Out of curiosity, what's their probability of successfully pursuing this litigation? Is this just a hail-mary, or do they actually have a case?

I'm sure the Atlanta FHLB is watching with interest. They must still have that 51 Bn loan to Countrywide safely nestled among their assets.

adornosghost wrote:
The launcher is then closed and the pressure of the product in the pipeline is used to push it along down the pipe until it reaches the receiving trap - the 'pig catcher'."
Let's hope that lawsuits like this are catching...

Juvenal Delinquent wrote:

E Pluribus Unabanker

There was only one Kaczynski. We should be so lucky.

Thanks for that last post, CR, regarding the Outlook. Much appreciated, both the summary and your general outlook. Never change, as most of us benefit from the balance you provide.

You. Complete. Me.

Jennifer Jones is in trouble.

2010 Ford World Women's Curling Championship

CalculatedRisk wrote:

I heard the Seattle FHLB is in the worst shape. The problem is some of the lenders are history ...

Liability is extinguished?

Juvenal Delinquent wrote:

Pussies galore

"I must be dreaming."

Rob Dawg wrote:

Liability is extinguished?

I guess they should have tried to hedge with some CDS action from AIG!

FHLB sues the TBTF and a dead Bear.

Move some money from the taxpayer's left pocket to his right. Yes, justice is truly served.

I thought that was written for a TV show called "Here Come the Brides". Did they just adapt it?

This is simply a game of musical chairs or catch the hot potato

Mike in Long Island wrote:

I know the winters are long in Canada but a duck? Geesh.

If it makes you feel better, the Canadian crest would be a loon caked in sawdust, oil and tar being molested by a forex trader.

And everyone else (including CR), thanks for the clarification regarding my legal query. I too hope albrt takes the time to educate us all on this issue.

(again)

AWESOME ....Federal Home Loan Bank taking offense to battle the despicable POS thing called the

Hopefully more will join in the fray....best news I have heard in about 10 yrs

mock turtle wrote:

"the bluest skies youve ever seen are in seattle"

Maybe on one of the 14 days of the year when the sky is clear.

Each of the FHLBs is owned by its member banks. The member banks own non-marketable stock in the regional FHLBs.

So, this is really regional groups of banks suing the big Wall Street firms.

I wouldn't be so pessimistic about the outcome, and I expect the ratings agencies will be sued by FHLB as well. The case against the ratings agencies may be stronger.

Wow. I'm glad I checked back in.

@ SNAFU (profile) wrote (in reply to...) on Sat, 3/20/2010 - 7:31 pm
km4 wrote: AWESOME ....Federal Home Loan Bank taking offense to battle the despicable POS thing called the Vampire Squid from Hell
Vampire Squid from Hell named in the suit? I missed that

**Please...... don't bring in the weak stuff....the is Wall St. **

Community banks, thrifts, commercial banks, credit unions, community development financial institutions and insurance companies are all eligible for membership in the Federal Home Loan Banks.

(From the FHLB S.F. website.)
I never knew that.

This sucker is going down. . .now who said that?

Mock sorry if i made you feel bad.

Ionly insult the smart and strong of mind.

Liz,is that why you are always nice to me?

Tom Stone wrote:

Liz,is that why you are always nice to me?

Damn, beat me to it. I must be dumb and slow.

You da BIG Dawg,so people will be nice anyway.mostly...

if the dems did this i would...and will condemn it

see the peg for yourself...i will not comment further, other than to say one word

despicable

Tea Party Protests: 'Ni**er,' 'Fa**ot' Shouted At Members Of Congress

scrowl down , must see peg

Perhaps if albrt is able to take on a post, he can also address the possibility of other actions that might stem from findings made as a result of this one? Pretty please?

(While I'd think that there could be, IANAL.)

lawyerliz

no problem

i have a thick skin...uh i mean shell

and a good sense of humor

besides...we're cool !

Sorry Mock I can"t stand it.

Scrowl==being mad while scrolling.

Comrade Elmer Fudd wrote:

http://corrosion.ksc.nasa.gov/images/fireplug2.jpg 

LoL. I get it. Bravo.

mock turtle wrote:

my wife has non stop hilarious fun laughing at me for the way i dont spell

My wife laughs at me because I can do crossword puzzles and yet I still can't spell.

Edit: That is, when she's spelling to me in front of our daughter, I have a hard time. My six year old daughter gives me hints.

As justified as it might seem, I think this is almost a frivolous lawsuit. Why is it not class action, since other parties bought these bonds besides FHLB SF banks? One could easily point the finger at those who bought these bonds for relying on spurious ratings agency models as being at fault. The fundamental guideline has in the past been "caveat emptor", in other words, you bought it, you own it. Also, any monies they seek to recover are sitting with ex-partners at subprime originators and Wall St. firms, who are decidely not open to clawbacks.

Mrsa--dreadful stuff.

prolly really bad stuff won't happen. In a sort of negative placebo, the dr mentioned that the
head of the femur might die if blood gets stopped up thereby reqiring an immensely painful hip replacement, and a bunch of awful other stuff, and make your decision right away .cause I'm available right now only and who knows when if you decide to wait.

I closed some remarkably unpayable loans, none technically fraudulent, few waivers of underwriting, none of which would qualify for being bought back.Broker did not do neg am and nearly did all fixed rate loans--wanted by borrowers. And I still wonder what nasties lurk.

the 12 banks of the FHLBank System are owned by over 8,100 regulated financial institutions from all 50 states. and also includes at least one territory (Puerto Rico).

circle jerking counterparties...this effort to drag in the TBTF 19 is a akin to Mcarthyism.

