*at the heart of claims of securitization is a data point that cannot be confirmed or corroborated, to wit: an unpaid loan account owed to as specifically identified creditor who makes decisions regarding collection, enforcement, and workouts. That account and that creditor does not exist in anyone’s world unless they are admitted in a court action.
Excellent article that can be used as the foundation for many things. What the banks are betting on is that your eyes will glaze over as you start reading this. Just like your poor eyes did before when articles were published on how the investment banks created a false marketplace with false securities and false pretenses.
But the reason this is so important — and why banks keep steering clear of me —- is that at the heart of claims of securitization is a data point that cannot be confirmed or corroborated, to wit: an unpaid loan account owed to as specifically identified creditor who makes decisions regarding collection, enforcement, and workouts. That account and that creditor does not exist in anyone’s world unless they are admitted in a court action.
The bottom line is that accounting rules have been so liberalized in favor of management that virtually any company that is not under investigation can say anything it wants about the crap they have sold or traded in the marketplace.
In the case of PennyMAc, the assumption that it is performing any of the servicing functions ascribed to them is at best dubious. It is and has always been a thinly capitalized entity that exists solely at the discretion (whim) of the major investment banks. And that is why adjustments on their balance sheet for “non-cash” transactions are an essential element of their income statements.
Filed under: foreclosure |
Government Rules. And bailouts continue. Bailout.