Chorniki

A Warning in the Bond Market

Laughable how all commentators give the banking industry and the real estate industry a pass on the present mess. Realtors had lists of "buyers" who would sign the docs for purchase cooked up by the banks
as AAA. Purchase completed, the realtor would share his profit with the buyer. The house would then be rented for a few months and a new "buyer" would then purchase the flipper, at a higher price, of course. Some properties were "flipped" three and four times in a span of less than two years. Illegal immigrants owned two and three houses bought in this fashion with the connivance of the usual suspects. Today they continue to collect the rents on these houses
even though they have stopped making the mortgage payments for some months now. Dilatory mortgage foreclosure procedures at the banks(the "AAA" paper was passed on to WS investment banking firms to slice and dice to their heart's content) is aiding and abetting these scams. The next shoe to fall will be when all these properties are thrown on the market for the value investors to place in their portfolios. We are not even half way there yet in my opinion, witness
MER's most recent write down.