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Karl Denninger Explains Foreclosure-Gate On The Ratigan Show
Karl Denninger, who has been tracking the issue of title fraud in the mortgage space for years, was on the Dylan Ratigan show earlier, and not only provided one of the most comprehensive explanations of where we are, how we got here, and where we are going (unfortunately nowhere pleasant) to date, but also was gleefully and sarcastically rhetorical with his closing remarks: "What if we find that of these $6 trillion in securities that are out there, outstanding right now, half or more of them are defective. You put them back on the banks and they all blow up. You know what - we have a resolution authority under Frank-Dodd, how about if we use it?" We would only add that courtesy of second degree, third degree, and fourth degree leverage, as we presented yesterday, the final amount of net capital at risk, courtesy of numerous other layers of debt, will end up being far, far greater than just $3 trillion. And yes, there is a reason why the OCC keeps a track of the $233 trillion in total derivatives held by US banks.
Full clip:
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This country needs an MSM that is as eager to report the news on this administration as they were on the last one.
Thank you Mr Denninger. Excellent reporting, analysis and recommendation.I agree with the recommendation. Mr Denninger show NO ego and the writer who wrote that is undoubtedly a paid dis-information agent for the satanists...
Could you expound on this ? Pike ...?
I am assuming satanists in the 'eyes wide shut' usage. To a devout Christian a Rothschild's orgy (or Friday over at Uncle David's house as we call it) Looks like a Satanic ritual. In reality, it is just a fun way to get it on semi-anonymously (wink and a nod) with some strange pussy.
Crab people, crab people
edit
Americans need to honor their debt obligations. Banks foreclose because the borrower has not made payments.
Banks need to pay for their derivative mistakes and file for bankruptcy, not be bailed out by the people.
Please. This is Amerika. We should just have housing, health care, and piles of disposable income, and eternal life for free, because we deserve them (tm). Only the ignorant stinginess of the Gumnut keeps us from just enjoying the limitless bounty that the good Lord bequeathed to us. Eventually we'll somehow get some enlightened Leader who understands that the chains of want should simply be eliminated by Gumnut fiat.
But, of course, when you point out these unfortunate realities, you're just taking the side of the greedy banksters. You're either for the poor underprivileged victimized lying deadbeat HELOCed homedebtor, or against him. You can't hate all the criminal vermin that is eating this country from the top to the bottom at the same time.
If they lend you 10 and ask that you pay back 12, then you should only pay back 10 and a big "FUCK YOU" TO THEM for usuary. And don't give me "well the banks take risks too". No they don't. They risk YOUR money because banks have NO MONEY of their own.
Banks that made fraudulent loans and are insolvent need to get seized by the FDIC and broke up rather than getting bailed out by taxpayers.
There are many legal issues invovled in this huge mess and all must be given proper deference contract obligations of the homeowner is but one, there are also property rights, due process, air-tight title transfer/recording, anti-fraud laws etc.
In regards to contracto obligations, we have long a good system of dealing with overburden of debt through bankruptcy, even if people don't get to stay in their house, there is no more reason for them to keep paying debt on asset worth a fraction of the value of the debt anymore than businesses do.
But we must be vigilant about property rights, due process, tight title record keeping. Muddy title and ownership records are just the thing that really messes up thirld world country developed. Efficient, reliable markets depend on reliable tracking and transferring of ownership. US had this for over a century, but for last 10 years we cast it aside and now no one truxts our markets, they are scary, full of fraud.
I'm sorry, in the US of all places property rights should trump all these concerns
if so, how far you wanna go?
Sand Hill Indians Now Claim Manhattan
http://www.nativeamericannetroots.net/diary/555/sand-hill-indians-now-cl...
aah...you must be that wrinkly old mole from the Mortgage Bankers Association on Jon Stewart's Daily Show....he sounded just like you, then he welched...why not, indeed.
and then, why not educate yourself and come back after reading up on Magnetar and junk yourself too.
