Freddie Mac -- The Evil Banker?

New Profiteers:  "I'm with the Government and here to help you." 

Click here for reference story [SoCal Public Radio]

We've learned that the biggest culprit in the mortgage scandal is none other than Freddie Mac!  Freddie took $125 BILLION in Federal bail-out money and leveraged it for profiteering while denying refinancing for eligible homeowners -- the original purpose of the bail-out money.

Their objective:  Make more money!
Hmmm.  Wasn't the bail-out money supposed to be used to assist eligible homeowners stabilize via refinancing into affordable monthly payments so they wouldn't default?  -- thus helping to stabilize the housing market, a key component of our economy?

Freddie Mac [and Fannie Mae], protected from regulatory oversight by Barney Frank and Chris Dodd, promoted subprime loans and predatory lending, then sold the repackaged bad loans to banks as "Mortgage Backed Securities",  and backed banks in their sales of these relabeled toxic asset bundles, now called CDOs [Collateralized Debt Obligations], setting the stage for the collapse of the US and international financial market.

The Federal Government came to the rescue with a bail-out; Freddie then came up with a convoluted way to use their bail-out money to bolster their bottom line.  The first part looked good.

1) They bought $3.4 Billion of mortgages, many of which carried low interest loans, but were fairly solid investments since the principal was being paid; Freddie sold these to banks for a profit.

2) Freddie also bought performing mortgages with comparatively high interest rates [7%] and held these for profitable returns via the interest.  In today's market, that's a higher risk, although, since the homeowner makes his monthly payments, it's very profitable for Freddie.

All this sounds good since billions of dollars of mortgages were removed from the market inventory.

The rub comes in as Freddie has been found to be denying the homeowners with the higher interest rates the opportunity to refinance to the lower market rates in the 3 - 4% range -- which could cut monthly payments in half -- thus giving homeowners a reason to hold onto their properties, and their credit ratings.  The purpose of the bail-out money was to help home-owners reduce their mortgage rates.

By denying mortgagees the opportunity to refinance, Freddie Mac defied its charter to assist homeowners, and became the biggest predator in the financial market; its practices perpetuate the "housing crisis" by forcing homeowners into financial instability and probable bankruptcy.

Keep in mind, Freddie created the problem [compliments of Chris Dodd and Barney Frank]; it was then bailed out by the Federal Government [i.e., you the taxpayer], its disgraced executives were paid massive bailouts on their exits --- after which many went into senior executive government  positions, and now, Freddie continues to undercut the housing market by using the bailout money which was intended to help homeowners.  Freddie became a profiteer using your tax money.

I am not a crook! (c) Politico

Time to restructure Freddie [and Fannie] and escort their leadership [and perhaps Barney Frank] to a nearby federal prison?

I am not a crook!
(c) charlieforoakland.com

As a footnote; you'll recall that Chris Dodd [former Senator [D]] is currently the force behind SOPA and trying to shut down Megauploads -- and the Internet.  [What a guy!]

US DOJ Poised to destroy Megadata files

Is this Attorney General Eric Holder and staff en-route to destroy the Internet ?          (c) Rumproast.com

Click here for related story [Washington Post]

The Associated Press reports that "... Megaupload user's data could be deleted as soon as Thursday."

As we've reported earlier, Megaupload, in addition to serving as a conduit to download pirated material, also functioned as a Cloud Server and Data Storage Site, storing trillions of data and image files for 50 million users every day.

As it turns out, Megaupload contracted with other companies to actually store the data on remote "server farms"-- to include Carpathia Hosting and Cogent Communications Group, both in the Dulles IT corridor outside Washington, DC.

Government prosecutors advised that they had "... copied some data from the servers, but did not physically take them."   Megaupload's attorney is working to block the company files from being erased, and advised that he hoped the US Government "... should have a common desire to protect consumers."


If the AP report is accurate, and Megaupload data files are deleted, it would appear the DOJ violates the law by, among other issues, by destroying evidence.
a)  How does Megaupload defend itself in court
b)  Millions of Megaupload clients will lose their personal and business files stored on the "Cloud."


