Reply #49: You're talking about before the swindle was put in place.

[sabrina 1]

At The Root Of The Crisis We Find The Largest Financial Swindle In World History

The tidal wave of evidence showing that the giant banks have engaged in fraudulent foreclosure practices is so large that the attorneys general of up to 40 states are launching investigations.

People's homes are being taken when they didn't even hold a mortgage, and the big banks have been using "robo signers" to forge mortgage related documents. Indeed, even president Obama has been hit by robo signers (see this and this).

Its so blatant that foreclosure mills have published price lists for forging documents, including such gems as:
"Create Missing Intervening Assignment" $35

"Cure Defective Assignment" $12.95

"Recreate Entire Collateral File" $95

This is not just a few pundits talking, this is based on evidence emerging from court cases based on witness testimony and documentation.

Johnson confirmed that a high housing default rate was part of the banks' models. The financial giants knew they would make huge sums during the boom, and then transfer their losses to the American people during the bust.

As William Black noted last October:

Everyone involved knew that the CDOs which packaged subprime loans were not AAA credit-worthy (which means that they are completely risk-free). He also said that the exotic instruments (CDOs, CDS, etc.) which spun the mortgages into more and more abstract investments were intentionally created to defraud investors
In November 2007, one rating agency - Fitch's - dared to take a look at some loan files. Fitch concluded that there was the appearance of fraud in nearly every file reviewed

Some of the country's most respected people have been warning about this for a long time. But the banks and the Republican party and their enablers in the media, have succeeded in diverting attention to those 'deadbeat homeowners'. For some reason this ability to blame the poor resonates with many Americans and they know it. It's an elitism that is rampant, and I am beginning to think, a real prejudice against those who are not wealthy, a disbelief that if someone is super rich, they must be respectable. And that attitude has kept the truth from emerging until now.

University of Texas economics professor James K. Galbraith previously said that fraud caused the financial crisis:

You had fraud in the origination of the mortgages, fraud in the underwriting, fraud in the ratings agencies.

Senator Kaufman said last month:
Fraud and potential criminal conduct were at the heart of the financial crisis.

Congresswoman Marcy Kaptur says that there was rampant fraud leading up to the crash (see this and this).

From James Galbraith:

"At the root of the crisis we find the largest financial swindle in world history."

The fraud originated in the mortgage market of the United States.

The houses were over-appraised, and the banks only hired appraisers who were willing to do that. Galbraith rhetorically asks: "For what conceivable reason would a lender accept an inflated appraisal for a house against which it was going to make a loan?"

The language used in the mortgage industry is very telling: "liar's loans", "ninja loans" (where the borrowers had no assets and no income), "neutron loans" (where it would destroy the people but leave the buildings), and "toxic waste"

The mortgages in the millions were counterfeits, not mortgages. They were "laundered" ... the dirty paper was converted into clean paper. Securitization was used to convert the worthless paper from triple D minus junk to triple A. The commercial banks were the "fences", they took the laundered paper and sold it on to the legitimate market. The "marks" were the pension funds, or any investing entity which trusted triple A rating or investment banks.

The police left the beat.

If the counterfeit is big enough, the whole system collapses, because you can't tell what's real from what's counterfeit and so confidence collapses.

The failure to face the problem of fraud constitutes a huge barrier in the path of economic recovery. The banking system can't be restored until it is taken apart, cleaned up and rebuilt in a transparent and honest manner.

There were borrowers who could not afford the mortgages they were encouraged to purchase. That was the GOAL. And this one article, there are literally hundreds now with documented testimony proving all of this. Lenders helped rather than prevented, borrowers to get loans the lenders KNEW they couldn't pay.

Galbraith now has an answer as to why they were doing this. Since his commentary, the insurance scam, insuring the same properties over and over again and then collecting when the homeowner defaults, from multiple sources, is the latest revelation in this gigantic crime. I don't blame Galbraith for not understanding it. You have to have a criminal mind to think up a scheme like this.

The borrowers were the patsies and even those who actually did make bad judgements were part of the PLAN. They were sought out. So to try to dismiss this as a greedy, lazy home buyer problem is exactly what they want you to do. They were ready for this phase of the scam also, when it would be exposed, and have bought enough members of Congress to get it all covered up, IF WE LET THEM.

Just two weeks ago as evidence of huge fraud began to emerge from trials in Florida and elsewhere, the Senate, who normally cannot agree that the sky is blue, unanimously passed a bill in secret, which would have legitimized part of this scam, the forged notaries. Fortunately that vote, a voice vote so as not to go down in writing, was exposed and the President forced into vetoing it.

Unless you are interested in helping the cover-up of these crimes, I would suggest turning your attention away from the patsies and on to the perpetrators because that is where 50 States Attorneys are now focusing THEIR attention. It is not a crime to be poor yet.

And the WH and the Banks would like to stop investigations and 'legislation' which they claim, would be bad for the economy. Iow, bringing criminals to justice is now bad for the economy. I sincerely hope our law enforcement agencies do not cave in to the government in its bi-partisan attempt to cover for the crooks who brought down this economy and who profited from it, then passed the bill on to the American people.

Some attorney generals would like to look beyond the narrow issues raised by the robo-signing. The issue "I'm most engaged in right now is the big servicers who are initiating foreclosures while the borrower is in the modification process," said Arizona Attorney General Terry Goddard.

Yeah, that happened to a friend of mine. And so many others. Lured into remodifying their loans under the President's re-modification program, many found themselves being forced into foreclosure instead despite having worked out agreements with the banks.

Sorry, but this cannot be swept under the rug, nor can it be passed off on home buyers. There is a poisonous corruption in the financial industry that if not addressed will eventually completely destroy this country. It almost did already.