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FOCUS: Man Trump Named to Fix Mortgage Markets Figured in Infamous Financial Crisis Episode |
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Saturday, 29 April 2017 11:02 |
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Taibbi writes: "In early 2007, a group of Morgan Stanley bankers bundled a group of subprime mortgage instruments into a package they hoped to sell to investors. The only problem was, they couldn't come up with a name for the package of mortgage-backed derivatives, which they all knew were doomed."
Craig S. Phillips, a former top executive on Morgan Stanley's trading desk, is the man Donald Trump put in charge of reviewing Wall Street rules. (photo: Stefan Falke/laif/Redux)

Man Trump Named to Fix Mortgage Markets Figured in Infamous Financial Crisis Episode
By Matt Taibbi, Rolling Stone
29 April 17
Former Morgan Stanley banker once dumped "shitbag" CDOs on clients
n early 2007, a group of Morgan Stanley bankers bundled a group of subprime mortgage instruments into a package they hoped to sell to investors. The only problem was, they couldn't come up with a name for the package of mortgage-backed derivatives, which they all knew were doomed.
The bankers decided to play around with potential names. In a series of emails back and forth, they suggested possibilities. "Jon is voting for 'Hitman,'" wrote one. "How about 'Nuclear Holocaust 2007-1?'" wrote another, adding a few more possible names: Shitbag, Mike Tyson's Punchout and Fludderfish.
Eventually they stopped with the comedy jokes, gave the pile of "nuclear" assets a more respectable name – "Stack" – and sold the $500 million Collateralized Debt Obligation with a straight face to the China Development Industrial Bank. Within three years, the bank was suing a series of parties, including Morgan Stanley, to recover losses from the toxic fund.
The name on the original registration document for Stack? Craig S. Phillips, then president of Morgan Stanley's ABS (Asset-Backed Securities) division. Phillips may not have written the emails in question, but he was the boss of this sordid episode, and it was his name on the comedy-free document that was presented to Chinese investors.
This is just another detail in the emerging absurd narrative that is Donald Trump naming Phillips, of all people, to head up the effort to reform the Government-Sponsored Entities, Fannie Mae and Freddie Mac.
As ace investigative reporter Gretchen Morgenson of the New York Times noted in a piece back on April 7th, Phillips headed a division that sold billions of dollars of mortgage-backed investments to Fannie and Freddie. Many of those investments were as bad as the ones his unit sold to the Chinese. In fact, as Morgenson noted, Phillips became a named defendant in a lawsuit filed by the Federal Housing Finance Authority (FHFA), which essentially charged, as the Chinese did, that Morgan Stanley knowingly sold Fannie and Freddie a pile of crap.
Morgan Stanley ended up having to pay $625 million apiece to Fannie and Freddie to settle securities fraud charges in that case.
Phillips worked in an area of investment banking that was highly lucrative and highly predatory. The basic scam in the subprime world in particular was buying up mortgages from people who couldn't possibly afford them, making those bad mortgages into securities, and then turning around and hawking those same mortgages to unsuspecting institutional dopes like the Chinese and Fannie and Freddie.
Phillips had a critical role in this activity. As Morgan Stanley's ABS chief, he was among other things responsible for liaising with fly-by-night subprime mortgage lenders like New Century, who fanned into low-income neighborhoods and handed out subprime mortgages to anyone with a pulse.
In a 2012 suit, a group of Detroit-based borrowers accused Morgan Stanley of discriminatory practices, claiming the bank helped New Century target minority areas with predatory loans. One Morgan Stanley due diligence officer, Pamela Barrow, joked in an email about how to go after borrowers.
"We should call all their mommas," Barrow wrote. "Betcha that would get some of them good old boys to pay that house bill."
Phillips was named in the suit and quoted in the complaint. He said that New Century was "extremely open to our advice and involvement in all elements of their operation."
The worst actors in the financial crisis worked in this shady world involving the creation of subprime-backed securities.
Of those bad actors, there is a subset of still-worse actors, who not only sold these toxic investments to institutional investors like pension funds and Fannie and Freddie, but helped get a generation of home borrowers – often minorities and the poor – into deadly mortgages that ended up wiping out their equity.
Phillips, who helped Fannie and Freddie into substantial losses and worked with predatory firms like New Century, belongs in this second category. As Beavis and Butthead would put it, Phillips comes from the "ass of the ass."
Donald Trump, then, has essentially picked one of the last people on earth who should be allowed to help reshape the mortgage markets. This is like putting a guy who sold thousand-dollar magazine subscriptions to your grandmother on the telephone in charge of the Consumer Financial Protection Bureau, or the A.A.R.P.
More foxes for more henhouses. Welcome to the Trump era.

