IEHI Feed: The Bank Implode-o-Meter http://implode-explode.com/ Tracking the many faces of the global credit implosion. en-us iehi-feed-61526 Fri, 20 Jan 2017 23:04:23 GMT Now we care about how Steve Mnuchin at OneWest Bank handled foreclosures? | Mandelman Matters http://bankimplode.com/viewnews/2017-01-20_NowwecareabouthowSteveMnuchinatOneWestBankhandledforeclosuresMan.html iehi-feed-61525 Fri, 20 Jan 2017 22:54:59 GMT Trump takes away FHA mortgage insurance premium cut not long after being sworn into office http://bankimplode.com/viewnews/2017-01-20_TrumptakesawayFHAmortgageinsurancepremiumcutnotlongafterbeingswo.html The move undid the quarter-point decrease in the FHA mortgage insurance premium that was announced earlier in the week by outgoing U.S. Department of Housing and Urban Development Secretary Julian Castro. For most borrowers, it would have been a reduction to 0.60 percent from 0.85 percent.

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House Republicans objected to the reduction because it would have lowered the amount of funds FHA has available to cover mortgage defaults. House Financial Services Chairman Jeb Hensarling (R-Tex.) issued a statement earlier in the week saying, "the Obama administration's parting gift to hardworking taxpayers is to put them at greater risk for footing the bill for another bailout."

... "According to our estimates, roughly 750,000 to 850,000 home buyers will face higher costs, and 30,000 to 40,000 new home buyers will be left on the sidelines in 2017 without the cut," William E. Brown, National Association of Realtors president, said in a statement. "We're disappointed in the decision but will continue making the case to reinstate the cut in the months ahead."

From the perspective of FHA being a bankrupt/fraudulent insurance fund, this is a good thing. However, it's just going to get bailed out anyways (in some form), so this consists of the removal of a marginal amount of housing-finance accessibility for a significant number of people. I.e., it's probably the fiscally right thing to do, but it's pretty interesting how scrooge-like of a move this is for one of Trump's first official acts....

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iehi-feed-61524 Fri, 20 Jan 2017 15:18:51 GMT Freshman congressman with guts is ready to file articles of impeachment against Trump http://bankimplode.com/viewnews/2017-01-20_Freshmancongressmanwithgutsisreadytofilearticlesofimpeachmentaga.html iehi-feed-61523 Fri, 20 Jan 2017 03:02:28 GMT CFPB To Sue TCF National Bank For Overdraft Fraud; CEO Named His Boat "The Overdraft" http://bankimplode.com/viewnews/2017-01-19_CFPBToSueTCFNationalBankForOverdraftFraudCEONamedHisBoatTheOverd.html TCF National Bank stood out among other financial institutions in its practices, consumer watchdog CFPB said. It "designed its application process to obscure the fees and make overdraft seem mandatory for new customers," the CFPB said. For existing customers, the bank used "deceitful language" in scripts it gave to its employees, such as asking customers if they "wanted their TCF card to continue to exist as it does today," instead of clearer questions about consent for allowing their accounts to go into overdraft, a spokesman for the CFPB said.

About 66% of all TCF checking account customers had opted in to giving overdraft abilities on their accounts as of mid-2014, triple the average rate of opt-in at other banks, according to the CFPB's complaint. What's more, the bank in 2010 also held opt-in celebrations, the CFPB said: one to celebrate 300,000 opt-ins and another one to celebrate 500,000, with senior executives attending both. TCF's chief executive at the time of the 2010 opt-in rule even named a personal boat "The Overdraft," the complaint added.

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iehi-feed-61522 Fri, 20 Jan 2017 02:07:20 GMT USGov Has Been Massively Under-Reporting Student Loan Delinquencies Due To "Glitch" http://bankimplode.com/viewnews/2017-01-19_USGovHasBeenMassivelyUnderReportingStudentLoanDelinquenciesDueTo.html iehi-feed-61521 Thu, 19 Jan 2017 23:38:50 GMT Dimon: Euro Zone May Not Survive If Economic Concerns Are Ignored http://bankimplode.com/viewnews/2017-01-19_DimonEuroZoneMayNotSurviveIfEconomicConcernsAreIgnored.html Dimon said he had hoped European Union leaders would examine what caused the U.K. to vote to leave and then make changes. That hasn't happened, and if nationalist politicians including France's Marine Le Pen rise to power in elections across the region "the euro zone may not survive," Dimon, 60, said in a Bloomberg Television interview with John Micklethwait.

