http://www.brasschecktv.com/page/291.html

Mortaging America's future
for a quick buck

It's one of the most amazing displays of journalistic incompetence and malpractice in recent memory.

The US news media failed to draw the obvious connection between the bizarre federal law enforcement investigation and leak campaign about the private life of New York Governor Spitzer and Spitzer's all out attack on the Bush administration for its collusion with predatory lenders.

While the international credit system grinds to a halt because of a superabundance of bad mortgage loans made in the US, the news media failed to cover the details of Spitzer's public charges against the White House.

Yet when salacious details were leaked about alleged details of Spitzer's private life, they took that information and made it the front page news for days.

To the 9/11 fiasco, the Iraq War, the travesty of the federal response to Hurricane Katrina, and the shredding of the US Constitution, we can now add a deliberate and reckless undermining of the credit and banking system of the US to its list of "accomplishments."

Hey, do you think it's a coincidence that a Bush was involved the last time the US banking industry fell into a black whole because of White House-inspired fraud?

There's actually a lot of money to be made blowing up banks. Here's how Bush Sr. and his friends profited:


Bush, the Mafia, the CIA and the Savings and Loan Scandal

They think that McSame is Bush. It's okay. Everyone has the right to think what they want. We know better. Too bad they don't realize McSame voted liberally throughout his voting history, they might realize he's a decent guy over Barry. They are also delusional when it comes Barry taking money from lobbyist to the tune of $138 million last year. Nah! That would nevah happen right? lol Sure McSame has taken his fair share, but if you added it all up, Nobama took more. Nobama's money also came from executives that made off with millions from faulting mortgage lenders.

STFU

Yeah...not even the courtesy to wait a week. They judged peoples reaction and said .. "hey, they're buying it...let's do some more while the getting's good". This is getting down to the nubbins. Now it's half a trillion dollars...you sit by and they watch if you eat it. Eat it, And it's one trillion next week, and on and on. There's gonna be no prosecutions, this was well planned ahead of time. Agreements were in place long ago. The media play is "failed mortgages"...that's the cover.

Money doesn't disappear...it's somewhere in the Bahamas by now. And the best I'll ever see is one corporate head go to jail. That's it. That's supposed to satiate us? Fncking 80's bank rip-offs equal Bush Brother...Neil(?), fncking 911 towers going down with Bush brother in charge of security, now the final rape of America by these biatches. Seems that I have a talent for looking into the future. I warned the knuckle draggers here on PP about corruption, Iraq, Iran, Enron, mafia style military use ....you name it years ago while the racists moron were begging for the blood of the innocent. With great disapointment I have been spot on and would like very much to see the end of the downward spiral into the sheit-er.

Now that they have built refuges in Paraguay or somewhere down there, it's so long you suckers. Still a few months left to absolutely fnck us if this isn't enough. Guaranteed...there's more fnck to come. Hunker down.

What a fuggin' idiot.

Well Hank you tell me where they stashed the money that we now don't have. It's obvious that American banks don't don't have it. They need to take my Social Security trust fund to operate. So who's wearing the foil?

Here I was thinking all those houses that sold at crazy prices profitted the seller (Joe Citizen), who then spent the (easy come-easy go) proceeds on "stuff" made in China. Wong Dong has the money, shall we send bombs ?

better dust off your fallout shelter Hookum.

This is a well orchestrated operation. Make no mistake about it. The one man who was a roadblock was Elliot Spitzer, NY Gov. Atormey general with a long, long, history of understanding these complicated crimes, and prosecuting dozens of them. He surcumed to the set up that took him down. That was an important part that had to happen before this [censored] came down on our heads. It's only ironic that Spitzer was replaced by an un-elected blind man. Now they're free and clear to continue the rape of society until it comes (to fruition). We're close. We're close to the absolute bottom...

A short explanation of how we got to where we are

Today's banking crisis is the THIRD trillion dollar plus US-caused financial meltdown in the last twenty years.

Each one of these crises came into being through the same basic mechanism...the fraudulent over-valuing of financial assets by Wall Street - with a "wink and a nod" (and sometimes a lot more)from the White House and Congress.

The fraudulently valued assets stimulate the economy, impart the illusion of health and then, inevitably, the fraud goes too far and the whole house of card comes painfully crashing back to earth.

