My tin foil hat is officially broken, again…
NPR reports:
As part of the bailouts of AIG and Bear Stearns, the Federal Reserve Bank of New York spent more than $70 billion to buy toxic assets the companies owned. Last week, prompted by a lawsuit filed by Bloomberg News, the Fed finally told the world exactly what it bought.
The Fed now owns loans to Hilton hotels in Hawaii, Puerto Rico, Malaysia and Trinidad. It owns loans to the Miami airport, and the Civil Opera House in Chicago.
It also owned a loan to Crossroads Mall in Oklahoma City. Then, when the owners of the mall couldn’t make the payments, the Fed foreclosed. So now it owns the mall, which includes a Chick-fil-A and an AMC theater.
The mall’s for sale — cheap! “This lender owned distressed asset … can be purchased at far below replacement cost,” this listing says.
The Fed also owns credit-default swaps — basically, insurance policies that pay off if a borrower defaults on a loan. It holds swaps on the debt of Florida schools, and on debt owed by California and Nevada. So the Fed would profit if one of those states defaulted on its debt.
“You should have the image of Chairman Ben Bernanke flying to a speaking engagement,” Reinhart says. “And he can look out the window and look down and say, ‘Boy, I own a piece of that, I own a piece of that, I own a piece of that, I own a piece of that.”
HA! And I thought that the Tribune Co. ceding control of the company to its lenders, J.P. Morgan Chase & Co. as reported here from the WSJ was concerning since they acquired ANOTHER media outlet while at the same time of negotiating the purchase of the proprietary rights to the Idols television brand, including the “American Idol” series in the United States and local adaptations of the television show format, according to its website. It would also give JP Morgan the rights to the names, images and likenesses of Elvis Presley and boxer Muhammad Ali.
Control anyone?
Angry yet?
4closureFraud
The very core source for our economic implosion and fuel for the “bubble” was FRAUDULENT LENDING by the banks. Forensic loan auditors from across the country agree that basically, 70% of all loans originated between 2003 – 2007, were FRAUDULENT, and/or contained UNFAIR and DECEPTIVE BUSINESS PRACTICES BY THE LENDERS.
The “regulators” (our government paid for by the taxpayers,) knowingly allowed this FRAUD to exist and flourish. Look closer at the OTS and “regulator shopping.” The FDIC is also in the REO disposition business aside from “regulating.” These are but just the tip of the iceberg of a few examples of aggregious conflicts of interest.
Homeowners in foreclosure should sue (by the millions) the lenders, and utilize discovery throught the court to prove this fraud was perpetrated on not only the homeowners, but the investors who unknowingly bought the toxic pools of mortgages.
The servicers profit by the foreclosures in REO disposition and by draining the remaining income streams from the revenue streams of the performing mortgage payments. This directly pays for increased default revenues from the deficient non-payments (by those in foreclosure) directly back to the servicers via the “pooling and servicing agreements” of the MBS (mortgage-backed securities.)
The servicers, in essence, are the “middlemen” of the scam and were also the wholesalers and securitizers of the fraudulent loans. All involved knew EXACTLY what they were doing.
These “middlemen” also recieved TARP money from CONgress at the further expense of the TAXpayers.
Sue, investigate, and prosecute now, or our children will be poor no matter their level of education and hard work in the future. We in America are becoming a croney driven fuedal state and two class society. The middle class will become non-existent.
This is not a representation of an emerging socialist state, but more appropriately, that of a corporo-fascist state where government and corporations prosper unfairly at the detriment of its citizens.
Sound familiar in 2010?
Rob Harrington
crharrington@cox.net
National WAMU Homeowners Support Group