Banking Shaping American Minds

“I wish someone would give me one shred of neutral evidence that financial innovation has led to economic growth — one shred of evidence.” — Paul Volcker, former Fed Chairman, 2009

“We have allowed the borrower to get raped and then we have gone to the rapist for a course on sex education. Thus the investors (pension funds who will announce reductions in vested pensions) and the homeowners have been screwed on such a grand scale that the entire economy of our country and indeed the world have been turned upside down.” — Neil F Garfield, livinglies.me 2012

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Editor’s Comment: The article below is very much like my own recent article on privatized prisons and the inversion of critical thinking in favor of allowing economic crimes to have a special revered status in our society. Kim highlights the rampage allowed to continue to this day in which Banks are ravaging our society and supporting anything that will confuse us or indoctrinate us to accept outright theft from our society, our purses, and our lives.

It is this lack of critical thinking that has made it so difficult for homeowners to get credit on loan balances that are already paid down by parties who expressly waived any right to collect from the borrower. It is the reason Judges are so reluctant to allow homeowner relief because they perceive the fight as one in which the homeowners are only expressing buyer’s remorse on an otherwise valid transaction.

It is the reason why lawyers are reluctant to deny the debt, deny the balance, deny that a payment was due, deny the default, deny the note as evidence of any debt, deny the validity of the mortgage and counter with actions to nullify the instruments signed by confused and befuddled borrowers assured by the banks that they were making a safe and viable investment.

In most civil cases Plaintiff sues Defendant and Defendant denies most of the allegations — forcing the Plaintiff to prove its case. Not so in foreclosure defense. Lawyers, afraid of looking foolish because they have not researched the matter, refuse to deny the falsity of the allegations in mortgage foreclosure complaint, notice of default and notice of sale. Lawyers are afraid to attack sales despite decisions by Supreme Courts of many states, on the grounds that the sale was rigged, the bidder was a non-creditor submitting a credit bid, and the fact that the forecloser never had any privity with the homeowner, never spent a dime funding any mortgage and never spent a dime funding the purchase of a mortgage.

The quote from the independent analysis of the records in San Francisco County concluded that a high percentage of foreclosures were initiated and completed by entities that were complete “strangers to the transaction.” Why this is ignored by members of the judiciary, the media and government agencies is a question of power and politics. Why it MUST be utilized to save millions more from the sting of foreclosure is the reason I keep writing, the reason I consult with dozens of lawyers across the country and why I have moved back to Florida where I am taking on cases.

As a result of the perception of the inevitability of the foreclosure most court actions are decided in favor of the forecloser because of the presumption that the transaction was valid, the default is real, and that no forgery or fabrication of documents changes those facts. The forgeries and fabrications and robo-signed documents are bad things but the “fact” remains in everyone’s mind that the ultimate foreclosure will proceed. That “fact” has been reinforced by inappropriate admissions from the alleged borrower, who never received a nickle from the loan originator or any assignee.

The lawyers are admitting all the elements necessary for a foreclosure and then moving on to attack the paperwork. Theoretically they are right in attacking assignments and endorsements that are falsified, but if they have already admitted all the basic elements for a foreclosure to proceed, then the foreclosure WILL proceed and if they have any real damages they can sue for monetary relief.

But under the current perception carefully orchestrated by the banks, there are no damages because the debt was real, the borrower admitted it, the payments were due, the borrower failed to make the payments, and the mortgage is a valid lien on the property securing a note which is false on its face but which is accepted as true.

Even the borrowers are not seeing the truth because the people with the real information on the ones that are foreclosing on them. So borrowers, knowing they received a loan, do not question where the loan came from and whether the protections required by the truth in lending statute, RESPA and other federal and state lending laws were violated. We have allowed the borrower to get raped and then we have gone to the rapist for a course on sex education. Thus the investors (pension funds who will announce reductions in vested pensions) and the homeowners have been screwed on such a grand scale that the entire economy of our country and indeed the world have been turned upside down.

Deny and Discover is getting traction across the country, with a focus on the actual money trail — which is the trail of real transactions in which there was an offer, acceptance and consideration between the relevant parties. More and more lawyers are trying it out and surprising themselves with the results. Slowly they are starting to realize that neither the origination of the, loan as set forth in the settlement documents at closing nor the assignments and endorsements were real.