Banks went from giving credit to a corpse to turning the spigot off pretty much entirely.
Bankster trick used throughout the millenia.
Why Not
Sorry buddy. There is an obligation but there is no damages for failing to complete the obligation, also the obligation is based on the bank giving you a loan which you will never receive.
I figure it will be another couple of years before people see the real problem, there is no loan. Banks can't lend their own credit.
Absolutely. Let's just make sure the debtor actually owes the money, and the bank is foreclosing on the right house.
Tyler please note:
"The Depository Trust and Clearing Corporation announced on Wednesday February 10, 2010 that the Federal Reserve Board has approved it's application, to form a subsidiary of the Federal Reserve System, responsible for the Trade Information Warehouse, for over-the-counter credit derivatives, under the umbrella of the Warehouse Trust Company."
This IMHO is flying under the radar, considering the mortgage fraud meltdown "black swan" event that is now upon us. What the above means to me is that all OTC CDS MBS are now backstopped by the Fed (taxpayer) if these derivative contracts go sour, since the guarantor in this game of backstopping is none other than the Federal Reserve Bank. Did they know something that the we didn't back in February? Tyler - can you shed some light on this with your many and varied magical sources? THX.
Sounds like TARP II- the toxic affadavit relief program paid for by the taxpayer once again.
http://www.zerohedge.com/article/otc-derivatives-dtcc-too-big-fail
http://www.zerohedge.com/article/enter-cede-co-ii-fed-now-backstopping-25-trillion-dtcc-cleared-credit-default-swaps
Tyler, Thank you for your prompt come back and links.
WOW! These MBS derivatives are in effect backed by the taxpayer, compliments of the FRB, when and if they require unwinding. And by the looks of "MortgageGate" this is where these financial instruments of mass destruction are headed! All I can say is WOW! KABOOM!
Gosh ... the exchanges were much more civilised and reasoned, way back then. :)
Why does everyone keep saying black swan. A black swan event is one that no one could see coming, that had no precedent. Anyone who knows banking could see the mortgage crisis coming years before it occurred. There is a reason old time bankers would not make the crazy loans that were made, because everyone knows they won't be repaid. This time everyone thought they would be clever and palm them off on someone else but they still blew up as usual.
The banks will be in stall mode again now big time. They have every incentive not to hurry the foreclosure process.
You will be able to tell if the paperwork was clean. The people will be thrown out within a year. If not, they may be there another 10 years or longer
Five years in CA, and that clock could have started ticking 5+ years ago.
Adverse possession, bitchez.
I think the states will have every incentive to SPEED it up. Hefty fines against the banks can fill budget shortfalls.....
It going to be tobacco all over again.
"smoke em" if you "got em"
Short the banks...once this issue grows legs, the banks are toast...major liabilites here.
AIG..CDS..MBS..DERIVITIVES..CDO..FANNIE..FED..They are nothing but a bunch of cronie synthetic junkies that need some serious rehab.
http://www.youtube.com/watch?v=X5LyhSWzJaU&feature=player_embedded
Squatters rule
renters drool
After all those toxic mortgage backed securities got stuffed into the Presbyterian Church USA's main investment fund for churches (New Covenant) by Wachovia subs Evergreen, they can all go rot. You know where.
Only half the Church's bond fund was even AAA, and almost all of that was toxic MBS. Only 1% Treasuries.
And the DC/NY elite decides to cripple the economy for 20 years and saddle my babies with hundreds of thousands of debt while they're still in diapers...to keep their precious Friends happy.
We're just getting started on the consequences. Not even started. The theft is so large that it's been two years of pure shell-shock. That won't last.
It goes back to the year one. You didn't stand a chance son.
http://www.youtube.com/watch?v=ZTKu-L1b--o
Awesome, Dylan. Thanks. :D
I am surprised that Douchinger's head has not already exploded with gold decisively above $1300...go figure. Maybe he has a fat xanax prescription to control the stress
2 ~~500mg plus a scotch on the rocks will do wonders...