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What Happened to the Promised Investigations Into Russian Interference in the 2016 Election? |
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Written by <a href="index.php?option=com_comprofiler&task=userProfile&user=36361"><span class="small">Robert Reich, Robert Reich's Facebook Page</span></a>
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Saturday, 29 April 2017 08:40 |
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Reich writes: "What happened to the promised investigations into Russian interference in the 2016 election? The House intelligence committee has been plagued by infighting and missteps. While the Senate investigative committee has pledged a thorough probe, it's done little so far - no high-profile hearings, until very recently no full-time staff, and its few part-time staffers have no investigative experience or expertise with Russia."
Former Clinton labor secretary Robert Reich. (photo: Steve Russell/Toronto Star)

What Happened to the Promised Investigations Into Russian Interference in the 2016 Election?
By Robert Reich, Robert Reich's Facebook Page
29 April 17
hat happened to the promised investigations into Russian interference in the 2016 election? The House intelligence committee has been plagued by infighting and missteps. While the Senate investigative committee has pledged a thorough probe, it’s done little so far -- no high-profile hearings, until very recently no full-time staff, and its few part-time staffers have no investigative experience or expertise with Russia.
Why? Look at history. When the parties are intensely polarized, congressional majorities investigate only when the White House is held by the other party. When different parties control the executive and legislative branches, congressional investigations multiply. But when the same party controls the White House and Congress, congressional investigations stall or disappear.
The period from 1898 to 1936 — from the Gilded Age to the depths of the Depression — was, like today, an era of deep partisan polarization. And since the Reagan era began in 1981, partisan polarization has increased steadily. In polarized eras (both in the early 20th century and today), when one party held both branches of government, the president’s partisan allies have routinely ignored calls for serious investigations.
In other words, don’t expect Republicans to investigate Trump’s Russian connection. It will only happen if and when Congress is flipped in 2018. Or if and when the intelligence agencies produce (or leak) a smoking gun.
What do you think?

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FOCUS: Dear Governor Hutchinson, Please Don't Execute the Man Who Murdered My Father |
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Friday, 28 April 2017 11:22 |
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Greenwood writes: "When he took my father from us, Kenneth Williams caused us all a great deal of pain. We still miss him and we still hurt. That does not mean that asking you to spare Mr. Williams is not the right thing to do. It is."
Kenneth Williams was executed last night. (photo: AP)