Have you no credit, sir?
no tienes credito, senior?
Voce' nao tem credito, senhor?

You don't want to here, J6P, esta en ti? Ist es in dir? Je to v tebe?

the threads have been a function of watching paint dry today.I view my comment today like an 18 year old girl views her myspace.

Seriously

1 comment today.

Article on FHLB system, via Atlanta FHLB journal. From 2006, near when the problems started getting noticeable.

80 here yesterday,65 and overcast today,tomatoes going in tomorrow!

jillayne wrote:

Ha. It was 65 degrees and sunny today in Seattle.

Operative word is "was" as in this morning? Has this evening's rain started yet??
OK, so 13.5 days and counting.
Got ?

Dennis Short has a chart up tonight that some might find interesting:

dshort.com: Mega-Bears with the S&P since 2000

This is, of course, selective presentation, as there were dozens of charts that don't show the same thing. Nevertheless...

Josh wrote:

Dennis Short has a chart up tonight that some might find interesting:

My positions like that chart, but we'll see.

jillayne wrote:

I was in Calif last summer and the smog was not something I could live with.

The smog is pretty horrible. I drove down the hill from the high desert yesterday, and as usual, the layer of schmutz was blanketing everything below about 2000 feet. Living a few blocks from the beach is the only thing that makes it tolerable here, as the prevailing ocean breeze pushes the pollution inland. Except for few weeks of the year when we get the Santa Ana condition, which blows all the crap back out at us.

Edit: One of the most disgusting things about the LA area is being out on the ocean during a Santa Ana. It appears that you are encircled by a wall of brown air that obscures the land, the ocean, and the the islands. You can look up and see sky, but it's like being at the bottom of a very large tube inserted into the ocean.

lawyerliz wrote:

? :pony

YouTube - The Beatles - I Dig A Pony (1969)

noob goldberg wrote:

Out of curiosity, what's their probability of successfully pursuing this litigation? Is this just a hail-mary, or do they actually have a case?

Here's a copy of one of the complaints:

Federal Home Loan Bank of San Francisco v. Deutsche Bank Securities Inc. Et Al

I've only skimmed it, but these seem to be the primary alleged misrepresentations in the term sheets and prospecti:

1. Appraisals were biased upwards, so LTVs and CLTVs were actually higher than represented. As evidence of this they point out that when properties in the pools were sold at foreclosure, the decline in value from the appraised amount was greater than the general decline in the geographical area in question. That foreclosures might perform poorly isn't exactly news--it seems to me they should be comparing to other foreclosures in the area, not to all properties. That they don't makes me think they don't have much here.
2. Investment properties were misrepresented as owner-occupied properties.
3. Prospectus supplements failed to note the deterioration in loan performance, in successive vintages, as a function of credit score and LTV.
4. No disclosures were made regarding the increasing frequency of exceptions to stated underwriting guidelines.

This last seems the most damning of the allegations. #2 seems more a question of borrower fraud (though perhaps aided by an originator in some cases). You could make a case that the securitizer should have done more to uncover this, but there doesn't seem to be anything in the complaint to support that case. #3 seems more a question of the FHLB not doing their job--they were given the information to figure this out themselves. But #4 seems to me to be something a buyer could reasonably expect the securitizer to know and to report.

More than a hail mary, I'd say, but there's less in the complaint than I'd hoped.

Yalt wrote:

More than a hail mary, I'd say, but there's less in the complaint than I'd hoped.

I should think investor owned would be easy to prove with physical address versus mailing address and that's a really low threshold of due diligence.

sdtfs wrote:

Not if they use a PO Box,...or an "office" address. IIRC, I only had to "intend" to move into the property, and as long as the purchase was more upscale than where I was living, it would sail through the agent said. It did. Multiple properties within a short time span might be more of a "smoking gun."

Agreed as long as it was only one additional property and for a small number of loans but these are large bundles. The laws of averages can probably prove patterns of lending given the large sample.

sdtfs wrote:

Multiple properties within a short time span might be more of a "smoking gun."

Owning a dozen or so primary residences in the same area might be worth checking in to as well.

sm_landlord wrote:

Owning a dozen or so primary residences in the same area might be worth checking in to as well.

Casey Serin had 17 different loans. What are the chances some of his toxic paper made it into these instruments? That'll look real good in a jury trial.

March 21 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said government bailouts of big financial companies are “unconscionable” and must be ended as part of a regulatory overhaul following the worst financial crisis since the 1930s.

“It is unconscionable that the fate of the world economy should be so closely tied to the fortunes of a relatively small number of giant financial firms,” Bernanke said yesterday in a speech in Orlando, Florida. “If we achieve nothing else in the wake of the crisis, we must ensure that we never again face such a situation.”

Bus. Week

This is certainly great stuff, but I'm more interested in the Bloomberg vs. Fed FOIA case.

Mish's Global Economic Trend Analysis: Victory for Bloomberg in Freedom of Information Lawsuit with Fed

Second Circuit Tells Fed If It Wants To Maintain Its Secrecy It Better Get Congress To Change America's Laws | zero hedge

Tom, if you're still there, good luck with the MRSA. Had me a touch of that last year, but it didn't go systemic. Nasty stuff, stay well!