Why, in the face of all the evidence, is this system allowed to continue?
"I have a friend who worked at the Pentagon and he tells me America has been taken over. He says the Israelis have operatives at all levels, including even the lowest of positions, answering phones and working as Senate pages. He asked me to examine a few facts for him and so I started doing a little research. I was shocked to see what was uncovered just doing a perfunctory study. From the surface to the murky depths our Government, our media and our society have been inundated with a self-serving power structure of secularized avarice which could prove to be very dangerous for America and for the American people. Look at this research and if you follow it, it continues to uncover layer upon layer, upon layer; every where, in every way, America has been taken over to an extent which is simply amazing!"
http://www.veteranstoday.com/2010/08/24/israeli-control-of-america-a-vet...
You paste a link, I paste a link.
http://www.scientificamerican.com/article.cfm?id=multifractals-explain-wall-street
I have to admit it. The Mandlebrot is fucking cool.
Obama may soon wish he had not vetoed the Aderholt bill today; you know, once his bosses explain it to him...
Must look at the design of the bonus system -- its how the CEO's can instigate fraudulent practices on down the line...
i know that Karl is not a fav of many who comment here, mainly I think because of his position on gold(not to mention his prima donna personality). But I am glad he gets the respect he deserves when he actually does know what he is talking about.
I like Karl because I think he drives the Mensa highway.
Nice piece. This has gone viral and mainstream in one week's time. Even that stiff anchor on the NBC nightly news led with foreclosure-gate.
Folks, don't be mistaken, this was the crime of the century. Banksters made money on originations, selling the MBS, TARP and now foreclosures. That is one neat scam, getting paid four times on the same rotten deal. I'll bet lots of these guys - like the dirty dozen who left Merrill Lynch for parts unknown when that crumbled - have escape pods, stun guns and bodyguards at the jets, ready to head for Mali or Bali or some other non-extradition nation (Venezuela, anybody?).
The fun is just beginning.
You nailed it.
Crime of the Century -
"Who are these men of lust greed and glory? Rip off the mask and let's see."
When the perps start ending up in jail, then things will be fun. Regardless of how much money was stolen. Justice needs to be served.
For any kind of system at all to ever exist, ever, JUSTICE MUST BE SERVED.
These cunts in office are dry humping one another to pass a VAT in America.
End of mystery.
Thanks KD for all the work you do.
They truly should go to hell. We need to stop paying our taxes. It's that clear.
Dust off, and nuke it from orbit.
It is the only way to be sure.
All good comments.
Rattigan-“Why isn’t our government dealing with it now? Perhaps because that would reveal systematic and criminal fraud at the highest levels of America’s banks and political corridors.”
Public awareness is building. Unfortunately, I think there is a real prospect that our attention will be diverted with some kind of event or emergency soon enough.
Its about that time ... no way out.
Yea,
So they false flag it, just like when the $ 2.3 TRILLION went missing from the Pentagon Audit Committee, according to Rumsfeld, and the next day 9/11/01.
I listened to an interview with a guy who was the former official photographer for FEMA. Right after 9-11 he was sent in to photo-document damage. (As I recall the public was prohibited from photographing the wreckage) Anyway this FEMA guy was given a full tour. He described how when taken to the basement area of Building 6 which had experienced no fire and little damage he was shown where the government documents / evidence in the SEC/federal criminal investigations of Wall street had been kept in a fenced, secured area. Everything had been cleaned out, nothing there… now that’s juice!
Anyway the FEMA guy wouldn’t give up his film to the gov and fearing for his life had fled to South America (from where he was giving the phone interview).
I can’t envision the syndicate cleaning this one up. One option is a really significant and continuous disruption to keep us focused and fearful of some synthetic threat. They must remove the rear view mirror.