"What went wrong is going wrong for everybody, not just going wrong for Britain, but in some ways it looks like they're kind of doubling down," Dimon said in the interview Wednesday at the annual meeting of the World Economic Forum in Davos, Switzerland. Unless leaders address underlying concerns, "you're going to have the same political things about immigration, the laws of the country, how much power goes to Brussels."

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iehi-feed-61520 Thu, 19 Jan 2017 23:26:32 GMT How Deutsche Bank Made a $462 Million Loss Disappear (Monte Pasci) http://bankimplode.com/viewnews/2017-01-19_HowDeutscheBankMadea462MillionLossDisappearMontePasci.html iehi-feed-61519 Thu, 19 Jan 2017 23:01:58 GMT Western Union Slapped With $586M Fine For Abetting Systemic Fraud http://bankimplode.com/viewnews/2017-01-19_WesternUnionSlappedWith586MFineForAbettingSystemicFraud.html Western Union Co, the world's biggest money-transfer company, agreed to pay $586 million and admitted to turning a blind eye as criminals used its service for money laundering and fraud, U.S. authorities said on Thursday.

Western Union, which has over half a million locations in more than 200 countries, admitted "to aiding and abetting wire fraud" by allowing scammers to process transactions, even when the company realized its agents were helping scammers avoid detection, the U.S. Department of Justice and the Federal Trade Commission said in statements.

With the help of Western Union agents, Chinese immigrants used the service to send hundreds of millions of dollars to pay human smugglers, wiring the money in smaller increments to avoid federal reporting requirements, U.S. authorities said.''

Meanwhile, governments don't want YOU to have access to cash or day-to-day use of virtual currencies like bitcoin, because ... well, something like what Western Union (and the big banks) have been doing MIGHT happen...

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iehi-feed-61518 Thu, 19 Jan 2017 22:50:47 GMT Mnuchin weathers stormy confirmation hearing http://bankimplode.com/viewnews/2017-01-19_Mnuchinweathersstormyconfirmationhearing.html In a wide-ranging hearing more than five hours long, Mnuchin was pressed by Democrats for details on everything from his thoughts on tax reform to his defense of foreclosures carried out by OneWest Bank while serving as its top executive.

Mnuchin also faced significant pressure over the fact that just one day earlier, he had to update his financial disclosures to include nearly $100 million in previously unreported assets, as well as a fund based in the Cayman Islands, a notorious tax haven.

But like many of Trump's picks, at the end of the day it appeared that Mnuchin could still rely on enough Republican support to win the job.

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Mnuchin took many of [the] critiques head-on Thursday, defending his time as a bank executive and his work in the private sector. While Democrats highlighted individuals who lost their homes to OneWest, Mnuchin emphasized the efforts his bank took to help struggling homeowners adjust their mortgages.

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iehi-feed-61517 Thu, 19 Jan 2017 04:21:33 GMT Janet Yellen: Economy is getting closer to "running on its own" http://bankimplode.com/viewnews/2017-01-18_JanetYellenEconomyisgettingclosertorunningonitsown.html [Yellen] said the long-run unemployment rate is probably 4.75 percent, just above the current 4.7 percent. Inflation is "inching back" toward the Fed's 2 percent goal, which has remained elusive even as the economy has stayed out of recession for nearly eight years and unemployment is at its lowest level since late 2007.

Despite the economic improvements, the Fed has remained cautious. "Right now our foot is still pressing on the gas pedal, though, as I noted, we have eased back a bit," Yellen said.

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The funds rate, which banks charge to lend to each other overnight, likely will be at 3 percent by the end of 2019, a target that Yellen acknowledged is "a full percentage point lower than our estimate just three years ago."

