker

This post is follow up of an article from an “American Banker”, written by Frank Sorrentino; the CEO of ConnectOne Bank, and Board Memeber of the American Banker’s Association.  My follow up to his prolonged discourse of biased rhetoric and postulation follows.

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It’s a rare occasion when both major political parties converge on a particular platform or issue — and rarer still when said platform involves the resurrection of an outdated law born of the Depression era.

Yet today, in 2016, we find ourselves in such a scenario.  Current discussions around the potential reinstitution of the Glass-Steagall Act — enacted in 1933 to prohibit commercial banks from engaging in the investment business as a response to the Great Depression — are headline-grabbing and emotional. However, Glass-Steagall ultimately has no merit in our current financial environment. It is a relic of an ancient world that no longer exists, where the U.S. was the supreme world power in financial services.

Today, this is far from the case. As of 2015, of the world’s 25 largest banks, only four are in the U.S. Quite simply, the “massive” financial institutions we have in the U.S. are not so massive on the global scale.

To reinstate a law that further breaks down these large institutions would put the U.S. at a huge competitive disadvantage, forcing some of the largest American companies to seek out non-U.S. financial institutions for their banking services. We can’t disregard the fact that the most sophisticated large borrowers want and expect to have all their financial services in one place, and they will not hesitate to look elsewhere if circumstances require them to.

While it may conjure up nostalgic sentiment or conciliate those who fear another financial crisis, the bottom line is that Glass-Steagall would do nothing to provide for our banking system today. Furthermore, had it been in place in 2007, it would not have prevented the recession or the collapse of financial institutions like AIG, Lehman Brothers or Bear Stearns — none of which were banks, and therefore, not included under Glass-Steagall’s legislation.

I agree that we should not allow financial institutions to become too big to fail, or have banks operating in every business. The Dodd-Frank Act, another example of post-crisis legislation, has done a lot to deal with these issues, and has strengthened the financial industry in certain respects. Yet there are also aspects of it that have done little more than add layers of cost and regulatory complexity to banks of all sizes, contributing to lackluster growth in GDP. At this time, our focus should not be on resurrecting another bill from the annals of history, but on analyzing the costs and benefits of our current regulations and figuring out what kind of modern financial system we want to have relative to other global institutions.

Since the 2008 financial crisis, we’ve taken numerous measures to make the financial industry significantly safer. According to the Financial Services Forum, the largest U.S. banks have become smaller and simpler; capital has doubled and liquidity has tripled among the largest firms. Many larger banks, due to capital requirements, are divesting their subsidiaries and scaling down.

Banks today are safer than ever — from a risk, capital, expense ratio, liquidity perspective, etc. — yet still, they remain the piñata when it comes to our economic woes. Calls to reinstate Glass-Steagall and further restrict the industry only reinforce this narrative.

At the end of the day, banks are here to support the U.S. economy, not to serve as its punching bag. People often want to divorce banking from the economic progress that’s going on, when in reality, they are very much related. Banks provide enormous tailwinds to the economy when they are able to do what they do best.

In our current post-recession environment, the focus should be on spurring aggressive economic growth and enabling U.S. competitiveness on a global scale. For this, Glass-Steagall is far from the answer. So what is?

Moving forward, we need to stop the rhetoric and take a pragmatic look at where we are in the economic landscape, where we want to be and the realistic measures that will help us get there. It’s time to de-politicize the conversation and think practically about how we can move forward as a major economic player. This includes allowing banks of all sizes, relative to our economy, to work efficiently to provide the services today’s financial environment requires.

This is not 2008, and it’s certainly not 1933. Let’s not allow emotional appeals to a bygone era drive our financial policy. It’s time to put the growth of our economy first.

 

Response –

This is one of the worst attempts from the CEO of an American bank, and Board member of the American Bankers Association to defend against the necessity of re-instituting the Glass-Steagall Act. I would think that he would work a bit harder to have more than hyperbole and postulation to make his point. I understand that financial institutions do not have the levity to use facts in order to prove any point on this subject due to the fact that there are none that will suffice. Using the point that the reinstitution of Glass-Steagall would not benefit American financial institutions because they are not the biggest banks on the block is not a valid argument.  His attempts to assume that “bigger is better” in the financial industry shows just how inane his arguments are.

The argument for the reinstitution is solely based on the facts that the financial institutions use fraud and criminal activities for their business model. Period. The reinstitution of Glass-Steagall did in its inception, and would do so again, create stop measures and regulations as to the actions of the financial sector.

