Packer's inspiration, as he explains in the book's afternotes, was the "U.S.A." trilogy by John Dos Passos, three novels that use a third-person choral method to portray American life in the early 20th century. "The Unwinding," while nonfiction, is narrative rather than polemical or analytic. Each chapter is a story, or an installment in a story, about a person or place. Some of the subjects are famous (Newt Gingrich, Oprah Winfrey, Colin Powell, Alice Waters) because such people, Packer writes, now "occupy the personal place of household gods, and they offer themselves as answers to the riddle of how to live a good or better life." But the key figures, the ones whose trajectories arc through the entire book like ribs or rafters, are unknowns: an African-American factory worker turned organizer in Ohio, a disillusioned lawyer who drifts from public service to finance and back again, a Silicon Valley venture capitalist with extreme libertarian beliefs and a scion of North Carolina tobacco farmers trying to make it as an entrepreneur. In the book's most bravura chapters, the city of Tampa, Fla. serves as yet another character.

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In a letter to Attorney General Eric Holder, current Securities and Exchange Commission Chairwoman Mary Jo White and Federal Reserve Chairman Ben Bernanke, Warren challenges decisions to settle with banks, offering a slap on the wrist, as opposed to jail sentences.  whether they had done any cost-benefit research into prosecuting a bank versus settling with one, which is equivalent to a slap on the wrist for a profitable financial institution.

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Via HuffPo:

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The Times noted that Greenberg's complaint, which was granted class-action status on Monday, "largely restat[es] his arguments that 2008 bailout of the insurer was unconstitutional and wrongly cheated shareholders out of billions of dollars."

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The Justice Department has not brought a single criminal conviction against a Wall Street executive four years after a financial crisis proven to have been precipitated by fraudulent behavior. On Wednesday, Holder admitted that the vast size of major banks and the structural integration in the economy makes criminal prosecutions basically impossible.

"I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy," Holder said, according to the Hill. "And I think that is a function of the fact that some of these institutions have become too large."

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This interview with the New York Times’ Dealbook (sponsored today by the financial firm Allianz) is no different. As a prelude, he gets a commendation from former Attorney General and current corporate lawyer Michael Mukasey (always good to have the lawyer from the other side of the table, defending those you could have but chose not to prosecute, praising your work). He gets phantom criticism from unnamed members of “the Occupy Wall Street crowd” and “Rolling Stone magazine,” a reference to Matt Taibbi. There’s no easier way to marginalize critics than to refuse to name them.

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Recent profiles of this event have called last night’s State of the Union the “anniversary” of the formation of the working group.  But you can’t really have an anniversary of something that never existed in the first place.  There never was a Residential Mortgage-Backed Securities working group, never a so-called task force dedicated to ferreting out Wall Street fraud -- the deceptive origination of mortgage loans, sale of worthless mortgage-backed securities for huge sums, and subsequent unloading of toxic debt to unsuspecting buyers. The working group fails to exist as a tangible entity to this day.  What does exist is the same years-old Financial Fraud Enforcement Group that serves as a conduit for press releases about investigative actions already in progress.

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Propelled by strong auto sales and optimism about U.S. jobs, the Dow Jones industrial average crossed the line early Friday and continued flirting with the mark all day. The other major stock indexes also rose.

The Dow was up 149 points to 14,010. It's gained 6.9 percent this year. The Standard & Poor's 500 rose 15 to 1,513. The Nasdaq composite index added 37 to 3,179.

The government jobs report that pushed stocks forward was mixed. The U.S. said it added 157,000 jobs in January, in line with expectations. But unemployment inched up to 7.9 percent.

Automakers Toyota, Ford, GM and Chrysler all reported double-digit sales gains for January.

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The report found that even many Americans who would consider themselves middle class, with household incomes of $55,465-$90,000, qualify as “liquid asset poor,” with less than three months' savings for basic expenses. One-quarter (26 percent) of households were found by CFED to be  “net worth asset poor,” meaning that the few assets they do have are overwhelmed by their debts.

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Capturing this sentiment, a group of California artists launched a bank heist competition, inviting entrants to dream up and plan out bank robberies. The idea, according to the cultural collective behind the competition, Center for Tactical Magic, is to "re-visit the romantic representation of bank robbers in relation to the current economic and social crises, including: income disparity, unemployment, housing foreclosures, federal bailouts, the LIBOR scandal, and a wealth of other egregious economic indicators." It's a playful idea with a $1,000 cash prize for the best heist proposal, which of course does not ask for real bank heists to be carried out, but raises interesting questions about legality and justice in this time of Wall Street malfeasance and impunity.

