Helping Homeowners In Michigan
Archive for January 17th, 2011
Got A Foreclosure Story?
January 17th, 2011 | 
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Are you with us? Can you help get the word out? Can you encourage people to visit and share their stories or comments on Shamethebanks.org? Can you encourage them to spread the word about what the banks are really doing? The more stories, the more comments we get the more likely that we will get the attention of major media and the politicians we need to stop listening to the banks and start listening to us.
Let’s get this moving even faster than it is. We need Change now, and we are the ones who can make it happen! We are in this together. For the sake of ourselves and our kids and, quite frankly for the sake of the new American Dream, we are not quitting.
When the law enforcers join hands with those who evade the law there are only two choices left – one legal, one illegal.
The legal choice is to use public pressure – that is, shame and shunning – to apply economic pressure to those institutions and individuals who will not conform with what they should be doing.
I have long said that public shunning is one of the most-effective means available to redress this situation. If your local bankster cannot get his car fixed, buy food for his fridge, cannot buy a haircut for any amount of money and can’t find anyone who will even talk to him in his neighborhood, things will change.
The Amish use this technique with considerable success.
Now you can when it comes to the banks and your home.
Posted in Banks, Corruption, Economic Crisis, Financial System, Foreclosuregate, Foreclosures, Fraud | 
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Financial trends of the new American economy – Higher educated workforce with harder time finding and keeping jobs, median retirement account for Americans at $2,000, global stock market growth, and housing bust covering up inflation in other areas.
The Great Recession is revealing some fundamental challenges in our economy. One of those challenges revolves around the exceedingly expensive college degree and its ability to translate into employment. As a percent many more American’s have a bachelor’s degree today than say in 1992 yet unemployment for college educated Americans is at modern record highs. Another profound challenge facing American families is retirement savings (or lack thereof which is more likely the case). Retirement is largely becoming a luxury that only a handful of families can count on. As we look back at the last decade not all global stock markets were created equal and this is evident when we compare the US stock market to those abroad. Finally we will examine what areas are seeing major price increases all the while overall inflation appears to be muted to average Americans.
College educated rise but less employment
Source: BLS
In 1992 27 percent of those employed and 25 years of age or older had a bachelor’s degree or higher. Today that figure is up to 36 percent. However back in 1992 during another recessionary time those with bachelor’s degrees or higher had an unemployment rate of 3.5 percent while today it is up inching closer to 5.5 percent.
“In other words as a nation our employed workforce is more educated but it is also having a harder time gaining or maintaining employment. At the same time college costs have far outpaced the overall inflation rate.”
This may seem counterintuitive because in terms of career aspiration a college degree is less likely today to secure you a job compared to 1992 but it is much more expensive in real terms. So what are you really paying for? Of course college is not merely a means to a job but a place where students develop into well rounded citizens. Yet many for-profit institutions sell themselves as job factories and are all the willing to take federal financial aid without any statistics to back up their career placement rates.
What has occurred is a bubble in higher education. Obviously becoming an educated citizen is important. However we are facing a stratified market. You have private institutions charging $50,000 a year or more catering to many of the financially well off in the country. This group continues to get a solid education. Next you have a public education system with very good schools but competition for admission is getting exponentially harder and students are dealing with bigger classes and more expensive tuition. Finally you have the for-profit sector that merely operates to generate revenues by sucking in federal financial aid and not being accountable to their students and many operating only one step above diploma mills.
Retirement accounts largely a concern for top households
A BLS report done a few years ago showed that the median amount in retirement accounts for Americans was $2,000. This makes sense given that half of Americans make $25,000 a year or less. Many are looking at Social Security as their retirement account. If you look at where the money is aggregated you will start to realize that retirement accounts are largely becoming a luxury for a small fragment of American society:
Keep in mind that only 15 percent of US households make more than $100,000 or more a year. However 64 percent of all retirement assets are in the hands of the top 15 percent. The median household income in the US is $50,000. So we can even average out this amount here:
$1.04 trillion / 55 million US households = $18,909
Now this may seem higher than the BLS figures but keep in mind this is because of the $20,000 to $49,999 cohort that holds the bulk of this amount. In reality 1 out of 3 Americans have zero in savings. Even here the data is skewed. But think about the $18,909. How long would that last you in retirement? Say you draw down $1,000 per month and you are out of money within 18 months.
For many saving for retirement has become a harder and more trying exercise. If we look at the domestic stock market we can see why.
Global stock market growth
Even after the amazing 90 percent stock market recovery from the 2009 lows the S&P 500 is still off by 11 percent from where it was in January of 2000. In other words someone investing in boring and plain bank CDs actually performed better than the overall stock market for the decade. The Wall Street mystique has been lost on many. 60 Minutes featured a story of a famed gambler that made millions betting on sports yet was taken for a ride with Wall Street. In his own words, he did not trust Wall Street. This coming from a professional gambler and hustler. Wall Street has largely become one giant casino.
