More on the MERS mortgage/foreclosure fraud

The following statement by a California Judge in this case sums up what has happened to most people's mortgages:

"Lenders passed around the deed to Vargas’ house as if it were a whiskey bottle at a frat party."

Here's the link from a year ago:

But Vargas, hero, citizen and family man, has been sucker-punched along with millions of other American homeowners, taxpayers and the nation’s entire economy by the mortgage-lending debacle.

A series of loans from some of America’s largest mortgage lenders cost him nearly $200,000 in less than two years and destroyed financial security it took a lifetime to build. Documents reviewed by msnbc.com show that loans sold to Vargas by mortgage brokers on behalf of the lenders were loaded with features that federal officials say are the hallmarks of predatory lending.

Lenders passed around the deed to Vargas’ house as if it were a whiskey bottle at a frat party. Ultimately, he wound up in foreclosure proceedings. And, finally, bankruptcy court.

Vargas’ story is the Cliff Notes version of what has happened to the larger American economy. It is a story of greed, lax lending standards, lack of government oversight and the fantasy that real estate prices will always rise.

Mortgage Deeds and Whiskey bottles

I also just read today that Ambac, previously the #2 provider of Mortgage insurance (PMI) has sued Bank Of America for $16 Billion:

ABK sues BAC for $16 billion over countrywide mortgage fraud

BAC bought out Countrywide and at that point assumed their liabilities. ABK is alledging that...

... 97 percent of 6,533 loans it reviewed across 12 securitizations sponsored by Countrywide didn’t conform to the lender’s underwriting guidelines, according to the complaint filed yesterday in New York state Supreme Court. Many of the loans were made to borrowers with limited or no ability to meet their payment obligations, Ambac said.

97%!!!!! of all the loans that ABK insured for BAC/Countrywide were violations of "warranties and representations".

It's evident that the financial crisis is not over. We have some SERIOUS PROBLEMS still remaining with the entire system that will likely take years to unravel (with, or without, congressional intervention).

Edit Oct 7th And it would appear that this congressional intervention has, in part, arrived. Much of the controversy over this foreclosure fraud was that documents were being presented with notarized signatures that were not accepted by other states. I also understand that some documents were electronically signed and notarized, which is contrary to the whole notary process (actually witnessing the signing of the documents). Well, Congress has QUICKLY passed the following bill and now Obama is sitting on it for signature. One has to wonder if he's wondering what the repercussions to his political career will be if he does:

n other words, with one simple signature Obama has the capacity to prevent tens of billions in damages to banks from legal fees, MBS deficiency claims, unwound sales, and to formally make what started this whole mess: Court Fraud perpetrated by banks, a legal act, and to finally trample over the constitution. Will Obama do it? Potentially - the banking lobby certainly has enough power over him and his superiors, the members of the FOMC. On the other hand, the populist revolt that will surely follow the enactment of such a law will certainly end any dreams of a second term, and potentially of a completed first one. The drama is now on: will Obama openly side on behalf of the bankers (without a "blame the republicans" fall back this time) or of the foreclosure "victims" (granted, the bulk of whom are deadbeat homeowners who should never have owned a home to begin with). We doubt a decision will be reached before the midterms, although quite a bit now hangs in the balance.

Obama's quandary

Yet, the market continues to climb on the back of a declining US dollar. The USD is down over 10% since May (input UUP, which is the "bullish dollar ETF" in the following link). But be sure to look at the weekly DOW chart first to make the comparison between it's performance and the UUP:

DOW Weekly Chart

Scrutinizer