Dear Governor Hutchinson, Please Don't Execute the Man Who Murdered My Father
By Kayla Greenwood, Guardian UK
28 April 17
Kenneth Williams was executed last night, but the piece is still powerful and worthy of consideration.
ear Governor Hutchinson,
My name is Kayla Greenwood. Kenneth Williams killed my father and tonight, he will be executed. I am writing on behalf of my family to ask that you spare Mr Williams’ life.
It would be dishonest to say that this is an easy thing to do. It is not. When he took my father from us, Mr Williams caused us all a great deal of pain. We still miss him and we still hurt. That does not mean that asking you spare Mr Williams is not the right thing to do. It is.
By asking you to spare Mr Williams life we are in no way asking you to ignore the pain felt by the victims of Mr Williams’ other crimes. We know what they are going through but ours is a pain that we have decided not to try and cure by seeking an execution. His execution will not bring my father back or return to us what has been taken, but it will cause additional suffering.
I learned Mr Williams had a daughter from an interview where he spoke about her and wanting to meet his granddaughter. Her name is Jasmine and we are the same age. I also learned that Jasmine had a Go Fund Me page set up to raise money so she could travel to see her dad one last time before his execution. I immediately knew I needed to talk to her so we could help her see her father.
My family paid for Jasmine and her daughter’s flight, picked them up at the airport and drove them to the prison. Yesterday, I waited outside the prison while Jasmine and her daughter visited with Mr Williams.
Watching her leave the prison and knowing that was probably their last goodbye broke my heart. Jasmine had done nothing at all but like me, she could lose her father. If Mr Williams is executed, her loss, her pain will be as real as mine. I do not wish this on anyone.
Jasmine told me that when she saw her father and talked to him she knew he was a different man. He was a man of love and gratitude for the opportunity to say his last goodbye. I have come to learn that he is man who counsels and helps people who may be in a dark place because they never felt love, or were victims of a horrible upbringing that caused trauma and hurt.
Because he once knew that same dark place, Mr Williams could connect and show people that from even the darkest of places, you can always come out and change and help others to see right from wrong.
Being there for others, no matter what, and showing what true pure unconditional love is and feels like, that is the closest we can get to God in this physical world. I know Mr Williams has and will change people he meets for the better and alive, he can make a positive difference and I believe that is the most beautiful story of justice.
I also believe in second, even third chances because I know people can change.
You often hear stories of men who go into prison and become bitter, angry and hateful. I do not believe Mr Williams is one of those men. He found God and I believe his redemption is genuine. Mr Williams is not the same person who killed my father on October 4, 1999. It is the changed man; the new Kenneth Williams that we are asking you to save.
My family was not aware that Mr Williams had requested clemency and that we could have testified at his clemency hearing. If we had known, we would have spoken to the parole board and told them that we did not want Mr Williams executed. Maybe we could have made difference.
My family also requested an opportunity to meet with Mr Williams but it was denied. We just wanted to tell him that we forgave him and thought it was important to do that face to face. It would be one way for us to get closure.
We would still like to do that. We would also like to meet with you. If we met, you would know that our wishes are sincere. If we sat and talked about loss and forgiveness from where we sit, you might also forgive Mr Williams and spare his life.
Sincerely,
Kayla Greenwood

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FOCUS: The Failure of Trump's First 100 Days Is a Win for America |
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Written by <a href="index.php?option=com_comprofiler&task=userProfile&user=6853"><span class="small">Frank Rich, New York Magazine</span></a>
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Friday, 28 April 2017 10:55 |
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Rich writes: "As someone is writing every ten minutes now, Trump's first hundred days have been marked by no major achievements beyond the successful nomination of a Supreme Court justice."
President Trump. (photo: Mark Wilson/Getty)

