|May 17, 2012||Posted by admin under John Parulis|
What California Governor Jerry Brown Needs To Read:
|May 12, 2012||Posted by admin under Admin|
Hon. Paul Hellyer, former Canadian Minister of National Defense and founder of Canadian Action Party, on “The Bank Of Canada: People’s Bank?”
Public Banking In America Conference, Philadelphia, April 27, 2012
|May 8, 2012||Posted by admin under John Parulis|
Filmed by John Parulis, at the historic first, Public Banking in America Conference in Philadelphis on April 27-28 2012.
|March 29, 2012||Posted by admin under Admin|
Thursday, March 29, 2012 7 – 9:30 pm
David Brower Center 2150 Allston Way, Berkeley
Convened by: Alliance for Humane Biotechnology, California BioSafety Alliance, California Coalition For Workers Memorial Day, Center for Environmental Health, Center for Food Safety, ETC Group, Friends of the Earth, Global Justice Ecology Project, Injured Workers National Network, International Center for Technology Assessment, Movement Generation Justice and Ecology Project, West County Toxics Coalition.
A Risky Development:
The University of California, Lawrence Berkeley National Lab, and the US Department of Energy have unveiled plans to build a high profile biotech laboratory in the East Bay. The lab and associated commercial activity will focus on developing biofuels and other products using synthetic biology: an extreme form of genetic engineering that creates artificial life.
Ground Zero for Syn Bio:
Already a multi-billion dollar field, synthetic biology is fast becoming the next ‘biotech bubble’ with the Bay Area as ground zero for this new industry . The San Francisco Bay Area is already home to over a dozen synthetic biology companies backed by some of the world’s largest energy, pharmaceutical, chemical and agribusiness players as well as “garage biotech” hackers. The next generation biofuels under development are a false solution to our environmental crises. The risks synthetic biology poses to worker safety, public health, social justice, and the environment are poorly understood and are as yet effectively unregulated.
|March 25, 2012||Posted by admin under John Parulis|
Russ Baker on “Power in America:
The Yin and Yang between Secrecy and Democracy” -at the First Unitarian Universalist Society of San Francisco.
March 25, 2012
|February 22, 2012||Posted by admin under Admin|
Speaker CJ Holmes, is real estate expert who has personally handled hundreds of transactions, viewed thousands of properties, and dealt with countless clients and agents. CJ is dedicated to uniting property owners to stop foreclosures. Eight million homes are already foreclosed. Another six million are in the pipeline. One in five U.S. foreclosures is in California. Nation-wide, local governments have lost more than $17 billion in tax revenues due to the housing crisis. An estimated 29% of all homes with mortgages are underwater.
“We need to come together as communities to demand principal and interest rate reductions for every mortgage that is underwater… We must move very quickly and make a huge ruckus,” says speaker CJ Holmes. “If we allow Hedge Funds to get their hands on our homes at these current depressed prices, the billions the 1% already took from us 99% will be peanuts in comparison.
12 STEPS OF BANK FRAUD -from Occupy-Our-Homes.info
CA Courts Rubber-stamping foreclosures by corporations
STEP 1: CHEAT County Recorders’ Offices nationwide: establish MERS (late 1990s)
Using MERS eliminates recording Loan ownership changes at the county recorders’ offices
Using MERS hides these ownership changes from the Public
Using MERS has cheated and still cheats our Counties out of billions of dollars of recording fees
STEP 2: CIRCUMVENT the SEC: use foreign corporations as Securities Vehicles
No SEC regulators; no prying eyes; no inhibitions; no rules
This significantly “Gamed the System” that was put in place to protect Investors from fraud
Fraudulent Securitization Process Video [transcription]
STEP 3: BUY OFF Ratings Agencies: Get AAA-Ratings on Securities PRIOR to
funding the Loans that should have been in the Securities at time of sale
Normally loans are made first, then pooled, then rated as a Security, then sold to Investors.
These Securities were created first, rated without Loans, sold to Investors, then filled with bad Loans designed to fail.
STEP 4: Commit Insurance FRAUD: over-insure the Securities’ Values by 30x,
then specifically design the loans to fail
Insurance was paid to Servicers managing the Securities, not Investors, when the values declined
Ex: AIG credit-default-swaps were used as Insurance for these Securities
These Securities were then filled with Loans “designed to fail” to ensure values would decline
Ex: when a $300,000 loan defaulted, payout is $9,000,000 to the Servicers
STEP 5: CHEAT Investors’ out of Collateral: do not assign Loans to the Securities
after the Loans are made
Loans funded with Investor money were not assigned to the Securities the Investors purchased
Using MERS allows Bank Servicers to change Loan ownership as they choose
Our Loans are Foreclosure Proof?
