Category Archives: mortgage crisis

Let The Fraud Continue

Banks Continue ‘Robo-Signing’ Foreclosure Practices In Spite Of

Promises To Contrary: Investigation

NEW YORK/IMMOKALEE (Scot J. Paltrow) – America’s leading mortgage lenders vowed in March to end the dubious foreclosure practices that caused a bruising scandal last year.

But a Reuters investigation finds that many are still taking the same shortcuts they promised to shun, from sketchy paperwork to the use of “robo-signers.”

That is the headline in the Huff Post Business section yesterday, September 20th.

Remember that the banks promised to not do that any more?  Of course they did but that promise can be added to the other 3 promises one should never believe.

Imagine, a promise made by organizations that have exhibited no moral conviction, no human compassion and certainly no concern for the economies of the entire world.  A promise made by a consortium of global scoundrels, criminals, gangsters, liars and thieves.  And what a shock it is to hear that they have broken their comments.

Banks today are on a preplanned course of obtaining as much U.S. real estate as they can.  It is a part of an even greater plan by powers not yet identified to transfer as much American wealth to a handful of elite.  We have already seen the evidence of this cash wealth transfer.  Now the real evidence of the fraudulent activities surrounding banks in their attempts to transfer real property to the same handful of elite is rearing its ugly head.

It is as if the Matt Taibbi’s description of Goldman Sachs as the Great Vampire Squid has spawned an entire underground cave full of  Vampire Squids with Goldman as the Mother Vampire Squid.

Yet with all of our lawmakers in Congress, our U.S. Attornely General and all the Attorneys General in the United States, the FBI, the FDIC as well as our Executive branch does absolutely nothing.  In fact, they all turn the other way.  They to must fear these Vampire Squids.

But not enough is ever said of those people, the real people, living, breathing human beings who have been and are affected by this rash of asset transfers.

The Huff Post – Reuters Report – does put a face on the story.

In its effort to seize the two-bedroom ranch house of 87-year-old Margery Gunter in this down-on-its-luck Florida town, OneWest Bank recently filed a court document that appears riddled with discrepancies. Mrs. Gunter, who has lived in the house for 40 years and gets around with the aid of a walker, stopped paying her loan back in 2009, her lawyer concedes. To foreclose, the bank submitted to the Collier County clerk’s office on March 3 a “mortgage assignment,” a document essential to proving who owns a mortgage once the original lender sells it off.

But OneWest’s paperwork is problematic. Among the snags: state law permits lenders to file to foreclose only if they already legally own a mortgage. Yet the key document establishing ownership wasn’t signed and officially recorded until months after OneWest filed to foreclose on Mrs. Gunter. OneWest declined to comment on the case.


I would say problematically illegal.  The question is who signed the “key document” and  what was that persons authority to do so?  Part of the Florida Statute says that an Assignment (proff of transfer of ownership) must be filed and recoded prior to the foreclosure action being filed by the Plaintiff.  Again, I am not a lawyer but I would have to say that this fact alone is a procedural casue for the action to be dismissed by the court.

With proof positive of wrong and illegal practices, still nothing is done by our courts or legal justice system.  It is as if many of our courts have gone over to the dark side.

Now in years gone by, in a time and space far far away- almost as if in another galaxy – banks would have always preferred to “work something out” with a homeowner rather then to take their home.  The old (real old) saying that banks did not want to own real estate is no longer true.  They do want to own real estate.  They want to own it all.

One of the industry’s top representatives admits that the federal settlements haven’t put a stop to questionable practices.

Some loan servicers “continue to cut corners,” said David Stevens, president of the Mortgage Bankers Association. Nearly all borrowers facing foreclosure are delinquent, he said, but “the real question is whether the servicer complied with all legal requirements.” The loss of a home is “the most critical time in a family’s life,” and if foreclosure paperwork is faulty homeowners should contest it. “Families should be using every opportunity they can to protect their rights.” (emphasis added)

From our mouths to the mouth of the President of the Mortgage Bankers Association.  “Families should be using every opportunity they can to protect their rights”.  Yes, we all do have rights.  Protecting our rights is an even bigger issue for the long run.  We must protect and preserve our rights if we expect our children and their children to live in a free Republic.

There are some in the judicial arena that are as concerned with the preservation of our rights as we are.  While not yet in the majority of judges we are seeing more and more taking a stand for justice against fraud and criminal behaviour of banks and the attorneys that represent them.

Increasingly, though, courts are holding that the trusts suing to foreclose don’t actually own the mortgages. Judges have ruled that foreclosing based on flawed or missing evidence violates longstanding laws meant to protect all Americans’ property rights. (emphasis added)

In a landmark decision in January, the Massachusetts Supreme Judicial Court overturned a foreclosure (emphasis added) because of a lack of proper documentation.

“The holder of an assigned mortgage needs to take care to ensure that his legal paperwork is in order,” wrote Justice Robert Cordry in a concurring opinion. “Although there was no apparent actual unfairness here to the (homeowners), that is not the point. Foreclosure is a powerful act with significant consequences, and Massachusetts law has always required that it proceed strictly in accord with the statutes that govern it.”

