I think there are serious, fundamental issues with our economy which are likely to lead (actually continue) to great despair for millions.
Today I saw an article at Some Assembly Required which summed up so well what I feel is going on.
From Some Assembly Required:
First Principals: In the US, housing is central to the economy, to the financial system, and to the society. It has failed. And with it the consumer economy has lost its main support, so, too, have employment, taxation, the social contract and governance. The replacement, in each case, is fear. And not far behind the fear is the gathering recognition that doom, that collapse is just off stage, waiting.
There is no rational way to discuss one aspect or another of the hydra facing us. Yes, fraudulent affidavits were used to keep foreclosure mills running. Why not? The mortgages were frauds at inception – deceitful loans made to deceitful buyers. The fraudulent mortgages were quickly passed on to the slice and dice middle-men who knew what they were cutting up was fraudulent but didn't care as long as they could pass it on – nudge, nudge, wink, wink – as MBS given fraudulently high ratings by firms that were no better than houses of prostitution. A “service” industry grew up that was designed to keep all the players fat, dumb and happy until they were starved, very unhappy, but still greedy, still dumb.
The housing market has disappeared into the hated federal government – no one else would lend money into such a market, nor offer MBS stuffed with fraudulent documents and backed by no-loss covenants. All the banks do is collect fees and distribute bonuses.
The rule of law disappeared along with the magic of deregulation – what are laws except inconvenient constraints on profits? Common sense left town years ago. Readers ask why I've not written about the 'foreclosure fraud', this is why: It is too big to grasp. We are living in a world made by fraud and it cannot but all fall down. Anyone who thinks this is all trivial technicalities is wrong.
I truly thought our doom would flow from the increasing decline in petroleum production, years from now. I was wrong.Yes it is a very depressing assessment of our current state. But I ask you, do you feel that we, the people of the United States, are doing the best, electing the best and doing more than what we have done in the past?
It is not enough to simply complain (Tea Party) and wish for things to go back to some hypothetical place that actually never existed.
We need real leaders. We need real vision.
It does seem that politics has turned into some twisted form of sport. We have idiots face off against each other, who will thne do exactly nothing differently than anyone before them.
ReplyDeleteI would not buy a house now for any reason. Prices bear no relationship to reality and the feds (actually you and me) own every mortgage and are desperately trying to keep prices up.
During the Great Depression housing fell by over 25% below historical norms. We have still not seen prices return to historical norms. Why can't prices fall by another 100%?
Buyer beware.
How bad?
ReplyDeleteThe law firm of David J. Stern in Plantation, Fla., for instance, assigned a team of 12 to handle 12,000 foreclosure files at once for big financial companies such as Fannie Mae, Freddie Mac and Citigroup, according to court documents. Each time a case was processed without a challenge from the homeowner, the firm was paid $1,300. It was an unusual arrangement in a legal profession that normally charges by the hour.
The office was so overwhelmed with work that managers kept notary stamps lying around for anyone to use. Bosses would often scream at each other in daily meetings for “files not moving fast enough,” Tammie Lou Kapusta, the senior paralegal in charge of the operation, said in a deposition Sept. 22 for state law enforcement officials who are conducting a fraud investigation into the firm. In 2009 alone, Stern’s law firm handled over 70,000 foreclosures.”
“When Wall Street banks securitized, packaged, sold, and resold mortgages, they created a system where it is often impossible to figure out who actually owns mortgage notes and therefore has the authority to foreclose on properties. But the big banks are getting tangled up in their own web. Recent events have exposed a handful of banks that are throwing families out of their homes even though they don’t have the mortgage note that proves they actually have a legal right to do so. There have been instances of two banks trying to foreclose on the same home, and in at least two cases, of a bank trying to foreclose on a house where the homeowner had never even taken out a mortgage with anyone in the first place.”
ReplyDeleteThis is frightening. I presume the foreclosure situation is the same worldwide if all those mortgages were sliced and pedaled all over.
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