Housing Remains the Weakest Part of the American Economy

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EDITOR’S NOTE: While the politicians argue campaign strategies over the debt ceiling, the main index for the economy continues to fall into previously unfathomable depths. It’s obvious that they will talk about anything BUT the housing crisis and the tens of millions of fraudulent “mortgage” transactions in which no mortgage was actually created, but it was filed and recorded anyway, corrupting the title system that has served all 50 states for hundreds of years. 5 million foreclosures have been “closed out” based upon fraud, forgery and fabrication. 

It’s obvious that the government is not going to initiate anything to stop this cataclysm. Borrowers have been in a defensive stance for five years, despite what is now obvious fraud, forgery and fabrication by pretender lenders.  Loans were securitized, they said. But then they were not securitized because the transfers were never made, leaving the so-called “loan originator” that never loaned a dime as the “lender of record” without a penny owed to the “lender of record.”

A mortgage that secures a non-existent obligation is no mortgage at all and should be removed from the public records. In virtually every case the “loan originator” — whether a bank or not — was acting as an unregistered mortgage broker without disclosure of its role to the borrower contrary to the requirements of federal and state law. The note and mortgage did NOT describe the actual transaction because they did not identify the investor/lender as the real lender and because they did not disclose all the fees that were earned up the false securitization chain. The fees earned were obscene because nobody  had any risk. Now it’s time to test that assumption.  

These “loans” were procured by outright lying, deception and a fraudulent scheme that swindled investors out of their money and homeowners out of their home equity. Although the number is dwindling, most courts are still allowing it under the assumption that if there was ever an obligation arising out of funding of a loan, then the borrower should be held accountable — even if it means holding the borrower accountable to someone who didn’t loan the money. The biggest fraud of all was the wide-scale cornering of the appraisal market where prices over entire regions were falsely inflated in order to make up for the lack of borrowers who could sign and thus “complete” the securitization scheme thus justifying the money taken from investors by investment bankers.

The value of the homes was in most cases vastly inflated, such that even with a 20% down payment the borrower was unknowingly stepping into a snake pit where the loss on the transaction was like the loss on a new car driven off the lot. Until now, in any situation where there was fraud — wide-scale or not — the victims were given restitution. In this case, it’s simple — eliminate the fake mortgage and use something like the Resolution Trust Authority to reconstitute the mortgages, get community bankers involved, and provide hope and equity to the homeowners who were affected. There is no difference between opposing relief for borrowers and opposing relief for a mugging victim or a victim of domestic violence. That is not our country.

This is a call to borrowers to go to mortgage 2.0. It’s time to go from defense to offense and score some points, win some damages, and stop these foreclosures. If you don’t do it nobody else will. We already know that the documents were forged by people signing documents indiscriminately while sitting around a table and not knowing the meaning of what they were doing. But they DID know they were signing someone else’s name. Linda Green didn’t sign those documents. Dozens of other people signed her name, forging it, and getting it witnessed and notarized by signatures that were also forged or procured illegally. The facts are there for causes of action ranging the gamut of money damages and injunctive and declaratory relief.

Just know that there is a difference between filing a lawsuit and getting the pleading right, with all the elements of a cause of action so that it will survive motion to dismiss. And there is a difference between information and evidence. Information is what leads you to sue. Evidence is what proves your claim.

U.S. Housing Sales and Prices Remain Weak

By THE ASSOCIATED PRESS

Fewer Americans bought new homes in June, evidence that the housing market remains weak, a Commerce Department report showed Tuesday.

A separate report on Tuesday showed home prices in major American cities rose for the second straight month in May. But after adjusting for seasonal buyers, prices actually fell in a majority of markets.

The Commerce Department said sales of new homes fell 1 percent in June to an annual rate of 312,000. That’s less than half the 700,000 new-home sales that economists say is typical in healthy markets.

Sales fell to record lows in the Northeast and West. The median price of a new home rose to $235,200 in June, up 5.8 percent from May, according to the Commerce Department report.

Last year was the worst for new-home sales on records dating back a half century, but through the first six months of this year, sales are lagging behind last year’s totals.

In June, new-home sales fell to record lows in the Northeast and West. The median price of a new home rose to $235,200 in June because of the influx of spring buyers. The median price is not adjusted for seasonal factors.