(U.S. Bank National Association, trustee, vs. Antonio Ibanez, 458 Mass. 637.)

Justice Robert Cordry is among the handful of judges in this country “who gets it”.  He joing the ranks of Federal Judge Boyko of Ohio who denied 17 cases for lack of standing and proper paperwork and Supreme Court Judge Schack of New York both of whom have been on the right side of justice since this crisis began.

We applaud these judges and the few others out there who “get it”.   There are others and we would love to hear about them from you.  If you have had a positive, legal experience let us know.  If you have know of judges and/or cases where they have ruled on the side of the law not on the side of fraudulent banks, trusts and servicing companies please let us know.

Please view the entire story from Reuters on the Huff Post…click here

NOTE:  Soon an important announcement from TheForeclosureDetonator.  We are gong to become proactive in the fight against illeal foreclosures.  Stay tuned.

Foreclosure Victims Plan Protests Across here 

This is the action we need.  We need to show our lawmakers that we are serious about our rights.  Click on above to read more.  THIS IS IMPORTANT.

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An Attorney Answers … Who is holder of a note

Half million dollar house in Salinas, Californ...

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One of our readers – who  appears to be an Ohio attorney  well versed in foreclosure defense – offered a comment to which I replied and to which he again replied giving a more detailed explanation of  who is considered to be the holder of a promissory note therefore having the Standing to foreclose.

I feel this information is important enough to reprint these comments.  The information is important to all those who are facing and/or currently fighting foreclosure.

As this attorney states, it is always recommended that you seek the counsel of a qualified  – I stress qualified – foreclosure defense attorney.  While I understand that many of you facing foreclosure believe you cannot afford an attorney, I assure you that there are some out there whose fees are reasonable and affordable.

You will not often hear me say this, but if you are in foreclosure then you are not making mortgage payments or paying rent.  If you are evicted from your current home you will have to pay rent somewhere so use your diverted funds to fight for your rights and defend your foreclosure.

And to the many who have been so wiped out that eviction would mean absolute homelessness I encourage you to also look for an attorney who can help.  There are some out there that are willing to work Pro Bono (without fees). At the very least  represent yourself  Pro Se.  Learn what you can from blogs like this and the several others that are credible and offer sound advice and information.  Just answering your summons (in a judicial state) will buy you more time and time is what everyone needs.

Here now the comment conversation from the post Financial Turmoil Evokes Comparison to 2008 Crisis – as posted on August 11, 2011:

On August 17, 2011 at 10:34 AM Ohio lawyer said: 

I disagree about ownership of the note being the only issue. Under the UCC, to be entitled to enforce the note, a person MUST be in possession of it (except when they can claim the note was lost, destroyed, etc.). In fact, a person in possession of a note endorsed in blank, even if they stole it, may enforce the note. Ownership is not necessary. Likewise, a person who “owns” the note may not enforce it unless they are also in possession of it. I was not sold on the “show-me-the-note” defense for a long time. But after briefing the issue several times in Ohio, I accepted its importance. Without actual possession of the note, a lender cannot prevail. I agree that standing is a major issue, but “ownership” is not the proper way of thinking about it.

  • On August 21, 2011 at 3:31 PM Larry Rubinoff said: |Edit This

    Thank you for your take on this very important subject. Since standing is a major issue and “”ownership” is not the proper way of thinking about it”, then what is the way to think about it.

    Possessing the note, as you say, endorsed in blank, gives the holder the right to foreclose. I was always under the impression that a mortgage note endorsed in blank is not like a bearer bond where anyone in possession of it can execute it. In other words, mortgage notes are not bearer bonds. What is your take on this?

    Of course, if a mortgage note is held by someone but has never been endorsed in blank then it is your argument that now the bearer does not have standing. If this is what you are saying, I must agree.

    On the issue of lost, stolen or destroyed, banks often use this as an argument and basically are using a “trust me your honor, I did have it at one time but it was lost, stolen or destroyed, therefore I should have the right to proceed with the foreclosure action”.

    Too many judges simply accept this from a bank because they are “the bank” and of course, banks don’t lie. Only one judge questioned this in the past asking the plaintiff which occurred.

    Was the note lost, stolen or destroyed? It could not have been all three and if you don’t know which it was then you probably did not have it. I believe it was now Supreme Court Judge Schack in New York who questioned and disallowed this argument.

    DISCLAIMER: i am not an attorney and my comments do not reflect legal advice in any way. My comments come purley from my research and experience in these matters.

    I do, very much, welcome comments from attorneys like the one I am responding to for their legal opinions. More dialogue like this can be of great assistance to our readers and the millions facing foreclosure.

