By Jim Willie CB
The mortgage & foreclosure scandal runs so deep that ordinary observers can conclude the US financial foundation is laced with a cancer detectable by ordinary people. The metastasis is visible from the distribution of mortgage bonds into the commercial paper market, money market funds, the bank balance sheets, pension funds under management, foreign central banks, and countless financial funds across the globe. Some primary features of the cancerous tissue material are allegations of mortgage bond fraud, major securities violations, absent linkage to property title, income tax evasion, forged foreclosure documents, duplicate property linkage to single mortgage bonds, NINJA (no income, no job or assets) loans to unqualified buyers, and more. In fact, more is revealed it seeems each passing week toward additional facie to high level and systemic fraud. The world is watching. The growing international reaction will be amplified demand for Gold, from impressions that the USDollar & USEconomy have RICO racketeering components extending to Wall Street banks and Fannie Mae mortgage repositories.
The Europeans have their damaged sovereign debt, but the Americans can boast twin beasts in the obvious USTreasury Bond bubble and the evident USAgency Mortgage Bond scam. The scam involves mortgage bond defects from improper perfection of property title that ensures revenue stream. The scam alleges securities violations from usage of the MERS title database, duplicate properties in multiple bonds, and forged documents. The scam alleges faulty finance vehicles (REMIC) with deep intractible flaws in the structure of funding the loans, whose remedy would come with a $1 trillion tax bill due (estimated by bank analysts). Just last weekend, the state of California demanded as part of a class action lawsuit, with MERS cited at the center, between $60 and $120 billion in unpaid property title recording fees. It seems no shady profit angle was left unused by the mortgage industry during the last decade that saved a few bucks and added to bank profit. The MERS & REMIC twins represent the two unfixable banking Achilles Heels. Can the USCongress build a wide back door for the big banks to escape prosecution with a fresh piece of supercharged legislation?? If they do, then civil disobedience will blossom across the land, in the form of public demonstrations, marches on Washington, non-payment of monthly mortgage bills, and demands to prove property title. The global response will be to sell any bonds with a US$ denomination.
BIG BANKS VULNERABLE AGAIN
The next QE2 is a done deal but with the details missing. The next TARP-2 bailout package is having its justification and foundation fashioned from the building blocks of need and desperation, along with the cement provided by banking lobbies. The two initiatives will likely meld paths. A disorderly condition comes. An armada of lawyers is on the job ready to challenge mortgage securities, foreclosure orders, and much more. Class action lawsuits are on the docket. The US financial platforms are unraveling. The USDollar will follow a path to oblivion, locked in a destructive spiral. The Competing Currency War assures that other major nations will undermine, debase, and devalue their currencies rather than seek out, plan, and establish a new monetary system. The investment in a broken system will soon be realized as infinite, with unchecked spew, even $trillions tossed in Black Holes. The sound money experts have always argued that accelerated funds are required to maintain an asset bubble. That was vividly true with the housing bubble, which required a fleet of unqualified buyers to sustain the bubble in its final chapter.
Gold will therefore skyrocket in price, as the monetary system will be actively ruined from unbridled growth in money creation. The silver price gains will be at least double the gold gains. Markets are beginning to take control, and kick aside the heavy handed control levers. The horizon features a big US bank on death watch. The ripple effects would be shocking even to those who expect it. Other big banks would be dragged down in a chain reaction, while illicit control in certain key markets would be stripped away. Control would be lost by the Powerz. The risk is for confusion to rein with rising chaos. The bank stock index BKX signals an imminent breakdown.