Tuesday, October 12, 2010
Reluctant as I am to admit it, fairness requires me to say that Barack Obama is taking the responsible position, or at least the less irresponsible position, on the matter of the mortgage foreclosure moratorium proposed by Congressional Democrats in their ongoing campaign to raise the cost of capital for the American economy.
Just a few days ago Obama refused to sign a bill that would allow foreclosures. Who was behind using the technicality to prevent foreclosures in the first place? My guess is that the ploy backfired and that is the reason for Obama's about face. Many dems probably told Obama-Reid-Pelosi they do not need this issue just before the election. Obama doing the right thing? Ha. You can't fix stupid.
Much more to it than that, see http://www.nakedcapitalism.com/2010/10/josh-rosner-could-violations-of-psa%E2%80%99s-dwarf-lehman-weekend.html for today
s comment on what is going on behind the scenes.
So the robo-signers were necessary to purposefully have someone in the dark attest to things they knew nothing about -- not just because there was a shitload of papers to sign.
Thus, if I'm reading this right, a lot of mortgages that were securitized may be ineffective as a security interest in the property. All the lender has is an unsecured debt. WTF? Is this right?
If so, doesn't this apply to all such securitized mortgages ... not just those presently in default.
Someone deep in the mortgage business told me about this problem two years ago. It went over my head and/or I didn't want to believe it. So this issue was a known problem to those in the know.
So we had a recent piece of legislation that apparently was an effort to slide through a technical fix without creating general awareness. It would have required acceptance of robo-signed documents. But somehow it didn't get enacted.
But we just had the Mother of All Financial Reforms enacted to fix everything.
Meanwhile, 90% of the mortgages in America may be legally defective.
WTF? That can't be right. Can it?