    If you are an attorney and would like to publish your views and opinions here at TheForeclosureDetonator please contact me at

    • On August 21, 2011 at 10:50 PM Ohio Lawyer said: |Edit This

      The question is whether someone is a “person entitled to enforce” the note. This status is defined by the Uniform Commercial Code. Below are the relevant provisions of the U.C.C. as adopted in Ohio:
      UCC 3-301
      (A) “Person entitled to enforce” an instrument means any of the following persons:
      (1) The holder of the instrument;
      (2) A nonholder in possession of the instrument who has the rights of a holder;
      (3) A person not in possession of the instrument who is entitled to enforce the instrument pursuant to section 1303.38 or division (D) of section 1303.58 of the Revised Code.
      (B) A person may be a “person entitled to enforce” the instrument even though the person is not the owner of the instrument or is in wrongful possession of the instrument.
      A “holder” is defined in U.C.C. 3-301
      (T)(1) “Holder” with respect to a negotiable instrument means either of the following:
      (a) If the instrument is payable to bearer, a person who is in possession of the instrument;
      (b) If the instrument is payable to an identified person, the identified person when in possession of the instrument.

      These two provisions have to be read together to get the complete picture. Let’s go through each type of person listed in U.C.C. 3-301.

      1. Holder – is someone in possession of an instrument which is either payable to that person (i.e. initially made payable to that person, or payable to that person via a special endorsement) or payable to bearer (e.g. endorsed in blank). This person need not be be the “owner” of the instrument, and may be in wrongful possession of it. Under this provision a thief could be a person entitled to enforce the note. All he needs is possession of a note endorsed in blank.

      2. Non-holder with rights of a holder – To qualify under this provision a person must: (1) be in possession of the note, but it need not be order or bearer paper; and (2) the person must have been given the rights of a holder. How does someone get the rights of a holder without being a holder? A holder transfers possession to the person and also grants to that person rights through a separate document, but doesn’t get around to negotiating the note. For example, Bank A sells a group of notes to Bank B. The notes are physically transferred to Bank B, but are not endorsed. Bank A also executes a bill of sale acknowledging that it sold the notes to Bank B. Think of it as possession plus ownership without endorsement.

      3. Someone not in possession under certain circumstances: There are two possibilities here. The first in the “lost, stolen, or destroyed” note. We see that often in foreclosure cases. The bank has to submit evidence to the Court to prove it can enforce the lost note. The other circumstance is almost never seen so I won’t go into it.

      That’s it. Only three classes of people can sue on a promissory note. Aside from “lost note” cases, possession is required. After that you need either negotiation (payable to order or an endorsement in blank) or some other evidence that you are intended by the last holder to be the person to enforce the note.

      This framework addresses commercial paper in general. That said, there may be other restrictions on transfers of certain types of mortgage notes. For instance, an FHA note cannot be sold to just anybody. They can only be transferred to other FHA-approved lenders. Some have suggested that such FHA or VA regulations renders notes issued under their programs to be something other than negotiable instruments. I do not know much about those arguments, but want to caution people that generalities are just that – general. Every situation is different and must be evaluated on its own facts.

      I can’t emphasize that last point enough. It’s all well and good for people to know the law, but too many borrowers try to go it alone. Law is not viewed in a vacuum; it is applied to fact. Most of the time the fact is harder to come by than the law. I urge borrowers to find counsel to help them. Doing it yourself almost never turns out well.

      I agree, Judge Schack drew attention to these issues by asking the simple questions and demanding some proof. Now, judges everywhere are more likely to listen to a borrower who challenges broad assertions of standing. Currently, this issue is pending before the Ohio Supreme Court and will likely be decided late this year. You can see the briefing on the issues on the Court’s website. The case name is U.S. Bank v. Antoine Duvall, Case No. 2011-0218.

Thank you Ohio Lawyer for taking your valuable time to offer these comments and help educate our readers.

To all attorneys:  Feel free to send your information for publication to me at  You can remain Anonymous, use a screen name or if you wish have your name, address and phone number published.  If you choose to use only your name or screen name, please let us know what state you are in or what state(s) you practice in.

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It Begins: The Foreclosure Fight Tide Is Turning In Our Favor

Yes, for all these years, those of us who have been blogging to expose the wrongs and injustices placed upon us by the banks are finally seeing some daylight.  In the beginning no one really believed that banks could be so ruthless or so criminal.  In the beginning no one could believe that the attorneys representing these criminal enterprises would be capable of violating the very laws they are sworn to uphold by performing criminal acts themselves.

In the beginning no one could believe that judges would disregard the laws so blatantly that they are sworn to uphold – but they did and they are.  In the beginning no one could believe that our legislatures – county, state and federal – could be complicit of an entire legal system gone wild by supporting these criminal activities.

Now their Rocket Dockets are in jeopardy and hopefully will be shut down altogether.  Those retired judges brought back to dispense “injustice” under a mandate of clearing dockets will hopefully be sent back into retirement where they belong.

Now that this fraud at the end of the process has come to light, I am hopeful that all of the other frauds committed by the banks, lenders, Wall Street securitizers and all of their respective attorneys will also finally be prosecuted.

A lot must be said for those few in the legal profession – lawyers and judges alike who have over the past three years stood up for our rights,  for the law of the land and for justice.  They are too numerous to mention and I really don’t know who they all are.  Allow me to recognize just a few who are representative of the many across this nation who have fought back the giants and have not been afraid to speak the truth when representing their clients in our courts.

Bruce Harlan, Esq.