The Standard & Poor’s/Case-Shiller home-price index said May prices increased in 16 of the 20 cities tracked for an average of 1 percent. Over the past 12 months, prices have fallen in 19 of the 20 cities tracked.

Housing remains the weakest part of the American economy. High unemployment, larger down payment requirements and tougher lending standards are preventing many people from buying homes. And some potential buyers who can clear those hurdles are holding off, worried that home prices have yet to bottom out.

Last year was the fifth straight year that new-home sales fell. That followed five straight years of record-high sales, when the housing market was booming.

Still, all home sales are weak. Sales of previously occupied homes fell for a third straight month in June and are lagging last year’s sales of 4.91 million homes sold last year, the fewest since 1997. In a healthy economy, people buy roughly 6 million existing homes annually.

While new homes represent less than one-fifth of the total housing market, they have an outsize impact on the economy. Each new home creates an average of three jobs and $90,000 in taxes, according to the National Association of Home Builders.

12 Responses

  1. The “manipulative and deceptive devices” prohibited by Section 10(b) of the Act and Rule 10b-5 thereunder include, among other things, the purchase or sale of a security of any issuer, on the basis of material nonpublic information about that security or issuer, in breach of a duty of trust or confidence that is owed directly, indirectly, or derivatively, to the issuer of that security or the shareholders of that issuer, or to any other person who is the source of the material nonpublic information.[1]
    Paragraph (b) addresses the unsettled “possession” versus “use” issue, stating that a person violates Rule 10b-5 simply by trading while in “possession” of inside information. It states, in full, that
    Subject to the affirmative defenses in paragraph (c) of this section, a purchase or sale of a security of an issuer is “on the basis of” material nonpublic information about that security or issuer if the person making the purchase or sale was aware of the material nonpublic information when the person made the purchase or sale.[2]
    In other words, under 10b5-1(b) a person could be liable for insider trading simply by possessing inside information regarding a given security, breaching a fiduciary duty to the source of the information, and then trading it with a self-serving intent, even if he or she would have made the trade anyway. See U.S. v. O’Hagan, 521 U.S. 642, 652 (1997). But it is unlikely the SEC will detect or particularly care about a small trade that would have occurred anyway. A large trade or series of trades that reap unusual benefits for a trader, however, will likely be detected, and it would be difficult to prove that the material non-public information did not contribute to the decision to make the trade.

    Nate, this is what Goldman Sachs and Citigroup have been doing for the past 7 years. They knew the loans were NFG, so they created the CDO’s and CDO-squared deals to continue to rope-a-dope the investor class. But I don’t think your going to find a cause of action here on behalf of mortgagors.

    If you have some better information than me, please advise.

    And I envy you with all those grandkids running around. What’s your address? I’d like to come raid your fridge, too.

  2. dying truth, what ‘communism” ?

  3. “This certainly heats up an already explosive situation. Whether the creators of MERS (its members) will throw MERS under the bus remains to be seen. Massachusetts is just setting an example all states should follow if they value the land upon which their states are defined. Otherwise states may well lose their own identity.”

    Posters comment:

    You see, they as in MERS as in Banks are trying to establish a new reality or agreement without even getting it passed in law or UCC’s or whatever codes you may have.

  4. Housing shouldn’t be a market or a part of the economy, it should be a basic fundamental right that the government guarantees, not invests in.

  5. “County Clerk Bill Bullard says he’s found more evidence that fraudulent documents are being used to foreclose on Oakland County homeowners.

    Bullard said Thursday he’s forwarded the documents to Michigan Attorney General Bill Schuette for review. He provided a copy of the letter to Schuette to county commissioners.

    Oakland County commissioners also introduced a resolution supporting an investigation into document fraud within the county.

    “This is part of our ongoing investigation into mortgage fraud in the Register of Deeds Office,” Bullard said. “We learned through a news story just yesterday that a gentleman by the name of Bryan Bly testified in a sworn deposition in a case in Florida that he had fraudulently signed 5,000 fraudulent mortgage documents a day.”

    “We immediately investigated the last three years and determined that 100 fraudulent documents had been signed by Bryan Bly as signatory representing allegedly about five different banks, and a couple he notarized.”

