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Monday, March 19, 2012
News Rolling Stone says Bank of America is too big — er, crooked — to fail
Posted By Ana McKenzie on Mon, Mar 19, 2012 at 12:42 PM
Matt Taibbi's scathing Rolling Stone piece "Bank of America: Too Crooked to Fail" won't hit stands until March 29, but already (well, as of Monday at noon) it's garnered 140 comments on RS's site and led to 1,781 tweets.
But I guess comparing one of the largest financial institutions in the country to a 40-year-old who buries dead hookers in his parents' backyard will get some attention.
The brutal account of the Charlotte-based bank's corrupt descent is peppered with vulgarities and hilarious plain-speak. One of my favorite lines is when Taibbi accuses Hugh McColl Jr., the local good ol' boy CEO who took BofA coast-to-coast, of engaging in a pissing contest, to put it mildly, with his competitor, former First Union (which eventually became Wachovia, which eventually became part of Wells Fargo & Co.) CEO Ed Crutchfield.
Hugh McColl Jr. and Ed Crutchfield, the respective leaders of North Carolina National Bank (which would take over Bank of America) and First Union (which turned into Wachovia), both based in Charlotte, North Carolina. Obsessed with each other, these two men transformed their personal competition into one of the most ridiculous and elaborate penis-measuring contests in the history of American business — even engaging in the garish Freudian spectacle of vying to see who would have the tallest skyscraper in Charlotte.
While Taibbi engages readers of this complex story with silly anecdotes like this, he mostly uses them as morbidly humorous juxtapositions to painful realities of BofA's own story:
This is the crossroads where Bank of America now lives — trying to convince the government to allow it to remain in business, perhaps even asking for another bailout or two, while it avoids paying back untold billions to all of the institutional customers it screwed, the list of which has grown so long as to almost be comical.
A street felon who gets out of jail can't even vote in some states — and yet Bank of America is allowed to receive billions in federal aid and dominate the electoral process with campaign contributions?
Bank of America should have gone out of business back in 2008. Just as the mortgage market was crashing, it made an inconceivably stupid investment in subprime mortgages, acquiring Countrywide and the billions in potential lawsuits that came with it. "They tried to catch a falling knife and lost their hand and foot in the process," says Joshua Rosner, a noted financial analyst.
As I always say, laugh so you don't cry.
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