STEP 6: CHEAT the IRS with a tax dodge: set up Securities as Closed-end
Long-Term qualifying Investments
Use Securities as Open-end Short-term Collateral for large cash deposits (REPOs)
Using MERS to shift Loan ownership at will, allows Bank Servicers to keep up this game
STEP 7: CHEAT Truth-in-Lending Laws (TIL) 1: At Loan funding, Banks lied,
calling themselves Lenders, but they weren’t (Banks are Pretender Lenders)
Money for the Loans came from pre-selling the Securities to Investors
No Bank money has EVER funded any of these securitized loans
Banks only SERVICE these loans and manipulate Loan ownership using MERS
STEP 8: Criminally Disregard TIL 2: pushed Borrowers into Loans Banks KNEW
borrowers could not afford when the Loan reset
This is criminal disregard of the Fiduciary Responsibility required of loan officers
Banks pushed loan officers with every ruse and bonus possible to snag unsuspecting Borrowers regardless of future harm to the Borrower.
STEP 9: CHEAT the Borrowers: create Loans designed to fail on schedule
Example: “NINJA” Loan requirements: no documentation, no income, no job (huh??)
Loan $300,000, 6% teaser interest rate for 2 years; 16% interest rate on month 25 (failure month)
6% teaser rate for 24 months = $1,500/m Interest Only payments for 2 years (affordable)
Month 25: Loan payment “explodes” to $4,000/m (16%/12 x $300,000) and Borrower defaults
STEP 10: STEAL the Investors’ Money: example below (both = $48,000/yr)
$300,000 Loan at 16% interest = 6% interest on $800,000 Investment
$300,000 of $800,000 Investment is used to fund the $300,000 Loan in Step 9.
$500,000 balance of Investment is used for Reserves, Bonuses, and Kick-backs
Reserves: $60,000 for 24 mths difference between $4,000/m due minus $1,500/m Borrower pmts
Bonuses, Kick-backs: $440,000 to loan brokers and bank servicers, other insiders
STEP 11: Fraudulently Foreclose Loan defaults: falsify Loan ownership;
falsify Foreclosure documents
“Pretender Lenders” (Banks) foreclose as if they own the Loans; they do NOT own the Loans
Loan Servicers (Banks) illegally assign Loans to Securities years after these Funds Closed (robosigning fraud not slipups)
60 Min: Fraudulent Foreclosure Docs Video
The REMICs have Failed
STEP 12: CHEAT the US Taxpayer: Use TARP to pay off lawsuits;
get money to do Loan Mods Bank Servicers can’t legally make
Pretender Lenders (Banks) are Servicers with NO authority to modify these loans
Only Loan Owners can modify the Loans.
Since Loans were not assigned to specific Securities, Investors don’t own the Loans either.
Confuse and obfuscate to the max to achieve affordable “settlements” with Fed and States
|February 16, 2012||Posted by admin under Admin|
Who lobbies for the poor, the out of work, the disadvantaged, the homeless and the foreclosed?
|February 9, 2012||Posted by admin under Admin|
As readers may know by now, 49 of 50 states have agreed to join the so-called mortgage settlement, with Oklahoma the lone refusenik. Although the fine points are still being hammered out, various news outlets (New York Times, Financial Times, Wall Street Journal) have details, with Dave Dayen’s overview at Firedoglake the best thus far.
The Wall Street Journal is also reporting that the SEC is about to launch some securities litigation against major banks. Since the statue of limitations has already run out on securities filings more than five years old, this means they’ll clip the banks for some of the very last (and dreckiest) deals they shoved out the door before the subprime market gave up the ghost.
The various news services are touting this pact at the biggest multi-state settlement since the tobacco deal in 1998. While narrowly accurate, this deal is bush league by comparison even though the underlying abuses in both cases have had devastating consequences.
The tobacco agreement was pegged as being worth nearly $250 billion over the first 25 years. Adjust that for inflation, and the disparity is even bigger. That shows you the difference in outcomes between a case where the prosecutors have solid evidence backing their charges, versus one where everyone know a lot of bad stuff happened, but no one has come close to marshaling the evidence.
The mortgage settlement terms have not been released, but more of the details have been leaked:
1. The total for the top five servicers is now touted as $26 billion (annoyingly, the FT is calling it “nearly $40 billion”), but of that, roughly $17 billion is credits for principal modifications, which as we pointed out earlier, can and almost assuredly will come largely from mortgages owned by investors. $3 billion is for refis, and only $5 billion will be in the form of hard cash payments, including $1500 to $2000 per borrower foreclosed on between September 2008 and December 2011.
Banks will be required to modify second liens that sit behind firsts “at least” pari passu, which in practice will mean at most pari passu. So this guarantees banks will also focus on borrowers where they do not have second lien exposure, and this also makes the settlement less helpful to struggling homeowners, since borrowers with both second and first liens default at much higher rates than those without second mortgages. Per the Journal:
“It’s not new money. It’s all soft dollars to the banks,” said Paul Miller, a bank analyst at FBR Capital Markets.
The Times is also subdued:
Despite the billions earmarked in the accord, the aid will help a relatively small portion of the millions of borrowers who are delinquent and facing foreclosure. The success could depend in part on how effectively the program is carried out because earlier efforts by Washington aimed at troubled borrowers helped far fewer than had been expected.
2. Schneiderman’s MERS suit survives, and he can add more banks as defendants. It isn’t clear what became of the Biden and Coakley MERS suits, but Biden sounded pretty adamant in past media presentations on preserving that.
