Why do I get the feeling that the US is becoming more like the mafia every day? Without having to worry about Federal RICO and other laws, of course.
Congress will pass a bill to “forgive” banks the potentially criminal errors made in foreclosure proceedings, a senior CNBC editor predicts.
In a blog column Friday, John Carney argues that lawmakers in DC won’t allow the country’s largest issuers of mortgages to suffer financial losses following revelations of numerous mishandled foreclosure proceedings, especially when bailing them out this time “won’t cost taxpayers a dime.”
Here’s what is going to happen: Congress will pass a law called something like “The Financial Modernization and Stability Act of 2010” that will retroactively grant mortgage pools the rights in the underlying mortgages that people are worried about. All the screwed up paperwork, lost notes, unassigned security interests will be forgiven by a legislative act….
The [foreclosure] crisis is not driven by economics. It is driven by legal rights. And there’s simply zero probability that the politicians in Washington are going to let Bank of America or Citigroup or JP Morgan Chase fail because of a legal issue.
Carney predicts that the lame-duck session of Congress following this November’s elections will pass the law. “Every member of Congress … who has been voted out of office will cast a vote for the bill. And the President will sign it.”
BofA and the others are going to FAIL – because of a couple of months of catching up on paperwork? Har!
Somehow, I think these banks are not quite that frail. Believing one blogger at CNBC who says that – is more than a bit of a stretch.
I doubt if that would even be advanced as rationale by whichever lobbyist-beholden pols who advance such a bill.
It is to laugh.
Not that such a bill won’t be introduced. It might be done to cover the bureaucratic failings of the beancounter brigade which infests American banking as thoroughly as it does the Republican Party.
The prime reason is that they often lose track of the original note in the course of selling and reselling mortgages. But, even that isn’t much of threat to foreclosures – because the average dweeb who jumped at the chance of getting a sub-prime mortgage doesn’t know they have a right to challenge the foreclosure on the grounds of the current mortgage holder’s inability to produce the note.
And the Dems claim Republicans are in the pockets of big business?
HAR!
Isn’t capitalism great?
Major banks and mortgage documentation are misdirection. Real monetary disaster and machinations are at Fanny and Freddie, look what lame duck Congress does for them as they certainly will.
As a member of the italian-american community I strongly object to the portrayal of any government corruption as Mafia like.
The Mafia is an organized crime outfit – nobody could possibly mistake any government since WWII for ‘organized’ crime.
The mafia is democratic, the heads of the families met to decide to wipe out adjective-jimmy, without the input of any Washington lobbyists.
With the mafia there is a clear and effective customers service dept. Admittedly you do have to wait for a don’s daughter to get married but this is still vastly quicker than dealing with the INS.
@4
This isn’t Capitalism this is Oligarchy. Besides which Party is in charge of the government right now? Oh that’s right…
Do you partisan dipshits really want more proof we have a ONE party system of lobbyists?
This is fascism, not mafia.
And what about those mortgage guys signing off on documents they haven’t even read. Who do they think they are, Congressmen?
With Wall Street, it looks like ALL “INVESTMENT” VHEICLES ARE FRAUDS !!! Never forget that Wall Street HAS BEEN CROOKED SINCE IT OPENED IT’S DOORS !!! Just waiting for the “Marks” to come in for a fleecing !!!
“Besides which Party is in charge of the government right now?”
Same party that has always been in charge of government – the corporations with the most money.
Their celebrity endorsement in the whitehouse has about as much to do with running the government as Tiger Woods has to do with running Nike.
“Every member of Congress … who has been voted out of office will cast a vote for the bill. And the President will sign it.”
Call it a job application.
Where’s Bobbo to blame this on Bush and justify this by saying Bush did it too?
Sorry boys, the cards have already been dealt on this one.
Congress has assigned ALL of you a losing hand.
All 5 Aces have been reserved for their friends.
Term limits for every elected position in the US down to Dog Catcher.
A nation of squatters. Is it better than a nation of homeless?
Folks need to wake up. This is a nation of no money. Bank vaults are empty, boomer equity has vanished. Witness the death of consumption. 99 week benefits will stop.
QE2 will go straight into wall street profits from that hyperflationary trash cash into abused foreign bond markets. If this occurs, we will get the money back. To throw back a conservative chant ‘simple its called theft’.
Things will change, Wall street is doomed. Perhaps if food supplies do get disrupted (never from production means) somehow folks will rethink and redo Wall Street out of existence.
Then we will have an American revival. Simple. Stop the import of goods and bring back jobs.
Years back I was chatting to someone from india.
They stated that their country was so crocked that it cost 3 times the value of a home to have it built, because of all the pay offs they had to make.
I told him the USA wasnt any different, as WE Make it LAW, TAX it, and license it to make it legal.
Can I ask?
IF this was YOU on the other end of a contract, would they let you SLIDE? How many of you have been kicked out of homes?
A more serious side-effect of this problem is title insurance (or lack thereof). Most banks require title insurance to get a mortgage. Title insurance protects both the buyer and the lender from loss due to title defects, liens or other matters.
With all the questionable foreclosures, some insurance companies are simply refusing to sell title insurance.
If the foreclosure problems are not resolved, it will simply become impossible to sell any property without a clear record of title.
It was bad enough when banks were loaning money to people who couldn’t pay. Now imagine if the entire real estate market comes to a grinding halt.
Yet another example of the nobles keeping the slaves firmly under their foot. I’m more convinced than ever that the Mega Corporations and the Big Banks run the planet. Heck, Goldman Sachs may as well own President Obama (as well as past presidents as well).
