Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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The 2007 year started out reasonably calm, and ended with constant damaging storms in an utter barrage. Wall Street denials of the housing crisis and mortgage debacle were as consistent as they were a departure from reality. The next big facade of deception to be smashed will be that the mortgage loan and bond problem is a subprime issue. By summertime, a gigantic crisis in mortgages will be recognized far beyond the boundaries of subprime. It is instead an adjustable mortgage issue, whose emphasis is firmly on recently written loans. By late next year, the climax to the mortgage debacle will be the horribly painful writedowns to prime mortgage bonds, from basic falling national housing collateral value. If the Untied States suffers another 5% to 7% decline in home values, the entire mortgage bond structure will be downgraded, lowered in value, sufficient to threaten the entire banking system. Below is a quick list of specific denials with ample spin, hard to swallow but heard frequently. Let this be a record of 2007, a litany recitation of corrupted information. Wall Street and their attendant media outlets and advertiser accomplices must paint a decent face on a turning point year coming to a close in 2007. It ended in truly deadly fashion. In just a few days recently, the following claims were made in the financial networks, from anchors to guests alike. They looked like liars because they are liars.

The real estate downturn was overblown. A modest correction took place, rendering prices more reasonable, taking the froth off the market, removing the speculators, bringing the system back to normal. What a crock! Watch inventory growth and continued home foreclosures. Watch housing values continue painfully down another 5% at the very least next year. Watch the incredible effect when prime mortgage loans and bonds crash as the next phase of this powerful bear market unfolds. National prices are down 6.7% for the last twelve months ending October in the top10 cities, and down 6.3% in the top20 cities. In eleven of the top20 cities, the largest single annual price decline has been recorded. Data comes from the S&P Case Shiller index. The prices are actually accelerating downward, in synch with inventories, as a valid expression of Supply & Demand dynamics. The ugly side to this story is horrendous mortgage fraud at every conceivable level. Small rings engaged in fraud with appraisers at the loan level, then abandoned loans. Lenders engaged in fraud at the volume level by promising refinances never to occur. The system enaged in NINJA loans on a rampant scale, requiring No Income, No Job or Assets. Bankers engaged in fraud at packaged bond levels by blatant misrepresentation. This downturn has already caught the attention of some more diligent analysts, who have begun to recognize it as deep and damaging as anything seen since the Great Depression. We will witness a depression with an Orwellian spin, all the pain but little of the recognition. On the footpaths traveled by prospective home buyers, they hold back, realizing the market has not stabilized, anticipating better bargains ahead, as they assess that housing is not a safe investment, period. The American dream of a home has morphed into a nightmare, a prescription for losing your lifelong savings.

The worst is over in financial firm bond loss writedowns, as the bank sector offers huge stock bargains. The stock selloff in bank equities is overblown. What a crock! They openly admit that the smartest guys in the room missed the big bond problem. Of course, they missed the problem, since they were feverishly trying to sell their lethal fraud-ridden bonds, the centerpiece to the problem. An old adage is appropriate, that hidden losses are triple the size of initial estimates. By the time more dust clears, Wall Street banker broker dealers in toxin will report bond writedowns totaling over $300 billion, perhaps over $500 billion. If the upper figures are a reality, then the financial nucleus on Wall Street is bankrupt. If lawsuits come fast & furious, their losses will easily surpass $1000 billion. The BKX banking stock index shows freefall, not any conceivable hint of reversal or stability. The funniest chapter of this tragedy is the continual renaming of the packaged bond toxin for sale by Wall Street. Collateralized Debt Obligations are not too bad sounding. Structured Investment Vehicles sounds more like trucks circling the city endlessly, whose bond cargo is unwelcome in any garage. Unidentified Financial Objects sound like they belong in Roswell New Mexico with other UFO sightings. They were designed to hold the unlabeled portions of dead bond packages, but jettisoning off the dead parts. The Master Liquidity Enhancement Conduit (MLEC) was a bold attempt by Wall Street to obtain USGovt bailout help, deceiving the US Congress and the public with a fancy label. The name of the game is to rename toxic agents, like salmonella, trichinosis, ptomaine. The public is not very educated, a strong advantage for the shell game artisans. There is innovation here, but only in packaging, nothing in value. This is not your father’s typical credit cycle. There is nothing healthy about what is happening, and no signs anywhere of stability of the situation. This is NOT the system working it out, but rather the system NOT working much at all. 

