Says Stockman:

This is ultimately, at the end of the day, a bailout for JP Morgan and Wells Fargo. They’re the big writers of second mortgages and home equity lines. Those – and there’s two or three or four hundred billion dollars in the top three or four banks – are in great jeopardy in the case of of homeowners who have mortgages, that are primary mortgages, that are way under water on primary mortgages and are likely to default or throw in the keys at some point down the road.

Good point…

New boss, same as the old boss … and the ones before that.

Maybe we’ll get a good third party candidate this year…

On a related note, according to this McClatchy report, BofA and other too-big-to-fail banks have settled on their pick for President this fall – Mitt Romney. Employees at the big banks gave the Romney campaign $600,000 through September of last year, dwarfing the $200,000 sent to the bankers’ second choice – President Barack Obama – virtually ensuring that there will be little change to the status quo, big-bank-wise, until 2017 or later.

One step in that direction originates in this part of the country where, according to this Bloomberg story, farmers are suing MF Global in an attempt to recover their money.

The lawsuit filed today by three farmers and a cattle- raising operation in Montana seeks to represent a nationwide group of commodities futures customers whose money went missing amid the $41 billion bankruptcy of MF Global, parent of the futures brokerage that is being liquidated. A trustee is looking for $1.2 billion or more in money missing from commodity customers’ accounts.

Corzine, the former governor of New Jersey, and other executives at MF Global made “knowingly false statements” to induce the plaintiffs to enter into contracts with the brokerage, according to the complaint filed in federal court in Missoula, Montana.

The executives failed to disclose to customers that their money was used to finance MF Global’s bad bets on European sovereign debt, the farmers said in the complaint.

What’s really disturbing about the whole idea of farmers suing Wall Street futures trading firms is that, more than 100 years ago,  futures markets were originally set up in the MidWest specifically for farmers and that system worked pretty well until the last decade or two when Wall Street began to really throw its money around.

Futures markets had always been a way for buyers (e.g., food manufacturers) and sellers (e.g., farmers) to lock in prices and add some predictability to their business while a relatively few number of speculators would bet on which way prices would go, adding liquidity to these markets in the process.

Now, you’ve got some well connected, ex-Goldman Sachs head who manages to run a futures trading firm into the ground and a billion dollars – some portion of it belonging to farmers all across the country – goes missing.

What a sad commentary on the direction the nation has been heading.

Someday I surely will, though there doesn’t seem to be any real urgency since the recent spurt of money printing is not likely to end anytime soon. Between now and then, this graphic from The Economist’s Central banks: Crazy aunt on the loose will have to do.

It is fairly remarkable to stop and think how far we’ve come since the world’s central bankers saved us (and, of course, the biggest and most dangerous banks) from sure annihilation three years ago. Who would have ever imagined back in 2005 or 2006 that nearly the entire globe would have “turned Japanese” by now.

Who imagines today that the chart above left might not change for another 10 or 20 years?

The film is basically a compilation of interviews with eleven individuals, most of the names being familiar to readers of this blog including G Edward Griffin
, Jim Puplava, James Turk, Jim Rickards, Peter Schiff, Eric Sprott, and Bill Murphy.

My guess is that the Federal Reserve, fiat money, and gold come up quite frequently.

Hopes were never very high for officials to accomplish much at tomorrow’s European Union summit (a meeting dubbed the most important gathering of this group in two years), but markets were instead placing their faith in the ECB (European Central Bank) to finally taking some sort of action to bolster credit markets.

But, after ECB President Mario Draghi spoke earlier today following the announcement that the bank had lowered short-term interest rates (a move that was widely expected) and offered banks long-term loans (a move that won’t make any difference over the near-term), markets appear to be quickly coming to the conclusion that Europe just doesn’t seem to care that they’re about to enter the abyss.

Word earlier today that the International Monetary Fund was riding to the rescue had raised the hopes of many and Bloomberg reports that European central banks are considering sending $200 billion to this group, which they’ll presumably “leverage up” somehow to a much higher amount before buying sovereign debt of spendthrift European governments.

We’ll see how that works out – it would appear to be the only hope at this point.

They’re starting to call tomorrow’s meeting the “No Second Chance Summit” after French President Nicolas Sarkozy warned that policymakers had better get it right this time, despite the fact that they’ve failed to get it right regularly over the last two years.

Something tells me that Lucy’s going to do what she always does…

Not that a little under $2 trillion in newly printed money to bail out the big banks is all that much better than just under $8 trillion, but, it’s important to get the facts straight. As you might conclude yourself by perusing the many items in the previous links post, the Fed did a good job by not naming Bloomberg in their letter to Congress and addressing criticism of Fed emergency lending in general so that they could lump Bloomberg’s report (which, was not in error) along with the rest of them, many of which were in error.

Occupy Memphis member Mallory Pope had just finished telling a group of about 75 tea party followers Thursday night that politicians should not allow themselves to be influenced by lobbyists and unions when she received an unexpected invitation.

“It sounds to me that y’all ought to be joining us,” said Jerry Rains, a 64-year-old computer programmer and tea party member. “You have a lot of the same goals we have, which is to take our country back.”

Pope and fellow Occupy Memphis protester Tristan Tran had a lively, sometimes strained and confrontational, but mostly civil discussion with members of the Mid-South Tea Party at a municipal meeting hall outside Memphis.

The factions saw eye-to-eye on some issues and clashed on others. And, while the young speakers didn’t change many minds, they did earn praise from the tea party members for their passion, honesty and courage.

The 21-year-old University of Memphis students had been invited by the tea party group to talk about the goals of the Occupy movement. The invitation was extended after a discussion between members of both groups on the tea party’s website, meeting organizer Jim Tomasik said.

At least they’re talking and, given the dim prospects for any substantive improvement in the U.S. economy, they’re likely to talk more and more in the years ahead, hopefully culminating in a third political party. No, that’s probably just wishful thinking.

I don’t know about you, but, I’m almost starting to feel sorry for the big banks given their recent troubles and how everyone pokes fun at them now. But, the feeling quickly passes.