Mathew Weidner, Esq

Jeffrey Barnes, Esq

April Charney, Esq  0 The Dean of Foreclosure Defense

Neil Garfield, Esq 0 The Dean of Legal Reference on the topic of Foreclosure Defense in his LivingLies Blog

Federal Judge Boyco of Ohio

Superior Court Judge Shack of New York

Again I recognize that there are many more but these are the ones I am personally familiar with and they do represent a true blue slate of legal professionals around the country who still believe that this is still America and our Constitution still governs us.

Now how the State of Ohio is taking a proactive stand and fighting back.  They, I believe, are just the first of what I hope will be 49 more states along with our Federal Government who will begin to take real and meaningful action against the criminals who have functioned all to long under a protective cloud of criminal exception.  To these banksters I say;  “Your time has come.  Anything you say Will be used against you in a court of law.  Your “Get Out Of Jail Free Card” has expired.  You will be held accountable for all the misery and havoc you rained over the entire planet.

Here now the latest story from the Huffington Post

Ohio Attorney General Sues Ally financial Over Alleged Foreclsoure Fraud, First In A Possible Wave Of Lawsuits

WASHINGTON — Ohio’s attorney general is suing Ally Financial Inc. and its GMAC Mortgage division, alleging the company violated state fraud laws in handling foreclosure cases.

The action could be the first in a wave of lawsuits by state regulators over what appear to be widespread problems in documents used by the nation’s largest mortgage lenders.

Attorney General Richard Cordray said Wednesday the alleged fraud could involve hundreds of foreclosures in the state. The lawsuit claims the company’s employees signed and filed false affidavits to mislead courts. Cordray called the alleged fraud the “tip of an iceberg of industrywide abuse of the foreclosure process.”

A message left at Ally was not immediately returned.

Read the complete story…click here

Editor’s Note:

For those of you who know of other attorneys or judges that should be recognized for their efforts in the fight for justice against the banks by defending the nations people from wrongful and illegal foreclosure leave their name and location (city, state) in the comment section or email the info to me at:

I will start a page here on this site listing them all.  They deserve the recognition.

Also, other foreclosure defense blogs that have worked so tirelessly the past few years attempting to alert people to the fraud and injustice need also be recognized.  If you have a favorite foreclosure defense blog, send me their name and URL.  I will publish all of them on our side bar.

This is the beginning and all of our efforts are going to begin to pay off.  But most important, stopping this terrible tsunami of foreclosures, helping people stay in their homes is the most rewarding benefit of all this.

My one other hope is that this same awareness of foreclosure fraud will take hold in all of the Non Judicial states.  The same illegal activity exists there and the same injustice needs to be stopped.  This criminal enterprise by the banks MUST BE STOPPED.

I know I will stay with this effort until it is.  I will join forces with others as the opportunities arise.  There is strength in numbers.  We have all been duped, stripped of our wealth and our homes.  It is time we took back what was taken from us.

One Final Thought:

Stopping foreclosures and ending evictions – keeping people in their “homes” will begin to stabilized our housing markets and  our economy.  Working with people will win back the hearts and minds of our population.  An effort we seem to want to export in the Middle East but don’t want to practice here at home.

An occupied house is a well maintained house.  It creates a well maintained and more stable neighborhood which in turn stabilizes prices which begins to take us on a road to recovery which all the trillions of dollars of bailouts and stimulus programs did not and cannot accomplish and never will.

Our work has just begun.

Look at all the main stream media  (below) who have now begun to report on this .  Many of them have avoided the topic up until now.  The tide has begun to turn.

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Homeowners Are Drowning…And So Is The Nation

To all of you who are facing or in foreclosure you are not alone.  In fact, you may be in the majority.  No this is not meant to make you feel better.  On the contrary, it is meant to possibly anger you so that you fight and speak out more.  What we need a vocal population verbalizing what is right and what is wrong.  A population that does not just sit by and let “them” take advantage.  Let’s get mad as hell and not take it anymore.

For those of you who are sitting back thinking that help is on the way and that as many are saying things are bottoming out and will begin to get better soon, read on.

With nearly half the mortgages in the U.S. expected to be under water when the recession ends, things look pretty bleak for mortgage servicers and investors, let alone consumers.

So begins the story by Glenn McCullom in National Mortgage News – a publication you may want to subscribe to.

Mr. McCullom refers to a report by Karen Weaver Ying Shen, an analysit in New York at Deutsche Bank.  McCullom says that in her report she says that “The percentage of “underwater” loans may rise to 48%, or 25 million homes, as prices drop through the first quarter of 2011…”

This is an interesting analysis and one which I believe.  There are those that aree saying that we have “bottomed out” to which I reply, I don’t think so.  If Ms. Ying Shen is correct then the worst has yet to come.  There can be no recovery without real estate recoverning and certainly not without unemployement decreasing.  Neither of these important factors are occurring or look like they will in the near future.

More of the negative impact to our economy – and us – is further told by Ms. Ying Shen’s report.  McCulom further says that according to Deutsche Bank the share of homes mortgaged for more then their value was 36% at the end of March.  he continues by

Further deterioration will depress consumer spending and boost defaults by borrowers who face unemployment, divorce, disability or other financial challenges, the securitization analysts said.