The USEconomy has suffered no spillover from the housing crisis and mortgage debacle. Never under-estimate the US consumer. Claims continue to flow in that the economy is resilient, its back is not broken, growth continues, and consumers are hanging in there. What a crock! Those who embrace such spurious views must pay too much attention to the official USGovt statistics, and not enough of the regional sources (Philly Fed, Chicago PMI, business investment) relating to manufacturing and services. Has anyone noticed that the consumer retail figures are not inflation adjusted, and are running well below even the doctored CPI series? Retail is in decline in real terms. The consumers and households where they live are under strain never seen before in several decades. Energy bills this winter have absolutely slammed households, the worst being in the NorthEast with heating oil. The last resort has been credit cards, since $500 billion less in home equity extraction was pulled in 2007. The credit card delinquency is rising. In fact, most delinquencies are rising, probably juvenile delinquencies also. The occupant of the highest office in the land might be another. When bonds backed by credit cards and car loans go bust in 2008, the denial will fade away. 

A USEconomic recession is not being indicated in the stock market, which is still an efficient market mechanism. The major stock indexes have held firm, withstood corrections and sudden selloffs. What a crock! Most major sector indexes have broken down, including banks (BKX), brokerage (XBD), mortgage finance (MFX), homebuilders (HGX), real estate investment trusts (RMZ), chips (SOX), retail (RLX), but not pharmaceuticals (DRG). America continues to be the sickest and most medicated in the industrialized world. And to be sure, the energy sector (XLE) is a strong as Atlas, while the Global Energy War rages on. Lest one forget, the defense industry (DFI) is doing swimmingly, as war is this administration’s middle name. Sorry, got distracted by details. The claims of an efficient market mechanism should bring laughter from the lowest portion of the human gut, with deep guffaws and bellows. The Plunge Protection Team has never been more active, and its activity has finally been admitted by the chieftains of the Titanics at sea, the ships of state. The Working Group for Financial Markets has worked overtime in 2007, rescuing the S&P500 with timely leveraged buys at 3pm. The PPT reach is broad, from stocks to bonds to currency to gold to oil. They have totally corrupted the entire financial market system. There is an efficient market mechanism at work, no denial here by me, since the PPT has efficiently destroyed the markets. So the S&P index is not pricing in a recession. Fine, everything else is!!! We have a situation where the top level overall measures show resilience, while all the components are breaking down. The Gross Domestic Product to measure economic growth has not faltered, while almost all economic components are in recession. The insult is to the doctors who falsify the all important aggregate measures, for the greater good. This is like saying every child in your family is sick, parents included, home structure also, but the family itself remains healthy and the home is strong. In the earliest school years, one should have learned that 1+1+1+1 does not equal 10. Every lie requires three more to support it. They powers forgot to lie with the components.

Foreign investment in US banks and institutions is a sign of strength, as they are attracted to opportunity in the United States. They see value in the US with bargain prices. What a crock! Foreign investors and institutions are actually racing to infuse cash into the several large banks in order to prevent a very ugly series of public declarations of bankruptcy. Start with Citigroup. Add Bear Stearns. Maybe pitch in Wells Fargo. The words ‘insufficient capital’ should tip off intelligent people, but so far that has yet to occur. The words mean insolvent and bankrupt, with absent cash liquidity being the linchpin for filing for bankruptcy. Foreign infusions like from Abu Dhabi, Singapore, even Citadel, these have stemmed the capital inadequacy condition, but not the insolvency. They are still suffering from assets being outweighed by liabilities. Their bonds and related derivatives have gone sour, resulting in magnificent losses. This is nowhere over. My view leans more on reality. Most Wall Street banks are now vampires, walking dead. They almost all seek huge gifts from the USGovt, at costs born eventually by the US taxpayers. Even that entity (taxpayers) is something of a joke. The Untied States does not pay its own bills, not when gargantuan federal deficits are financed by Arabs and Asians via recycled trade surplus. The printing press might soon be the biggest single support mechanism for US debts. The foreign institutions are taking a stake in control of the US system itself, even while they attempt to prevent the bankruptcy of some of their largest investments. If Citigroup did not receive the multi-billion$, how far would a bankruptcy filing be down the road? These banks are as busy trying to dump mortgage bonds as they are resisting compliance of accounting rules. They have so much garbage assets sitting off balance sheet, it has become openly humorous. No, the US system is being sold. Sovereignty is being compromised in open visible fashion. Expect in a few years to apply for a car loan from Arab and Chinese banks. They might actually be more honest.