I have heard from a good source that all police force etc. are on alert for things like IEDs and other bombs and the "Terrorists" are in this country and ready to strike , black swan event imminent.
This whole thing reminds me of the expression "hoisted by your own petard".
The financial system has been rewarding the "hollow company" model for decades now; a bunch of low paid lackeys on the bottom, a clique of high paid execs on top, and only a few knowledgeable and competent mid-level employees with a bunch of computers to bridge the gap between the extremes. Looks like that model came back and bit 'em on the ass.
After all, isn't that what killed the titles? In their rush to make max money, these banks were too cheap to hire enough people to handle the paperwork; instead they tried to fake it all electronically for pennies. There used to be a name for folks who handled that kind of stuff... dotted all the i's and crossed all the t's. I checked a history book... they used to call them "bankers". In essence, the banks were too cheap to hire actual bankers.
It's a modern day parable... a lesson in all that is wrong with post-industrial post-moral post-modern America. They outsourced the care and feeding of their most valuable asset -- legitimate, legal titles to trillions of dollars of housing -- just to save a short-term buck, at the cost of their own long-term health.
Turns out you really can't run a bank with only tellers, salesmen, and MBAs. Those anal retentive fussbudget banker guys served a purpose after all. Imagine that.
Nicely put. And one of the reasons I don't think the banks will escape from this. They have no one else to blame but themselves, and the meme of not doing paperwork properly and still kicking j6p out doesn't look so good.
For the first TARP, there was a quasi-acceptable "no one thought this could happen"-thing. This time, they didn't do the most basic part of their jobs: reading documents, signing/transferring, filing and storing. And the country hates them that much more. We're two/three years into this depression. And everyone now believes it was the banks' fault.
Too bad Karl comes off as such an arrogant asshole, does he EVER shut UP??
I think Karl has nice hair.
Herr Denninger has Weimar hair
it is a bit creepy like that
Word.
3 trillion is the new 100 trillion with Kevin Bacon derivative math.
Tyler, I noticed that Beck plugged ZH on his T.V. show yesterday. Will we be seeing Mr. Pitt on beck in the near future? That truly would be a hoot and a must see!
He sited ZH's reporting on the mortgage fraud.
Confederate flag.
Watches Glenn Beck.
Of course.
Slave owners and confederates have all been racist segregationist Democrats, from Jefferson Davis to Al Gore Sr. The Republican party arose spontaneously as the anti-slavery party from nothing in 1854 to stop democrats from expanding slavery, and they took over DC in 1860
Of the 5000 people lynched by democrats during Jim Crow, 1350 were white Republicans still fighting for black civil rights after fighting the civil war to free the slaves -- which was the only time in world history a race and class has fought it's own to free another race and class from bondage.
MLK was a Republican and marched on Washington in 1963 because it was run by racist democrats who wanted to turn back the Eisenhour civil rights, like Brown vs Board Ed. 1954
Read a book and get it right if you're going to do it at all
You unwittingly just proved yourself wrong.
Not once in my post did I mention racism, nor was it mentioned in the post above mine.
All I did was connect Glenn Beck to those who are very proud of the confederacy. My point was that it was not surprising that a Glenn Beck viewer would also find some identity in that confederate flag.
You, YOU, are the one who swung in on your vine and began a peculiar defense about how racism is not just a Republican phenomenon.
Quite laughably, for you to immediate associate racism with Glenn Beck and confederate flags convincingly blows a hole through your own point.
You doth protest too much.
oops
Karl D headlined on ZH!
Crisis makes for strange bedfellows.
Looks like most of the major alter-pundits have been right about one thing (Karl mostly on Money Supply as I see it, Velocity of Money, His breathless call when the multiplier fell below zero).
Looks like brains come with outsize ego's attached for the most part, eh?
ORI
http://aadivaahan.wordpress.com
"Looks like brains come with outsize ego's attached for the most part, eh?"
that and a very realistic looking hair piece
or is that a muskrat on his head?
