The Mortgage Foreclosure Slap-on-the-Wrist Settlement

The recent nationwide mortgage forclosure settlement with the banks shows that they got off pretty easily. Although, this article in the LA Timespoints out that the banks still have some troubles ahead. While they can not be prosecuted anymore on a Federal level, they can stll be sued by class action suites and private claims.

Good place for bankers

The good part is that the banks can still be sued by individuals, the bad part is that they got off relatively easy. It remains to be seen how these private suites will play out. I suspect the banks will have some trick up their sleeves to deal with them.

We must remember that these banks were, possibly still are, involved in criminal activity which let to the ruination of millions of families. Their fraudulent practices, most emphatically with the mortgage backed securities and sub prime lending, helped bring down the economy starting in 2007. Most of these bankers should be going to jail, not hailing this settlement as a positive thing, as Wells Fargo’s Timothy Sloan did. If the Wall Street bankers are happy about it, it’s not a good thing for Main Street Americans.

“The settlement itself is still being viewed as a positive thing within the industry, given that it erases one of the many points of uncertainty that have hung over executives and complicated planning for the future.

Wells Fargo & Co. Chief Financial Officer Timothy Sloan hailed the agreement as being good for the company and shareholders. He said in a speech Thursday that the deal “is a significant and important agreement, which we believe is good for the country, good for our customers and good for our shareholders.”

These bankers should have gotten much more in this settlement, like jail time. The really truely bankrunpt banks should be left to go under and make way for real banks that have some economic value to contrubute to the country such as that kind of banking outlined in the Glass-Steagall Act from the Roosevelt period. That will separate the criminal, parasitical bankers from the productive bankers.

Does anyone even remember the Glass-Steagall Act and how it saved the economy from the speculative banks?

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