Methinks I see a squeeze play in the making, that President Obama's "stern talking to" could have been a warning shot from a different direction while Congress works from another.
DailyKos diarist Badabing posted this morning that Sen. Carl Levin, chair of the Senate Permanent Committee on Investigations, has subpoenaed Goldman Sachs, Washington Mutual and more financial industry firms with regards to the financial meltdown. Note this key graf from WSJ excerpted in the DKos diary:
According to people familiar with the matter, the Senate Permanent Subcommittee on Investigations also has issued a subpoena to Washington Mutual Inc., a Seattle thrift that was seized by regulators in last year's financial crisis and is now largely owned by J.P. Morgan Chase & Co. It appears likely that several other financial institutions also have received subpoenas. Subcommittee investigators declined to comment. A Goldman Sachs spokesman declined to comment on the subpoena. Deutsche Bank didn't immediately respond to a request for comment.
Huh. Isn't that interesting?
Especially when one considers that then Sen. Obama was a co-sponsor of legislation along with Sen. Levin on corporate transparency, also cited in the same DKos post.
Perhaps Levin is going to finally make some traction with the hope of getting a DOJ referral after other attempts to reveal the criminality of subprime lenders and their aides and abettors further upstream in the financial industry. He's got better political headwinds this time, and a former fellow senator in the White House.
Goodness knows CBS' 60 Minutes' Steve Kroft and Scott Pelley tried to explain the problems in clear terms over the last year, but nobody in Congress or law enforcement picked up on it. (See below the list of 60 Minutes' programs which featured all related stories on mortgage fraud and the financial instruments up the food chain which were based on the fraud.)
And Elliot Spitzer also tried his hand after ALL 50 states' attorneys general were quashed by the White House when they tried to go after subprime mortgage fraud. We all know how that turned out after Spitzer called out the White House and Wall Street in his fateful WaPo op-ed, "Predatory Lenders' Partner in Crime", published only weeks before another fateful article in the NYT, and weeks before Bear Stearns crashed.
Let's hope Sen. Levin can get the dirt -- it's out there.
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House of Cards: how the U.S. sub-prime mortgage meltdown, in which risky loans drove a housing boom that went bust, is now roiling capital markets worldwide (Video, Feb. 26, 2009)
World Of Trouble: Three years before the housing market crash, Paul Bishop says he warned his superiors at World Savings that many of the mortgages they were granting were misleading and predatory. (Video, Feb. 19, 2009) [NOTE: This is the clearest statement of the amount of fraud involved. A must-watch.]
An Invitation To Fraud: Financial editor Jim Grant says that everyone got a cut in the subprime circle and many share the blame for the crisis. (Video, Feb. 9, 2009)
Credit Default Swaps: an examination of the complicated financial instruments known as credit default swaps and the central role they are playing in the unfolding economic crisis.(Video, Oct. 27, 2008)
Wall Street's Shadow Market: a look at some of the arcane Wall Street financial instruments that have magnified the economic crisis. (Video, Oct. 5, 2008)
The U.S. Mortgage Meltdown: report on the U.S. sub-prime mortgage meltdown, in which risky loans drove a housing boom that went bust, and how this crisis is now roiling capital markets worldwide.(Video, May 25, 2008)
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