Daily Archives: March 11, 2014

Could a Wall Street firm be your landlord?

In cities like Atlanta, Phoenix and Las Vegas, Wall Street is moving into the rental market for single family homes, a new trend that is raising concerns among housing advocates. Josh Barro, David Cay Johnston, Laura Gottesdiener, Dorian Warren and Rep. Mark Takano, D-Calif., join to discuss.






Guess who cashed the biggest paycheck at Bank of America (Hint: It’s not Brian Moynihan)

Guess who cashed the biggest paycheck at Bank of America (Hint: It’s not Brian Moynihan)

Brian Moynihan stands to earn $14 million from his efforts leading Bank of AmericaCorp. in 2013. 

But his New York-based co-chief operating officer, Thomas Montag, who leads the bank’s commercial banking and Wall Street businesses, stands to make $15.5 million. 

Charlotte-based BofA disclosed the numbers after the market closed Friday when it filed its  2014 proxy statement. Shareholders get to participate in a non-binding advisory “Say-on-Pay” referendum as part of the annual meeting May 7 in Charlotte. 

Montag’s pay package exceeded Moynihan’s thanks to a $5.8 million cash bonus, in addition to a $1 million base salary and various stock awards that pay over time and are contingent upon future performance. The board of directors, in the filing, says Montag’s pay is justified by his presiding over improved revenue, risk management and maintaining the bank’s No. 2 ranking for global investment banking. 

Moynihan did not receive a cash bonus. Instead, his pay is awarded in a $1.5 million salary and various stock awards payable over time.




I am concerned however, that S. 1369 may unintentionally go beyond legitimate concerns about protecting the integrity of state regulation of insurance. As drafted, S. 1369 would provide a wholesale carve-out from common sense protections contained in the Section 171 of Dodd-Frank, also known as the Collins’ amendment, for insurance conglomerates, including their banking and derivatives activities. This would give insurance giants a significant competitive advantage over banking organizations engaged in the same activities, and leave the door open to the kinds of highly leveraged risk-taking which contributed to the 2008 crisis. We should not forget that in 2008 AIG was also an insurance company, which took excessive risks in its non-state regulated affiliates.



Who’s sending the bill for your mortgage? It might be a hedge fund

Who’s sending the bill for your mortgage? It might be a hedge fund

Washington’s effort to push banks out of the mortgage-servicing business is propelling the handling of customers’ loans into companies such as hedge funds and nonbank financial firms.

The shift is fueling concern among federal and state regulators about the level of oversight and capital requirements in the industries now servicing a growing share of these loans.




Too Big To Fail Is Now Bigger Than Ever

Too Big To Fail Is Now Bigger Than Ever

Too Big To Fail Is Now Bigger Than Ever

During the last great financial crisis we were also told that one of our biggest problems was the fact that we had banks that were “too big to fail”.

Well, guess what?

Those banks are now much larger than they were back then.  In fact, the six largest banks in the United States (JPMorgan Chase, Bank of America, Citigroup (NYSE:C), Wells Fargo, Goldman Sachs and Morgan Stanley)have collectively gotten 37 percent larger since the last financial crisis.

Meanwhile, 1,400 smaller banks have gone out of business during that time frame, and only one new bank has been started in the United States in the last three years.

So the problem of “too big to fail” is now much worse than it was back in 2008.

-The U.S. banking system has 14.4 trillion dollars in total assets.  The six largest banks now account for 67 percent of those assets and all of the other banks account for only 33 percent of those assets.

-Approximately 1,400 smaller banks have disappeared over the past five years.

-JPMorgan Chase (NYSE:JPM) is roughly the size of the entire British economy.

-The four largest banks have more than a million employees combined.

-The five largest banks account for 42 percent of all loans in the United States.

-Bank of America (NYSE:BAC) accounts for about a third of all business loans all by itself.

-Wells Fargo (NYSE:WFC) accounts for about one quarter of all mortgage loans all by itself.

-About 12 percent of all cash in the United States is held in the vaults of JPMorgan Chase.