The three trillion dollar plus frauds were:

Fraud #1: The so-called "Savings and Loan Crisis" of the late 80s

Fraud #2: The so-called "Tech Bubble" of the late 90s

Fraud #3: The so-called "Credit Crisis" of today

*** How the scam works

The mechanism of these frauds is simplicity itself...

...Take a shaky financial asset and blow up its value and then sell as much of it as you can.

In the "Savings and Loan Crisis," the instrument was junk bonds.

In the "Tech Bubble" it was Internet stocks.

In the "Credit Crisis" it was individual mortgages collected into pools and then re-sold to investors.

In each case, normal, well established "bread and butter" financial principles were consciously thrown away by Wall Street with no hint of protest from federal regulators.

***The "Savings and Loan Crisis" dissected

Junk bonds caused the Saving and Loan crisis which resulted in the US taking over the assets of hundreds of banks and selling them back over time to the marketplace at fire sale prices.

Junk bonds, which caused the "Savings and Loan Crisis" were shaky bonds that were pumped up by deliberate misrepresentation and what I call "staged dealing."

Bonds get their value from two things: the amount of interest they pay and how safe they are.

"Junk" bonds have to pay higher interest because they are less safe. Therefore, until the "Savings and Loan Crisis," savings and loan banks banks were not allowed by law to buy them and call them assets.

Reagan/Bush changed all this and then a group of Wall Street fraudsters used the new loophole to kick off an orgy of junk bond creation and junk bond selling to banks and insurance companies.

The crooks would deal the junk bonds back and forth amongst themselves thereby establishing their "value" and then they'd sell them to outsiders. The bonds then became "assets" which could be borrowed against and leveraged to buy even more bonds.

When the bonds failed, the banks failed and in stepped the US government to "fix" the problem that it created at the cost of at least one trillion dollars to US tax payers.

Deja vu, eh?

***The "Tech Bubble" dissected

The instrument of fraud in the "Tech Bubble" was Internet stocks, start ups in particular.

A stock gets its value from the underlying company's sales, its growth and its overall prospects for the future.

Pre-tech bubble, companies used to have to prove themselves by being in existence for several years before they could be sold on major exchanges. That standard was thrown away during the tech bubble.

To pump of their values, the companies engaged in "staged dealing" just like the junk bond crooks.

Company #1 would "sell" 20 million dollars in banner ads to Company #2 which would in turn "sell" 20 million in banner ads to Company #1.

In fact, nobody sold anybody anything. Company #2 ran ads for Company #1 and billed it for them. Company #1 ran ads for Company #2 and billed for an equal amount.

These should have been called media trades not sales, but Wall Street was happy to claim them as legitimate cash sales and then use the sales numbers to fraudulently value these companies - many of them totally worthless - in the hundreds of millions and sometimes even the billions.

***The "Credit Crisis" dissected

By now, you see how the scheme works.

It's not complicated at all.

You take near worthless pieces of paper (junk bonds, stock of start up Internet companies, etc.) and declare them to be good as gold.

Then you create as many junk bonds and Internet start up stocks as you get and sell them as fast as you can.

In the case of our current crisis, the instrument of fraud was so-called sub-prime mortgages.

Previously, sub-prime mortgages had very little trading value. Only people in the sub-prime industry itself dealt in them and for good reason. They're tricky to value and packed with financial peril.

But Wall Street changed all that.

Wall Street said: "If we take LOTS of these mortgages and assemble them into large pools and then slice and dice the pools in various ways, we can sell the slices to banks and other investors as AAA paper."

It sounds crazy, doesn't it?

If the underlying pieces of paper are garbage, how does assembling a whole bunch of garbage into one place make it "better?"

It doesn't, of course, and this is a principle even a three year old child can understand.

But greed and the need to pump up a shaky economy for propaganda purposes are two very strong motivators.

Banks created these mortgage pools, sold them to each other, and they by virtue of these "staged sales" declared them valuable.

Do you recognize the pattern now?

If you do, then you are now smarter than all the assembled j@ck@sses who do financial reporting because they apparently can't - or won't.

This is the THIRD trillion-dollar plus fraud driven financial meltdown in twenty years and apparently no one in the financial news media can see how it happened.