The debt described in the note does not exist and never did. Neither was it the same deal that the lender/investors meant to offer through their investment bankers.

The note and the bond have decidedly different terms of repayment. The payment of insurance and credit de fault swaps to the banks was a crime unto itself — a diversion of money that was intended to protect the investors. The balances owed to those investors would have been correspondingly reduced. The balances owed from the borrowers should be correspondingly reduced by payment received by the only real creditor.

Thus millions of homeowners have walked away from homes they owned on the false representation that the balance owed on their homes was more than they could pay. And the messengers of doom were the banks, depriving investors of money due to them and depriving the borrower of the real facts about their loan balances. Lawyers with only a passing familiarity have either told borrowers that they have no real case against the banks or they take a retainer on a case they know they are going to lose because they will admit things that they don’t realize are false. And Judges hearing the admissions, have no choice but to let the foreclosure proceed.

But that doesn’t mean you can’t come back and overturn it, get damages for wrongful foreclosure, and this is where lawyers have turned bad lawyering into bad business. There is a fortune to be made out there pursuing justice for homeowners. And the case far from the complexity brought to the table by the banks is actually quite simple. Like any other civil case or even criminal case, stop admitting facts that you don’t know are are true and which are in actuality false.

In every case I know of, where the lawyer has followed Deny and Discover and presented it in a reasonable way to the Judge, the orders requiring discovery and proof have resulted in nearly instant “confidential” settlements. Some lawyers and waking up and making millions of dollars helping thousands of homeowners —- why not join the crowd?

Banks Stealing Wealth and the Minds of Our Children

by JS Kim

In the past several years, people worldwide are slowly beginning to shed the web of deceit woven by the banking elite and learning that many topics that were mocked by the mainstream media as conspiracy theories of the tin-foil hat community have now been proven to be true beyond a shadow of a doubt. First there was the myth that bankers were upstanding members of the community that contributed positively to society. Then in 2009, one of their own, Paul Volcker, in a rare momentary lapse of sanity, stated “I wish someone would give me one shred of neutral evidence that financial innovation has led to economic growth — one shred of evidence.” He then followed up this declaration by stating that the most positive contribution bankers had produced for society in the past 20 years was the ATM machine. Of course since that time, we have learned that Wachovia Bank laundered $378,400,000,000 of drug cartel money, HSBC Bank failed to monitor £38,000,000,000,000 of money with potentially dirty criminal ties, United Bank of Switzerland illegally manipulated LIBOR interest rates on a regular basis for purposes of profiteering, and though they have yet to be prosecuted, JP Morgan bank, Goldman Sachs bank, & ScotiaMocatta bank are all regularly accused of manipulating gold and silver prices on nearly a daily basis by many veteran gold and silver traders.

http://www.zerohedge.com/contributed/2013-01-03/banking-elite-are-not-only-stealing-our-wealth-they-are-also-stealing-our-min

Obama Gets a Set — Accepts Volcker’s View

Editor’s Comment: Finally! The president has now played out the Geithner-Summers scenario and seen the results — a large middle finger raised in the air from an arrogant bunch of people who are tone deaf to the needs of the nation and the world. This decision brings us into line with the rest of the world, whose central bankers have been waiting for ANY signal from Washington that we were ready to get real about financial services and currency weakness.

This is a massive break from the Bush era of “free-market” self regulation and a recognition of the truth — that the markets are anything but free. As of now, the financial markets and our economy are in the death grip of a very small coterie of people more bent on power and privilege than commerce, profit, accountability to shareholders, fairness to the consumer and respect for the taxpayers whom they bilked for trillions of dollars after stealing trillions from homeowners and investors through destruction of the lives and prospects of most middle class Americans.

The lone voice in the inner circle has been the chairman of economic advisers, Paul Volcker who until now has been marginalized, discounted and generally avoided. Joined by the former Fed Chairman Greenspan who now admits the mistakes of “free-market” thinking and the consequences of taking the referees off the playing field, Volcker proposes a whole new paradigm. By breaking up the large “too big to fail” institutions we break up the oligopoly that is running our government.

