April 11, 2014 – Statement 167: “Even that wouldn’t cure a second level of constitutional infirmity. Based mostly on precedent established before the SEC had any power to punish, courts have exempted SEC prosecutions from many bedrock due-process protections taken for granted in criminal cases. The presumption of innocence…
April 8, 2014 – Statement 166: “Freddie Mac’s former President, the one who was their Chief Operating Officer right up to the financial crisis and left just about a year before they were placed in conservatorship by the U.S. government (from 2004 through September 2007) is now going to postpone his retirement, so that he can ‘save’ Citi from its regulatory problems with the Fed?”, Mike Perry
April 8, 2014 – Statement 165: “Just to clarify, the difference between being pro-business and pro-market is categorical. A politician who is a “friend of business” is exactly that, a guy who does favors for his friends. A politician who is pro-market is a referee who will refuse to help protect his friends (or anyone else) from competition…and opposes special treatment for anyone.”, Jonah Goldberg, Los Angeles Times
April 7, 2014 – Statement 164: “If you were ill at the beginning of the 19th century, a physician was your best bet, but his knowledge was so rudimentary that his remedies could easily make things worse rather than better. And so it is with economics today. That is why we economists should be sure to apply the principle “first, do no harm.””, N. Gregory Mankiw, Harvard Economist
April 7, 2014 – Statement 163: “The Nobel Prize-winning economist Daniel Kahneman has noted that it’s our nature to overestimate how much we understand the world and to underestimate the role of chance. And it’s our folly to assume we know very much at all. There’s “a highly objectionable word,” he writes, “which should be removed from our vocabulary in discussions of major events,” and that word is “knew.””, New York Times
April 7, 2014 – Statement 162: “And there was Washington Mutual. TPG led a group of investors in extending a $7 billion lifeline to the struggling bank in the spring of 2008. Just months later, the government seized WaMu, and TPG lost every penny.”, New York Times
April 7, 2014 – Statement 161: “By the way, if the feds knew about this, why wasn’t it disclosed to investors when the reborn GM sold shares to the public in 2010 or when the government sold the last of its shares in 2013? This would seem to be an issue for the SEC, which never tires of sanctioning companies that fail to disclose material facts. Does GM get a pass because it was Government Motors?”, Wall Street Journal
April 7, 2014 – Statement 159: “The government’s job as a criminal prosecutor is not to obtain convictions, but ‘to do justice’….It should be required to follow the Brady rule in civil trials…but the SEC does not, even when it accuses a citizen of fraud.”, Mark Cuban and Thomas Melsheimer, WSJ, April 4, 2014
April 7, 2014 – Statement 158: “Monetary policy should be less accommodative…willing to tolerate a larger forecast shortfall of the path of the unemployment rate from its full employment level…when estimates of risk premiums in the bond market are abnormally low.”, Jeremy C. Stein, Federal Reserve Board Governor, March, 2014
April 7, 2014 – Statement 157: “As our culture moves both in form and substance from a “rule of law” society to an “ends justifies the means” approach, we will see our country begin to resemble Russia and China in the courtroom. Those people that the state wants to hammer will be indicted for political reasons.”, Russell Dodds, WSJ, April 4, 2014
April 3, 2014 – Statement 156: “This is a great OpEd by American entrepreneur Charles Koch. I share these views based on my 30 plus years of business experience and academic study; including the last five where I (and my family) personally experienced a federal government bureaucracy that did not seem to care about the facts and the truth (and the law) and certainly does not seem to care much about individual American’s freedom and liberty.”, Mike Perry
March 13, 2014 – Statement 154: “Thus, (securities) cases certified as class actions—and 77% of decided motions for class certifications are granted, according to a 2014 study by consulting firm NERA—threaten defendants with financial ruin. They subject defendants to relentless pressure to settle, even in cases with weak merits.”, Andrew N. Vollmer, former Deputy General Counsel, the Securities and Exchange Commission
March 12, 2014 – Statement 153: “So, I think it will take a while for scholars to decide exactly what role easing monetary policy had in contributing to the financial crisis. I would not argue with the idea that a long period of low interest rates does contribute to the buildup of leverage and may have touched off a housing bubble.”, Federal Reserve Board Chair, Janet Yellen, February 27, 2014
March 12, 2014 – Statement 152: “Advocates of it say it never costs anything and so that sometimes begs the question: Do you need the federal backstop there?” said Rep. Scott Garrett (R., N.J.). “If other countries want to make bad economic decisions, they’re free to—it’ll benefit the U.S.,” said Rep. Justin Amash (R., Mich.), who has introduced legislation with Sen. Mike Lee (R., Utah) to eliminate the (Export-Import) bank over three years., Wall Street Journal, February, 2014
March 10, 2014 – Statement 151: “In December, almost 40 percent of the home sales were all cash. Redfin estimates that, on average, 60 percent to 80 percent of San Francisco homes are selling for prices over the original asking price. Most are gobbled up within 16 days of being listed….”, New York Times, March 3, 2014
