Jamie’s Cryin – Episode 3: Wherein Jamie Loses the Debit Swipe Battle & is Forced to Take Bernanke to Task for Raising Capital Requirements from the Floor of a Finance Summit
Update: I want to add that IMO Jamie is the best Bank CEO out there. He is brilliant. He is savvy, he is kewt, he is a capitalist, I dig it. I wanted him for Treasury Secretary and wrote about it in March of ’09. But the TBTF have refused to allow the consumer to deleverage from the crushing weight of their housing debt, and the TBTF helped create this problem.
They are the whiz kids in the room, Mom and Pop Homeowner need a HOLC, and the TBTF blocked it and continue to block it, assuring us a long, slow, slog through a Depression like forced deleveraging as the Fed continues to try to inflate its way out of this massive debt it used to prop the very same TBTF.
All unnecessary pain, if only the TBTF would take some of the responsibility they like to lecture about when they laughingly call principal writedowns moral harazrd after they made the Goddamned loans. (see Meredith Whitney ask Jamie about this on an earnings call in January 2010)
Lost juice Jamie? Have you Lost Hand? Did you think buying the POTUSship for Obama meant a free reign?
Did you think basing all our policies on what is best for a handful of TBTF bankstas was really a good way to GROW the American economy?
Oh woe is me. Cry me a river.
PragmaticCapitalism has it:
(…) his bank was saved from the brink of disaster in 2008. The US government took extraordinary measures to ensure that he did not go down as one of the greatest bank failures of all-time. In fact, the US government did him a huge favor by making his bank the linchpin in the US economy.
Of course, this was done by making Mr. Dimon’s already too big to fail bank too bigger to fail. But none of this is enough. Saving someone’s career and ensuring that their bank is now an instrumental portion of the US economy is not enough. And in a fit of rage Mr. Dimon went and rewarded himself with a monstrous $16MM pay package last year. After all, he deserved it. But this is not enough.
It’s not enough to pay yourself outrageous sums of money when your company should be in a hole in the ground. It’s not enough to have the government by the throat and know that the taxpayers can never let your company fail. It’s not enough to have been a key player in helping the US banking system become the gigantic leach on the world’s largest economy. It’s not enough that you help pull our best and brightest minds out of productive fields and into finance where they will do nothing but think of new ways to help separate the middle class from their savings. It’s not enough that you helped build a banking system that nearly crashed a $15 trillion economy.
No none of this is enough. And when we pass an incredibly weak regulatory bill that does nothing to actually fix what caused the crisis you go and complain that the government is doing too much….
Then today REALLY SUCKED for Jamie when he lost the Debit Card Swipe Fee battle to the retailers despite INSANE LOBBYING and Jon Tester- D-MT, Bob Corker R-TN last minute attempt to stave off the changes for a year.
This is a Fed set cap on swipe fees. Lowering avg fee charged to RETAILERS from .44 a swipe to .12 a swipe. TBTF are babied left and right, the retailers are going out of business left and right let the Fed baby someone else for a change Jamie. I’m sure Obama will give you another bailout any second now anyway.
…The fee cut could cost the card industry and banks billions of dollars, but nobody in the retail business is shedding any tears — it will save them money.
Bank stocks, up earlier in the day, flipped into the red on the news and ended down nearly 1%, making them among the worst performers in the market today….
like ZZ Top said~IT’S BAD, IT’S NATIONWIDE (& QE isnt doing JACK about it)
…Eleven of the markets hit their lowest point since the housing bust, in 2006 and 2007: Atlanta, Charlotte, N.C., Chicago, Detroit, Las Vegas, Miami, New York, Phoenix, Portland, Ore., Seattle and Tampa, Fla.
The damage from the real estate bubble now spreads well beyond the Sun Belt, where new homes cropped up at a frantic pace during the mid-2000s. In many places, prices are expected to keep falling for at least the next six months….
