How far will a politician go to boost their image? Apparently for New York Senator Charles Schumer, bringing down a bank is not beyond the boundaries.
In a Friday evening press release, the Office of Thrift Supervision (OTS) announced the closure and takeover by the FDIC of $32 billion IndyMac Bank (IMB). The California-based savings and loan has become the third biggest bank failure in US history. In the press release, the OTS states:
“The immediate cause of the closing was a deposit run that began and continued after the public release of a June 26 letter to the OTS and the FDIC from Senator Charles Schumer of New York. The letter expressed concerns about IndyMac’s viability. In the following 11 business days, depositors withdrew more than $1.3 billion from their accounts."
“’This institution failed today due to a liquidity crisis’,” OTS Director John Reich said. “’Although this institution was already in distress, I am troubled by any interference in the regulatory process’.”
A fact sheet accompanying the OTC’s press release states:
“The pressure on IndyMac required time to be relieved. Negative news coverage and a subsequent deposit run beginning on June 27, 2008 took that time away. The deposit run followed the release of a letter from Senator Charles Schumer to the FDIC and OTS on June 26, 2008. The letter outlined the Senator’s concerns with IndyMac. The institution did not have sufficient access to liquidity to withstand the deposit run.” Under “Recent Deposit Flows” on page one of the Fact Sheet, Inflows in the three days prior to June 27 were $31.2 million. Outflows beginning June 27, 2008 were $730.2 million through July 7 and $1.3 billion through July 10.John M. Reich, the OTS’s director, told reporters: “When a member of the United States Senate makes such a statement, it frightens depositors.” Would the institution have failed without the deposit run? We'll never know the answer to that question."
IndyMac (Independent National Mortgage) was originally set up by Countrywide Financial in 1985, but the two entities severed ties in 1997. Although IndyMac sold most of its loan originations, it specialized in Alt-A mortgages (loans for borrowers with blemished credit or borrowers not providing complete documentation). Significant losses from the housing downturn and subsequent credit crisis had severely affected the bank’s operations. IndyMac stopped originating non-conforming mortgages in November 2007.
While Senator Schumer points the blame at the OTC for “not doing its job,” I’d like to know why Senator Schumer was at a loss for words during the housing boom years of no doc loans, 110% financing, 1% Fed Funds rate, etc? As an elected official, Senator Schumer has a responsibility not to incite panic. The Senator’s words have adversely affected IndyMac employees and their families, individual and business customers, and shareholders. The entire US banking sector will be affected if the FDIC has to raise insurance fees to cover the estimated $4-8 billion cost to the FDIC’s insurance fund.1
As a politician with His Sun (self-identity) conjoined with Venus (banking) in Sagittarius (ethics/law), Schumer’s committee memberships reflect his interests in banking and the legal system. This planetary signature also reflects his love of extravagant self-promotion, since his Sun and Venus challenge Sagittarius’ ruler Jupiter. This is why the Senator’s remarks about IndyMac are particularly damaging. Schumer is a member of the Senate Finance, Banking, Housing & Urban Affairs, Judiciary, and Rules Committees. He is a Ranking Member of the Oversight/Courts Subcommittee and the Economic Policy Subcommittee.
A graduate of Harvard Law School, Schumer clearly understands the power of words and their impact. Schumer’s Mercury (communication) is in Sagittarius. People with Mercury in this sign have a tendency to be too candid and can exhibit a lack of discretion concerning sensitive information. Any concerns Schumer had regarding a financial institution and the government’s regulation of it should have been aired in private. If there had been a lack of cooperation from any private investigation conducted by the Senator, then he should have aired it before the appropriate committee for action. Since he has spent his entire career as an elected official, Schumer cannot try to feign ignorance that his words couldn’t have possibly caused a public reaction.
Schumer’s letter to the FDIC and OTC regarding IndyMac was written on June 26 as the Last Quarter Moon in Libra challenged Schumer’s progressed2 Mercury in Capricorn, motivating him to communicate (Mercury) as an authority figure (Capricorn) his concerns about the bank. Mars in Leo was opposing Schumer’s progressed Mars as well as the USA’s natal Moon in Aquarius. The Moon represents real estate and the general public. With his progressed Mars conjoining the USA Moon, Schumer no doubt sees himself as an activist on behalf of the American people to protect them from weakened financial institutions. The Last Quarter Moon challenged the USA’s Jupiter in Cancer, reflecting the huge financial ramifications of Schumer’s letter. Uranus in Pisces went stationary retrograde3 that day, affecting the challenging alignment in the USA chart between Mars and Neptune. This represents allegations and rumors (Pisces) sending shockwaves (Uranus) that cause people to take quick action (USA Mars in Gemini) by pulling their money out of a financial institution, fearing its dissolution (USA Neptune in Virgo). Since Gemini is a dualistic sign, action has taken place in the stock market as well.
Senator Schumer’s natal Mars in Capricorn opposes natal Uranus in Cancer. This leads him to aggressively defend his integrity whenever challenged. Unfortunately for the Senator, transits to his natal and progressed charts show potential questioning of his actions, particularly around July 15, 18, 21, August 6, and 16. Saturn in Virgo will challenge his natal Mercury on September 7 and Jupiter in Capricorn will move stationary direct, conjoining his natal Mars the following day, increasing the intensity. Pluto in Capricorn will challenge Schumer’s Saturn in Libra at the end of the year, an influence that potentially could transform his standing.
Charles Ellis Schumer: November 23, 1950 time unknown Brooklyn, New York.
USA: July 4, 1776 5:10 PM Philadelphia, Pennsylvania.
1 “Crisis Deepens as Big Bank Fails”, Wall Street Journal July 12, 2008.
2 A predictive method that mathematically calculates the planets forward in time.
3 Planets do not really move backward, but appear to from Earth’s vantage point.