The argument that other banks outside of the United States would benefit more due to these regulations is a non-sequitor to say the least. That argument is simply stating that if American financial institutions are going to have to act in accordance to the rules of law, it will hurt their bottom line. This is an insane means of rationale and show the depths of depravity that our society has allowed our corrupt politicians and financial system.

Abosulte power corrupts absolutely. The human condition has shown that when there is no oversight or regulations greed will corrupt absolutely. Taking away regulation from the foundations of the capitalistic paradigm leave zero room for fairness when profit is the sole desired base in a system that holds no conscience. There is no reason for any amount of ethics to be used in the financial corporate systems when the sole reason for existence is profit at any cost. Corporations hold no ethical reason toward fairness to their clients as their sole means of existence is profit for the shareholder. Without proper oversight and regulation to their actions, as well as, accountability and repercussions to their illegal activities there is no difference between Wall Street today and the wild west lawlessness of the 1800’s.

When Mr. Sorrentino stated, “it may conjure up nostalgic sentiment or conciliate those who fear another financial crisis, the bottom line is that Glass-Steagall would do nothing to provide for our banking system today. Furthermore, had it been in place in 2007, it would not have prevented the recession or the collapse of financial institutions like AIG, Lehman Brothers or Bear Stearns — none of which were banks, and therefore, not included under Glass-Steagall’s legislation”,  is simply bullshit. The fact that these institutions held such destructive power is because of the deregulation from the Clinton Administration of Glass-Steagall. It was due to Glass-Steagall that these institutions never had the power to participate in the financial sector to the extent they were able to in the first place. So, the fact that these corporation were not banks means nothing. What Glass-Steagall did was remove the availability for these types of instituions to act in the ways that they did in concert with Wall Street and Main Street financial institutions to begin with. This article is simply rhetoric and PR used to benefit the financial industry with no merit of logic whatsoever.

The one thing I am not a big fan of is the fact that the first amendment allows greedy biased CEO’s and other idiots to spew untruths and rhetoric to the masses as if they have held intelligent, rational thoughts behind their bullshit ideas.

 

 

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I welcome those reading my story. I appreciate all of the emails I have been receiving. I also appreciate those who have registered and subscribe to this blog. If you have come from Facebook please comment on this site, rather than any Facebook post of this page due to the fact that there are many readers who are not part of Facebook forums, or even Facebook itself. I encourage all readers to put their comments on this site so that all of the information will be accessible to all readers from all parts of the internet. I urge you to join this site and receive the RSS feed, or bookmarking us, sharing us with your friends on Facebook and Twitter. If you know of anyone who might benefit from this information I urge you to pass on this website address! Share and let’s make some change together!

Thank you for stopping by.

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©2014-2017 Doug Boggs All Rights Reserved

A CALL TO ACTION

This is a call to action.  I sit here writing as I approach the completion of my “tell all” book about my personal experience of the illegal foreclosure of my home and subsequent lawsuit against Wells Fargo Bank for Fraud. The book has been a very difficult project to undertake, just as the lawsuit was, since I had to litigate my case personally. It’s been no easy task to take on one of the largest corporations in the United States, and I also found it daunting to write a book exposing the truth in a way that everyone is able to understand so that actions could be taken in order to create change to our broken systems. It would have been a lot easier to complete my book if the court had not silenced my case files.

My goal through all of this has been to expose the evidence I found which shows that EVERY deed of trust is based on fraud. This is because the banks know that the trustee is a strawman and hold no power in the deed of trust agreement to protect the borrower’s title from any wrongdoing from the banks, yet they fail to inform the borrower of this information and give the borrower a deed of trust agreement anyway. Therefore, there is never a “meeting of the minds” in the contract negotiations. The banks know this information because it was their lobbyists who constructed Senate Bill 1638, which was signed into law in 1996, by then CA Governor Pete Wilson. This law amended CA Civil Code 2934a, which is an integral part of the Power of Sale clause that pertains to a deed of trust agreement which dictates the rules of the non-judicial foreclosure procedure.

A non-judicial foreclosure procedure is used in a state using a deed of trust agreement. This procedure was instituted for use in order to alleviate any undo burdens against the court system by overloading the them with “frivolous foreclosure lawsuits”. In 1978, the CA Supreme Court issued a ruling in the Garfield v Superior Court for Contra Costa County, respondent being Wells Fargo Bank, specifically detailing the independence of the trustee in a deed of trust agreement. There is a presumption of correctness to papers being filed by the trustee in a non-judicial foreclosure procedure because the trustee is given the legitimacy of being the court as the trustee is to be independent in their oversight of the foreclosure process. There are 35 states in the United States that allow the use deed of trust agreements. All of the other states, which use standard mortgage agreements, are attempting to go through the transition of allowing the use of deeds of trust in real estate transactions. Let this sink in.