March 10, 2014 – Statement 150: “Sounds a lot like the short sellers who attacked IndyMac and the U.S. housing, mortgage and financial system. I think they might have coordinated. I read that short seller Paulsen donated millions to the Center for Responsible Lending. Then they issued misleading reports about us (and others). Did they get New York, U.S. Senator Schumer to publicly release his letter of concern and spur our bank run (and failure)? Don’t we all deserve to know the truth?”, Mike Perry, Former Chairman and CEO, IndyMac Bank
March 10, 2014 – Statement 149: “Aggressive (U.S. government) housing programs have not always helped the poor and middle class. The median net worth of American adults is now one of the lowest among developed nations—less than $45,000, according to the Credit Suisse Global Wealth Databook. That compares with approximately $220,000 in Australia, $142,000 in France and $54,000 in Greece.”, Michael Milken, WSJ, March 6, 2014
February 27, 2014 – Statement 148: “It is very hard to make the judgment now that the financial system as a whole or the banking system as a whole is undercapitalized. Based on everything we know today, if you look at very pessimistic estimates of the scale of losses across the financial system, on average relative to capital, they do not justify that concern.”, Timothy F. Geithner, President of New York Federal Reserve and Vice Chairman Federal Reserve Board of Governors, FOMC Minutes, March 18, 2008
February 27, 2014 – Statement 147: “(t)he class representatives in this case do not have troubling traits that suggest this is a lawyer-driven litigation by a manufactured plaintiff out to make a quick buck.”, The Honorable Judge George H. Wu, United States District Court Judge, November 14, 2011 (citing from “Cooper”, in granting Lead Plaintiff’s Motion for Class Certification, Sven Mossberg vs. IndyMac Financial, Inc. and Michael Perry)
February 27, 2014 – Statement 146: “Tapping this data (land availability “elasticity scores”), economists Atif Mian at Princeton University and Amir Sufi at the University of Chicago’s Booth School of Business have shown that more constrained areas saw bigger booms in the housing bubble—but also bigger busts on the way down.”, Wall Street Journal, February 27, 2014
February 27, 2014 – Statement 145: “From 1997 to 2013, there were 3,200 private securities class-action lawsuits, costing $75 billion (in settlements). There are only about 5,400 U.S. publicly-traded companies on the NYSE Euronext, NASDAQ, and NYSE Amex!!! Based on my experience, I believe that most of these suits are the real fraud; designed to “extort” public companies, by exploiting our dysfunctional civil legal system.”, Mike Perry, Former Chairman and CEO, IndyMac Bank
February 20, 2014 – Statement 144: “The stock price is withering. Investors and analysts are feeling burned….if Mr. Zuckerberg has a revolution up his sleeve, let’s see it. Otherwise, he should settle the lawsuits, expect large staff turnover, and get on with running a business whose scope, prospects, and share price are limited by the limited prospects of advertising on Facebook.” Holman W. Jenkins, WSJ, August 18, 2012
February 19, 2014 – Statement 143: “Mr. Perkins first came to widespread attention a few weeks ago by comparing anti-tech demonstrators to Nazis. We might be heading, he said, to a new Kristallnacht, when Hitler Youth and stormtroopers were unleashed against Jews and their businesses. He quickly disavowed the analogy, but not the reasoning behind it.”, David Streitfeld, New York Times
February 19, 2014 – Statement 142: “Dr. Friston has proposed that our brains are prediction-generating machines. Our brains, Dr. Friston argues, generate predictions about what is going to happen next, using past experiences as a guide.”, New York Times, February, 2014
February 19, 2014 – Statement 141: “Securities laws require material information — that is, information that might affect an investor’s view of a company — to be disclosed. That the government would deny a company’s shareholders all its profits certainly seems material, but the existence of this policy cannot be found in the financial filings of Fannie Mae.”, Gretchen Morgensen, New York Times, February 15, 2014
February 18, 2014 – Statement 140: “Crisis Management Discussion with Mike Perry, former Chairman and CEO IndyMac Bancorp”, UCLA Anderson School of Management, May 13, 2013
February 18, 2014 – Statement 139: “Discussion with Mike Perry Regarding the Financial Crisis”, University of Redlands, March 28, 2012
February 18, 2014 – Statement 138: “Profits are at a record high as a share of G.D.P., yet corporations aren’t reinvesting their returns in their businesses. Instead, they’re buying back shares, or accumulating huge piles of cash. This is exactly what you’d expect to see if a lot of those record profits represent monopoly rents.”, Paul Krugman, NY Times, February 17, 2014
February 13, 2014 – Statement 137: “The Lira has lost as much as a third of its value against the dollar, since the Federal Reserve in Washington began making noises last May about cutting back on its stimulus program, prompting investors to move their money from risky emerging markets…”, Wall Street Journal, February 9, 2014
February 13, 2014 – Statement 136: “In December 2008, Citi was effectively insolvent. (It’s) equity-to-assets ratio, measured in market value—the best single comprehensive measure of a bank’s financial strength—fell steadily from about 13% in April 2006 to about 3% by September 2008. And that low value reflected an even lower perception of fundamental asset worth, because the 3% market value included the value of an expected bailout.”, Charles W. Calomiris and Allan H. Meltzer, February 12, 2014