We have a very long road ahead. Deflating the bubble that still exists in trading proprietary currency-equivalents (derivatives, mostly) will take a long time and will no doubt have both negative and positive, intended and unintended consequences. Nothing is perfect. But what is perfect is a nation that can go through peaceful revolution and come out the other end with a healthier, safer, free society where the goal is opportunity for everyone and protection from those who would economically enslave people and systematically dumb them down through starving educational initiatives.

Following through on this initiative means we can really address the jobs problem and the corporate welfare drain on the American taxpayer. Those must end as quickly as possible. Changing the context to consumer protection and transparency in the financial markets means that the reality of the foreclosure crisis can be stated openly: neither the obligations nor the property were ever worth what they were sold for and they never will rise to those levels again in any meaningful amount of time.The ONLY honest answer is principal reduction. The only open questions are how to share the losses amongst all the affected losers.

Recent realistic projections show that the largest wave of foreclosures is yet to come in 2012 and 2013. Unwinding the increasingly damaged titles of property encumbered by fabricated documents asserting false terms could take generations. If the President follows through on this announcement, our ordeal, now projected to be 20-30 years and beyond, could be shortened considerably with a real brass ring at the end instead of a simple sigh of relief and resignation that the b–tards are always in charge.

The President promised change. Now he is aiming for it. Let’s hope he makes it. Write your congressman, senators, governors and legislators supporting this initiative. Give the President as much support as you can — he’s going to need it in the battle ahead. Believe in yourself and not in the messages blasted at us through institutionalized advertisements and a lazy media. And keep fighting the battle against foreclosure. You are warriors on behalf of yourself and what will be a grateful nation.

By JACKIE CALMES and LOUIS UCHITELLE

Published: January 20, 2010

WASHINGTON — President Obama on Thursday will publicly propose giving bank regulators the power to limit the size of the nation’s largest banks and the scope of their risk-taking activities, an administration official said late Wednesday.

The president, for the first time, will throw his weight behind an approach long championed by Paul A. Volcker, former chairman of the Federal Reserve and an adviser to the Obama administration. The proposal will put limits on bank size and prohibit commercial banks from trading for their own accounts — known as proprietary trading.

The White House intends to work closely with the House and Senate to include these proposals in whatever bill dealing with financial regulation finally emerges from Congress.

Mr. Volcker flew to Washington for the announcement on Thursday. His chief goal has been to prohibit proprietary trading of financial securities, including mortgage-backed securities, by commercial banks using deposits in their commercial banking sectors. Big losses in the trading of those securities precipitated the credit crisis in 2008 and the federal bailout.

The president will speak at an appearance on Thursday at the White House with Treasury Secretary Timothy F. Geithner, an administration official said, speaking on the condition of anonymity because the talks were private. It will come after a meeting with Mr. Volcker.

A similar discussion is percolating in Europe, led by Mervyn King, head of the Bank of England.

The president’s announcement comes as his popularity in public opinion polls is falling because of stubborn unemployment and the stagnant economy, and just days after he suffered a stinging loss when the Republicans won the Senate seat from Massachusetts.

It will be the third time in just a week that he has waded into the battle heating up in Congress over tightening regulation of financial institutions to avoid the sort of abuses that contributed to the near collapse on Wall Street. Last week he proposed a new tax on some 50 of the largest banks to raise enough money to recover the losses from the financial bailout, which ultimately could cost up to $117 billion, the Treasury estimates.

And this week, he served notice to senior lawmakers that he wants an independent agency to protect consumers as part of any financial overhaul legislation.

Only a handful of large banks would be the targets of the proposal, among them Citigroup, Bank of America, JPMorgan Chase and Wells Fargo. Goldman Sachs, the Wall Street trading house, became a commercial bank during this latest crisis, and it would presumably have to give up that status.

“The heart of my argument,” Mr. Volcker said, “is who we are going to save and who we are not going to save. And I don’t want to save what is not at the heart of commercial banking.”

Mr. Volcker has been trying for weeks to drum up support — on Wall Street and in Washington — for restrictions similar to those passed in the Glass-Steagall Act in 1933. That law separated commercial banking and investment banking, so that the investment arm could no longer use a depositor’s money to purchase stocks, sometimes drawing money from a savings account, for example, without the depositor’s knowledge.

The 1929 stock market crash and subsequent Depression made a shambles of that practice. But Glass-Steagall was watered down over the years and revoked in 1999.