The governments and intel agencies of most nations seem to be nothing more than front groups for these entities to control, pillage and decimate the populace. The governments and their appendages have their own limited volition for their own agendas of course, but ultimately they seem to answer to the Big Banks and Big Corporations.
We can’t have the slaves prosper and be free after all because that would threaten their power base.
We need more Libertarian rebels and less elitist establishment hacks I think.
Derek==it is sad you are so simple minded, though not unusual on this blog. Bush IS responsible for what Bush did and the consequences therefrom = like = a real estate bubble gone bust due to unregulated financial manipulations. Obama IS responsible for what he does = like = signing or not signing a retroactive law. Simple isn’t it? And only a simpleton can fail to recognize the truth.
As to the merits: the borrowers have none. The law already provides on a case by case method a remedy for lenders who have “lost” the note. All other things being equal, changing the law would be the right outcome = course other things are rarely equal so the specifics involved should be relevant, probably rare, but still relevant.
Dismal==I forget the details but have read the fraud/defaults in the Fannies was much lower than in non Fannie programs. Their problem was taking over the debt caused by non-Fannie loans. All part of the perfidy that exists when claims are made “the tarp has been paid back.” Most of what our government pumps out is a lie.
Bobbo,
I don’t get an honorable mention? No disagreements? I do wholeheartedly agree with your last sentence “Most of what our government pumps out is a lie”.
If a thief is never punished for stealing… then they will just keep on stealing. The same holds true for the banks. This just proves that many of our politicians are the bank’s little bitches (so to speak).
Bobbo, you may become a Libertarian Rebel yet my friend.
RSweeney, MikeN
Yep, that about sums it up..
The Don,
My choice would be to have some honest straightforward Libertarians running the place. But in regard to the Mafia – I think we’d actually be better off with the them running things than the last few decades of our politicians… at least the country would actually operate in an efficient manner and we wouldn’t have a deficit. They also generally have a better code of honor than many of our own politicians despite their incidences of violence. How many worldwide has the US killed again? There’d be side effects like gambling, booze, hookers and blow.. hmm.. still sounds better than a police state.
In the 1920s, Benito Mussolini initiated a campaign to destroy the Mafia and assert Fascist control over Sicilian life. Interesting yes?
One good thing to consider as the nation crumbles as that we all inherit the progress of the prosperity years in that we have massive infrastructure, somewhat neglected, and maybe a few more bridges will fall. But the road foundations are still there. The wheat distribution system is still there and food production will still go on even as cars and planes cannot. We will be poor, but fed. Maybe a vege garden craze will start.
The first indication of change back to prosperity will be when the nation decides to stop ‘free trade’ with china.
#6 What changed since the classical gangster days is that it is now so much easier and safer to commit crimes from within an ostensibly legal organization. Everybody just follows orders and nobody gets in trouble.
In OC terms there is a big separation in the nature of the organization once they start to move beyond the authority of the state. It becomes almost a mini-government. That is what has happened to the financial sector.
The traditional Mafia loan is actually a MUCH better deal than the “Pay Day” loans.
–And–
dexton7,
You posit that the big corps and banks have bought/frightened D.C. into submission. I agree.
By saying Libertarianism is the answer you are saying: Nobody follows the rules any longer, answer is to do away with the rules.
The specific rules we are dealing with here are intentional misrepresentation of goods for sale and contract law. Strip those out of a market system and there ain’t much left.
Regulation formed by the regulated and 30 years of disinterested authorities have created a de facto Libertarian market. It sucks, deal with it.
# 24 chris,
I see your point… and it is a valid one. But what good are rules when they are selectively enforced in the first place? I’m not sure what system should replace our failing one. One with more checks and balances than our own may be a start… Do you have any suggestions?
Most republics, while relatively a good system of government when compared to some of the others, seem to fall apart once corruption has eaten enough holes in it. Heck the French on their 3rd or 4th republic right now? As far as disinterested authorities go.. I think that ‘colluding authorities’ might be a more accurate measure of what has happened. This could in fact be declared a global tyranny ‘disguised’ as a Libertarian free market here in the US (and many other nations unfortunately).
And it does suck, but we will ALL have to deal with it – the looming very real potential collapse of our Republic will not discriminate too much on who will be crushed if it falls. Most people won’t believe it until it happens and I sincerely hope that won’t be the case because it will be quite ugly.
I’m glad that we agree on the problem, but what should the solution be?
Q:
What do lawmakers do after ALL the laws are created?
Q:
What company LETS you be paid TWICE for the same job? WE are paying them and the CORPS are making promises.
#25
I think the system is fine, but there is no sense of direction or purpose.
Several hundred billion dollars, at least, was stolen in the US real estate market over the past few years. Fraudulent borrowers should be damaged in civil proceedings and fraudulent lenders should have their contracts voided.
The rest of the world saw this too. We can’t continue to skate by as a lesser crook compared to the competition. A genuine desire to chase down the money would have been valuable.
The US was always seen to be asleep, but hell on wheels when awakened. This time they hit the snooze button.
and
We have let some sectors grow well beyond their utilitarian value. The excess has repeatedly led to a shuddering of the global economy.
The financial system ought to operate like the physical shipping business. To send several tons from one side of the world to another is in the low thousands. This requires breathtaking infrastructure and operates in an extremely efficient manner. The dramatic drop in shipping prices revolutionized the global economy(good and bad).
Why can’t we do that to money?
Strip the public utility parts of the banking system and let Amazon or WalMart(somebody good at logistics) do it. Make decent profits forever.
Everything else in the financial sector would be self-capitalized and live or die by their decisions.