We've gone from a country that makes things to a country that makes things up: CDOs, synthetic CDOs, CDOs squared. -Arianna Huffington
357 MAG HYDRA-SHOCK will stop foreclousure bank thugs 100% of the time. I guarantee it and approve this message!
Hoser
I had no idea that Black Panthers can sign mortgage documents. That would explain Eric Holders' lack of enthusiasm in stopping this!....... If I was an investor of MBS I would go after these banks who packaged these bad-loans and sold off as AAA paper. Oh yeah, go after the rating agencies too. GOOD LUCK!
Hoser
Denninger is a twat.
Back in early 08, while he was busy censoring everybody who dared post contrarian thoughts on his website, several of us argued that hyperinflation was inevitable.
He blew a gasket spewing apple pie whilst vehemently demanding that the Fed would NEVER monitize the debt because that would destroy the dollar and they would NEVER do that to America.
What a rube.
He's a founder of the Tea Party movement?
Again, that's about right.
Not that I don't love the idea of fiscal restraint, but the idiot nationalism and religionism that runs through that "movement" describes him to a T.
Denninger is terrific. Sometimes his bellicose conservatism turns me off, but his anger and economic analyses are SPOT ON.
One quick point about fraud and 'the rule of law':
THE RULE OF LAW is a hoax. The ONLY WAY for the USA to retain its somewhat hegemonic position in world affairs is through violation of THE RULE OF LAW. The only way to keep the economy from coming completely unglued in the present is for the government to conspire with the financial industry to promote fraud in every way, shape and form.
A question
What would motivate our liberal-minded, middle-class-embracing, health-care-reforming President to give lip-service to increasingly stringent regulation and oversight of our financial system whilst simultaneously turning a purposeful blind eye to all of the fraud and graft that continues to "grow" and sustain that very system?
The answer is simple. It's because without the fraud- without the likes of Goldman Sachs and JP Morgan Chase having a totally unfettered ability to turn a profit regardless of issues of legality or morality- the economy crashes. We have entered a period in our history in which the material existence of a recognizable United States of America is predicated upon the banking sector having the ultimate freedom to make trillions of dollars in fraudulent profits- profits skimmed off of the top of risk free (and thus illegal) gambling operations and funded by tens of trillions in consumer and governmental leverage and promises of massive bailouts should the bets fail. Profits by hook and by crook. Profits not based upon the creation of productive capital, but based upon the perpetuation of myriad Ponzi and pyramid schemes.
It is time to call us what we really are: No longer a Democratic Republic, but a political and economic syndicate whose 4-5% per annum growth is based upon the fraud and theft and lies and graft promulgated by Wall Street and promoted by Pennsylvania Avenue.
Welcome my friends to Sopranoland!!
It's pretty straightforward stuff. Regulation and oversight circumscribe the banking sectors ability to make their hundreds of billions, right? That's why real oversight of OTC products like Credit Default Swaps will NEVER occur. That's why on the one hand our President waxes eloquent about the need for the banking industry to face new and real oversight, while on the other hand his administration does NOTHING to actually enforce such "beliefs". In fact his administration (And lest you forget, I'm a Liberal Democrat. I voted for him!) does the opposite: it finds ways to promote the "profitability" of the very industry that trashed our economy while in the same moment putting forward, to the public, words of justice and righteousness.
Real regulation? An end to fraud? Forget about it.
You see, if our leaders REALLY believed in true reform of the financial industry, they wouldn't create obstacles to the imposition of such reforms. Why aren't banks being forced to put all of their assets on the books? Why are the banks allowed to value their assets NOT to the marketplace but to pure fantasy? Why are OTC products like CDS still being traded when it is those very unregulated OTC products that precipitated, to a great extent, the coming of this economic crisis? Why is there opposition to auditing the Federal Reserve when it is the Federal Reserve who- through its "open market" operations- has dished out trillions of dollars in tax-payer monies in an effort to save the very banks that have brought the nation to its fiscal knees? Why is the FHA helping to originate mortgages that, like their subprime cousins, lack any reasonable expectations with regard to upfront capital requirements for incipient homeowners?