Reasonable credit standards have returned to the lending process, an indication that the system has corrected itself. What a crock! Bankers and mortgage agencies have turned into scaredycats, afraid to lend even to qualified borrowers. They distrust all collateral presented, since either assets are questionable in value or markets are too opaque. Many loans are approved, but down payments are much higher than ever before. Lenders are properly afraid that home collateral will gradually vanish. Anyone who makes the above claim must not be watching the interbank commercial paper market, as sizeable amounts shrink every week, almost without exception. Anyone who makes the above claim must not be watching the LIBOR rates, which continue to give the US Federal Reserve skimpy shallow myopic solutions a failing grade. Anyone who makes the above claim must not be watching the parade of banker bond writeoff losses. Anyone who makes the above claim must not be watching the collapse in mortgage bond indexes, even the significant losses to primes. Anyone who makes the above claim must not be watching the banker capital ratios plummet. Anyone who makes the above claim must not be watching the delinquency rates on loans of almost every conceivable type. Anyone who makes the above claim must not be watching the decline in residential home values, the collateral for many asset backed bonds.

The US banking system is heading deeper into crisis. Just like the Japanese banking system went insolvent during the 1990 decade, so has the US banking system. This has been a Hat Trick Letter forecast, registered in 2005. Japan kept many insolvent banks afloat, refusing to log soured failed assets on their balance sheets. Japan ran trade surpluses. Neither does the US run surpluses, nor its banking system fully enable prevent dead assets from showing up on balance sheets. Few properly link the resuscitation of the Japanese banks with the rise of China in the Asian sphere. The industrial buildup in China owes its equipment investment primarily to Japan, not the US. The majority of Japanese trade takes place with China nowadays, not the US. The US banking system will continue to implode. Wait until the prime mortgage implosion next year. We are not even in middle stages to the housing crisis and mortgage debacle. IT WILL CHANGE THE ENTIRE US SYSTEM, IN EVERY PHASE, NOT JUST FINANCIAL.

Globalization has made America strong, a successful initiative in free trade. High trade volumes mean improved wealth and living standards. What a crock! No doubt that global trade has advanced to great heights and huge volumes. Imagine a corporation with very high worker wages and not great reliability either. Expose that corporation to increased competition, and that US firm gradually liquidates. Imagine a corporation with moderate costs from regulations and high taxes. Expose it to foreign competition from rival firms who have absent regulatory burden and lower taxes, and the US firm gradually liquidates. Executives of US firms see fully the high wage, regulatory, and tax costs. They want to capitalize on greener pastures overseas. This is capitalism, and the loser is the US worker and tax base. The winners have been investors in multi-national firms. The list of US firms doing over 50% of their business overseas is growing. The other list of US firms whose employee base is over 50% overseas is also growing. The list of US firms with Research & Development located overseas is also growing. These US firms benefit from globalization trends, but not the US workers. By the way, the Chinese yuan currency is not the problem. My assessment is that the yuan could be upwardly revalued by 100%, but the wage differential would not be totally addressed. That ratio is between 5:1 and 10:1, not to be fixed even by a big currency adjustment. Their country has a few more people than the Untied States, with more migrating from the rural areas every year. Story of globalization reads like another chapter of a US tragedy novel.

Gold is giving the wrong inflation signal, since the Consumer Price Index has yet to show any surge whatsoever. The rise in gold has no basis. What a crock! The most crucial of all economic indexes is the CPI, whose doctored numbers permit broad price inflation to be misrepresented as economic growth. Cost of living increases must be kept low for Social Security payments, for government pension payments, and for all manner of official statistics often reported after adjustment for price inflation. The export of inflation has been increasingly difficult recently, sure to be more difficult in 2008 after the global revolt against the USDollar and toxic bond export from Wall Street, not to mention trade war with China. When money supply is growing at 14% to 15% in the US and Europe, systemic price inflation must be immediately in its wake. IT IS! The Shadow Govt Statistics folks report a CPI without gimmicks over 10% steadily in monthly figures, more in touch with reality. They also report a GDP in reverse, as in minus 2.3% for 3Q2007 and running negative in almost every quarter since 2001. No no no! Gold is flashing a warning signal from unprecedented Western bank monetary inflation, the likes of which have never been seen in modern history. Gold is flashing a warning signal for banking system breakdown, even geopolitical global tensions. To be sure, some new money supplied to the system has gone to offset dying assets in bailouts. The rest spills into gold and crude oil and other materials. In 2008, gold will hit $1000 per ounce without the slightest exertion. After the banking panic, economic recession recognition, continued revolt against the US$, and utter desperation to seek remedy, gold will advance toward $2000 very quickly.