Even more frightening is his comment on seven real estate markets in the U.S. which had the “fastest appreciation during the five year housing boom”.  Those markets he says are, Fort Lauderdale , Miami, Merced and Modesto, CA and Las Vegas.  (I would have to assume that these markets cover the majority of the counties they are situated in).  He says that these markets my have as many as 90% of borrowers underwater according to the Deutsche Bank report.

It is important to note that the latter comment deals with borrowers who are underwater not the number of homes but it is safe to assume that the vast majority of homes purchased during the boom years were financed.

Already, servicers are grappling with a delinquency tsunami. According to figures compiled by National Mortgage News and the Quarterly Data Report, 34% of all subprime loans — or $320 billion worth of loans — are in some stage of delinquency.

It appears as if we are drowning economically and no rescue appears to be on the horizon.  I don’t even see a flotation device anywher in sight either.  We seem to be having an endless cycle of downturns which in turn feed more downturns which feed even more downturns.

As said earlier, without a recovery in real estate and employment – both of which feed on each other and continue the cycle – there can be little in the way of economic recovery on a national scale.

Help, as promised by the current and past administrations, have not come to the people.  The help that was made available – trillions of dollars – has certainly had a positive and lucrative affect on our “too big to fail” financial institutions.  They seem to be reporting profits and higher returns and increasing stock values.  All this while the general population is drowning.  Could it be that these “too big to fail” institutions that “you” have sent financial aid to own all the life vests and flotation devices and holding them instead of using them?  I think so.  These guys are living the good life, getting a better life – if that is possible with the money they already have – and don’t give a dam about the rest of us.

We are busy being distracted by conversation of health care reform – and it is only conversation at this point as there is no definitive proposals on the table yet.  This distraction, while a valid topic is purposeful to detract our attention from drowning.  Are the members of our Administration and Congress that stupid to believe that we think it is ok to drown knowing that maybe somewhere down the road a national health care program will bring us back to life?  We need a healthcare program but we need to eat to.  With no food, no health care program will benefit us.

I say to our Congressmen, you are all members of the human race and Americans.  You enjoy stable and high incomes, benefits and perks and THE BEST HEALTH CARE PROGRAM IN THE NATION.  In your comfort and as OUR representatives you should be working first and foremost on rescuing us from certain drowning.

To read the full article in National Mortage News…click here


Proving Ownership of the Note

TheForeclosureDetonator was originally founded to alert and inform people facing foreclosure that there is a way to “fight” back and that they should fight back.

The tangled web of financial companies that we are currently giving billions upon billions of dollars to are still working their tangled web of corporate entities to defraud the very same people they sold their version of the American Dream to.  This tangled web of cheaters, liars and illegal enterprises continue to destroy the people of this country while the good peole of this country fighting for their very survival are funding them to do so.

Is this not treason?  Purposely destroying this nation for their own personal financial gain and more important – control – of our country.

They believe – by virtue of illegallyl foreclosing – that they are not only above the law but are the law.  They can do whatever they want, whenever they want and to whom ever they want at any time they want.

As I have been writing on the issue of defending foreclosure for almost two years now, a more prominent advocate, April Charney, attorney from Jacksonville, Florida has gained national attention by actually challanging these unlawful acts and standing up to the creators of our current and what shall be a very long term crisis.

She has not only defended foreclosures but has taught over 1500 other attorneys how to do so.  April Charney’s message is worth repeating over and over again.

Don’t take my word for it but do take hers.  Those taking foreclosure action against you are most probably doing so illegally.  But unless – you – the homeowner takes the legal defense action against them they will continue to use the wrinkle in the law – that of default for lack of response – to accomplish the foreclosure.

I cannot urge all of you enough to FIGHT.

Recently this article was published in the New York Post on line by Richard Wilner,




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Inside The Meltdown…PBS Frontline…A Must See Program

Inside the Meltdown was broadcast Tuesday, February 17th on PBS Frontline.
The occurances of September, 2008, can be called “The Economic 911”. (my tag)

Courtesy of their site I am embedding the entire program for your viewing. It is a one hour program but is a MUST SEE by every American.

See and hear for the very first time what the causes were, why the actions taken by the government and why the urgency to spend billions of our dollars. Also learn if this crisis is close to being over. Includes commentary from former Bear Stearns executives.

The stark reality is shocking. Following is dialogue directly from the Frontline web page.

As the housing bubble burst and trillions of dollars’ worth of toxic mortgages began to go bad in 2007, fear spread through the massive firms that form the heart of Wall Street. By the spring of 2008, burdened by billions of dollars of bad mortgages, the investment bank Bear Stearns was the subject of rumors that it would soon fail.

“Rumors are such that they can just plain put you out of business,” Bear Stearns’ former CEO Alan “Ace” Greenberg tells FRONTLINE.

The company’s stock had dropped from $171 to $57 a share, and it was hours from declaring bankruptcy. Federal Reserve Chairman Ben Bernanke acted. “It was clear that this had to be contained. There was no doubt in his mind,” says Bernanke’s colleague, economist Mark Gertler.

