Archive for October, 2010
It sorta seems like the US is backed into a bit of a corner. At least temporarily. A big part of the reason I have considered moving is just the general uncertainty. It is pretty clear that the trend is going to be a lower standard of living across the board. The question is how will people react to it? This year and next year no cost of living adjustment for Social Security. Numerous food commodities are up 30% to 80% over the past 3 months, the US Dollar index is down about 13%, and in spite of having excessive liquidity in the system Ben Bernake keeps jawboning further easing to paper over the fraud from his banking buddies.
The big issue is that those who committed the crimes which have caused the instability have not been punished, but rather rewarded. They claim that oversized record bonuses are needed to retain the best and the brightest, but when they crash the system they play naive:
They can’t have it both ways. First they said that the brightest and most talented Americans work at these companies and therefore they need to be paid millions to keep them. And then when something like this happens they can’t claim incompetence. So yeah I with Black on this one after all he had plenty of experience dealing with very corrupt bankers.
Rather than enforcing the rule of law, there has been a gradual evolution of the creation of a mechanism for systemic economic fraud which will become legal after the fact due to “systemic risk”
The financial industry functions on the assumption that contracts and activities that are either illegal or unenforceable under current law will – as long as they involve significant bank losses or liabilities – always be made legal retroactively.
Over the past half century the financial industry has not treated the law as a bedrock institution that constrains the nature of its activities, but rather as a set of rules that can be forced to adapt to the industry’s needs and desires. Thus, the industry knowingly and deliberately creates standardized contracts that are either designed to circumvent the law or in some cases flatly illegal under current interpretations of the law, and then when a case involving the contract arises (which in many instances happens only long after the standardized contract has become an institution), the financial industry tells the court that the dubious or illegal contract is so widespread that the court would create systemic risk by enforcing the law.
The issue with foreclosure mill policies is not just the end outcome
“The mortgage servicers hired people who would never question authority,” said Peter Ticktin, a Deerfield Beach, Fla., lawyer who is defending 3,000 homeowners in foreclosure cases. As part of his work, Ticktin gathered 150 depositions from bank employees who say they signed foreclosure affidavits without reviewing the documents or ever laying eyes on them — earning them the name “robo-signers.”
The deposed employees worked for the mortgage service divisions of banks such as Bank of America and JP Morgan Chase, as well as for mortgage servicers like Litton Loan Servicing, a division of Goldman Sachs.
but all the other stuff they are hoping to hide in rushing fraud through the courts. The fraud is so fast and so furious that title insurers won’t even insure titles foreclosed on by its own attorneys: “The title insurance arm of one of the state’s largest foreclosure law firms is refusing to cover properties foreclosed on by its own attorneys citing potential defects in court filings.
Either there is due process of law or you have a kleptocracy/”banana republic” oligarchy. At present, that is the decision we face as a nation. If the banking Elites and their partners in the Central State (Fed and Treasury) are allowed to “win” and gut the property laws of the states, then the U.S.A. will be revealed as a kleptocracy/”banana republic” oligarchy.
If state laws are upheld, then the “too big to fail” banks are insolvent and they will fail. Then the question of kleptocracy arises once again: will the banks be allowed to fail as per Classic Capitalism, that is, their owners and managers will have to absorb the losses of that bankruptcy/failure, or will the Central State use its powers to collect taxes and cover the private losses of the Bank/Financial Power Elites? Privatizing profits and socializing losses has been the entire game plan since the global house of cards collapsed in 2008.
It’s decision time, citizens. Either the banks/Central State “win” and we are a kleptocracy/ “banana republic,” or they lose and the U.S. mortgage/ banking sector implodes and is either formally socialized (i.e. owned lock, stock and barrel by the Central State) or rebuilt from scratch without big banks, Federal guarantees and the Fed’s incestuous interventions. (“We create the credit that enables the mortgage, you issue the mortgage, and then we buy the mortgage.”)