February 13, 2014 – Statement 135: “The recent turn has been abrupt. The flop reflects a broader turning point in one of the U.S.’s biggest recent asset booms. From 2009 to mid-2013, average prices for agricultural land in the U.S. rose by half, while in Iowa, Nebraska and some other Midwest farm states, prices more than doubled….”, Wall Street Journal, February 12, 2014
February 13, 2014 – Statement 134: “The fact is they (Asian countries) bulked up on savings, held back on consumption and investment, and amassed huge caches of foreign reserves. Sunk into Treasury bonds, these reserves drove a speculative boom in the “emerging market” of the moment: American subprime mortgages.”, Eduardo Porter, New York Times, February 11, 2014
February 12, 2014 – Statement 133: “I find that mandate (the Fed’s dual mandate: stable prices and full employment) both operationally confusing and ultimately illusory. It implies a trade-off between economic growth and price stability, a concept that I thought had long ago been refuted not just by Nobel Prize winners but by experience.”, former Fed Chairman Paul Volker, 2013
February 12, 2014 – Statement 132: “Annual earnings dropped for the first time since Rackspace went public. The stock price has plunged more than 55% over the past 12 months. Rackspace is far from dead, but its business of offering Web hosting and other cloud-based tech services has undergone a big shift since Amazon’s AWS operation got into the game with that company’s usual playbook of driving down prices.”, Heard on the Street, WSJ, February 11, 2014
February 10, 2014 – Statement 131: “… the financial crisis hammered the Harvard endowment and exposed its weaknesses, including a lot of illiquid investments. The endowment declined by 27.3% in its fiscal year ended in June 2009 and still hasn’t gotten back to its pre-crisis peak of $36.9 billion.” Andrew Barry, Barrons
February 10, 2014 – Statement 130: “The Peterson Institute of International Economics estimates that 39% of the increase in U.S. income inequality is because of this imbalanced trade. Yet Washington keeps negotiating so-called free-trade agreements that seem to open the U.S. market while leaving others relatively closed.”, Clyde Prestowitz
February 10, 2014 – Statement 129: “Mr. Hamman suggested a $1 billion prize for nailing every game in the NCAA tournament. Before coming to terms, SCA and Mr. Buffett, along with his reinsurance-business chief, Ajit Jain, set about answering a tough question: What was the chance of a winner? Mr. Buffett said the odds can’t be calculated.”, Wall Street Journal, February 10, 2014
February 7, 2014 – Statement 128: “This debate is fundamental, and the answers affect nearly everyone. Are speculative market booms and busts — like those that led to the recent financial crisis — examples of rational human reactions to new information, or of crazy fads and bubbles? Is it reasonable to base theories of economic behavior, which surely has a rational, calculating component, on the assumption that only that component matters?”, 2013 Nobel Laureate in Economics, Robert J. Shiller
February 7, 2014 – Statement 127: “Yelp sells ads through a mix of a self-service model similar to Google’s and a “full-service” model using a sales force. The company doesn’t disclose how much revenue comes from each method, but said it plans to invest more in the business in the coming year to capture more market share.”, Heard On The Street, Wall Street Journal
February 6, 2014 – Statement 126: “Investor Jim Chanos is quietly building an investment thesis around the idea that buybacks are a sign of corporate weakness, not strength. We were both left agog at what his analysis shows.”, Dennis K. Berman, The Wall Street Journal
February 6, 2014 – Statement 125: “Flailing investors…frustrated by low returns and desperate for yield…can delude themselves, pouring money into ill-conceived projects, be they subprime lending or capital flows to emerging markets.”, Nobel Laureate Paul Krugman, January 30, 2014
February 6, 2014 – Statement 124: “M2 has grown so fast in China not just because the central bank has been issuing a lot of renminbi, but also because the state-owned banking system has lent and relent those renminbi with encouragement from the government, creating a multiplier effect….The Federal Reserve pays little attention to money supply measures, since they do not provide much guidance to setting monetary policy.” The New York Times, January 16, 2012
February 6, 2014 – Statement 123: “I don’t think the (Fed’s) QE policies are so benign for inflation since 40% of my former retirement income has been rerouted to support the life styles of Messrs. Bernanke and Goolsbee’s friends. With my income so deflated, I’m spending a much higher percentage of my income for my essentials (not unlike you’d expect from wild inflation).”, Larry Noertker, Letter to the WSJ Editor, January 20, 2014
February 6, 2014 – Statement 122: “To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble.”, Nobel Laureate Paul Krugman, August 2, 2002
February 6, 2014 – Statement 121: “Mr. Bernanke was the board’s intellectual leader in its decision to cut the fed funds rate to 1% in June 2003 and keep it there for a year despite a rapidly accelerating economy and soaring commodity and real-estate prices. The Fed’s multiyear policy of negative real interest rates produced a credit mania that led to the housing bubble and bust. His record before the crisis was a clear failure.” Wall Street Journal, January 25, 2014