What is fascinating is markets that have benefitted from outsourcing such as India and China have boomed exponentially. In exchange for cheap goods many Americans are now struggling to keep a hold on to what they once thought of as the middle class. Why would a global multinational corporation want to pay someone in the US $10 an hour when they can pay someone overseas $10 per day for the same work? That is the profound question many now have to wrestle with and no politician is willing to tackle.
Inflation is where?
The BLS CPI has shown virtually no movement over the last few years. Much of this is due to the bursting of the housing market. The BLS heavily weights housing as it should. Most Americans spend the most on their housing costs each month. Yet the housing crash has hidden some major inflation in certain items. For example, oil is back up and you need only look at gas prices. For those who shop the cost of food items has gone up last year. Yet retailers have gotten creative with packaging so prices stay the same yet the amount you are receiving has gone down.
Take a look at the price of coffee, wheat, soybeans, orange juice, and other items over the last year. The S&P 500 went up by 13.6 percent but this pales in comparison to other sectors.
What can we conclude from the above? It is safe to say that there is a bubble in higher education. The costs are outstripping the benefits in many cases depending on what schools you go to. This is similar to the housing bubble. Some homes should have never tripled in value yet many homes are nice and built with quality in good areas. Others are not but when banks get involved you are likely to find speculation and gambling inflating costs. Students need to be extremely careful in choosing their institution and not falling into too much debt. Another conclusion you can draw is that the housing bust has hidden the inflation of many daily items. The CPI is muted because of the implosion of the housing market and this covers up rising costs in other sectors. For example college tuition, healthcare, gas, and food have all gone up significantly over the decade yet this hardly shows up while wages have gone stagnant or declined. Ultimately American families have to be cognizant of these changes since they will impact their daily lives.
Posted in Banks, Debt, Economic Crisis, Economy, education, middle class, Money, Retirement Accounts, Savings |
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MERS Minus A Few Bricks….
Which one is the critical one that, when removed, causes all of this bogosity to crumble into dust?
A Utah court case in which the owner of a Draper townhouse got clear title to the property, even though he still owed $132,000 on it, raises new legal and financial questions about a property-records database created by mortgage bankers.
Oops.
What happened here was that an attorney went in and filed a “quiet title” action – that is, to remove any clouds on the title. The problem MERS instantly ran into is that it has publicly disavowed being a real party at interest – that is, it’s only a nominee. Therefore, it doesn’t have to be named.
This is a major problem for them. See, the point of MERS is to avoid paying recording fees. But the point of property records is to provide a clear and clean record of who owns a property and who has an interest in it – including who has a lien. MERS entire purpose is obscuring this and abstracting it to a thing inside their database only, making the disclosure of the underlying facts a function of the investor’s desires, rather than one of public notice and record.
Unfortunately for MERS (and those who bought paper allegedly “secured” in this fashion) state property law says otherwise in a number of jurisdictions. Specifically, State Property Law in some jurisdictions requires that security interests be held by a named entity, just as a deed must be. That is, you can’t transfer a deed “in blank” nor can you have a security interest “in blank”; the identity of said person or corporation has to be known and recorded.
What happened here is that an enterprising attorney, recognizing this, sued for quiet title – that is, to remove any clouds on the title. Since MERS was not entitled to be noticed as they by their own words and actions are not a real party at interest, they didn’t know about it. The title companies, which were on the original records and the original writer of the mortgage, who were in the records, didn’t bother to respond because the title company doesn’t hold the paper and the original lender was paid in full when he sold off the note – so he has no real interest either.
Oops.
Mish is going bananas over this, claiming it’s “a travesty of justice.”
No it’s not.
The debt is still collectable. It’s just unsecured. Now that makes foreclosure impossible, but not a suit for collection. Effectively, the mortgage is now like a credit-card loan – it has no security interest associated with it, and that might make it far more difficult to collect.
It also, however, brings into question whether the purchasers of MBS that were assembled by the people who did this have a claim under criminal and civil fraud statutes. The parties assembling these loans into trusts knew damn well that State Law required recordation of interests and that they were marketing these loans as fully-secured by the underlying real estate. They decided, on their own initiative, to forego the “hassle” and “expense” of recording the interests, as well as (in the case in Massachusetts) bothering to transfer the notes as required into the trusts at the time, producing a business record that was sufficient to meet the requirements of law and admissible evidence.
Deciding to play “go go” during the bubble years was a decision made by the securitizers and lenders; the borrowers had exactly nothing to do with it. They were no more able to influence that decision than was Mickey Mouse, and to claim that there’s something “inequitable” that comes about when someone makes an allegedly secured loan but doesn’t bother to do the things necessary under the law to retain the security interest is pure nonsense.
Again, the debt isn’t gone – it’s just lost its characteristic of a secured note.
And that, my friends, is exactly what the rule of law says should happen when you make an intentional decision to cheat the process for your own pecuniary benefit.
You get the consequences.
Posted in Banks, Corruption, Economic Crisis, Economy, Financial System, Foreclosuregate, Foreclosures, Fraud, MERS, Mortgage Electronic Registration Systems |
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proudly supports:
Bill Still For President
for Congress
Michigan 11th District
By Bill Still
There is only one answer for the world economic situation; monetary reform.
1. No More National Debt
2. No More Fractional Lending
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