Why? Because pulling the plug on the fraud and on the pyramid-scheme structure that defines our economy would mean pretty much immediate 30% contraction in GDP and subsequent economic depression. It IS that simple.
The United States of America should be renamed [Tony] Sopranoland. Our big house in the suburbs (subsidized by decades of false economic growth) has been purchased with the profits skimmed from running numbers and selling heroin and pimping whores and strong-arming local businesses. If we "went straight", we'd lose our suburban home and our fancy cars and our fine wines. Either we protect the syndicate (and keep our big houses and fancy cars and fine wines) at all costs, or we "get honest"- and contract.
Hmm. Lemme guess which path our leaders will choose.
D'ohBama's pocket veto of the bill that would have allowed much of this to be swept under the carpet is a very interesting if unexpected development. Especially odd due to Eric Holder's no show so far. He must be too busy suing Arizona.
Combined with the departure of the odious Rahm, Bummers, Axelrod and the other banker butt boys and the fact that Frank Dodd does have resolution powers that could slam the brakes on the scam cycle, I wonder if the pocket veto means the worm is turning.
If D'ohBama has any smarts at all, he's realized that getting onboard with the American People on this right here and right now would be the October Surprise he so desperately needs.
I enjoy reading Karls Tickers, The word Fraud is in almost every sentence and correctly so, Karl explains with facts the the rule of Law itself has been so corrupted in the US, The country is heading to the status of a banana republic,
Karls message is do nothing and thats exactly what the US will be or revolt by legal means to stop the corruption of the elite.
Myself I am in the UK and here the corruption of the elite is just as rife and its not if the UK will be a banana republic but when.
I accept the UK is a failed state as a UK resident I have no political representation, The political say I have is a vote once every 5 years to vote for a bunch of treacherios liars guised as democrazy who work for the nwo to screw me over, I will never vote for any of the 3 main corrupt partys ever.
Freedom of speech in the UK is nearly outlawed here, at least the US thats not the case YET has wikileaks gone?
Keep up the good work Karl
"Force the bad paper back onto the originators, repay the MBS holders"......like Countrywide or the other BANKRUPT originators???? Do you suppose the security holders may have already been repaid through TARP, Maiden Lane I, Maiden Lane II or AIG ?? How many times do you want to repay the same debt mr. sleeper cell for Goldman Sachs. Maybe someone should inform Karl you cant reconvey fraudulent paperwork back onto anybody. How about repaying the homeowner all monies they have paid to date, on property that now has clouded title. Gee Karl, who do you suppose has the authority to sign a satisfaction of mortgage if they dont have authority to foreclose??? What of those pesky second mortgages, that are backed by a defective mortgage.
Oh yea and lets give the money back to the pension fund managers......... so they can blow it in Vegas.
Last call baby.
Finally, this national travesty is getting some decent air time!
this is just smokescreen. a lender should legitimately be able to get back their collateral quickly. the way the modern court system operates , it can take years. the banks are not being treated appropriately by the system in this particular respect. however the real story is that the excessive loan making and securitization which led to an inevitable collapse in both inflated home prices and 2007 level employment rates, is largely the fault of not only the banks but the government. Should the government , court system, and banks themselves push for a speedy foreclosure process it will be all too obvious that this collateral was loaned out for the sole purpose of ripping off millions of home owners.
not to mention that TARP is basically a financing program that is allowing the large banks to be solvent long enough to pay their lawyers to initiate foreclosures. the government bail out is actually a financing program that subsidizes the bankside foreclosure process. meanwhile all the 'mortgage' help the government is giving homeowners is not going to help alleviate public anger against the government and banks.
this is a large mess. it's only likely to get messier not more organized.
so can i keep my surfboard?
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