There should be cause for concern by other clients of Carpathia and Cogent, which reportedly seem ready to start deleting Megaupload's client files.   Cogent customers include major law firms, entertainment companies, and top universities; Carpathian's clients include a major federal contractor, software companies, and medical suppliers. 

Don't worry.  DOJ will give you a receipt for your deleted files.
(c) Criticallycorrectblog

Why the rush to delete evidence -- and unrelated personal and business files?

Is the Obama system where no one is privy to the government process until it's a done deal?

Using the DOJ logic in seizing Megaupload's content, could the data of Carpathia and Cogent clients be at risk of DOJ seizure as well, since Megaupload's files reside on the same cloud servers?

Client companies might want to start paying attention to this cloud destruction process.  

Cloud Storage Industry?
POOF!
(c) Hackingalert

Ask your IT manager which cloud company is hosting your data.

Once again, it appears that this Administration's concept of creating jobs seems to be restricted to building police forces and prison guards -- to keep all the newly unemployed from causing too much trouble.

What's next?
Book burning?

The Buck Stops --- Anywhere But Here!

Tough to figure out the bad guys these days (c) jpfo.org

With the legacy of Pine Ridge/Wounded Knee, Ruby Ridge, Waco, Elián González,
and now, Fast & Furious,  we have to wonder about the Department of Justice [DOJ] and its leadership.

Click here for related story [Washington Post]

Today, the Washington Post announced the findings of the Democrats on the House Oversight and Government Reform Committee

The Democrats concluded that neither the DOJ nor the Administration bore any responsibility for the actions of the ATF, and blamed all the problems on the Phoenix ATF office.

Get off my back, Brewer, or I'll sick my posse on you.
(c) Lehighvalleylive.com

Phoenix,of course, is in Arizona, where Governor Jan Brewer [R] has been a vehement critic of the ATF, the DOJ, and the Administration.

You may recall that ATF's Fast & Furious program fed roughly 2,000 automatic weapons into Mexican Drug Cartels, supposedly to track where they went.

Oddly, it turned out that all the weapons ended up with Mexican Drug organizations, who then used the weapons to kill each other, innocent Mexicans and Americans, and ATF agents.



That apparently makes the program a "success" by ATF/DOJ standards.

Representative Issa [R-CA], Chairman of the House Oversight and Governance Committee, has grown weary of DOJ's stonewalling his investigation.  Issa subpoenaed all documentation related to the Fast & Furious program; and DOJ produced 80,000 documents, but turned over only 6,000 to Issa's Committee, restricting the remaining 72,000 documents to the DOJ Inspector General
[we assume the DOJ shredding machines are working 24/7 now].

Issa is now threatening to hold Attorney General Eric Holder in Contempt of Congress for failing to deliver the subpoenaed documents.

One interesting statement in the Democrats' report was that the ATF's aggressive [and illegal] actions were taken because the US Attorney's office in AZ was not aggressive enough in its prosecutions.

They omitted the fact that the US Attorney's Office is a subsidiary of the Attorney General's Office.
The conclusion is that the DOJ took illegal actions because the DOJ was not performing its functions adequately.

Grab me again and I'll show YOU Fast & Furious!
(c) Politico

[Makes as much sense as all the rest of the illegal activities in this Administration]

Now, please don't get the idea that we believe ATF is a rogue, out-of-control organization and the agents are all criminals.  Absolutely not!

The reason this scandal was revealed was because ATF field agents were appalled at the actions of their superiors and the decisions made at the DOJ level to continue Fast & Furious even after the Bush Administration discredited the operational concept.

This was a case where we find a DOJ bureaucratic hierarchy ready and willing to violate the law, but, when things went sour, the leadership denied all knowledge and blamed it on a low echelon fall guy.

Back when I was a military commander, it was expected that the senior officer follow the basic Leadership tenets, one of which was to distribute praise for all successes,
and to take responsibility for the failures.

Mr Holder apparently never served in the military.

[Did anyone in this Administration (other than Petraeus) ever serve in the Military?]