More than a few seasoned financial observers say Bank of America is in desperate financial shape and its problems are worsening. Its acquisition of Countrywide was disastrous and left them with hundreds of billions of toxic glop on their books. In addition, they are getting hammered by a multitude of lawsuits and investigations over their allegedly dicey business practices. All of this has created a perfect storm for them, a storm some think they will not be able to survive and still remain intact.  The birth of the original Tea Parties as well as Occupy Wall Street is a response to financial calamities like BofA that continue to stumble along after huge infusions of money from the federal government.

BofA was formed in California and many still think it's based in here. It's not. The bank was bought by NationsBank of Charlotte, NC in 1998 where it is headquartered now. They took the name Bank of America for the new entity.  But it still has a huge presence in California, as well as nationwide. In addition to the ill-fated Countrywide purchase, they have also acquired Security Pacific, Merrill Lynch, FleetBoston, and others in the past ten years. They are one of the big four banks, along with JPMorgan Chase, CitiGroup, and Wells Fargo.

But BofA has problems, big ones. California Attorney General Kamala Harris subpoenaed them last week over their toxic mortgage securities and whether they were sold to institutional investors under false pretenses. If so, then triple damages can be assessed. Further, she has pulled California out of a 50 state agreement with major banks including BofA on foreclosure settlements, saying than banks weren't offering enough.  Several other states also withdrew, making that agreement all but dead. Bank of America already has massive losses on Countrywide from lawsuits. Harris' actions will increase pressure on them.

BofA also wanted to make an $8.5 billion settlement with institutional investors, again related to Countrywide. But a federal judge last week nixed it, saying it needed to be settled in federal, not state court. This means everything starts over again.

The financial blogosphere was enraged last week, and rightfully so, over news that BofA was moving $53 trillion (yes, trillion) of risky notional derivatives to a unit where it would be insured by the government. That means if this securitized garbage goes really bad, then we the taxpayers will be left with the bill. Naked Capitalism says this is "a desperate (or at the very least, remarkably inept" move by the bank to stave off their looming crisis. The Fed favors it, FDIC opposes it. BofA says they don't need permission to do it. If this doesn't make you angry, you aren't paying attention.

Former S&L regulator William Black says Not with a bang, but a whimper: Bank of America's death rattle in his detailed history of how BofA got to where it is now. He also says that thousands of bank executives went to prison during the S&L scandal of the 1980's yet we've still yet to see the first criminal indictment of a bank executive during this crisis. He also coined the phrase 'control fraud', which is when a highly ranking person in a corporation or country deliberately subverts the rule of law by getting rules changed so they can perpetrate fraud and enrich themselves. In a key phrase he says, failure of the entity is not failure of the control fraud.

The original Tea Party, the one founded by Karl Denniger, was founded specifically in outrage against the bailout of big banks by the government. On this, there is plenty of common ground with the Occupy movement.