The Fed looks set to undershoot -- as they almost always do in rate-rise cycles. This is probably a major reason that gold usually rallies hard after rate hikes begin -- because it's too little, too late.

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iehi-feed-61515 Wed, 18 Jan 2017 22:54:44 GMT The Dollar, "the Most Crowded Trade," Gets Less Crowded http://bankimplode.com/viewnews/2017-01-18_TheDollartheMostCrowdedTradeGetsLessCrowded.html iehi-feed-61514 Wed, 18 Jan 2017 21:45:44 GMT Troubled Deutsche Bank Scraps Senior Bankers' Bonuses for 2016 http://bankimplode.com/viewnews/2017-01-18_TroubledDeutscheBankScrapsSeniorBankersBonusesfor2016.html Deutsche Bank AG scrapped the bonuses of its top executives for a second straight year and slashed variable compensation for other senior employees, as Germany's largest lender tries to shore up capital that's been eroded by low interest rates and legal expenses.

The measures, announced in a memo to employees Wednesday that was signed by the members of the management board, will affect about a quarter of employees, including vice presidents, directors and managing directors. A "limited number" of employees in crucial positions will receive a special long-term incentive, partly in stock, that will be deferred for as long as six years, according to the memo.

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"Now that we have a clearer idea of the financial impact of the settlement with the U.S. Department of Justice and our performance for the year, we feel that tough measures are unavoidable," the bank said in the memo. "This is especially true at a time when thousands of jobs are being cut and our shareholders are not receiving an annual dividend."

The widespread bonus cuts, unprecedented in the bank's recent history, highlight the severity of its troubles, and come as fixed-income traders around the world are about to see their annual pay grow for the first time since 2012 amid a surge in bond trading, according to a November report from recruitment firm Options Group Inc.

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iehi-feed-61513 Wed, 18 Jan 2017 21:42:45 GMT Credit Suisse finalizes $5.3 billion mortgage settlement with U.S. http://bankimplode.com/viewnews/2017-01-18_CreditSuissefinalizes53billionmortgagesettlementwithUS.html Credit Suisse has formally agreed to pay $5.3 billion to settle with U.S. authorities over claims it misled investors in residential mortgage-backed securities it sold in the run-up to the 2008 financial crisis.

As part of the settlement, announced by the U.S. Department of Justice on Wednesday, the Zurich-based bank acknowledged that home loans it pooled into the securities did not meet underwriting guidelines, with some described by employees as "complete crap" and "[u]tter complete garbage."

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Credit Suisse will pay a $2.48 billion cash penalty and provide $2.8 billion in consumer relief, including loan forgiveness and financing for affordable housing, the Justice Department said in the statement.''

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The settlement clears the biggest cloud over Credit Suisse. However, the total amount in U.S. penalties could climb as the bank is still defending itself against lawsuits by the New York and New Jersey attorneys general over similar claims involving billions of dollars in investor losses.

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Major U.S. banks, including JPMorgan Chase & Co and Bank of America Corp (BAC.N), have paid a total of $46 billion to resolve similar conduct involving the quality of loans pooled and sold.. While the Credit Suisse settlement will likely be the last under the Obama administration, other banks under investigation include Royal Bank of Scotland, Wells Fargo & Co, UBS Group AG, and HSBC.

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iehi-feed-61512 Wed, 18 Jan 2017 21:29:46 GMT China Housing Bubble Finally Pops: First Slowdown After 19 Months Of Acceleration http://bankimplode.com/viewnews/2017-01-18_ChinaHousingBubbleFinallyPopsFirstSlowdownAfter19MonthsOfAcceler.html iehi-feed-61509 Tue, 17 Jan 2017 23:04:55 GMT Gundlach's Projections: Stocks Will Correct; Euro Will Deteriorate http://bankimplode.com/viewnews/2017-01-17_GundlachsProjectionsStocksWillCorrectEuroWillDeteriorate.html iehi-feed-61508 Tue, 17 Jan 2017 22:36:28 GMT Survey Says: Americans Already Hate Their Incoming "Populist" President http://bankimplode.com/viewnews/2017-01-17_SurveySaysAmericansAlreadyHateTheirIncomingPopulistPresident.html The CNN/ORC poll shows 53 percent of Americans view Trump unfavorably, while only 44 percent have a favorable opinion of the incoming president. In the ABC News/Washington Post poll, Trump's favorable rating is just 40 percent, with 54 percent having an unfavorable opinion.