Bernanke, a former economics professor from Princeton, specialized in studying the Great Depression. “He more than anybody else appreciated what would happen if it got out of control,” Gertler explains.

To stabilize the markets, Bernanke engineered a shotgun marriage between Bear Sterns and the commercial bank JPMorgan, with a promise that the federal government would use $30 billion to cover Bear Stearns’ questionable assets tied to toxic mortgages. It was an unprecedented effort to stop the contagion of fear that seemed to be threatening the rest of Wall Street.

While publicly supportive of the deal, Treasury Secretary Henry Paulson, a former Wall Street executive with Goldman Sachs, was uncomfortable with government interference in the markets. That summer, he issued a warning to his former colleagues not to expect future government bailouts, saying he was concerned about a legal concept known as moral hazard.

Within months, however, Paulson would witness the virtual collapse of the giant mortgage companies Fannie Mae and Freddie Mac and preside over their takeover by the federal government.

The episode sent shockwaves through the economy as confidence in Wall Street began to evaporate. Within days, in September 2008, another investment bank, Lehman Brothers, was on the brink of collapse. Once again, there were calls for Bernanke and Paulson to bail out the Wall Street giant. But Paulson was under intense political pressure from conservative Republicans in Washington to invoke moral hazard and let the company fail.

“You had a conservative secretary of the Treasury and conservative administration. There was right-wing criticism over Bear Stearns,” says Congressman Barney Frank (D-Mass.), chairman of the House Financial Services Committee.

Paulson pushed Lehman’s CEO Dick Fuld to find a buyer for his ailing company. But no company would buy Lehman unless the government offered a deal similar to the one Bear Stearns had received. Paulson refused, and Lehman Brothers declared bankruptcy.

FRONTLINE then chronicles the disaster that followed. Within 24 hours, the stock market crashed, and credit markets around the world froze. “We’re no longer talking about mortgages,” says economist Gertler. “We’re talking about car loans, loans to small businesses, commercial paper borrowing by large banks. This is like a disease spreading.”

“I think that the secretary of the Treasury could not fully comprehend what that linkage was and the extent to which this would materialize into problems,” says former Lehman board member Henry Kaufman.

Paulson was thunderstruck. “This is the utter nightmare of an economic policy-maker,” Nobel Prize-winning economist Paul Krugman tells FRONTLINE. “You may have just made the decision that destroyed the world. Absolutely terrifying moment.”

In response, Paulson and Bernanke would propose — and Congress would eventually pass — a $700 billion bailout plan. FRONTLINE goes inside the deliberations surrounding the passage of the legislation and examines its unsuccessful implementation.

“Many Americans still don’t understand what has happened to the economy,” FRONTLINE producer/director Michael Kirk says. “How did it all go so bad so quickly? Who is responsible? How effective has the response from Washington and Wall Street been? Those are the questions at the heart of Inside the Meltdown.”

To view this program please turn off Bloomberg TV by pressing the square button on the lower left of the Bloomberg image on the left side of this screen. Thank you.

Is this crisis over or even close to being over? You be the judge.

Paul Volker on Charlie Rose

I have my opinions and beliefs that I publish here. But who am I, just an ordinary citizen with no credibility or national exposure. So, I am pleased to bring you clips of those who are and who may get you thinking more.

Paul Volker, regardless of his political affiliations was, to this writers belief, one of the best Federal Reserve Chairman of recent times.

I must go on record however, as saying, that I do not believe The Federal Reserve functions on behalf of the citizens of this nation. They are not elected government officials nor are they even a part of our government. They are in fact, a secret, privately help corporation who contols each and every dollar we own and collect interest on each and every dollar we not only own but which they manufacture out of thin air. Case in point, the over a Trillion Dollars used in these latest bailouts.

The question remains, and perhaps somewhere down the line someone like Paul Volker can explain to us, why is it that we can create dollars to enhance and enrich corporate America but we cannot create dollars to pay off our deficit? Why also can we not create dollars or at least move existing dollars at the same “superman” speeding bullet velocity to places like New Orleans?

I just don’t get it.

CBS 60 Minutes…Finally The Truth

The good news, they finally are reporting the truth. The bad news, they should have done these reports before the Congressional vote on the latest bailout plan.

The scam supported by our regulatory agencies, created by those we have just spent over 1.1 Trillion Dollars bailing out and I believe with the knowledge of the Treasury, The Federal Reserve and The White House.

This is not only historic but unprecedented in the history of this country. I believe it to be treasonous as it sold out the American people and continues to sell them out by offering up trillions of dollars more to those that scammed not only this nation but the world.

I don’t want to say “I told you so” but I told you so. Read my previous posts here and other stories at This has been my position since the beginning of what “they” called a Mortgage Crisis and what I have been calling a National Disaster.

The FBI claims to be investigating fraud at 24 companies yet they do not disclose which ones. Perhaps they can’t because if the truth be known, many prominent people would be found to be complicit. How High The Fraud!

If you missed the story on TV, here it is direct from their website. I urge you to watch it and comment.

