Debt Ceiling Talks Collapse as Boehner Walks Out
By CARL HULSE and JACKIE CALMES
Published: July 22, 2011

WASHINGTON — Negotiations over a broad deficit reduction plan broke down in acrimony Friday after House Speaker John A. Boehner suddenly broke off talks with President Obama, raising the risk of an economy-shaking default.

The epic clash between the White House and Congressional Republicans came just a week before the government hits its borrowing ceiling, and set off sharp accusations from both sides about unwillingness to compromise.

A visibly angry Mr. Obama, in a hastily scheduled White House news conference,  demanded that Congressional leaders come to the White House on Saturday morning.  

“I want them here at 11 a.m. tomorrow,” Mr. Obama said. “They are going to have to explain to me how it is that we are going to avoid default.”

The president spoke moments after Mr. Boehner, the Republican from Ohio, released a letter that he had sent to House colleagues, saying he was breaking off the budget negotiations because of differences over revenues and would instead try to strike an agreement with Senate leaders to raise the debt limit by Aug 2 and avoid sending the government into a potential default.

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Jim Sinclair’s Commentary

The Banksters only need to change the law to be clear of their dastardly deeds.

States negotiating immunity for banks over foreclosures
By Scot J. Paltrow
NEW YORK | Wed Jul 20, 2011 6:24pm EDT

NEW YORK (Reuters) – State attorneys general are negotiating to give major banks wide immunity over irregularities in handling foreclosures, even as evidence has emerged that banks are continuing to file questionable documents.

A coalition of all 50 states’ attorneys general has been negotiating settlements with five of the biggest U.S. banks that would include payment of up to $25 billion in penalties and commitments to follow new rules. In exchange, the banks would get immunity from civil lawsuits by the states, as well as similar guarantees by the Justice Department and Department of Housing and Urban Development, which have participated in the talks.

State and federal officials declined to say if any form of immunity from criminal prosecution also is under discussion. The banks involved in the talks are Bank of America, Wells Fargo, CitiGroup, JPMorgan Chase and Ally Financial.

REUTERS REPORT PROMPTS LETTER

Reuters reported Monday that major banks and other loan servicers have continued to file questionable documents in foreclosure cases. These include false mortgage assignments, and promissory notes with suspect or missing "endorsements," which prove ownership. The Reuters report also showed continued "robo-signing," in which lenders’ employees or outside contractors churn out reams of documents without fully understanding their content. The report turned up several cases involving individuals who were publicly identified as robo-signers months ago.

Reuters found that such activity has continued even after 14 major mortgage lenders signed settlements with federal bank regulators promising to halt such practices and give remediation to some homeowners who were harmed.

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Jim Sinclair’s Commentary

Paper over everything results in all Western world paper depreciated in terms of gold.

Greek debt plan would be restricted default: Fitch
By William L. Watts

An earlier version of this item misstated the likely post-default ratings.

FRANKFURT (MarketWatch) — Fitch Ratings on Friday said the plan for private-sector participation in the Greek rescue plan approved by euro-zone leaders Thursday will constitute a "restricted default." Noting that the proposed debt exchange implies a 20% net present value loss for banks and other holders of Greek government debt, Fitch said "any exchange that offers new securities with terms worse than the original contractual terms of the existing debt and where the sovereign is subject to financial distress constitutes a default event." The debt plan was widely expected to result in default designations by ratings firms. Fitch said it will place the Greek sovereign rating in restricted default when the debt exchange closes and will assign new post-default ratings once new bonds are issued to participating bondholders. The new ratings are likely to be "low speculative-grade," the firm said.

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