***But there's more...

Junk bonds were mass manufactured as fast as the crooks could invent them. Ditto for Internet stocks.

But how did hundreds of billions of dollars worth of "toxic" mortgages suddenly come into being?

Why did the mortgage industry change its lending standards so radically and so suddenly to make their creation possible?

And why did real estate lending regulators in all 50 states - because real estate lending is a STATE-level issue not a federal - go along with it?

Here's where it gets very interesting...

The fact is state-level lending regulators were VERY concerned about what was going on. They have been for years.

And they not only expressed their concern clearly, they also took SERIOUS concerted legal action to stop lenders from making bad real estate loans to their citizens.

(Most of the sub-prime loans in the news so much today were designed to screw the people who borrowed the money and can rightly be called "predatory" loans.)

Guess who stopped the states from enforcing their own time-proven real estate lending laws and thus created the raw material that made the current "Credit Crisis" possible?

*** The trillion dollar plus question

If you're a US taxpayer, you're going to pay for this fraud so you might as well know who did it to you.

His initials are GB.

You know him well.

But perhaps more interesting is the name of the person who single-handedly rallied first state attorneys general and then fellow governors to fight the creation of these loans and who in the process became Public Enemy #1 to the Bush Administration...

His initials are ES.

And you will *finally* understand why he was quickly and permanently assassinated politically earlier this year.

Had ES been allowed to "live," he would have been in position to remind everyone every day of who made the current meltdown possible.

Instead, he was silenced very effectively. Not with a bullet in the back of the head, but the net effect was just the same.

So effective was his assassination that no one can even mention his name in connection with today's crisis without risking ridicule, or worse.

Last note:

The crisis this fraud has created is *exponentially* bigger than the S & L and Tech Bubble combined.

It's not going to be resolved by a quick "patch up" and will likely have the same impact on the current generation that the depression of the 1930s had on its parents, grandparents and great grandparents.

Michael Savage brought up the Spitzer-Wall Street connection this week. Seems possible. If you think of the dollar amounts some of the higher-ups on Wall Street are making, nothing is impossible.

+2

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/13/AR2008021302783.html

Predatory Lenders' Partner in Crime
How the Bush Administration Stopped the States From Stepping In to Help Consumers

By Eliot Spitzer
Thursday, February 14, 2008; Page A25

Several years ago, state attorneys general and others involved in consumer protection began to notice a marked increase in a range of predatory lending practices by mortgage lenders. Some were misrepresenting the terms of loans, making loans without regard to consumers' ability to repay, making loans with deceptive "teaser" rates that later ballooned astronomically, packing loans with undisclosed charges and fees, or even paying illegal kickbacks. These and other practices, we noticed, were having a devastating effect on home buyers. In addition, the widespread nature of these practices, if left unchecked, threatened our financial markets.

Even though predatory lending was becoming a national problem, the Bush administration looked the other way and did nothing to protect American homeowners. In fact, the government chose instead to align itself with the banks that were victimizing consumers.

Predatory lending was widely understood to present a looming national crisis. This threat was so clear that as New York attorney general, I joined with colleagues in the other 49 states in attempting to fill the void left by the federal government. Individually, and together, state attorneys general of both parties brought litigation or entered into settlements with many subprime lenders that were engaged in predatory lending practices. Several state legislatures, including New York's, enacted laws aimed at curbing such practices.


What did the Bush administration do in response? Did it reverse course and decide to take action to halt this burgeoning scourge? As Americans are now painfully aware, with hundreds of thousands of homeowners facing foreclosure and our markets reeling, the answer is a resounding no.

Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye.

Let me explain: The administration accomplished this feat through an obscure federal agency called the Office of the Comptroller of the Currency (OCC). The OCC has been in existence since the Civil War. Its mission is to ensure the fiscal soundness of national banks. For 140 years, the OCC examined the books of national banks to make sure they were balanced, an important but uncontroversial function. But a few years ago, for the first time in its history, the OCC was used as a tool against consumers.

In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks. The federal government's actions were so egregious and so unprecedented that all 50 state attorneys general, and all 50 state banking superintendents, actively fought the new rules.