The crude oil price is heading down, since the majority of analysts and principal observers believe in unison that it is heading up. Contrarian principles rule, since buyers have already bought their positions. What a crock! This is not a contrary investment setting. They must not have been seeing the USDollar distress, the revolt by Arabs and Asians alike (not to mention Russians), the relentless growth demands from emerging economies, or the gradual depletion in major oil fields. To be sure, a slowdown in the piggish USEconomy will result in lower US-based oil demand. The Untied States account for 25% of world crude oil demand, and 10% of world gasoline demand. However, emerging economy growth remains rapid, from Brazil to Russia to India to China. Will their growth eclipse the falloff in the US demand? We will see. Any further weakness in the USDollar will cause the crude oil price to climb in offset. The only ground worth giving here is that the USDollar might stage an intermediate level rally, in counter-trend. If it does, then crude oil will head toward $80 per barrel. Such a counter rally might be underway, and might be almost over as the year closes out. The problems behind the fundamentals in the oil market are too grotesque to fix. The producers need higher prices to develop difficult oil fields. My forecast is that gold will outperform crude oil in future months, as the economies slow further and the bank system implodes further.

The most perverse side of the crude oil market can be described in disturbing terms. In order to finance the USGovt debt, a higher oil price is necessary. Why? Since the Arab nations, or more generally the Persian Gulf nations, feel compelled to recycle their surpluses into US$-based financial securities. They depend upon the USMilitary for protection. Call it a Protection Racket, more precisely. If it isn’t a pack of infidels occupying bases next door, it might be a terrorist attack out of nowhere, to rattle the Arab cages into continued USDollar support. Watch the Saudis for a sever or crack in support. Another truly perverse factor is involved. The USEconomy needs fuel to power its many functions. Therefore it needs to ensure oil supply. The military offers assistance via annexation. Try the converse. The USMilitary needs fuel to wage war for its own objectives. With its security groups, it acts much like a sovereign entity, but whose costs are largely covered. Therefore it needs to conquer and control the nations rich in oil. Does it matter which drives which? Just Wednesday, the mere story of Turkish military attacks in Kurdistan, an Iraqi province rich in oil, drove the crude oil price up toward 96. This demonstrates the frailty of any crude oil selloff.

CNBC has degraded in 2007 in its integrity, let it be known. The US financial news network has always served as a platform for Wall Street spin, blatant promotion. In 2007, in my view the network slid further down the slope of deception and basic pumping the propaganda. The loudest and most obnoxious player is clearly Larry Kudlow, whose specialty is to interrupt his guests when they explain opposing viewpoints. The Kudlow byline is “Right on the USEconomy, where if the Congress comes through on low taxes, limited government, and free trade, you will make money.” In the last several years, taxes continue to plague the entire US spectrum, led by the problem child of Alternative Minimum Tax. The size of the USGovt has grown to frightening levels, leading in job growth, as the state rises in power. Free trade has been the open door for exploiting cheaper foreign labor, in the hidden liquidation of important segments of the USEconomy, resulting in an unprecedented Middle Class squeeze from falling wages. Since 2003, the average price adjusted wage in the Untied States has fallen by 4% to 5%, depending upon men or women. If one properly adjusts wages for inflation, the fall is more like 25% in real wage decay!!! The CNBC network continues to talk down gold, to embrace CPI price inflation data as valid, to embrace GDP economic growth data as valid, to embrace BLS jobless data as valid. The CNBC network does not provide the information you need or put forward the people you trust. They serve as a potent dominant Wall Street mouthpiece and promotional vehicle, one Orwell himself could comment on in clear prose.

The CNBC network has its majority of advertisers come from Wall Street and the related financial sector. They are biased. They do give 5% of their time to tremendously adept guys like Greg Weldon, who just finished a quick interview. He explained how the US and European central banks are providing a huge monetary stimulus even though their own price inflation figures are rising, specifically citing the $500 billion by the Europeans to ensure adequate credit to their banking system. He points out the huge liquidity stimulus by the Europeans, not yet by the American counterparts, in pumping up monetary inflation. Weldon still likes gold, and even more platinum, since the USFed has crossed the line in stimulus despite the price inflation warning signals. He believes the US consumer is saturated with debt, so central bank efforts will result on pushing on a string. That usually results in a vast increase in the central bank stimulus. If it does not work, do more of it!!!