February 5, 2014 – Statement 120: “All of these things….the pushing around of nuns, the limiting of freedoms that were helping kids get a start in life, the targeting of conservative groups—have the effect of breaking bonds of trust between government and the people. They make citizens see Washington as an alien and hostile power.”, Peggy Noonan, WSJ, January 31, 2014
February 4, 2014 – Statement 119: “This (FTC) opinion is the most problematic agency action I have seen in terms of the potential to cause harm to consumers. It demonstrates a distinct lack of regulatory humility. This is a product-design case brought in the guise of alleged unfairness to consumers. Do you really want a regulatory agency designing your iPad?”, Dissenting FTC Commissioner Joshua Wright
February 4, 2014 – Statement 118: “Chris Kostman, who operates the Badwater run, Furnace Creek bike race and three other Death Valley events, called it “mind-blowing” and “unprecedented” to have to cancel or relocate the competitions, given that they have had no deaths, serious accidents or citations over 24 years. (The National Park Service does not dispute the events’ clean safety records.)”, The Los Angeles Times, February 2, 2014
February 3, 2014 – Statement 117: “What the SEC has done here is highly questionable and vulnerable to challenge…it is hard to fathom what they were thinking (in deciding to redact interviews on grounds of personal privacy).”, Daniel J. Metcalfe, former head of the U.S. Justice Department’s Office of Information and Privacy and director of American University’s Collaboration on Government Secrecy project
January 30, 2014 – Statement 116: “Nothing distinguishes more clearly conditions in a free country from those in a country under arbitrary government than the observance in the former of the great principles known as the Rule of Law.” Nobel Laureate F.A. Hayek, “The Road to Serfdom”
January 23, 2014 – Statement 115: “Central banks cannot simply move economic growth and employment to a desired level. Monetary policy (cannot) replace a sustainable growth policy, a well-balanced fiscal policy, a well functioning labour market, or an open world trade regime. It is important to avoid illusions in this respect. Monetary policy cannot assume responsibility for everything.”, Thomas Jordon Chairman, Swiss National Bank
January 23, 2014 – Statement 114: “I did not have sexual relations with that woman, Miss Lewinsky.”, President Bill Clinton, Jan. 26, 1998
January 14, 2014 – Statement 113: “During the pre-crisis boom, homebuyers were encouraged to borrow heavily to finance undiversified investments in a single home, while governments provided guarantees to mortgage investors. In the U.S., this occurred through implicit guarantees of assets held by the Federal Housing Administration (FHA) and the mortgage agencies Fannie Mae and Freddie Mac.”, 2013 Nobel Laureate in Economics, Robert J. Shiller
January 14, 2014 – Statement 112: “The private plaintiffs’ litigation against me, as CEO of IndyMac Bank, was entirely without merit. From day one they never intended to prove a single allegation (and they didn’t). It was all about extracting settlement money from D&O insurance policies, like their scamming brethren in asbestos suits.”, Mike Perry
January 13, 2014 – Statement 111: “And part of the (economic stimulus from FED monetary policy) comes through higher house and stock prices, which causes people with homes and stocks to spend more, which causes jobs to be created throughout the economy and income to go up throughout the economy.”, Janet Yellen
January 6, 2014 – Statement 110: “Look at me. Helpless, tortured, shot, blown up, my best buddies all dead, and all because we were afraid of the liberals back home, afraid to do what was necessary to save our own lives. Afraid of American civilian lawyers.”, Marcus Luttrell
December 17, 2013 – Statement 109: “Public plans have historically assumed roughly an 8% rate of return. But thanks to falling yields on safe assets, pensions must invest in riskier assets to have any hope of getting 8% returns….investment risk to budgets has risen roughly tenfold over the past four decades.” Andrew G. Biggs
December 17, 2013 – Statement 108: “Instead of encouraging innovation, patent law has become a burden on entrepreneurs, especially startups without teams of patent lawyers….the direct and indirect costs of litigation against technology companies (are estimated to be) $80 billion per year.” L. Gordon Crovitz
December 17, 2013 – Statement 107: “A clash between the management of Banca Monte dei Paschi di Siena SpA (The world’s oldest bank and Italy’s third largest financial institution) and the bank’s largest shareholder threatens to throw into chaos a plan to raise cash needed to stave off its full nationalization.” The Wall Street Journal
December 16, 2013 – Statement 106: “(we) worked together to fully vindicate both our clients after their lives were needlessly disrupted and their reputations were needlessly tarnished by years of litigation (by the SEC). As the Court aptly noted, the evidence showed our clients acted with ‘absolute integrity, prudence, and honesty.’”, David C. Scheper
December 13, 2013 – Statement 105: “Would you pay this claim? The Gulf Settlement Program did.” BP
December 11, 2013 – Statement 102: “Given these facts, further regulation of the financial system through the Dodd-Frank Act was a disastrously wrong response. The vast new regulatory restrictions in the act have created uncertainty and sapped the appetite for risk-taking that had once made the U.S. financial system the largest and most successful in the world.” Peter J. Wallison, American Enterprise Institute