3. Nevada’s and Arizona’s suits against Countrywide for violating its past consent decree on mortgage servicing has, in a new Orwellianism, been “folded into” the settlement.
4. The five big players in the settlement have already set aside reserves sufficient for this deal.
Here are the top twelve reasons why this deal stinks:
1. We’ve now set a price for forgeries and fabricating documents. It’s $2000 per loan. This is a rounding error compared to the chain of title problem these systematic practices were designed to circumvent. The cost is also trivial in comparison to the average loan, which is roughly $180k, so the settlement represents about 1% of loan balances. It is less than the price of the title insurance that banks failed to get when they transferred the loans to the trust. It is a fraction of the cost of the legal expenses when foreclosures are challenged. It’s a great deal for the banks because no one is at any of the servicers going to jail for forgery and the banks have set the upper bound of the cost of riding roughshod over 300 years of real estate law.
2. That $26 billion is actually $5 billion of bank money and the rest is your money. The mortgage principal writedowns are guaranteed to come almost entirely from securitized loans, which means from investors, which in turn means taxpayers via Fannie and Freddie, pension funds, insurers, and 401 (k)s. Refis of performing loans also reduce income to those very same investors.
3. That $5 billion divided among the big banks wouldn’t even represent a significant quarterly hit. Freddie and Fannie putbacks to the major banks have been running at that level each quarter.
4. That $20 billion actually makes bank second liens sounder, so this deal is a stealth bailout that strengthens bank balance sheets at the expense of the broader public.
5. The enforcement is a joke. The first layer of supervision is the banks reporting on themselves. The framework is similar to that of the OCC consent decrees implemented last year, which Adam Levitin and yours truly, among others, decried as regulatory theater.
6. The past history of servicer consent decrees shows the servicers all fail to comply. Why? Servicer records and systems are terrible in the best of times, and their systems and fee structures aren’t set up to handle much in the way of delinquencies. As Tom Adams has pointed out in earlier posts, servicer behavior is predictable when their portfolios are hit with a high level of delinquencies and defaults: they cheat in all sorts of ways to reduce their losses.
7. The cave-in Nevada and Arizona on the Countrywide settlement suit is a special gift for Bank of America, who is by far the worst offender in the chain of title disaster (since, according to sworn testimony of its own employee in Kemp v. Countrywide, Countrywide failed to comply with trust delivery requirements). This move proves that failing to comply with a consent degree has no consequences but will merely be rolled into a new consent degree which will also fail to be enforced. These cases also alleged HAMP violations as consumer fraud violations and could have gotten costly and emboldened other states to file similar suits not just against Countrywide but other servicers, so it was useful to the other banks as well.
8. If the new Federal task force were intended to be serious, this deal would have not have been settled. You never settle before investigating. It’s a bad idea to settle obvious, widespread wrongdoing on the cheap. You use the stuff that is easy to prove to gather information and secure cooperation on the stuff that is harder to prove. In Missouri and Nevada, the robosigning investigation led to criminal charges against agents of the servicers. But even though these companies were acting at the express direction and approval of the services, no individuals or entities higher up the food chain will face any sort of meaningful charges.
9. There is plenty of evidence of widespread abuses that appear not to be on the attorney generals’ or media’s radar, such as servicer driven foreclosures and looting of investors’ funds via impermissible and inflated charges. While no serious probe was undertaken, even the limited or peripheral investigations show massive failures (60% of documents had errors in AGs/Fed’s pathetically small sample). Similarly, the US Trustee’s office found widespread evidence of significant servicer errors in bankruptcy-related filings, such as inflated and bogus fees, and even substantial, completely made up charges. Yet the services and banks will suffer no real consequences for these abuses.
10. A deal on robosiginging serves to cover up the much deeper chain of title problem. And don’t get too excited about the New York, Massachusetts, and Delaware MERS suits. They put pressure on banks to clean up this monstrous mess only if the AGs go through to trial and get tough penalties. The banks will want to settle their way out of that too. And even if these cases do go to trial and produce significant victories for the AGs, they still do not address the problem of failures to transfer notes correctly.
11. Don’t bet on a deus ex machina in terms of the new Federal foreclosure task force to improve this picture much. If you think Schneiderman, as a co-chairman who already has a full time day job in New York, is going to outfox a bunch of DC insiders who are part of the problem, I have a bridge I’d like to sell to you.
12. We’ll now have to listen to banks and their sycophant defenders declaring victory despite being wrong on the law and the facts. They will proceed to marginalize and write off criticisms of the servicing practices that hurt homeowners and investors and are devastating communities. But the problems will fester and the housing market will continue to suffer. Investors in mortgage-backed securities, who know that services have been screwing them for years, will be hung out to dry and will likely never return to a private MBS market, since the problems won’t ever be fixed. This settlement has not only revealed the residential mortgage market to be too big to fail, but puts it on long term, perhaps permanent, government life support.
As we’ve said before, this settlement is yet another raw demonstration of who wields power in America, and it isn’t you and me. It’s bad enough to see these negotiations come to their predictable, sorry outcome. It adds insult to injury to see some try to depict it as a win for long suffering, still abused homeowners.