NOTE: Please turn off Bloomberg TV on the left to listen to this newscast. Simply “click” on the box with the square in it. Thank you.

Watch CBS Videos Online

If you don’t think that is bad enough, watch this clip from the same 60 Minute show. There may well be a connection here. Allowing the the economy to falsly flourish could have been a tactical diversion to keep the public focus off of the war and from stories such as this one.

By keeping the public focused on their new found prosperity enjoying all the toys and rewards it had to offer, few truly paid attention to the realities of both Afganistan and Iraq. Iraq was pre determined to occur. By the premature capture of Bin Laden Iraq never would have been possible.

The wool has been pulled over our faces and “they” continue to do so.

Watch CBS Videos Online
Watch CBS Videos Online

You be the judge.

FBI Investigations and Government Bailout Schemes

The last few days have created a lot of conversation from people and Congressmen. It seems like some are beginning to wake up and smell the wilted roses.

Following are reprints of comments I have made recently on The article title is linked to the site for your reference. I am reprinting my comments as they describe my beliefs and point of view.

I am not in favor of this or any other bailout plan. Let the free market dictate who survives and who does not. As you will see in my last comment below, I believe there is a far greater plan in effect here that is not for the benefit of the people of this country.

None of these bailouts directly impact or offer badly needed help to Main Street, you and me. Why then you must ask is our government dong this.

Your comments are welcome.

Mortgage Fraud and the Housing Bailout by Ralph Roberts

Comment 1:


Maybe someone out there has been listening. Ralph, you are finally beginning to put the blame where it should be.

As I have been saying and writing for many months now, “how high the fraud”? Perhaps now we can vindicate many of the mortgage brokers in the sub prime industry for being wrongfully accused of creating this crisis, however late it may be. It is much like letting a person out of prison after years of confinement only to find them innocent. You can’t give back the years they lost and you can’t give back the industry and jobs lost by the hundreds of thousands.
The corporate executives of these companies now under investigation knew full well what the end result of their schemes would be. After all, they are intelligent with a full understanding of how the system works. They worked the system, enriched themselves along with their inner circles and select employees at the expense of the entire nation.

Indeed, they formulated a plan, executed the plan and sold the concept of “free” money through real estate acquisition to an all but too willing population wanting a better life. In other words, they took advantage of people’s dreams and desires, they dangled a carrot and sucked everyone in. They wrote the book “Fraud For Dummies” and it was a best seller.

They said, we’ll give you something for nothing, in fact, you can have as much as you want for nothing, all we want is your signature. It is a fact that every signature they got they were able to multiply up to sixty times the value of the note. For every dollar you signed for they could make up to $60.

In my article posted here back in February, The Credit Crisis – Subprime Mortgages and Various Idiots, I said, “This could be the greatest Ponzi scheme in the history of the world, and the perpetrators have the nerve to blame it all on mortgage brokers.”The total count of corporate investigations given by the FBI is 26 although they do not name any of the others. I would only hope that Merrill Lynch and Bear Stearns are being investigated as well. I have long laid blame on them as well. Merrill, Bear and Lehman were the sub prime industry. They created the programs, issued the underwriting guidelines and sold the securities to a long line of waiting investors – also duped in believing these were AAA rated issues.

Perhaps J.P. Morgan should be investigated for planning a Sunday evening rescue of Bear Stearns with the aid of the privately and secretly owned Federal Reserve Board, much of which has been controlled for years by J.P. Morgan through his seat on the Board of The New York Federal Reserve Bank. J.P.’s Chairman, Mr. Dimon, still retains that seat. Was this 11th hour rescue to the tune of $55 Billion of taxpayer money just a cover up? Maybe the FBI will discover the truth and the truth needs to be known by all Americans.

The AIG bailout is probably another cover up as would be the $700 billion currently being proposed. None of these bailouts trickle down to any of us, it only obligates each and every one of us and many future generations to this debt.

So FBI, if you do browse this blog as it is said you do, my congratulations for doing your job and protecting the interests of the people of this country. You have the power. Use it to maintain the integrity, honesty and most of all the American way of life for your fellow citizens.

Comment by Larry Rubinoff — September 24, 2008

Comment 2:

“Give me control of a nation’s money and I care not who makes her laws.”Mayer Amschel Rothschild (February 23, 1744 – September 19, 1812)

Rothschild basically founded the central banking system and was instrumental in its formation in the U.S. His colleagues and partners were none other then August Bush – George W’s great grandfather – who headed up The Bank of New York – which in turn financed Hitler and J. P. Morgan – helping him create his empire. These two were instrumental in the formation of The Federal Reserve and The Federal Reserve Bank of New York where as I said earlier, J. P. Morgan still maintains a seat. It is said that by controlling The Fed Bank of N.Y. you control the Fed itself.

Do your research on Rothschild and you will find that he laid out a plan in the late 1700’s – an economic plan that would control most of the world’s economy. In part he called it “The New World Order”. Sound familiar? His plan, which is published and can be found on the internet is being executed today. President Bush is so quick to socialize our financial institutions with almost dictatorial powers. If you read about Rothschild and the Bush/Morgan connection you will understand why. There is no doubt in my mind that the Bush’s are part owners of The Federal Reserve.