Here are the
Deceleration in 18 of 20 cities in the MSAS Annual Growth Rate
In October only 4 cities rose, LA, San Diego, SF & D.C. saw gains in house prices
-6 cities hit all new lows since the collapse began in 2006
CR breaks out the data reflecting previosuly strong housing markets now succumbing to the collapse:
…six markets – Atlanta, Charlotte, Miami, Portland (OR), Seattle and Tampa – hit their lowest levels since home prices started to fall in 2006 and 2007…
Blitzer says the double dip is ‘almost here’ (from here in Phoenix I can tell you it has been here for a while, TPTB have just been hoping and praying it would ‘go away’ all by itself, NOT GONNA HAPPEN.
The US economy and the US consumer, and therefore, the global economy, which is dependent upon the US consumer, WILL NOT RECOVER until they FIX HOUSING. DO HOLC.
ONLY TOTAL SHILLS ARE STILL YAMMERING THAT THIS IS A BLIP AND HOUSING WILL FIND IT’S ‘TRUE BOTTOM’, THE SUPPLY IS 2 YRS AND GROWING WITH THE STRUCTURAL UE ISSUE, IT WILL JUST KEEP
Obama and Geithner have left the BANKS in charge of this, the GSEs and the TBTF keep shuffling paper back and forth for buybacks and assorted BS. GET REAL, THE TAXPAYERS ARE ON THE HOOK FOR ALL OF IT AND WE ALL KNOW IT, JUST BITE THE BULLET AND DO THE DAMNED WRITE DOWNS.
The TBTF seem to be incapable of doing what NEEDS to be done to allow the economy to recover, the CONSUMER needs to be deleveraged from their massive housing debt. JUST DO IT.
..The Standard & Poor’s/Case-Shiller composite index of 20 metropolitan areas declined 1.0 percent in October from September on a seasonally adjusted basis, a much steeper drop than the 0.6 percent fall expected by economists….
Update: 8:30 am Revision to 1.6%, est was 1.4% (original 2Q reading was 2.6%). This is only the first revision folks, it will get worse on the next print.
~How low can you go~ How can they get this number up without the Return of the American Consumer? They can’t. You need us TBTF face it.
Obama expects the Fed to save his bacon. Ummmmm bacon. Obama, unable to take responsibility, has nicely deflected the MFM to portray this as all on the Fed. Pfft. Consumers need $ to consume, period.
We have been calling for a double dip for over a year, and the fact that a trillion dollars in stimulus only got us 3 really good prints on GDP is, well, FRAKKIN PATHETIC!!!
WHAT A WASTE! Ugh! And what do we have to show for it? New infrastructure? Nooooo. I have no G-D idea what they did with all that $. At least when I blow through a wad of cash I can usually look around the house and SEE things I invested the dough in. Like a new door, or pavers, or a tankless water heater or something. These jokers can not even do that much.
Well back to the drawing board for the FED and TBTF and TPTB.
Hey maybe like Churchill said, ‘After they try EVERYTHING ELSE, they will do the right thing’ and you know, HELP CONSUMERS who are, you know, 70% OF GDP. G-D these people are stupid.
I know I know, you don’t want to help homeowners. But hey, HOUSING LED US INTO RECESSION. It will LEAD US INTO THE DOUBLE DIP (it is as we speak).
Stop throwing wads of cash at FIRE and TBTF and try listening to Scott Brown who tried to pass a WORKER PAYROLL TAX HOLIDAY. DEMOCRATS voted against it.
Gawd forbid we get to keep our money. I know lots of folks do not want to help homeowners they perceive as irresponsible but face it, THOSE PEOPLE SPEND LIKE CRAZY!
Give underwater homeowners already backed by the GSEs, who have already blown through 200B with nothing to show for it BTW, give them a 1 pg refi.
We ALREADY back the loan, we are losing nada, zip, zilch. But if they refi and free cash flow it will both stop the bleeding in foreclosures AND boost CONSUMER SPENDING! Leading to ..JOBS! You remember jobs!
But nooooooo, we cannot have all these trillions going to help ACTUAL CONSUMERS, far better to give it to BANKS who are sitting on it to the tune of 1 trillion, doing ABSOLUTELY NOTHING with it. The Fed can give away all the $ it wants, THERE IS NO VELOCITY PEOPLE!!