Since there was never a “meeting of the minds”, according to contract law and the Statute of Frauds, which is still valid law and dates back to the year 1677, then the contract is therefore based on fraud. Fraud in the inducement, fraud in the misrepresentation of facts, and much more. The fact that every deed of trust is based on a fraud legally means that every deed of trust is VOID. The fact that the contract is then VOID means that no borrower needs to pay back the funds to the lending party. The lending party should not have tried to use fraud in order to coerce the borrower into signing the legal documents. Due to their choice of using a fraudulent document in order to create a debt, they lose. The fact that no borrower needs to repay a fraudulent loan is not something that the banking industry wanted to have out into the public consciousness. If the fraudulent deed of trust was used as the instrument in the transaction in order to create the debt against the borrower who has paid any monthly payments to the lender for that fraudulent contract, then the borrower is due to have those payments returned to the borrower that were made to the financial institution who fraudulently collected on a fraudulent debt. Let this sink in. How long have you been making your payments, and how much would that add up to? Plus penalties…

Therefore the banks use every means available, including corrupting our judicial system by paying off and or putting pressure on those participants which might include; clerks of the court, bailiffs, witnesses, opposing counsel, court reporters, judges and district attorneys, the government, etc. I also wanted people to learn of the corruption in the legal system. The corruption I experienced by the court in my legal case, which is detailed in my book, is just one case out of the millions of illegal foreclosures across the country.

The above law, Senate Bill 1638, became effective as of January 1998. This allowed the banks to take a borrower’s note and title and use it as they see fit for their own profit without informing the borrower of that fact. This is another basis for the fact that there is not a meeting of the minds. The banks are able to profit from a borrower’s note by manipulating it on Wall Street and not having to give the borrower any percentage of profits from those investments. The borrower was never given the opportunity to profit in these investments which used the borrower’s title because the borrower was never given the information that the bank was going to be manipulating the title for profit. Therefore, the bank defrauded the borrower again through their misrepresentation of facts. You’ve heard of some of these types of investment vehicle at this point called Mortgage Backed Securities or Collateralized Debt Obligations, etc. These did not exist prior to the year 2000.

You see, in 1999, President Bill Clinton signed the Gramm-Leach-Bliley Act into law, therein repealing four key provisions of the Glass-Steagall Act. This Act is officially named the U.S. Banking Act of 1933, signed by President Franklin Roosevelt. These provisions were instituted to create a separation of banking powers of Wall Street and Main Street. In theory, Roosevelt was protecting the public’s assets because the restrictions did not allow Main Stream banks to gamble with their client’s assets in the same way that Wall Street does with their client’s investment portfolios. When President Bill Clinton repealed these provisions it opened the flood gates for Wall Street to begin to manipulate and gamble with Main Street assets such as real estate, car loans, student loans, retirement accounts, savings accounts, etc. It also allowed Wall Street to combine forces with Main Street banks which began the mergers and acquisitions of the banking industry to a consolidation to only a handful of corporations.

This consolidation created the current financial institutions to become what the Department of Justice’s, Eric Holder, called “too big to fail”.

So, what does this mean now?

Sign in and become a member to this blog for more upcoming detailed information. If you have a home in CA or any other state which uses a deed of trust, and you used a deed of trust agreement in any of your real estate transactions, or if you have been foreclosed on from your home, I urge you to contact me further through the contact page herein. Through the upcoming release of my book, there will be information which will instruct the reader how we are be putting together a class action lawsuit, and how the reader can become a part of that action. If you wish to participate in this process I urge you to contact this blog further through the contact page.

 

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I welcome those reading my story. I appreciate all of the emails I have been receiving. I also appreciate those who have registered and subscribe to this blog. If you have come from Facebook please comment on this site, rather than any Facebook post of this page due to the fact that there are many readers who are not part of Facebook forums, or even Facebook itself. I encourage all readers to put their comments on this site so that all of the information will be accessible to all readers from all parts of the internet. I urge you to join this site and receive the RSS feed, or bookmarking us, sharing us with your friends on Facebook and Twitter. If you know of anyone who might benefit from this information I urge you to pass on this website address! Share and let’s make some change together!

Thank you for stopping by.

©copyright 2014-2016 Doug Boggs