Lastly a happy note, for those who embrace truth. No longer are we hearing nonsense like how trade deficits are a sign of US financial strength. The foreign central banks and major financial institutions continue to be flush with cash, most being basically monetary inflation exported from the Untied States. With recent unraveling of the US$-based recycle process, with the advent and rise of the powerful Sovereign Wealth Fund, the landscape has changed. The hedge funds have been put to the back pages, as the SWF funds have been elevated to the front pages. The SWF funds have become weapons used by nations hostile to the US interests, utilized to oppose the USDollar, utilized to oppose the hegemony, utilized to resist the global structure. During the great recycle resistance, as manifested in more accurate terms as the breakdown of the Bretton Woods II pseudo-agreement, the risks of such grand foreign credit dependence is more recognized these days as a weakness. Bring in Wall Street fraud hucksters, export a couple trillion$ worth of toxic bond sludge, and this so-called advantage is seen as an avenue for Wall Street corruption, and foreign anger, revenge, revolt, and retribution. Now that same Recycle Avenue has become more of a One-Way Street.


Hey! Don’t look now, but the Canadian Dollar has recovered almost back to 102.

© 2007 Jim Willie, CB
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Jimmy Cayne

Hey, that Jimmy Willie must be smoking the same stuff I am!  Hardy Har Har....

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Dear Arky Girl,

    Much of what you say seems true, however I think your belief gold is
going up must be wrong. Swiss Banks are selling gold, ie selling at the top.
This tells me they are expecting widespread deflation around the world.
The dollar is grossly undervalued as any European will tell you when they
come here to visit and compare prices. The US dollar is backed by what
we have here. That is why everyone with a brain around the world wants
to be here and why we have such an immigration problem.
    Look at all the hucksters trying to peddle gold at the top. They are
pushing it to get rid of it before it collapses. See what happened to
gold prices after 1929. The price fell so low, Roosevelt had to artificially
raise its price or governments would have run out of cash. The same
will happen again.
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Much of what you say seems true, however I think your belief gold is
going up must be wrong.  Swiss Banks are selling gold, ie selling at the top.  This tells me they are expecting widespread deflation around the world.  The dollar is grossly undervalued as any European will tell you when they come here to visit and compare prices.  The US dollar is backed by what we have here.  That is why everyone with a brain around the world wants to be here and why we have such an immigration problem.


Look at all the hucksters trying to peddle gold at the top.  They are pushing it to get rid of it before it collapses. See what happened to gold prices after 1929.  The price fell so low, Roosevelt had to artificially raise its price or governments would have run out of cash.  The same will happen again.


Everyone should disregard what Mr. Roper, George, t, ka, Bill and other regular posters say about foreclosure and the law.  Mike H. is ALWAYS RIGHT.


For example, on January 2, 2008, Mike H. cautioned arkygirl against holding any gold, given that it was grossly overpriced and at the top of the market.  Giving money to a swindler like Mike H. was a far safer investment.  That day gold reached its all time peak of $856 per ounce.


Today (January 10, 2012), gold has fallen to $1,633 per ounce.  Whoops?  What??  Oh, nevermind.  (Actually, it fell from its peak of $1,900 per ounce reached in September 2011)


Mr. Roper is probably in league with the bankers and just ran up the world gold price over the past four years to make Mike H. look bad.


Besides losing their houses and the "fees" stolen through the unauthorized practice of law, I wonder how much suckers have lost to Mike H. in his other various swindles over the years? 

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John Lewis

and the end result :-( Roper no longer contributes and MikeH is able to continue to troll ----

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Nice find!  Mike H. really is such a low life.  He has been preying on members of this Forum for so long, he feels he is entitled to steal from Forum visitors.  He vilefies anyone who questions his bogus information or interferes with his swindles.

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John Lewis
RE the us dollar to Swiss Franc: usd/sf

01/02/07 closed at = 1.21310

low reached 08/08/2011 = .72108

today: 01/10/2012 = .94886

Both Eric and this post represent facts ie verifiable facts ~ once again MikeH - plez provide verifiable proof for any of ur positions.
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