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  • The Round Robbings Of Rotational Relationships In Regulated Robbery 3 comments
    Mar 24, 2012 1:45 PM | about stocks: BAC, FNMA, FMCC, JPM, WFC

    "Wells Fargo & Co. (NYSE:WFC) failed to hand over documents demanded in U.S. subpoenas and should be forced to cooperate with a probe into its sale of almost $60 billion in residential mortgage-backed securities, regulators said", according to Bloomberg.

    What Bloomberg and the SEC do not know is how the bankers play the bad asset transfers amongst themselves to postpone their own inevitable collapse and loss of employment at their institutions.

    Who did WFC sell $Sixty Billion$ worth of mortgages to in the past six years? It is not clear because neither the Wall Street Journal or Bloomberg, the SEC, the Justice Department or the Federal OCC, or even the secret service do not understand how robbery occurs under the current financial systems computerized trading models.

    "The SEC is looking for evidence that firms failed to disclose underlying credit weaknesses in mortgage pools and delinquencies, and has also told Goldman Sachs Group Inc. and JPMorgan Chase & Co. (NYSE:JPM) that they may face civil claims," says Bloomberg.

    Unfortunately, unless the attorney's at the SEC understand the mortgage loan origination process they will always be looking for the wrong source and fine the wrong target. Fraud begins with loan officers, loan processors, and loan underwriters who originate loans.

    Why have they not investigated and barred hundreds of thousands of mortgage brokers, many of whom also have real estate licenses as in California, or act as Realtors, found guilty of committing fraud in the loan application process? Because they don't have the knowledge or the manpower to do so in an efficient and cost effective way.

    Instead they try to create new laws and regulations to bar new entrants into the industry if their names have been tarnished from the wreckage of the 2008 meltdown, Act 2 as pending news of more trouble in the financial sector mounts.

    They have to look at the borrower, look at the loan officer, the loan processor, the loan underwriter, and then look at the heads of each mortgage brokerage and mortgage banking operation in America to clean up the whole mess which is still many eons away.

    Then they need to look at the loan servicers, the mortgage traders, the secondary marketing officers, but because most brokerages are private, not publicly traded companies, the SEC has no jurisdiction other than to go after the public stock companies whose capital rests on the validity of their "air assets", and their trading in the marketplace on a ship of titanic fools, who don't know the ship is still sinking.

    According to Housing Wire, "There are currently 11.1 million borrowers who owe more on their mortgage than the house is worth, according to CoreLogic ($16.63 0%). Of that, estimates show roughly 3.3 million of those mortgages belong to Fannie and Freddie."

    Why is the SEC not following the paper trail from the bottom of the ponzi scheme to the trading floors of Wall Street? Do executives at BAC, WFC, JPM, who together hold more than $4 trillion in inflated assets, including housing related mortgages, ever look at the originating paperwork that creates a phony loan in the first place?

    Where are the SEC charges against WFC, BAC, FNM, FRE, JPM, and the rest of the big 12 mortgage market players for "knowing or should have known" about the fraud contained in no income no asset loans? It's called "scienter", but is it being broadly applied to every employee at thse big five too big to fail institutions? No, because "we don't have the manpower" according to SEC officials.

    It doesn't take a lot of manpower to realize after a few years of being in the business that the entire mortgage industry and banking industry itself is no better than the pea sharks on the streets of New York City who get you to gamble under which cup the pea is situated.

    The only difference between the street con and the wall street traders is that there are many more cups to hide the pea (fraud) under in the world of finance.

    It's all regulated robbery to me. No one wins in the long run and there is a lot of suffering in the world. Like I tell my disabled banking buddies, there are no jobs out there, but there sure is a lot of work to do.

    Jon Prior wrote, "Mortgage lending will not return until firms figure out how to better automate an underwriting process overloaded with new rules but still being done by hand, according to entrepreneur Bill Dallas.

    "Dallas founded First Franklin and is chairman of Diversified Capital, another large mortgage operation. His newest venture is Skyline Mortgage located on the West Coast. Dallas is building out a system that will allow his network of brokers to underwrite mortgages by checking off various compliance issues from new Dodd-Frank provisions to Real Estate Settlement Procedures Act requirements."

    First Franklin was sold to Merrill Lynch who in turn was taken over by BAC. Dallas has overseen the origination of more fraudelent mortgages than Franklin Raines or the former head of Countrwide, Mozzillo, combined.

    In the end, only a zero interest mortgage program and the creation of the secondary market for them, along with a major change in income tax laws (cancel the the mortgage interest deduction and give people tax credits for paying off their mortgages early) will save the mortgage industry from complete collapse.

    All these "Top Executive" people still trying to keep the industry going are just the "walking dead" and in my book, I always let the dead bury the dead.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Stocks: BAC, FNMA, FMCC, JPM, WFC
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  • AlexSGaborsAssociates
    , contributor
    Comments (10) | Send Message
    Author’s reply » The most expensive house on the market a few years ago was listed at more than 140 million in Bel Air. It sold for sixty million less than the asking price and that was an estate sale with no mortgage on it.

    24 Mar 2012, 01:49 PM Reply Like
  • AlexSGaborsAssociates
    , contributor
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    Author’s reply » This just in:

    24 Mar 2012, 01:57 PM Reply Like
  • Alex S. Gabor
    , contributor
    Comments (222) | Send Message
    Connecting the dots for the securities regulators. Berkshire Hathaway owns shares in Goldman Sachs and Wells Fargo. Wells Fargo owns shares in in BERK.a and Berk.b and GS. GS owns shares in WFC and BERK.A and BERK.B. In banking terms its called a "Round Robbin" of Robbing the public and misleading information which inflates the stocks of all three firms. No wonder Warren Buffet is under investigation by the International Bank Activities Reform Commission. Securities Regulators in the United States and Europe are being forewarned that Warren Buffet is a bigger ponzi schemer than Bernie Madoff by more than 1,000 fold.
    If you want to do a story on this based on information provided to Soros Fund Management in New York publicly via this web site contact the author who is now in the top 100, (Ranked 97) Instabloggers here at See King Alpha!
    12 Mar 2013, 05:28 PM Reply Like
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