Three Dozen Attorneys General To Launch Probe Into RoboSigning On Monday
Perhaps the ruling Fed dictators can just go for a trifecta on November 3, and in addition to determining who wins the mid-term elections and announcing QE2, they can formalize TARP 2 as well. The reason is that starting tomorrow, 36 attorney's general are expect to launch a joint probe into "charges some banks used fraudulent paperwork to kick struggling borrowers out of their homes." Which of course means that Dick Bove is about to start appearing on CNBC every 10 minutes, providing instanalysis how banks have gone from overcapitalized to non-capitalized in the span of a weekend, under very "mysterious" circumstances. More from Reuters: "The source, who spoke on condition of anonymity,
said the deadline for attorneys general to sign on to the investigation
effort led by Iowa's Tom Miller was at the end of the day Monday, so a
formal announcement could be made Tuesday." Whether or not that call will also include demands for a moratorium remains to be seen.
At least half a dozen attorneys general have already announced individual investigations into the foreclosure mess.
The total number of attorneys general calling for an investigation is not precisely known but it is expected to be at least three dozen and possibly more.
At this stage, the joint effort is not expected to include a call for a moratorium, the source said, though some attorneys general have already done so in their individual states.
Many, including Miller, are running for re-election or election to other offices.
U.S. Attorney General Eric Holder said last week the Justice Department is looking into the widespread reports of bogus paperwork. It is not clear if the matter is under the jurisdiction of the states or the federal government but federal officials are looking into the matter, the source said.
President Barack Obama, however, opposes a national foreclosure moratorium, though he wants a quick resolution to any foreclosures that might have questionable paperwork, top White House adviser David Axelrod signaled on Sunday.
"I'm not sure about a national moratorium," Axelrod told CBS television. "Our hope is that this moves rapidly and that this gets unwound very, very quickly."
Banks are expected to take over a record 1.2 million homes this year, up from about 1 million last year and just 100,000 as recently as 2005, real estate data company RealtyTrac Inc. said last month.
There are many question marks around what will happen as a result of ForeclosureGate. One thing is certain: injecting fresh trillions of liquidity into a market, in which deleveraging courtesy of an immiennt plunge in home prices as prospective homebuyers decide to step away from the plate in a scandal in which nobody knows just who the titleowner is, will bring such waves of volatility to an already jittery market, that only the biggest and baddest will survive. As always, we recommend that everyone else quietly step aside and let the big boys cannibalize each other's income statement. After all, everyone already knows theit balance sheets are pure magic.