Steve, you are correct. The old saying, “he who has the gold rules” has never been more evident then it is today. In fact, that is what Rothschild was saying and what our government is doing today.

Politics have always been dirty but never as it is today. Socialism is a very close cousin to communism which is a first cousin of facism.

Continuing to allow these massive bailouts – a cover up – will mean total control by government – now an entity unto itself and no longer representative of the people. The government will decide if and under what terms you get a mortgage, a car loan, a student loan and perhaps even a job. If you don’t belong to the right party or totally support it you may be denied your loans, a home and transportation.

Don’t think it can’t happen. My father, a Holocaust survivor, back in the 50’s attempted to get his electrical contractors license for several years in the town we lived in. Each time he failed the test by just one or two points. Since he had an excellent reputation as an electrician and was well respected at City Hall, some one at the city suggested he change his party affiliation from Democrat to Republican and he would get his license. He did that and yes, the very next time he took his exam he passed with flying colors.

If we as citizens continue to behave as “sheeple”, allowing the greed and fleecing of America by our elected officials and their corporate cronies, we are doomed.

Comment by Larry Rubinoff — September 24, 2008

Comment 3:

This was all an orchestrated, collaborative effort between government and the private sector financial institutions driven by greed on both sides.

Our politicians dance to the tune of the same drummer, The Fed.

During the Clinton years we saw the emergence and tremendous growth of sub prime. Lenders went from a handful – like Ford Motor Credit – to hundreds of bank subsidiaries around the country. And yes, it was at the governments request that more money in the form of credit was made available.

Sub prime was not the problem. Criteria such as Debt to Income, reserves and value were all taken into consideration. There were no problems then and we did see a period of declinging markets and values. The only difference was a much higher rate as those borrowers already exhibited a poor payment history.

Rates were as high as 16% but again, the borrower had to prove that they could afford it. Having bad credit did not mean you did not have the ability to pay.
The problem arose when the rules of engagement were changed. Eliminating any evidence of ability to pay and offering multiple loans to everyone.

To mask a depletion of our surplus and to take the emphasis over an ever increasing unprecedented deficit and an unpopular war draining trillions out of the economy, the only option left by the Fed and government (they are not one in the same) was to create a credit based (no real cash money involved) economic growth pattern in the only major industry left in this country. By doing so prosperity proliferated the society and society was too consumed by their new found material wealth – real estate, cars, electronics, leisure travel, etc. – to pay attention to or care about the rest.

This is not a normal capital market failure. This appears, to me at least, to be a well planned and orchestrated occurrance.

Pay close attention to the Rothschild quote I gave above.

Comment by Larry Rubinoff — September 25, 2008

The "SEC Jihad" and More Truth From the New York Times

A must read article published in the New York Times on line September 19, 2008 written by Joe Nocera. His reference to the SEC not doing their job, calling it the “SEC Jihad”, further points out the lack of oversight that occurred. His analysis and observations, I believe, are right on target.

After reading the NYT’s article then read the next one from a local hometown publication. It raises the question a very important question.

Hoping a Hail Mary Pass Connects
By Joe Nocera
New York Times published September 19, 2008

Henry Paulson at a news conference to announce an insurance program for money market

After reading the NYT’s article, read this one from a small local hometown paper. It raises a very good question.

Asia makes big screens and we just watch TV
Published: Saturday, September 20, 2008 1:38 AM EDT
by Chris Powell

What is it about the United States that every generation it must have a catastrophically mistaken imperial war and a catastrophically expensive rescue of its predatory financial class?A generation ago the catastrophically expensive rescue of the financial class arose from the collapse of savings-and-loan institutions, which had recklessly lent into a real estate boom against deposits insured by the government even as the government paid little attention to what the banks were doing. Today the catastrophically expensive rescue of the financial class arises from the failure to regulate the great New York financial houses, which were allowed to create and misrepresent bogus financial instruments, now called derivatives, and poison the world financial system with them. Ten years ago a few members of Congress proposed regulating these instruments, but Congress was dissuaded by worthies such as Federal Reserve Chairman Alan Greenspan, who testified that derivatives would diminish risk by dispersing it and thus should be left alone. Of course as it turned out so much risk was created and dispersed that it took the world’s economy hostage.
While he now is thundering emptily about accountability, Connecticut’s U.S. Sen. Christopher J. Dodd facilitated this failure of regulation from his seat on the Senate Banking Committee. Dodd was a leading advocate of unleashing the financial houses to do whatever they wanted, as by repeal of the Glass-Steagall Act in 1999. But Connecticut’s other members of Congress were just as negligent and approved staffing the financial regulatory agencies via the revolving door from Wall Street. Of course they financed their campaigns largely with financial industry contributions.Now the country is bankrupt and lemon socialism is replacing free-market capitalism, with the government desperately extending taxpayer guarantees to cover every bit of corporate irresponsibility as the country loses its sovereignty to the nations that hold its proliferating bonds. Asia makes big-screen TVs and Americans mainly just watch television — but not, it seems, much news.
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