December 11, 2013 – Statement 101: “And the Fed’s trillions in interest rate risk is supported by only $55 billion of capital; their capital is just 1.4% of assets. They have debt (leverage) that is about 70 times their capital!” Mike Perry
December 10, 2013 – Statement 100: “…you can buy your own stock (with borrowed funds) at a 14% return with a negative or zero or 1% to 2% cost of capital for at least a 12% spread.” Larry Haverty, Gabelli Multimedia Trust
December 10, 2013 – Statement 99: “One of the problems we have in the United States is that prosecutors like to make a name for themselves and they all try to distinguish themselves in one way or another. One way to distinguish yourself is to get the highest penalty ever against a bank…I don’t think it bears much resemblance to anything else. It is not rational.” Commissioner Daniel M. Gallagher, The Securities and Exchange Commission
December 4, 2013 – Statement 98: “So what is it with the Norwegians? Well, they have a kind of superiority complex.” Nobel Laureate Robert Shiller (explaining his psychological theory for what appears to be a current Norwegian housing bubble)
December 4, 2013 – Statement 97: “If you simply announce that things are irrational, then that alone doesn’t get you very far. You have to replace rational agents with some concrete notion of what it means to be irrational. You need to test that notion in a formal, mathematical model.” Nobel Laureate Lars Peter Hansen
December 3, 2013 – Statement 96: “Again, the evidence suggests that we have become an economy whose normal state is one of mild depression, whose brief episodes of prosperity occur only thanks to bubbles and unsustainable borrowing.” Paul Krugman
December 2, 2013 – Statement 95: “Now we’re seeing another upswing in risky behavior. It began surprisingly soon after the crisis, spurred on by central bank policies that depressed the return on safe investments.” Howard Marks
December 2, 2013 – Statement 94: “The recognition of the insuperable limits to his knowledge ought indeed to teach the student of society a lesson of humility which should guard him against becoming an accomplice in men’s fatal striving to control society—a striving which makes him not only a tyrant over his fellows, but which may well make him the destroyer of a civilization…” Nobel Laureate Friedrich A. Hayek
December 2, 2013 – Statement 93: “Venezuelans need a moral authority that defends their rights…they need a champion for a rule of law that will limit the power of the state over their person. Mother Church ought to be that voice. In siding with Mr. Maduro, however inadvertently, she harms her cause in the region.” Mary Anastasia O’Grady
November 26, 2013 – Statement 92: “These agencies (like the CFPB, FDA, FDIC, NSA, and SEC) have assumed frightening new powers over the everyday lives of American citizens, giving government entities free rein over you and me in ways unprecedented in our country’s history.” Sen. Rand Paul
November 25, 2013 – Statement 91: “Allow me to highlight—and then question—some of the prevailing wisdom at the basis of current Fed policy”, Kevin Warsh
November 25, 2013 – Statement 90: “Too much money is chasing too few assets, pure and simple. Artificially low rates deliver artificially high asset prices, accentuating financial fragility.” Tad Rivelle, TCW
November 18, 2013 – Statement 87: “One can hope that in a future financial crisis and there will surely be one…economists, investors, and regulators will better understand how fat-tail markets work. Doing so will require better models, ones that more accurately reflect predictable aspects of human nature…” Alan Greenspan
November 14, 2013 – Statement 86: “The banking system in the United States has been highly crisis-prone, suffering no fewer than 14 major crises in the past 180 years…A country gets the banking system it deserves..”, Charles W. Colomiris and Stephen H. Haber
November 13, 2013 – Statement 85: Does Amazon Have a Special Exemption From the SEC in Complying with Securities Disclosure Laws?
November 12, 2013 – Statement 84: “..ask a U.S. citizen if some semi-governmental agency should control the prices of cars, morning newspapers, and wine…he would jump in anger, as it appears to violate every principle the country stands for….this is not France.” Nassim Nicholas Taleb
November 12, 2013 – Statement 83: “My worst fears are confirmed. This is what I was afraid of, that the euro would be preserved and it would pervert the venture and destroy the European Union.” George Soros
November 11, 2013 – Statement 82: “It’s a common observation in the context of emerging-market financial crises that they’re often preceded by large capital inflows from abroad and that the problem is that the local banking system can’t handle the massive inflow of capital. So by analogy, sort of a similar story may have happened in the United States.” Ben Bernanke
November 11, 2013 – Statement 81: “The global economy is just as dysfunctional now as it was before the financial crisis. Imbalances that helped fuel the crisis–including the U.S.’s easy monetary policy…..still exist. In fact, they’ve gotten worse.” Rana Foroohar, Time Magazine
November 7, 2013 – Statement 79: Should housing and other asset bubbles and busts (and related banking crises) that occurred throughout the developed world, raise doubts as to whether nonconforming mortgages and securitization caused the U.S. housing bubble, as many claim?
