>> THANK YOU SO MUCH, KELLY
O’GRADY IN FRONT OF FIRST
REPUBLIC BANK.
FORMER OFFICE MANAGEMENT BUDGET
DIRECTOR, FORMER ACTING
WHITE HOUSE CHIEF OF STAFF,
MiG MULVANEY. GREAT TO SEE YOU.
GREAT TO SEE YOU.
I WILL DESCRIBE FIRST REPUBLIC’S
BUSINESS, AGGRESSIVE RICH PEOPLE
SMOOCHING, HANDING OUT LOANS TO
RICH FOLKS LIKE 1%, DUMB, BUT
WHAT DOES THIS MEAN FOR REGULAR
WORKING PEOPLE?
CERTAINLY THEY WILL PAY HIGHER
COSTS TO THE BIG BANKS INCLUDING
JPMORGAN BECAUSE THE FDIC
INSURANCE FEES WILL GO UP?
>> YEAH.
DAGEN, THE DISCUSSION RIGHT NOW
OBVIOUSLY WHETHER OR NOT THESE
INSURANCE LIMITS ARE GOING TO GO
UP.
YOU’RE LIMITED TO $250,000 OF
INSURED FDIC DEPOSITS.
A LOT OF DISCUSSION IN
WASHINGTON AMONG LAWMAKERS,
REGULATORS, TAKE THAT UP TO
PERHAPS INFINITY.
THAT IS NOT FREE.
SOMEONE WILL PAY FOR THAT.
USUALLY FOLKS WITH MONEY ON
DEPOSIT.
IT WILL BE INTERESTING TO SEE
HOW IT SHAKES OUT, WHETHER OR
NOT THIS WILL BE ANY RISK AT
ALL.
IF THE GOVERNMENT WILL SAY LOOK,
BANKING WILL BE A RISK-FREE SORT
OF PROCESS.
THAT COSTS MONEY.
AT THE END OF THE DAY, USUALLY
COSTS TAXPAYER MONEY.
THEY WILL SAY IT COSTS
DEPOSITORS MONEY, ET CETERA.
AT THE END OF THE DAY THE
INSURER OF LAST RESORT APPEARS
TO BE THE FEDERAL GOVERNMENT
WHICH IS A DANGEROUS PRECEDENT
TO SET.
SEAN: AS YOU EXPECT, MICK, BIDEN
CALLED ON CONGRESS TO STRENGTHEN
REGULATIONS.
LISTEN TO THIS.
PRESIDENT BIDEN: LET ME BE CLEAR
DEPOSITORS ARE BEING PROTECTED
SHAREHOLDERS ARE LOSING THEIR
INVESTS.
TAXPAYERS ARE TYPICALLY NOT THE
ONES ON THE HOOK.
I CALLED ON CONGRESS TO GIVE
REGULATORS THE TOOLS TO HOLD
BANK EXECUTIVES ACCOUNTABLE.
I CALLED ON REGULATORS
STRENGTHEN REGULATIONS,
SUPERVISION OF LARGE AND
REGIONAL BANKS.
SEAN: MICK, TO QUOTE JOE BIDEN
HIMSELF THAT IS MALARKEY.
THERE IS ENOUGH REGULATION IN
PLACE TO ACTUALLY MAKE SURE
BANKS ARE SAFE AND SOUND.
THE PROBLEM IS, YOU DIDN’T HAVE
REGULATORS ON THE BEAT TO MAKE
SURE YOU DIDN’T HAVE THE BANKS
FAIL, AM I WRONG?
>> SEAN, SAME THING WE SAW WITH
SILICON VALLEY BANK AND
SIGNATURE A FEW MONTHS AGO WHICH
IS SUPPOSEDLY ITS WITH THE TRUMP
ERA CHANGES IN REGULATIONS THAT
LED TO THIS.
THAT IS A BUNCH OF MALARKEY.
THIS WAS A SIMPLE PROBLEM
BETWEEN THE, BETWEEN DURATION
RISK.
THEY HAVE LENT MONEY OUT LONG
TERM AND INVESTED SHORT TERM
THAT WAS A PROBLEM FOR THEM.
SO THAT IS SOMETHING THAT AN
ORDINARY REGULATORY
INVESTIGATION WOULD TURN UP AT
ANY LEVEL SOFT WE WENT FROM HERE
TO HERE, IN TERMS OF REGULATION
BUT EVEN REGULATION DOWN AT THIS
LEVEL SHOULD HAVE CAUGHT THESE
SORTS OF DEFICIENCIES.
THE QUESTION IS THIS, WHERE ELSE
HAVE THE REGULATORS MADE THESE
EXACT SAME MISTAKES?
WHERE ELSE HAVE BANKS GOT THE
DURATION RISK ON THE BOOKS BUT
THE REGULATORS HAVEN’T CAUGHT
IT?
THAT IS THE THING WORRYING MOST
PEOPLE, WE TRYING TO FIGURE OUT
ONE OFF, TWO OFF, OR A BIGGER
PROBLEM THROUGHOUT THE BANKING
SYSTEM AND I DON’T THINK WE KNOW
THE ANSWER TO THAT QUESTION.
