I know that MSM is not calling our current economic situation a Depression, but we have been in a depression since at least mid-2008. In fact, I would argue that this depression is far worse than the first by a number of indicators. However, I think the one indicator that is most telling is the bank failures. However, it is not just the fact that 185 banks have fallen since 2008, nor is it the fact that compared to the first depression, the term “bank” must be defined differently. By that, I mean, those who wish to blow smoke up you know where, they look at raw numbers and say.. “Well we had a lot more banks fail between 1929 and 1934, so you really can’t say this recession is a depression”.
BS. If you look at the number of banks that have failed since 2008 and you look at their sizes and the number of branches and assets they represent, D2 is far worse than D1. But even that under reported fact is not the issue I wish to point out in today’s article.
When you analyze the banks that are currently failing, no one hardly pays attention to the question of when these failed banks were established. Why is that important you ask? Well, a significant number of banks that are currently failing and are closed were established before D1 and they had survived the first depression. Here are some examples:
1st National Bank of Danville Ill. Was closed in July 2009. This bank was established in 1857. George Washington Savings Bank of Orland Park, Ill. failed February 19th this year and was established in 1890. Consumer Bank and Trust of Cornelia, Ga. failed on the 19th of February this year and was established in 1900. Here’s a complete list that is well maintained by the Wall Street Journal :
In fact 38 of the 185 banks that have failed since January 2008 were established BEFORE 1925. That is nearly 20%of the current bank failures have been with banks that had weathered the first depression, but couldn’t survive this “deep recession”.
What we need to ask ourselves is why? Were these banks poorly managed or where they manipulated into a position of failure? Everyone should be paying very close attention to the legal actions being taken over the failure of Washington Mutual, which BTW was established in 1889.
The complaint alleges that, during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business and financial results. WaMu’s loan portfolio contained more than $57 billion in adjustable-rate mortgages or Option-ARM loans. The complaint further alleges that the Company failed to disclose: (i) that it had far greater exposure to anticipated losses and defaults in its home loan portfolio, particularly with Option-ARMs, than it had previously disclosed; (ii) that defendants’ Class Period statements about the Company undertaking significant preparations and implementing defensive measures to weather the increasingly difficult credit and housing markets were patently false; (iii) that defendants had engaged in a conspiracy and scheme to inflate the appraisal value of homes with the intent to artificially increase the estimated loan-to-value ratio of its Option-ARM portfolio; and (iv) that due to the Company’s improper appraisal practices, the mortgages it had issued were much riskier than represented.
According to the complaint, on October 17, 2007, after the market closed, WaMu stunned investors by disclosing that it had suffered a 72% drop in third quarter of 2007 net income and would have to set aside up to $1.3 billion in the fourth quarter of 2007 to cover its loan losses. On this news, WaMu’s stock dropped from $33.07 per share to as low as $30 per share, closing at $30.52 per share on October 18, 2007 on volume of more than 36 million shares. Then, on November 1, 2007, News York’s Attorney General issued a press release announcing that a lawsuit was filed against First American Corporation and eAppraiseIT, alleging that they conspired with Washington Mutual to inflate Real Estate appraisals. Following this disclosure, WaMu’s stock dropped to as low as $23.59 per share before closing at $23.81 per share, on volume of 31 million shares.
On October 21, 2008, the lead plaintiff filed a Consolidated Class Action Complaint adding additional defendants as well as additional claims pursuant to the Securities Act.
On May 15, 2009, an Order On Defendants’ Motions To Dismiss was granted in part and denied in part.
On October 27, 2009, various orders granting in part and denying in part Motions to Dismiss were issued by the court in this matter.
On December 15, 2009, two separate amended complaints were filed by Plaintiff City of San Buenaventura and Plaintiff Lou Solton, Monterey County Treasurer against the defendants in this action.
Subsequently, on December 18, 2009, an Order of Consolidation was granted by the court which established the two cases be maintained in one file under Lead Case No. C09- 664.
But wait there is more. By some accounts J.P. Morgan Chase manipulated the FED in closing down WAMU prematurely and in fact had “inside help” in WAMU to convince the FED to act. This is one of the banks that is “too big to fail”. None of this is conjecture. It is all facts.
What this is represents in the on-going roll out of the United States of Mega Corporations. I will restate I am not some conspiracy nut. I am just blessed enough to be fully awake. I am presenting facts that are not being covered in MSM because the PTB don’t want you to know about this and they certainly don’t want you to act in any “uncontrolled” manner. As always, please do not take my word for anything, but do get involved. Do your own research. Form your own opinions and most importantly exercise your free will. The PTB are pushing us to a point where they calculate we will revolt, which in turn will give them an excuse to declare martial law and strip us of last vestiges of our rights and our freedom. Taking all of our money certainly would cause us to panic and rage. This is what we have to avoid at all cost. We must act before that and in a civil peaceful democratic manner. The PTB know they have no contingencies to deal with an informed public that exercise their free will in the political process.