NewsBreakingOnline

enlarge Everyone ready for some fun?!!?! I thought so!!!! Here’s today’s Bell: I wish I could tell you guys that everything is going to be OK in the economy. I really, really, do. But I can’t : President Barack Obama directed Treasury Secretary Timothy Geithner and budget office director Jack Lew to lead negotiations with congressional Republicans to break a stalemate on extending Bush-era tax cuts. After meeting for almost two hours with Republican and Democratic congressional leaders at the White House, Obama said that both sides agree action is needed to extend tax cuts to middle-income families before the end of the year even as they remain divided on tax rates for the wealthiest Americans. “There must be some sensible common ground” to resolve differences on taxes, Obama said. He said he appointed Geithner and Lew “to break through this logjam.” I can’t wait to see what compromise Tim “Voice of the People” Geithner agrees to. My prediction: The rich get to keep every single tax cut in the original Bush package. This will be offset by raising taxes on the unemployed to get them to pay for their unemployment benefits. Obama will hail the deal as “an example of how bipartisanship can foster a sense of shared responsibility.” On the happier side of things, it looks as though WikiLeaks is going to dump a bunch of dirt on one of our esteemed major financial institutions: In an exclusive interview earlier this month, WikiLeaks founder Julian Assange told Forbes that his whistleblower site will release tens of thousands of documents from a major U.S. financial firm in early 2011. Assange wouldn’t say exactly what date, what bank, or what documents, but he compared the coming release to the emails that emerged in the Enron trial, a comprehensive look at a corporation’s bad behavior. “It will give a true and representative insight into how banks behave at the executive level in a way that will stimulate investigations and reforms, I presume,” he told me. This sort of talk makes me feel all tingly inside. Early speculation is that Assange has the goods on Bank of America, whose shares dropped by 3.18% yesterday to close at $10.95. Fortune’s Colin Barr tries to throw ice down my pants , however, by noting that these revelations aren’t likely to hurt the banks’ reputations any further: But consider that the main effect of the previous WikiLeaks episodes was to expose official hypocrisy. When you consider what bad actors the banks have already shown themselves to be, it is sort of hard to imagine what damage Assange might actually expect to do. “What else can you possibly do to embarrass these guys?” asks FusionIQ’s Barry Ritholtz, who spent much of the last few months chronicling how the banks have defrauded homeowners and investors in mortgage securities. “The bar is so high. We may find out some stuff about their lobbying before the bailouts, but that doesn’t look bad for them as much as for the government.” But, like, here’s the thing. I don’t care about their reputations being harmed. What I care about is SEEING A BUNCH OF THESE SOB’s THROWN INTO JAIL . Yeah, I know, I know, we never throw our corporate overlords into jail because they’re special wealth leprechauns who will stop making mortgage-backed pots of gold if we hold them accountable for criminal behavior. But I can dream, can’t I? And speaking of “Bank of America” and “criminal behavior,” take a look at this : Testimony by a Bank of America Corp. employee in a New Jersey personal bankruptcy case may give more ammunition to homeowners and investors in their legal battles over defaulted mortgages. Linda DeMartini, a team leader in the company’s mortgage- litigation management division, said during a U.S. Bankruptcy Court hearing in Camden last year that it was routine for the lender to keep mortgage promissory notes even after loans were bundled by the thousands into bonds and sold to investors, according to a transcript. Contracts for such securitizations usually require the documents to be transferred to the trustee for mortgage bondholders. In the case, U.S. Bankruptcy Judge Judith H. Wizmur on Nov. 16 rejected a claim on the home of John T. Kemp, ruling his mortgage company, now owned by Bank of America, had failed to deliver the note to the trustee. That could leave the trustee with no standing to take the property, and raises the question of whether other foreclosures could similarly be blocked. Barry Ritholtz has a detailed rundown of why banks playing fast and loose with the transfer of notes fundamentally threatens basic property rights. And on the investor side of things, Yves Smith describes how anyone who invested in a mortgage-backed security basically has no right to claim mortgage payments if the note wasn’t properly transferred to the trust. These revelations are making the banks poop their pants, since they could face a double whammy of having foreclosures blocked *and* having investors sue the crap out of them for selling them fraudulent securities. As Georgetown Law professor Adam Levitin noted in his testimony before the House Financial Services Committee last month: Recently, arguments have been raised in foreclosure litigation about whether the notes and mortgages were in fact properly transferred to the securitization trusts. This is a critical issue because the trust has standing to foreclose if, and only if it is the mortgagee. If the notes and mortgages were not transferred to the trust, then the trust lacks standing to foreclose… If the notes and mortgages were not properly transferred to the trusts, then the mortgage-backed securities that the investors’ purchased were in fact non-mortgage-backed securities. In such a case, investors would have a claim for the rescission of the MBS, meaning that the securitization would be unwound, with investors receiving back their original payments at par. Wheeeeeeeee! And finally, Paul Krugman notes that Italian bond yields are skyrocketing too. This is bad because if there ain’t enough money out there to bail out Spain, there definitely ain’t enough money out there to bail out Italy. Wait, what’s that you’re asking? Why of course gold futures traded higher today ! Have a great start to your December, peeps!