DAGEN: MICK, 60% OF THE TOTAL
CREDIT, STEPHANIE POMBOY TALKS
ABOUT THIS ALL THE TIME, IS
CREATED OUTSIDE OF THE BANKING
SYSTEM AND THE REGULATORS DON’T
HAVE ANY CONTROL OVER THAT AND
ALL OF THIS, THESE PROBLEMS WERE
CREATED BY THE RECKLESS SPENDING
OF THE BIDEN ADMINISTRATION AND
THE RECKLESS MONETARY POLICY OF
BIDEN’S FEDERAL RESERVE.
I CALL IT THAT BECAUSE
JAY POWELL MIGHT HAVE BEEN
APPOINTED BY DONALD TRUMP BUT HE
WAS RENOMINATED BY JOE BIDEN.
>> THIS IS A RISK THAT YOU RUN
IN A RAPIDLY-INCREASING INTEREST
RATE ENVIRONMENT.
THE POINT THOUGH, DAGEN IS THIS,
THAT IS NOT ROCKET SIGN
ACTIVITIES.
ROCKET SCIENCE.
EVERYBODY KNOWS THAT.
IF THE BANKS BOUGHT ALL SHORT
TERM PAPER, LOW INTEREST RATES
COMING IN, PAYING OUT HIGH RATES
OF INTEREST THEY ARE GOING TO
HAVE A PROBLEM.
SIMILAR TO WHAT 457ED IN THE
SAVINGS AND LOAN CRISIS BACK IN
THE 1980S.
DAGEN: YEAH.
>> THE REAL SURPRISE HERE
ANYBODY INCLUDING THE
REGULATORS, MOWERS IMPORTANTLY
THE REGULATORS ARE SURPRISED BY
THIS.
SEAN: WE DON’T NEED REGULATION.
USE TOOLS YOU HAVE, REGULATE THE
BANKS YOU OVERSEE BUT I WANT TO
SWITCH GEARS BIDEN’S MORTGAGE
RULE BEGINS, MICK.
MORTGAGE BORROWERS WILL SEE
HIGHER FEES TO COVER THOSE WITH
LOWER SCORES.
LOOK AT THE NUMBERS.
I DON’T KNOW WHETHER YOU SEE
THIS.
YOU HAVE 350,000-DOLLAR MORTGAGE
AND PUT DOWN 20%.
IF YOU’RE CREDIT SCORE IS 640
YOUR FEES GO DOWN $2600.
IF YOUR FEE IS 740, BETTER
CREDIT SCORE, FEES GO UP 1300
BUCKS.
YOU COULD TASTE ESTIMATED COST
OF $30,000, MICK, BECAUSE YOU
HAVE A BETTER CREDIT SCORE.
IS THIS SOCIALIZING CREDIT AT
FHFA?
NUMBER ONE.
NUMBER TWO, WE SAW FANNIE AND
FREDDIE WHEN WE CAME INTO
CONGRESS, THEY NEEDED A BAILOUT,
HUNDREDS OF BILLIONS OF DOLLARS
BAILOUT.
YOU WOULD THINK THEY WANT BETTER
CREDITORS HIGHER CREDIT SCORES
BACKED BY U.S. GOVERNMENT AS
OPPOSED TO THOSE WHO PUT 5% DOWN
WITH LOWER CREDIT SCORES.
THIS IS INSANITY.
>> I CAN’T READ THAT, THING
READING OUT LOUD JUMPED OUT AT
ME, IF YOU PUT 20% DOWN ON A
HOUSE, NOBODY DOES THAT.
WE’VE BEEN WORRIED, SEAN, SINCE
YOU AND I WERE IN CONGRESS THE
POLITICIZATION OF CREDIT.
ELIZABETH WARREN BELIEVES CREDIT
IS NATURALLY POLITICAL, THAT THE
GOVERNMENT SHOULD BE INVOLVED.
KEEP IN MIND SHE HAS WRITTEN
PAPERS IN THE PAST SHE LIKES THE
JAPANESE SYSTEM WHERE THE POST
OFFICE IS INVOLVED IN THE
BANKING SYSTEM SO THE GOVERNMENT
IS HEAVILY INVOLVED.
IT IS HEART TO MAKE THIS UP.
THIS DOESN’T SURPRISE ME.
THIS IS WHERE THE DEMOCRATS WANT
TO TAKE EVERYTHING.
I’M HERE IN CALIFORNIA, MILTON
CONFERENCE IN LOS ANGELES WHERE
THE STATE LEGISLATURE IS
NEGOTIATING A BILL, DISCUSSING A
BILL PEOPLE WHO MAKE MORE MONEY
WHERE PEOPLE WILL PAY MORE FOR
THEIR ELECTRICITY.
JUST SMACKS OF SOCIALISM.
NOT JUST IN CREDIT.
CERTAINLY DRIVING A LOT OF
DISCUSSION IN CREDIT.