The Failure of Trump's First 100 Days Is a Win for America
By Frank Rich, New York Magazine
28 April 17
his weekend marks the end of President Trump’s first 100 days — a chance to evaluate not only his progress (or lack thereof), but how the nation will change under a Trump administration. What are the early signs of the changes he’s brought to Washington, to our understanding of politics and political journalism, and to our sense of civic engagement?
As someone is writing every ten minutes now, Trump’s first hundred days have been marked by no major achievements beyond the successful nomination of a Supreme Court justice. Every other attempt to do something big has been shot down by a Republican-controlled Congress or the courts. Even by his own campaign yardstick his administration is thus far a failure. While the White House busily promotes the sheer number of executive orders the president has signed since January 20, a Washington Post fact-checker found that of the 60 promises candidate Trump made in his self-proclaimed “contract” with Americans, he has kept five, broken five, and taken no action on 34 others. In other words, that “contract” has roughly the same value as a diploma from Trump University: It’s a scam designed to bamboozle a credulous public while he and his family pick its pockets. Kleptocracy — surfacing everywhere from State Department web sites tasked with promoting Mar-a-lago to a tax proposal that benefits Trumps and Kushners über alles — remains the only consistent ideology at this White House.
It’s good news that Trump thinks governing is as easy as picking up a phone and calling room service at a Trump hotel. The more lazy, ineffectual, and incompetent he is, the less damage he can inflict. The most patriotic act he can perform is to play more golf. But in some ways the young Trump administration is nonetheless a roaring success. For all the attention paid to the president’s historically low standing in the polls, he has nonetheless held on to a unified, intractable base that thinks he’s doing fine. Trump’s approval number in the Washington Post-ABC News survey released this week, 42 percent, may be dismal, but his approval rating among his own voters is 94 percent. Only 2 percent of those who voted for Trump in November regret doing so — even as he shows no sign of creating jobs with a trillion-dollar infrastructure program but every determination to gut those voters’ health care. He could still pull out a gun and shoot someone on Fifth Avenue without losing any of his faithful.
Yes, Trump voters are a minority of the country. But they are a powerful minority that has brought to heel a major political party — the party that holds the most power at the federal and state levels alike. The craven Vichy Republican leadership remains so cowed by these voters that it thinks nothing of abandoning its own most cherished principles — a detestation of government deficits, a hawkish stance toward Putin’s Russia — to curry favor with Dear Leader. Even nominal Democrats collaborating with the administration are reduced to Jell-O by the prospect of accruing more power by proximity to Trump: Witness the humiliating prevarication of the Goldman Sachs alum turned White House economic chieftain, Gary Cohn, as he helped promote the president’s tax proposal in a dog-and-pony show this week.
Meanwhile, the Democratic Party remains short of national leadership and anything but unified. The disarray and lack of focus was most recently symbolized — for me, anyway — by a dustup in which some in its ranks took umbrage at Bernie Sanders for answering “I don’t know” when asked by a reporter if Jon Ossoff, the favored Democrat in the Georgia special congressional election, could be called “a progressive.” Really, who cares? Is this the kind of ephemera the left should be debating during the Trump presidency? (Sanders, it might be remembered, doesn’t even call himself a Democrat.) What ultimately mattered is that Ossoff didn’t win the majority vote needed to lock down that Georgia seat in the primary. For all the passion and fledgling power of the Resistance, exemplified by the Women’s March and the raucous town-hall confrontations that shook GOP members of Congress visiting their home districts, that great energy is as yet untethered from a national political apparatus that might reverse Republican rule at the ballot box in 2018 and 2020.
The press, for its part, has shown renewed vigor since the election; the investigative work by the Times and the Post on the administration has been relentless and impressive even if all but 2 percent of Trump’s voters dismiss the findings as “fake news.” But in some corners of the commentariat we are already seeing some grading on a curve: Note the heretofore Trump-phobic pundits who suddenly declared him presidential because he read from a teleprompter without mishap when addressing Congress, or bombed Syria, or manifested inchoate signs of “a learning curve.” (The only thing Trump has learned since taking office, as far as I can tell, is to specifically cite the Jewish victims when talking in public about the Holocaust.) Another form of normalization that’s creeping in could be seen in this week’s White House tax rollout. Almost without exception television journalists and print headline writers reflexively referred to it as Trump’s “tax plan.” It was not a plan: It was a publicity stunt rushed before the public to beat the 100-day report-card deadline — a one-page assemblage of campaign bullet points full of hyperbole, bereft of most crucial details, and tied to no legislation. It too has all the value of a Trump University degree. To label it a plan is a surrender, however slight, to the White House’s propagandistic ambitions. A lot of small surrenders can add up.
Even now, Trump’s effect on our culture — not just our political culture and civic discourse — has been profound. He is nothing if not a brilliant showman. By bombarding us with outrageous statements and policy feints, then shamelessly contradicting those bombshells hours or days later with a new round of outrageous actions or rhetoric, he holds our attention as surely as the cheesiest soap opera. And it’s a soap opera on steroids, with something happening constantly, even in the wee hours on Twitter, to encourage binge-watching — the perfectly calibrated short-attention-span theater for a citizenry with an ever-shorter attention span.
I know people who claim they can turn Trump off and tune him out, and I congratulate them on their self-discipline and mental health. For the rest of us, living through the chaotic first hundred days of his presidency has often felt like standing under an enormous fire hose raining down a nonstop deluge of raw sewage.

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