November 7, 2013 – Statement 78: “We’ve been bouncing from investment bubble to deficit spending to offset the income that is being drained out of the economy by trade deficits” Jared Bernstein and Dean Baker
November 6, 2013 – Statement 77: Pre-Crisis, World Bank Data Shows That Iceland Grew Its Money Supply 5.4 Times Faster Than Its GDP Growth! Spain 4.9 Times! The U.K 4.4 Times! The U.S. 3.3 Times! What Were Central Bankers Thinking?
November 5, 2013 – Statement 76: “Booms and Busts Around the World Happen Whenever Central Banks Tighten or Loosen Monetary Policy.” John Mauldin
November 5, 2013 – Statement 75: “It all fell apart, in the sense that not a single major forecaster of note or institution caught it (predicted the financial crisis)….I was actually flabbergasted, it (studies about market behavior) upended my view of how the world works.” Alan Greenspan
November 4, 2013 – Statement 74: Foreign Trade and Investment Imbalances Were a Major Cause of the U.S. and Global Financial Crisis. They Remain a Huge Unaddressed Risk, Because It was Easier Politically to Just Blame the Bankers.
November 4, 2013 – Statement 73: “The first and most important lesson that history teaches about what monetary policy can do….and it is a lesson of the most profound importance…is that monetary policy can prevent money itself from being a major source of economic disturbance.” Milton Friedman
October 29, 2013 – Statement 72: “The evidence against Fan and Fred is voluminous, but the feds want to whitewash Washington’s role in the panic.”
October 28, 2013 – Statement 71: The Fed’s Low-Rate Policies Prompt Investors to Make Dicier Tech Bets; Just Like They Did in The Dot-Com and Housing Bubbles/Busts
October 22, 2013 – Statement 70: Does JP Morgan Have a Special Exemption from the SEC in Complying with Securities Disclosure Laws Too?
October 21, 2013 – Statement 69: Does Goldman Sachs Have a Special Exemption from the SEC In Complying with the Securities Disclosure Laws?
October 21, 2013 – Statement 68: FDIC Chair Gruenberg Stunningly Admits That Prior to the Financial Crisis They Had No Plans To Address a Big Bank Failure!
October 21, 2013 – Statement 67: “In a post Dodd-Frank world, banks are public utilities and no CEO can afford to resist government’s demands.”
October 18, 2013 – Statement 66: “I’m glad I’m able to be the person who can afford to stand up to them. I don’t want anything from the SEC; except them to act like American citizens and treat other American citizens the way they deserve to be treated.” Mark Cuban
October 15, 2013 – Statement 65: India’s New Central Bank Head Warns the Fed to Pay More Attention to the Global Consequences of Their Actions
October 4, 2013 – Statement 64: “(Federal) Student loans are the new subprime; were talking about hundreds of billions of (government) losses…”, Jim Rickards
October 2, 2013 – Statement 63: Federal Judge Rules HUD/FHA Violated Reverse Mortgage Statute by Improperly Directing Lenders to Foreclose on Elderly Widows!!!
October 1, 2013 – Statement 61: “Monetary policy (set by central bankers like the Fed) insidiously plays with our time preferences and our very ability to engage in economic calculation. The greater the distortion, the greater the destruction needed to correct it.” Mark Spitznagel
September 27, 2013 – Statement 60: “They (central bankers) believe that flooding the world with money will somehow solve the very problems that such interventionism created in the first place.” Ron Paul, 2013
September 27, 2013 – Statement 59: “…the Fed in good measure is the source of risk”, Jim Grant, Founder and Editor Grant’s Interest Rate Observer
September 26, 2013 – Statement 58: “There is an Interaction Between The Monetary Excesses (by the Fed) and Risk-Taking Excesses; Rapidly Rising Housing Prices and Resulting Low Delinquency Rates Threw Underwriting Programs Off Track…”, John B. Taylor
September 25, 2013 – Statement 57: “So if we want them (banks) to be a free capitalist company, they have to be able to fail. If we don’t, we might as well treat them as a utility, because that’s what they are.” Ben Bernanke
September 24, 2013 – Statement 56: “…We believe that the government deserves quite a lot of the blame for getting our financial system and our nation into trouble in the first place.” FCIC Minority Report
September 24, 2013 – Statement 55: “Could the breakdown that so devastated global financial markets have been prevented? I very much doubt it.” Alan Greenspan, February 2010
September 24, 2013 – Statement 54: “With nominal interest rates around 6% and inflation around 6% (in 2004), the real interest rate was near zero, so household borrowing took off” Vernon L. Smith and Steven Gjerstd
September 20, 2013 – Statement 53: “Your No. 1 Client is the Government”
September 19, 2013 – Statement 51: The Simple Explanations for the Global Financial Crisis and Western Slowdown are Wrong
September 18, 2013 – Statement 50: Five Years Later: Don’t Mention the Feds
September 18, 2013 – Statement 49: Unbelievably, the Government’s National Statistical Rating Agency Problem Remains Unsolved!!!