At least spenders, SPEND!
Consumers gotta spend.
We don’t have time for Obama’s magical export plan to kick in, even though they are crashing the USD as fast as they can to get there.
Address housing in a meaningful way. TPTB don’t seem to get that even if you are staying in your home, the PERCEIVED drop in value AFFECTS CONSUMER BEHAVIOR!!! It is our biggest asset! How could it not? (Well maybe if we were big spendthrifts like D.C. )
Rosenberg comes in around the 6.30 mark.
Courtesy of CNBC: David Rosenberg, Gluskin Sheff & Associates chief economist, discusses his belief that we are in a depression despite the government’s best efforts.
…Rosenberg points out that the “overall economic malaise” has come despite aggressive efforts by the Federal Reserve to stimulate the economy through rate cuts. The central bank itself has scaled back its economic projections, has held steady on its balance sheet, and could be announcing another round of quantitative easing measures at its Jackson Hole summit this week.
“How’s that for a reality check,” Rosenberg said. “It’s not too late, by the way, to shift course if you have stayed long this market.”…
Update: the perfect Python sketch for this data- economy
Update: 10:16am EST- CR has posted the data. Brutal. Just brutal. 15 year low.
…Months of supply increased to 12.5 months in July from 8.9 months in June. A normal market has under 6 months of supply, so this is extremely high and suggests prices, as measured by the repeat sales indexes like Case-Shiller and CoreLogic, will start declining.
Ignore the median price! Double digit supply and lowest sales rate since 1996 are the key stories….
Hey that’s when we bought our house, 15 years ago. IMO that’s where prices need to be, where they were 15 years ago- coinkydink? I think not, lol.
Treasury told bloggers OFF RECORD that HAMP had worked as intended, b/c even though homeowners went through hell, my words, and then got kicked out of the pr0gram, it served to extend the time to foreclosure keeping supply off market. When bloggers suggested other uses for the HAMP funds, they were told it was all spent. Huh. funny that.
…On HAMP, officials were surprisingly candid. The program has gotten a lot of bad press in terms of its Kafka-esque qualification process and its limited success in generating mortgage modifications under which families become able and willing to pay their debt. Officials pointed out that what may have been an agonizing process for individuals was a useful palliative for the system as a whole. Even if most HAMP applicants ultimately default, the program prevented an outbreak of foreclosures exactly when the system could have handled it least.
There were murmurs among the bloggers of “extend and pretend”, but I don’t think that’s quite right. This was extend-and-don’t-even-bother-to-pretend. The program was successful in the sense that it kept the patient alive until it had begun to heal. And the patient of this metaphor was not a struggling homeowner, but the financial system, a.k.a. the banks. Policymakers openly judged HAMP to be a qualified success because it helped banks muddle through what might have been a fatal shock.
I believe these policymakers conflate, in full sincerity, incumbent financial institutions with “the system”, “the economy”, and “ordinary Americans”. Treasury officials are not cruel people. I’m sure they would have preferred if the program had worked out better for homeowners as well. But they have larger concerns, and from their perspective, HAMP has helped to address those….
So tell us oh brilliant Timmeh, with 12.5 months of supply on market now without the SHADOW inventory we all know is out there, exactly how do you propose to keep these prices up now? You did NOTHING, jack shxt, you made it worse by spending money and breaking consumer confidence in givt ability to help and in fact now people are actively walking away, All you have done is made walking away palatable to middle class people who felt an obligation FIRE and TBTF apparently dont feel, an obligation to live up to their perceived responsibilities.
You Tim, and your masters, are all morons. If you would get the hell out of the way America would right itself. You blew all that money and housing is right where it started, and it WILL take us into the double dip. You moron.
I had the under at 3.77m -
here it comes
fell 27.2% to SAAR 3.83 Million, I WIN!!!!
hey what do I win? does a FRAKKIN JOB come with my prediction, Hey how about making me CHIEF ECONOMIST , oh forgot I am overqualified, I HAVE A FRAKKIN CLUE!!