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As Wonkblog notes on the transcripts:

In December 2007, the month that the recession is now known to have begun, Fed officials were working from economic projections that would prove wildly inaccurate. They forecast sluggish but sustained growth in 2008 followed by a bounceback in 2009. Staff economist Dave Stockton acknowledged that his was a more optimistic view:

“Our forecast could admittedly be read as still painting a pretty benign
picture: Despite all the financial turmoil, the economy avoids recession and, even with steeply higher prices for food and energy and a lower exchange value of the dollar, we achieve some modest edging-off of inflation.”

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Boiled down, the new rules force lenders to take responsibility for the loans they write. It will no longer be possible for lenders to say a customer bears all the responsibility for what they sign. This could curtail overly pushy salesmanship and other lending practices that enabled mortgage lenders to write risky loans before getting them off their books. After the economy cratered there were numerous reports of lenders offering "liar loans" that required minimal or no documentation from customers or deceptively low teaser rates that exploded soon after the loans were signed.

According to the agency the Ability to Repay rule requires that:

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AIG was legally obligated to consider joining the lawsuit being brought against the government by former AIG Chief Executive Maurice Greenberg, who claims that the terms of the $182 billion bailout weren't fair to AIG shareholders.

The prospect of AIG joining the lawsuit had already triggered outrage. A congressman from Vermont issued a statement telling AIG: "Don't even think about it."

AIG was rescued from the brink of collapse by the U.S. government at the height of the 2008 financial crisis. The insurance company nearly imploded after making huge bets on mortgage investments that later went wrong.

The company currently has an ad campaign themed "Thank You America."

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One of Scott Brown's most consistent arguments is that Elizabeth Warren represents Obama's liberal "tax and spend" policies leading to big government. But a new paper by Stanford political scientist Lucas Puente published in PS. Political Science and Politics shows that Elizabeth Warren's work on the Congressional Oversight Panel was highly advantageous to the taxpayer, saving over a billion dollars money by taking a skeptical approach towards the Treasury Department's bailout plans.

The issue has to do with an obscure part of the Troubled Asset Relief Program, or TARP, known as warrants. This was a piece of the bailout that was designed to allow the government to profit from its investment in banks.

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According to U.S. Attorney Preet Bharara, these loan sales resulted in "countless" foreclosures and over $1 billion in losses. As Salon noted in early October, the U.S. filed a fraud complaint against Wells Fargo and, in September, a joint federal and state task force sued JPMorgan Chase for deceptive practices related to the sale of mortgage-backed securities. All of these suits, including today's BofA filing, are civil and may result in monetary penalties for banks, but no jail time for bankers.

As I wrote following the Wells Fargo complaint filing, "although many welcome the government going after Wall Street, critical pundits have raised questions about the timing, noting that the Obama administration might be projecting a tough-on-banks stance with the election countdown in mind."

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The book, "Why I left Goldman Sachs: A Wall Street Story," promised to elaborate on his essay, which decried Goldman for deceiving clients in order to earn the firm as much money as possible, even when it meant betting against a client's interest.

“I knew in my heart there was simply something deeply wrong with the way people were behaving, in the way they didn’t care about the repercussions, in the way they saw their clients as adversaries,” Smith wrote in his book, according to a New York Times preview. Speaking to "60 Minutes" on Sunday night, the 33-year-old former equity derivatives salesman said that naive clients were considered a "golden prize": “[The] quickest way to make money on Wall Street," he said, "is to take the most sophisticated product and try to sell it to the least sophisticated client.”

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Despite this indictment, economists have not only retained their prominence in the years since the global financial crisis; they have expanded it. Media-savvy economists have only grown in number, disseminating nuggets of user-friendly economic theory and technocratic liberalism in newspaper columns, blogs, and econo-centric podcasts. Krugman, along with Joseph Stiglitz, Nouriel Roubini, Nassim Taleb, and Jeffrey Sachs have become household names as swaggering political pundits.

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The complaint is the first to be filed by the joint federal and state task force formed in early 2012 to hold Wall Street banks accountable for their role in the financial crisis. The civil suit against Bear Stearns (acquired by JPMorgan in 2008) alleges that the bank "kept investors in the dark" about the quality of mortgage-backed bonds it was securitizing and selling between 2005 and 2007.

The New York Times reports:

The firms made material misrepresentations about the quality of the loans in the securities, the lawsuit said, and ignored evidence of broad defects among the loans that they pooled and sold to investors.

Moreover, when Bear Stearns identified problematic loans that it had agreed to purchase from a lender, it was required to make the originator buy them back. But Bear Stearns demanded cash payments from the lenders and kept the money, rather than passing it on to investors, the suit contends.

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