EVEN IF A BANK FAILS BECAUSE OF
BAD MANAGEMENT, OVERSIGHT BY
REGULATORS, NOT FOR LACK OF
REGULATION, EVERY TIME THAT
HAPPENS, IT GIVES FOLKS LIKE
ELIZABETH WARREN THE CHANCE TO
MAKE HER CASE AGAIN, MOVE THE
NEEDLE IN HER DIRECTION.
DAGEN: SHE CAN DO THAT, SHE CAN
STICK HER FINGERS INTO THE
MORTGAGE BUSINESS, MICK, BECAUSE
WE STILL AS A NATION STILL
SUBSIDIZE MORTGAGES MORE THAN UP
TO THE TUNE OF MORE THAN A
MILLION DOLLAR MORTGAGE AT THE
FEDERAL LEVEL.
SO IT IS, THERE ARE HAVES AND
HAVE-NOTS BASED ON WHAT SEAN WAS
TALKING ABOUT.
FANNIE MAE AND FREDDIE MAC STILL
EXIST.
THAT IS THE INHERENT PROBLEM.
SO IN EVERY CORNER OF OUR
ECONOMY BIDEN AND COMPANY ARE
MEDDLING WITH REGULATIONS
BECAUSE THEY CAN.
>> THAT’S RIGHT.
LOOK AT, WE HAVEN’T TALKED ABOUT
IT TODAY, IN THE STUDENT LOAN
MARKET AS WELL, RIGHT?
DAGEN: RIGHT.
>> ONE OF THE REASONS THAT THE
DEMOCRATS WANTED TO GET AHOLD OF
STUDENT LOANS, KEEP IN MIND THAT
WAS PART OF OBAMACARE, PART OF
THE AFFORDABLE CARE ACT, TAKE
MONEY MAKE SPENDING OFF STUDENT
LOANS, USE THAT PROFIT TO MAKE
FOR THE AFFORDABLE CARE ACT.
LOOK THAT UP, I’M NOT MAKING
THAT UP.
NOW THEY HAVE CONTROL OVER.
WE HIKE YOU, SO YOU DON’T HAVE
TO PAY YOUR MONEY BACK.
WE DON’T LIKE YOU, YOU HAVE TO
PAY YOUR MONEY BACK.
IT IS POLITICIZATION OF CREDIT.
PART OF WHAT THE DEMOCRATS
WANTED FOR A LONG TIME.
EVERY TIME A BANK FAILS, IT
GIVES THEM A CHANCE TO MOVE
THINGS IN THAT DIRECTION, THAT
IS BAD LONG TERM FOR THE
COUNTRY.
SEAN: POINT OF CLARIFICATION,
WHEN MERCK AND I WERE IN
CONGRESS WE TRIED TO ADDRESS
THIS PROBLEM, TAKING POWER AWAY
FROM THE GSEs.
WE WERE UNSUCCESSFUL.
>> I WAS NOT POINTING AT YOU.
SEAN: WE WERE JUST TRYING TO BE
CLEAR.
TITLE 42 IS SET TO END NEXT
WEEKEND.
THE WHITE HOUSE IS PATTING
ITSELF ON THE BACK.
ILLEGAL IMMIGRATION IS DOWN?
>> HUMANE WAY, THE PROGRAM HAS
BEEN SO SUCCESSFUL IT HAS, WHEN
IT COMES TO ILLEGAL MIGRATION
YOU’VE SEEN IT COME DOWN BY MORE
THAN 90%.
BUT WE KNOW THAT MORTGAGE ACTION
NEEDS TO BE TAKEN.
IT HAS TO BE LEGISLATIVE ACTION.
WE’LL CONTINUE TO CALL ON
CONGRESS TO DO THAT.
SEAN: MICK, YOU SERVED IN THE
WHITE HOUSE, THIS IS BOLD-FACED
LIE.
ILLEGAL IMMIGRATION HAS
EXPLODED.
HOW DO THEY GET AWAY WITH LYING
TO THE AMERICAN PEOPLE?
ILLEGAL IMMIGRATION DOWN 90%?
>> ASIDE FROM THIS NETWORK, ONE
OR TWO OTHERS NO ONE WILL PRESS
HER ON THAT.
THE PRESS IS DOING MEDIA
DISSERVICE TO THE COUNTRY WHEN
THEY ALLOW THOSE TYPES OF
ANSWERS BE GIVEN WITHOUT PUSHING
BACK.
IT IS NOTEWORTHY THAT EVERY TIME
THE WHITE HOUSE WANTS TO DO
SOMETHING THEY DON’T NEED
CONGRESS.
WHEN THERE IS SOMETHING THEY
DON’T WANT TO DO, WE’RE WAITING
ON CONGRESS WHICH IS EXACTLY
WHAT IS HAPPENING HERE.
LOOK, I DON’T THINK KARINE
JEAN-PIERRE HAS MUCH
CREDIBILITY.
I PAY ATTENTION.
IT IS A SHAME WE DON’T HAVE AN
ACTIVE MEDIA PUSHING BACK WHEN
SHE SAYS THINGS THAT ARE ABSURD
LIKE THAT.
THAT IS DISCUSS NOT RIGHT.