FDIC closes IndyMac: Second biggest bank failure in history

Your fear is correct, there will be many more and I have been on this bandwagon for over a year. Now there will be believers at the point when little can be done. The two F's are not banks, but mortgage bond holders, pseudo government and really private entities that will be next. Today, the Fed implied that they would make money available through the discount window to insure solvency. This gesture was designed to keep confidence up on Wall St. and it is becoming a case of the tail wagging the dog. Bernanke can ill afford a stock market crash but he is making moves that are not the Fed's bailiwick. Fannie and Freddie really belong to Congress and it is up to the august body to use taxpayer funds for any bailout.
This should prove interesting as the funds required for a bailout are likely to exceed the ability of the government's printing presses. The lads and lasses in Washington have yet to wake up to the fact that this is not another RTC. You can't wave the magic wand, set up an agency and have it all go away.
The Brit's have not had much luck with Northern Rock and they have plenty more over there too. I think that all those invested in the street will have the week end to think this one over and while they are thinking --
Where is your insurance company's money? Like in a major disaster payout - hmm, maybe hurricane, quake?
Where is your retirement fund invested?
Oh, and while I am at it - is your money safe in the bank? (see above blog)
When finished with this go and read what Jim Cramer has to say as he deals with fairy tales.
Maybe we should have Disney world run the show as they can make them come true.
(same boat as Cramer - claimants only)

With the credit market recovery predicated on the precarious balance derived from Federal Reserve liquidity injections, capital infusions by sovereign wealth funds and investment managers, and bailouts of major financial institutions, one must wonder if this period of stability has legs. Prior fits of turbulence in late summer 2007 and March 2008 led to dramatic market seizures that froze access to capital, eroded confidence in counterparties, and led to the demise of two dominant financial institutions. The current credit market predicament is the result of years of overabundant liquidity and exorbitant hubris among Wall Street bankers that led to an inexplicable decoupling of risk and return. Begrudgingly, market participants are revaluing deflated assets as the extent of credit impairment in the financial system continues to be exposed

Yes, Indymac and OTS bear primary responsibility. But Senator Schumer is also (ir)responsible. If he plans to go around 'outing' every institution that is in trouble, it will be a long, painful, expensive summer.

Perhaps Indymac would have gone bust anyway -- we'll never know. But Senator Schumer's letter was certainly the final nail in the coffin.

TO BAD, IMB WAS A VERY GOOD BANK, THE CUST, IS THE ONE'S TO BLAME, NOT PAYING FOR A HOUSE THEY DID'T HAVE THE INCOME THEY NEEDED IN START OF THE LOAN, BAD PEOPLE SAYING THEY WERE ABLE TO PAY FOR THE HOUSE LIE AND LIE THE VALUE OF THE HOME, AND THEY SAID THE INCOME WAS MORE THEM IS WAS, NO PROFE OF INCOME NEEDED, BAD BAD THAT WHAT HAPPEN WITH ALL THE BANKING MESS

New York Times reported that hedge fund managers have a new champion in their effort to keep legally dodging the taxes the rest of us pay: none other than New York Senator Charles Schumer. Now you know who is Schumer's friend and why he caused the bank run on Indymac. He truly support hedge fund and private equity because they truly support him.

http://www.nytimes.com/2007/07/30/washington/30schumer.html?_r=1&oref=slogin

"Large Investor decided to pay a few bucks to a Senator in New York to force the issue."(Prospect Mortgage Backed By Sterling Fund--Private Equity Acquired The Mortgage Branches from Indymac before FDIC takeover)
http://www.housingwire.com/2008/07/03/regulators-to-schumer-weve-got-a-whole-bag-of-shhh-with-your-name-on-it/

"And do remember that there are many investment bankers located in New York, making them pretty influential constituents of Sen. Schumer."
http://www.pasadenastarnews.com/opinions/ci_9783402


Same thing he did for FRE and FNM, he forced FRE and FNM to buy $145 billion bad loans last September. So his hedge fund friend could short the stock, then his private equity friend could take huge discount to acquire the properties. So obvious criminal acts, but he is still out law and do whatever to harm the American and benefit himself and his friends.

Hooey Mr. Cohan. Whether the offender is a US Senator or an "ordinary", unprivileged citizen, yell fire in the crowded movie theater is a crime and should not go unpunished. Mr. Schumer, who took an oath of office, should be prosecuted for singlehandedly staring a run on a Not unhealthy bank, run by quite responsible and ethical people. Perhaps agressive, or even too aggressive, but a bank that had no reason to fail. That is until the publicity seeking Mr. Schumer yelled fire. This was done not in private to "alert" the regulators, but in public to secure headlines for himself. Unforgiveable.

Perhaps an ethics committee investigation or even a headline seeking Attorney General looking at Mr. Schumer would be appropriate.