  6. Anonymous & Neil.

    I think you need to look this over:

    http://deadlyclear.wordpress.com/2011/07/25/ag-settlement-opposition-ma-throws-the-first-punch/#more-289

    “Massachusetts will not sign on to any global agreement with the banks if it includes a comprehensive liability release regarding securitization and the MERS conduct,”

    http://news.firedoglake.com/2011/07/25/massachusetts-ag-coakley-i-wont-sign-away-liability-over-mers-in-foreclosure-fraud-settlement/

    ok, what does “global agreement” mean? As in the globe, earth, or our global agreement in the USA?

  7. Nothing matters as long as claims are before a toss-up court or by the luck of the draw as to a judge.

    No uniform law — or precedent law — across the country.

    This is the reason for the AG settlement. To release liability — and to block precedent law that will permanently nail them.

    Without uniform precedent law — we have nothing.

    Think Neil gets it — any settlement will preclude case law from going forward.

    Wisconsin — Madison — University Professor came out today with distribution of wealth study. Minorities and others remain in the dust — even as stock is escalated for the wealthy due to Quantitative Easing (ie — buy stocks cheap). Distribution of wealth — is focused at top — this will continue. And, all by continued fraud — and by investigations that will cease by AG settlement.

    Now — how does anyone here propose to change this situation???

    Elections?? Who are you going to elect???

    As it stands, US economy continues to falter. Jobs are scarce and growth is anemic.

    Housing was the (false) SOURCE of the American economy for years. Without housing — we are done.

    The irony lies in “selling” bogus foreclosures to parties who have no right — in order to sell the property to some other American (whoops — meant also outside America), while still holding the original borrower to escalated debt — whoops — meant collection rights — that were never valid to begin with. Simply a fraudulent transfer of American middle-class/lower income wealth. Wiped out.

    And, who wanted it this way??? Either just undisclosed agendas — or simple ignorance.

  8. The Weakest part of the US economy is

    obama Beavis
    and
    Boehner Butthead

  9. Because as Neil wrote—

    “Just know that there is a difference between filing a lawsuit and getting the pleading right, with all the elements of a cause of action so that it will survive motion to dismiss. And there is a difference between information and evidence. Information is what leads you to sue. Evidence is what proves your claim.”

    And just WHAT IS SEC 10(b)-5???

  10. Okay, so give us the EXACT pleadings & causes of action to PROVE:

    1. NO actual “funding”…fraud at/before origination.

    2. FALSE and VOIDED original “mortgage contract”.

    3. GIVE ME MY MONEY BACK THAT YOU STOLE.

  11. Smart people should not be buying houses today. Every home in the Mers system has a clouded title. I cringe when people I know are buying are buying ‘all cash’ or making large downpayments with the possiblity that they could someday loose that investment with no recourse. Those good deals, those ‘to good to be true’ good deals are just that..’to good to be true’. Buying a short sale or f/c is a huge gamble. I am still seeing ads for all the loan products that got us into this mess…nothing has appeared to slow down to me. I just hope some of the downturn is the result of people getting educated and understanding the fraud.

  12. Hi Everybody. I’m here to throw a challenge down on the table to you all.
    In a recent post on July 22, 2011, “CBS News: John Boehner walks away from debt talks”, Deadly Clear states: “I’m telling you – one smart attorney is going to find a way for homeowners to claim SEC 10(b)-5 and it will be lights out GAME OVER.”
    Is this true?? I bit into this statement like a pit bull and have been behind this computer for the last two days researching. My question to tnharry, carrie and all others here – Is there meat on this bone or have I gone down the rabbit hole to Toon Town (Chink in the armor – Welcome to the Machine)?? I SMELL meat, but I don’t see it. But then, I’m also not an attorney nor am I “smart”. I’m just a lowly Sys Admin (Linux – Debian), out of work, house in foreclosure (Supreme Couty, Kings County, NY) with 12 grandkids coming everyday raiding my fridge, messing my house up, getting on my nerves and saying “I love you grandpa”.
    Back to the challenge: If there IS some meat on the bone, why can’t we/us – COLLECTIVELY – be that “one smart attorney” Deadly Clear is looking for??
    tn, go easy on me. Your comments, advice, no nonsense, refusal to agree and go along with attitude has given me quite a few issues and arguments that I have raised in motions AND WON in Court. But you do have a calm, quiet, subtle way of saying things that gives one the impression that you think and are calling them “dumb”, “ignorant” and “stupid”. Now, very simply – Do YOU think that there is ANY MEAT on Deadly Clear’s bone?? Peace.

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