That, according to The Washington Post, makes Trump the least-popular incoming president of the past 40 years -- by a large margin. Eight years ago, ABC News/Washington Post polling showed Barack Obama with a 79 percent favorable rating. Even George W. Bush -- who lost the popular vote and was designated the next president only after a protracted recount in Florida -- had a 62 percent favorable rating on the eve of his inauguration. Bush's 36 percent unfavorable rating was the lowest of the modern era, until Trump's 54 percent score in the new poll.

This is only surprising to those that are in denial of the popular vote outcome (and let's not forget the vast pool of people who didn't vote at all or voted for neither major candidate, who are especially at liberty to start grousing); but we have to wonder if Trumps insular handling of staffing his administration and conducting his naescent policy (much more actively than for a typical president-elect) are already alienating additional people.

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iehi-feed-61507 Tue, 17 Jan 2017 22:03:37 GMT Why the Price of Gold Will Rise 15.2% This Year http://bankimplode.com/viewnews/2017-01-17_WhythePriceofGoldWillRise152ThisYear.html iehi-feed-61506 Tue, 17 Jan 2017 21:14:00 GMT A Hint of Gold Backwardation Means Rising Gold Scarcity http://bankimplode.com/viewnews/2017-01-17_AHintofGoldBackwardationMeansRisingGoldScarcity.html iehi-feed-61505 Tue, 17 Jan 2017 21:06:39 GMT Crazy Housing Reality Shows Are Back http://bankimplode.com/viewnews/2017-01-17_CrazyHousingRealityShowsAreBack.html [The shows don't want] too much to think about.  Real estate buying is simple!  It never goes down!  If this dingbat couple bought then surely "I" with my genius IQ and my spouse will live happily ever after so long as we buy.  No one lost buying real estate (aside from the 7,000,000+ recent foreclosures from the latest housing bust).

In the end, no one cares about your financial well being more than you.  In my view, managing your finances wisely is about financial independence, not being locked down as a house slave while having to forge into the toxic freeway wasteland of California.  That financial independence may very well include owning a home.  Heck, in most parts of the country buying is really a no brainer.  But in expensive regions and states, the math isn't so clear. 

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iehi-feed-61504 Tue, 17 Jan 2017 19:58:25 GMT Bombshell as Trump just signaled the death of Clinton-era strong "dollar policy" http://bankimplode.com/viewnews/2017-01-17_BombshellasTrumpjustsignaledthedeathofClintonerastrongdollarpoli.html Presidents in recent history have refrained from talking the currency up or down, and Chandler says going back to Clinton Treasury Secretary Robert Rubin, the policy has been for a strong dollar. Even when the dollar's strength created headwinds, administrations have stood by it, at least verbally.

Trump said the dollar was already "too strong," and he pointed a finger at the Chinese currency. "Our companies can't compete with them now because our currency is too strong. And it's killing us," he told the newspaper. Trump said the yuan has been "dropping like a rock," and that recent Chinese moves to support its currency were done "because they don't want us to get angry."

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"It raises questions. Are we back to Lloyd Benson? He talked the dollar down and the dollar collapsed. Is this a jettison of the Rubin strong dollar policy? We don't know," said Chandler.

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Woo said he does not expect Mnuchin to tout the strong dollar policy. Instead, he expects him to stop short of it as he did in a recent CNBC interview by more or less saying a strong "economy" is in the best interest of the U.S. That is very like the comment made by Lew on Tuesday.

This is one of the simplest, most effective things Trump can do (as it addresses the all-important monetary front of U.S. economic challenges, and apparently, is all Trump cares to do on that front) -- of course, there is a risk of it overshooting badly. The real bold move would be to re-back the dollar with gold when it is at its nadir, but that would take "work" to setup, not just gum-flapping/twitter tapping.

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