September 17, 2013 – Statement 48: No Down Payment Required (for home mortgages) in Latest Government QRM Proposal!!!
September 10, 2013 – Statement 47: One Thousand One Hundred and Forty Seven Pages: My Entire Sworn Testimony Before the SEC Staff
September 4, 2013 – Statement 46: The Porridge was Too Hot. Now it’s Too Cold. Only Wise Government Knows When It’s Just Right!!!
April 23, 2013 – Statement 45: MBIA Dismisses Lawsuit Against M. Perry and Others
March 13, 2013 – Statement 44: The Securities and Exchange Commission v. The State of Illinois
February 26, 2013 – Statement 42: Is FHA “A home wrecker”?
February 26, 2013 – Statement 41: HUD/FHA is Not More Capable or Noble Than Their Private Sector Counterparts
February 7, 2013 – Statement 40: “Never Explained is Why Some Were Bailed Out and Some Were Not.”
February 4, 2013 – Statement 39: Resolution of All Government Civil Litigation Re. M. Perry: Summarized
January 29, 2013 – Statement 37: Discussion of IndyMac Bank’s 2007 Safety and Soundness Regulatory Examination
January 17, 2013 – Statement 36: “Many People Like Cheap Moralizing…In the West, Intellectuals Like to Blame the Markets”
January 9, 2013 – Statement 35: FDIC Settlement Documents and M. Perry’s Comments Re. Settlement
January 3, 2013 – Statement 34: IndyMac’s (Credit Quality) Performance as a Loan Originator
January 2, 2013 – Statement 33: “Informal Mortgage Industry Talk By Michael Perry”
January 2, 2013 – Statement 32: “IndyMac Bank OMG Not TBTF”
September 27, 2012 – Statement 31: SEC Settlement Documents and M. Perry’s Attorney’s Comments Re. Settlement
September 24, 2012 – Statement 30: U.S. Judge Manuel L. Real’s Signed “Findings of Uncontroverted Facts and Conclusions of Law: Related to Order Granting Partial Summary Judgment in Favor of Perry on SEC’s Risk-Weighting and Section 17(a)(2) Claims”
September 10, 2012 – Statement 28: Transcript of 2nd Partial Summary Judgment Motion Hearing Before Judge Real
August 30, 2012 – Statement 27: The Truth is Emerging Despite the SEC’s Attempts to Conceal It.
August 30, 2012 – Statement 26: I think the SEC is engaging in denialism in their statements to the Court.
August 29, 2012 – Statement 25: How about this recent SEC Statement to the Court; is it misleading? I think so.
August 28, 2012 – Statement 24: Are these recent SEC Statements to the Court inaccurate or misleading? I think so.
August 28, 2012 – Statement 23: Status update on SEC vs. Michael W. Perry
August 24, 2012 – Statement 22: Excerpt from Michael W. Perry’s Sworn SEC Testimony
August 23, 2012 – Statement 21: Supplemental Brief in Support of M. Perry’s 2nd Motion for Partial Summary Judgment in SEC Matter
July 2, 2012 – Statement 20: Reply in Support of M. Perry’s Motion for Partial Summary Judgment: SEC’s Risk Weighting and 17(a)(2) Claims
June 13, 2012 – Statement 19: M. Perry’s Motion for Partial Summary Judgment: SEC’s Risk-Weighting and Section 17 (a)(2) Claims
May 31, 2012 – Statement 18: U.S. Judge Manuel L. Real’s Signed “Order Granting Partial Summary Judgment in Favor of Perry and Keys”
May 31, 2012 – Statement 17: U.S. Judge Manuel L. Real’s Signed “Findings of Uncontroverted Facts and Conclusions of Law”
May 25, 2012 – Statement 16: M. Perry’s Motion in Limine to Exclude Testimony of Professor Anthony Saunders
May 25, 2012 – Statement 15: M. Perry’s Motion in Limine to Exclude Analyst Testimony
May 21, 2012 – Statement 14: Transcript of Partial Summary Judgment Motion Hearing Before Judge Real
May 18, 2012 – Statement 13: M. Perry’s Memorandum of Contentions of Fact and Law
May 7, 2012 – Statement 12: Reply Memorandum in Support of M. Perry’s Motion for Partial Summary Judgment
April 23, 2012 – Statement 11: Former FASB Director MacDonald Opines on $18 million Intercompany Payable/Receivable at March 31, 2008
April 23, 2012 – Statement 10: FTI’s Beloreshki Opines on 2008 DSPP Stock Issuance/Impact on Book Value
April 6, 2012 – Statement 9: Former OTS Regional Director Vigna Opines on Disclosure of Various Regulatory Matters
April 6, 2012 – Statement 8: Former SEC Chief Economist Lehn Opines on Materiality of SEC Allegations and Defendants’ Intent
April 6, 2012 – Statement 7: Former SEC Commissioner Fleischman Opines on Indymac’s Disclosure Controls
April 6, 2012 – Statement 6: Declaration of M. Perry In Support Of His Motion For Partial Summary Judgment
April 6, 2012 – Statement 5: M. Perry’s Motion for Partial Summary Judgment
November 30, 2011 – Statement 4: M. Perry’s Responses to SEC’s First Set of Interrogatories
November 21, 2011 – Statement 3: SEC’s Responses to M. Perry’s First Set of Interrogatories
September 29, 2011 – Statement 2: M. Perry’s Motion to Dismiss FDIC Complaint
September 1,2011 – Statement 1: Initial Statement
“To sin by silence when they should protest makes cowards of men” -Abraham Lincoln
My name is Michael Perry. I am the former Chairman and Chief Executive Officer of Indymac. I have kept silent for three years in the hope that I would be left alone and allowed to rebuild my professional life, but unfortunately that has not been the case. I have been forced to defend myself against unwarranted and false, public allegations.