But the unanimous opposition of the 50 states did not deter, or even slow, the Bush administration in its goal of protecting the banks. In fact, when my office opened an investigation of possible discrimination in mortgage lending by a number of banks, the OCC filed a federal lawsuit to stop the investigation.

Throughout our battles with the OCC and the banks, the mantra of the banks and their defenders was that efforts to curb predatory lending would deny access to credit to the very consumers the states were trying to protect. But the curbs we sought on predatory and unfair lending would have in no way jeopardized access to the legitimate credit market for appropriately priced loans. Instead, they would have stopped the scourge of predatory lending practices that have resulted in countless thousands of consumers losing their homes and put our economy in a precarious position.

When history tells the story of the subprime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners, the Bush administration will not be judged favorably. The tale is still unfolding, but when the dust settles, it will be judged as a willing accomplice to the lenders who went to any lengths in their quest for profits. So willing, in fact, that it used the power of the federal government in an unprecedented assault on state legislatures, as well as on state attorneys general and anyone else on the side of consumers.

The writer is governor of New York.

Gee that's odd!


By STEVEN A. HOLMES

Published: September 30, 1999

In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets -- including the New York metropolitan region -- will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.

Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

In addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers. These borrowers whose incomes, credit ratings and savings are not good enough to qualify for conventional loans, can only get loans from finance companies that charge much higher interest rates -- anywhere from three to four percentage points higher than conventional loans.

''Fannie Mae has expanded home ownership for millions of families in the 1990's by reducing down payment requirements,'' said Franklin D. Raines, Fannie Mae's chairman and chief executive officer. ''Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.''

Demographic information on these borrowers is sketchy. But at least one study indicates that 18 percent of the loans in the subprime market went to black borrowers, compared to 5 per cent of loans in the conventional loan market.

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's.

''From the perspective of many people, including me, this is another thrift industry growing up around us,'' said Peter Wallison a resident fellow at the American Enterprise Institute. ''If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.''

Under Fannie Mae's pilot program, consumers who qualify can secure a mortgage with an interest rate one percentage point above that of a conventional, 30-year fixed rate mortgage of less than $240,000 -- a rate that currently averages about 7.76 per cent. If the borrower makes his or her monthly payments on time for two years, the one percentage point premium is dropped.

Fannie Mae, the nation's biggest underwriter of home mortgages, does not lend money directly to consumers. Instead, it purchases loans that banks make on what is called the secondary market. By expanding the type of loans that it will buy, Fannie Mae is hoping to spur banks to make more loans to people with less-than-stellar credit ratings.

Fannie Mae officials stress that the new mortgages will be extended to all potential borrowers who can qualify for a mortgage. But they add that the move is intended in part to increase the number of minority and low income home owners who tend to have worse credit ratings than non-Hispanic whites.

Home ownership has, in fact, exploded among minorities during the economic boom of the 1990's. The number of mortgages extended to Hispanic applicants jumped by 87.2 per cent from 1993 to 1998, according to Harvard University's Joint Center for Housing Studies. During that same period the number of African Americans who got mortgages to buy a home increased by 71.9 per cent and the number of Asian Americans by 46.3 per cent.

In contrast, the number of non-Hispanic whites who received loans for homes increased by 31.2 per cent.

Despite these gains, home ownership rates for minorities continue to lag behind non-Hispanic whites, in part because blacks and Hispanics in particular tend to have on average worse credit ratings.

In July, the Department of Housing and Urban Development proposed that by the year 2001, 50 percent of Fannie Mae's and Freddie Mac's portfolio be made up of loans to low and moderate-income borrowers. Last year, 44 percent of the loans Fannie Mae purchased were from these groups.

The change in policy also comes at the same time that HUD is investigating allegations of racial discrimination in the automated underwriting systems used by Fannie Mae and Freddie Mac to determine the credit-worthiness of credit applicants.


Sounds like they are all a bunch of bottom feeders. No one is rising to the top on this one.

I worked for the COC back in 1972. And back in the day they were 100% non political and did a strong job of regulating the banks. Today they have one man where we once had five . It's obvious they have lost their regulatroy mission. Not a big surprise. The Bush admin, has many more political appointees than any previous administration. When you reward your incompetent cronies, like he did with Brown at FEMA, this is what you get.