Sunday, January 25, 2015

"And What Am I - A Potted Plant !?!"

Chief Legal Eagle
Mr. Michael McKenna is the General Counsel of the NCUA; has been with the Agency for over 25 years; and has held the top legal position for the last few.  He is one of the highest paid lawyers in all of Federal government.

Don't know Mr. McKenna on a personal basis; but would assume from his resume, background, experience, and current position, that he is probably the # 1 U.S. expert on the Federal Credit Union Act (FCUA) and the rules and regulations controlling federal credit union supervision - or should be! 

After all, he has spent a lifetime focused specifically on credit union statutes and rules; has helped draft and craft many of those laws; and is intimately familiar with the logical subtleties and historical compromises underlying their promulgation.  

"RBC"(Ringling Bros. Circus)

As you may have noted, there is "a slight disagreement" on the legality of NCUA's rule-making in the area of risk-based capital (RBC). Who is right concerning the legality of RBC is open to debate, but few will dispute that NCUA, over the last two years, has played the clown on the RBC rule repeatedly - and convincingly!  

Three questions come to mind when listening to the legal arguments:

1.)  What is Mr. McKenna's , the #1 U.S. FCUA expert, opinion on the legality of RBC?

2.)  Why would Chair Matz feel compelled to pay an outside law firm $150,000 "to do my own due diligence", when she had Mr. McKenna sitting down the hall?

3.) Given that extraordinary $150,000 outside legal expense, can you determine which of the following is...

Saturday, January 24, 2015

A Softer, Gentler RBC Rule...


... fondly called "RBC #2" !!! 

But if you'll study it a little more 
closely you will quickly notice that...

Friday, January 23, 2015

Pants On Fire...

The Chief Architect

"You spoke NCUA listened." 

So spake Mr. Larry Fazio, NCUA's Director of Examination and Insurance, in a January 21, 2015 opinion piece ("Agency's Revised RBC Rule Responds To Stakeholders...") in the Credit Union Journal.  Mr. Fazio is a most senior executive in the NCUA, a federal government agency "of the people, by the people, and for the people" - a position of high importance and responsibility, requiring the utmost in honesty and integrity.

Mr. Fazio was the principal author and architect of the 2014 RBC #1 proposal which so painfully demonstrated "a gap" in NCUA's capital/risk assessment capabilities and blew holes in NCUA's credibility all the way from Main Street Mid-America to the front benches of Capitol Hill. But in fairness, Mr. Fazio also provided the leadership on NCUA's recent "scrap-salvage-save face-damage control" reissue of RBC #2.  "You spoke NCUA listened."

Mr. Fazio, in addition to his opinion piece editorials, has already become a webinar rock-star and trade association pontificator on the "great improvements" NCUA has made in the new RBC proposal, such as higher asset thresholds to qualify ($100 million), lower overall capital and risk weight levels, longer implementation period, and "removing interest rate risk components from the risk weights".     "You spoke NCUA listened."
I smell something...

But, while Mr. Fazio was so diligently and earnestly promising that NCUA had listened, seen the light, and changed its ways on interest rate risk in connection with risk-based capital, did you happen to notice the other little item approved at the January 15, 2015 NCUA Board Meeting?

Thursday, January 22, 2015


Q:  How many of the good folks at NCUA does it take to screw in a lightbulb?

Duke Street, Alexandria

Or to screw up the Federal Credit Union Act?

Wednesday, January 21, 2015

On Today's RBC #2 Webinar...

"Just be thankful we're not getting
all the government we're paying for."

"If stupidity got us into this mess, then why can't it get us out?"

- Will Rogers

How ya' doing on reading the 450 page draft of RBC #2??
(See above)

Tuesday, January 20, 2015

Flights of Fantasy...

Fully Qualified...!!

To believe that working at the 
NCUA qualifies you to run a credit union, is like thinking you are an NFL star because you play Fantasy** Football.

** fantasy - adj., definition: "the faculty or activity of imagining things that are impossible or improbable."
Synonyms:  make-believe, charade, farce, mockery, fabrication. See also:  "RBC#1". 

Monday, January 19, 2015

All Of God's Children....

Sometimes it's important to...
"Stand in The Way."

(Is there anything more important?)

"Now is the time to make real the promises of democracy."

"Now is the time to make justice a reality for all of God's children."

          - Martin Luther King, Jr.

Sunday, January 18, 2015

Common Sense

"My motive and object in all my political works, beginning with Common Sense, the first work I ever published, have been to rescue man from tyranny and false systems and false principles of government, and enable him to be free."
      ..... Thomas Paine, 1806.

Friday, January 16, 2015

Danger !! Danger !! Soaring Interest Rates Update...

Potential For Descending Sky Alert 
Listen Up !!

SQUAWK!!!!   SQUAWK!!!!   SQUAWK!!!!

                                       01/02/2014       12/31/2014       1/16/2015

                 5-yr T-bill      1.72%               1.65%               1.29%

                10-yr T-bill      3.00%              2.17%               1.83%

                30-yr T-bill      3.92%               2.75%               2.44%

... how robust !!!
(Soar, Baby, Soar!)