On July 11, 2008, Indymac Bank was seized by the Federal Deposit Insurance Corporation (FDIC) after a U.S. Senator’s inappropriate public statements during the financial crisis caused a “run on the bank” that rapidly depleted the bank’s ample liquidity. As a result of this bank run and the fact that Indymac was deemed by banking regulators to be “Not Too Big To Fail”, it was not around just a few months later, at the height of the financial crisis, to receive any of the significant and unprecedented assistance the government provided to every “Too Big To Fail” financial institution and hundreds of smaller financial firms. Without this assistance, many, if not most would have suffered the same fate as Indymac, including some of the largest and oldest firms.
Since that time, I and others have been the subject of various government investigations and named as defendants in numerous civil lawsuits, including ones filed by the Securities and Exchange Commission (SEC) on February 11, 2011 (31 months after Indymac was seized), and the FDIC on July 6, 2011 (3 years after Indymac was seized).
The plaintiffs in these civil lawsuits apparently don’t care about the facts or the truth; these suits are filled with distortions and inaccuracies. They are primarily being pursued to gain access to potential settlement proceeds from directors and officers liability insurance, or in the case of the SEC to show politicians, the press, and the public that they are now tough enforcers of the securities laws. The FDIC, for its part, is seeking a significant share of D&O insurance proceeds, but it is also inappropriately seeking to blame former banking executives like me for the FDIC’s own failures. The private deposit insurance fund, for which the FDIC is responsible, became insolvent during this crisis and remains so; without the full faith and credit of the U.S. behind them, they like Indymac and many others, would have failed.
Importantly, Indymac decided in 2000 to carry out its business model through the acquisition of a depository institution whose deposits were insured by the FDIC. Because of this decision, Indymac – unlike government-sponsored mortgage lenders Fannie Mae and Freddie Mac (and others) — has not cost U.S. taxpayers one penny. And while the seizure of Indymac Bank has cost the FDIC’s insurance fund billions, industry experts and others (including me) believe that much of the insurance fund’s loss was avoidable, if only the FDIC had worked with us to save the bank when that was still possible or if the FDIC had made better decisions as conservator once it took over the bank.
Not one of the lawsuits against me has any merit.
I, and the management team and directors of Indymac Bank, made prudent and appropriate business decisions based on the facts available to us at the time and always with the primary goal being to keep Indymac Bank safe and sound, within the parameters of our regulatory-approved, mortgage lending business model. And importantly, we always acted with honesty, integrity and complete transparency and properly complied with all relevant regulations and laws.
The plaintiffs know this and as a result do not want these matters to go to trial where they will lose. This is what happens in America today. Frivolous lawsuits rarely go to trial and nearly always settle despite their lack of merit, because of the time and cost to defend against them (and perversely having a “pot” of liability insurance, or even better a deep-pocket, corporate indemnification, encourages more lawsuits and more settlements). It is particularly disheartening though, to have U.S. government agencies like the SEC and FDIC engaged in this type of behavior in order to further their own image without regard to the damage done to the reputation, career, and finances of honest individuals like myself and others. And it’s not just me and my family that is adversely affected. I believe these legal tactics have a long-term cost to our country’s economic potential and erode our standards. In regard to my latter assertion, I don’t think most Americans are aware (I wasn’t until recently), but there is an exemption in our defamation laws that “privileges” plaintiff’s lawyers and allows them to distort facts and make untrue statements and defame defendants like myself, without any consequence, even if the defendant proves so later in a court of law. This doesn’t seem right, does it?
In conclusion, this site’s purpose is to counter the allegations in these lawsuits (and regurgitated in the press as authoritative, when they are not) with the truth and the facts, for those who care to spend the time to read the documents on this site and understand them. I plan to start out slowly, focus on the government cases, and then if I have the time and it is warranted, expand the site to include my views based upon my experiences and post-crisis study of its true systemic and macroeconomic causes.