Now the concern is a new type of activity in which financial giants like Citigroup, Bank of America and JPMorgan Chase engage. They now operate on two fronts. On the one hand, they are commercial banks, taking deposits, making standard loans and managing the nation’s payment system. On the other hand, they trade securities for their own accounts, a hugely profitable endeavor. This proprietary trading, mainly in risky mortgage-backed securities, precipitated the credit crisis in 2008 and the federal bailout.

Mr. Volcker, chairman of the president’s Economic Recovery Advisory Board, a panel of outside advisers set up at the start of the Obama administration, has gradually lined up big-name support for restrictions on such trading.

But the Obama administration until now focused on regulating the activities of the existing financial institutions, not breaking them up or limiting their activities. Under the new approach, commercial banks would no longer be allowed to engage in proprietary trading, using customers’ deposits and borrowed money to carry out these trades.

“Major institutions with a deposit facility should not be allowed to invest in subprime obligations under any conditions,” said Henry Kaufman, an economist and money manager, and one of a dozen prominent Wall Street figures who have told Mr. Volcker that they support his proposal, in principle if not in detail.

Others include William H. Donaldson, former chairman of the Securities and Exchange Commission; Roger C. Altman, chairman of Evercore and a Treasury official in the Clinton administration, and John S. Reed, a former chairman of Citigroup.

“When I was running Citi,” Mr. Reed said of his tenure in the 1980s and 1990s, “we simply did not trade for our own account.”

Jackie Calmes reported from Washington, and Louis Uchitelle from New York.

Euro Dominance And American Policy


Get with the Program: Challenge for the Obama Presidency. Fundamentals vs. Brute Force

American policy should be changed to reflect the paradigm shift — to determine ways in which we would be an acceptable member of the European Union and gradually shift to the Euro as the currency of choice. In order to accomplish this, U.S. leaders must guide the country back on track toward production, rather than perceived “productivity” and purchasing power rather than perceived “corporate earnings.” Rather than the old methods of brute force, Obama’s message of consensus will do more to stabilize our economy and foreign affairs than any of the proposals of his opponents or prospective opponents. Far from being in the clouds, Barack Obama, reflecting his experience at ground level on the streets of Chicago, understands the true dynamics of achievement, especially when it comes to peace and prosperity.

The European Union and the creation and adoption of the Euro as a competitive currency to the U.S. dollar was an inevitable bi-product of the Bretton Woods agreement and an American policy that pursued brute force and meddling in the affairs of other nations rather than the rather simple logic employed by such countries as Ireland, Brazil and Venezuela who have all achieved status by investing in their greatest resource — their own people. As nations join the European Union and the Euro gains increasing market share, the perceived safety of the judgment of a council of nations rather than dominance of a single nation is becoming apparent.

Things change. While the definition of “money” has not generically changed, the character of money has fundamentally shifted in every conceivable way. Agreement, acceptance and faith are elements of human interaction and society. They are also the cornerstone of “money,” by which we measure the value of things, store value and exchange goods. 

It is common theme that the perceived dominant world player has had its currency adopted by most of the commercial world and the governments of other sovereign nations. 

Prior to the dollar, it was the pound sterling. Over centuries the main currency of world commerce has shifted from the fiat money of one country to another depending upon world perception of the strength of their economy and their political and military strength to maintain their position. 

Everyone has their “fifteen minutes” and then it is up — but nobody gives up their position without a fight. Sometimes the fight is world war, extended regional wars or other military confrontations. Other times it is a diplomatic and commercial battle in the marketplace of ideas and the relative strength and weakness of competing treasuries. 

In the end, for better or worse, a new consensus arises and the currency of the dominant country shifts along with the enormous economic, political and social power and influence that commercial dominance endows the creator of the most favored currency.

In 1944, world leaders, prompted by “economists” and pure commercial interests came up with the forerunner of the new world order emerging today. It was the Bretton Woods conference. It was a formal meeting of sovereign nations and a negotiated agreement as opposed to “market forces” or competing unilateral sovereign agendas coming into balance. It was consensus of the kind that Barack Obama proposes and which even our enemies embraced as they have ever since scurried to enhance their holdings of U.S. dollars.

This event marked the beginning of a process that would pacify the U.S. and its ever-expanding ambitions, but ultimately end up with a shared unity that was NOT tied to whims of a single government. It was a relinquishment of sovereignty that could not and would not become undone. It would grow and evolve causing pervasive changes in business, banking and relations between countries.

The Bretton Woods Agreement did two things — set a gold standard, which was a temporary measure that only the the most forward thinkers understood, and set the currency for international (world) commerce as the U.S. dollar which was tied to Gold at $35.00 per ounce. 

Using gold is a standard that was hardly new. Yet the process of formal agreement was new and that process would emerge as the only lasting impact impact of the conference. 

Gold was valued because of its scarcity, its beauty and mythic reverence that was in the minds of believers from the dawn of commerce. It worked because of two factors — on the one hand a subjective set of factors including agreement, acceptance and faith and on the other, a scarcity that was somewhat controllable by additional mining. Periodically, gold strikes wreaked havoc with the price of gold but on the average it has been a relatively stable influence on commerce. 

The weakness of Gold was in its relative scarcity to population growth and related growth of commercial activity on the one hand and in the meteoric changes in the nature of money which has become increasingly symbolic tot he point where now most of it merely exists in electronic data files that nobody can touch, feel or roll around in their hand. There is no slight of hand coin trick to display for amusement because there is no coin.

Putting these factors together brings us to the inescapable conclusion that the supply of gold could not possibly keep up with the growth of human society. Indeed that was the precisely the issue when Nixon and Volcker, in 1971 decided to withdraw from the Bretton Woods agreement, and NOT promise to back every dollar with gold valued at $35 per ounce. 

While viewers of the popular show Bonanza were doubly disturbed that their favorite program was interrupted by the President on a lazy Sunday evening and that their currency was suddenly in free fall, the Nixon-Volcker decision was merely a statement of the obvious — the U.S. already was out of balance three to one (gold on hand versus dollars issued) and the situation was clearly permanent and getting worse. We had in fact passed the point of no return very soon after the Bretton Woods agreement was signed.

This decision eventually brought the U.S. back to dominance of the the perceived leader on world affairs. But lurking underneath was the positive knowledge of other world leaders and people who would become world leaders that an agreement was not only possible but inevitable. As long as the dollar was useful it would remain the currency of choice. Now the dollar’s usefulness is in doubt — the result of “creative schemes” from wall Street, overspending, failures to invest in itself and the inevitable downfall of the two engines of any economy — production of goods and services that people want, and the ability of people to pay for them. 

The European Union and the creation and adoption of the Euro as a competitive currency to the U.S. dollar was an inevitable bi-product of the Bretton Woods agreement and an American policy that pursued brute force and meddling in the affairs of other nations rather than the rather simple logic employed by such countries as Ireland, Brazil and Venezuela who have all achieved status by investing in their greatest resource — their own people. As nations join the European Union and the Euro gains increasing market share, the perceived safety of the judgment of a council of nations rather than dominance of a single nation is becoming apparent. It is proof positive that Obama’s perception of the world is right and that the other candidates are clueless as to the realities.

This represents a fundamental but entirely logical shift. It is a change from the acceptance of brute strength to consensus — a somewhat democratic consensus that captures the spirit of the American experiment if not its announced policies and secret agendas. 

It logically follows that the tide is changing with such force that it is unlikely that any one nation, no matter how strong, will gain world acceptance of its currency as the currency of choice for world commerce regardless of its military or political power. In the end it is people who determine agreement, acceptance and faith in the marketplace.  

When people start making distinctions of their own as to which “band” of dollar has greater value (recently issued or older) and discounting the dollar based upon their own individual perceptions the currency is in trouble. There are places where the signature of one U.S. Treasury secretary over another results in a discount of 10% or more. 

Thus it is the either the Euro that will eventually overtake the dollar or some other emerging union that will find acceptance. The dollar is in free fall and no amount of bailouts, regulation or creative solutions will suffice. The goal post has been moved. 

American policy should be changed to reflect the paradigm shift — to determine ways in which we would be an acceptable member of the European Union and gradually shift to the Euro has the currency of choice. In order to accomplish this, U.S. leaders must guide the country back on track toward production, rather than perceived “productivity” and purchasing power rather than perceived “corporate earnings.” There are plenty of examples around the world as to how to do this — they all amount to the same thing — education of every man, woman and child, in skills, culture, knowledge and analytical ability. The words are very simple and have already been written: “The pursuit of happiness.”


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