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article imageOp-Ed: The next big disaster- Mortgage crash V.2

By Paul Wallis     Oct 21, 2010 in Business
From America the Beautiful to America the Disaster area wasn’t such a short step, was it? Another wonderful achievement is just around the corner- mortgages, again. The big banks need more money.
Ridiculous? Yes. Inevitable? Probably.
As venal vermin rejoice in the streets at the coming mid term elections and the oil industry and its servile social set preside over the now somewhat repetitious murder of the United States economy a new joy is on the horizon.
The markets “rallied”, if you can call stimulating fossils a rally, when Fed Chief Coroner Bernanke announced the possibility of another stimulus package. While business is busily sitting on billions and throwing political tantrums in keeping with the apparent mentality of a two year old spoilt brat, another rescue mission, this time to cover the trillion dollars worth or so of toxic mortgage assets is now on the cards.
The irony of the situation is apparently only lost on those who still incomprehensibly think that business is on the same side as the nation. This latest rescue of mortgages is based on an interesting set of circumstances:
· The banks, illegally foreclosing without adequate documentation, often get knocked back by the courts.
· In many cases, the “brilliant” mortgage securities are so messed up nobody knows who actually owns the mortgages.
· Mortgagees have successfully blocked repossession because of these situations.
So, obviously, the banks are sitting on a lot of very toxic “assets”. It also means their balance sheets are way out of whack with anything resembling reality. It also means their own borrowings are underpinned by assets which may not even exist.
This is the end product of the geniuses of Wall Street, the Chamber of Commerce and other happy go lucky institutions looking for laughs, presumably, because there’s not a lot of money in it, at this point.
To the rescue, as usual, comes the Fed riding the famous Greenback Mule, on the correct but unfortunately unjust assumption that the public will suffer if the banks go to the wall. The Wall Street Nuthouse needs demolition, not saving, if anyone expects there to be an American economy on Main Street anytime soon.
I’ve always found it as hilarious as sickening that the so-called Gods of Free Enterprise invariably live on government contracts, directly or indirectly. The Fed should reclassify itself as a charity on this one.
1. Why shouldn’t these corrupt, expensive, and economically utterly useless bastards take what’s coming to them?
2. Losses are part of business. Why are these guys exempt? Everybody else pays for their mistakes, in cash.
3. Why should anyone pay them for their greed?
4. Will buying toxic assets do much more than just clean the auditable diapers of these pretentious idiots?
And how, you may ask, is this rescue to be achieved? By printing more money to cover the huge gaping holes, of course. Result, prices go up, and this, charmingly, prevents deflation. The US dollar value remains the same for goods and services, whereas the shrinking economy would normally cause prices to drop and (gasp) losses to occur in the markets.
The fact that import costs will skyrocket should encourage US producers (if there are still any alive) to enter the market. The dollar, at chicken feed levels, will solve everything.
Except it won’t. The actual owners of American equity, security and bonds, mainly foreigners, will be able to buy up everything quite easily. Bad? Nope, because they’ll be the only people able to afford them. Americans will get the short end of the stick, priced out of their own equity.
This is exactly the same scenario which allowed a few rich people to buy Soviet Russia after the collapse. Worthless stock issued to workers were bought for peanuts. Equally low value US assets, like the millions of houses in the mortgage securities scam, are already being bought up by thoughtful parasites.
The theory of the rescue and stimulus is that this will protect capital. Capital, apparently, has no obligations. Whichever collection of pitiful Gollums happens to be in charge of the money can charge anything for anything, and make the nation as uncompetitive as possible. They then send jobs offshore, claiming US labor costs are too expensive, not that their geriatric brains can’t comprehend the technology which could regenerate industrial production in the US in seconds.
It gets even better. Having destroyed the domestic economy several times over, no criticism is permitted, and even people who really should know better assume that the big capital interests are on their side. (It always surprises me that even Murdoch, who’s no idiot, associates with these cretins.) These guys are basically wannabe Madoffs, just more self righteous, and nation molesting is a sort of birthright, as far as they know.
Some democracy. This institutionalized urinal has gone on long enough. In any other country on Earth, billionaires, even the adorably gaga, can get jailed. Financial crimes are actually punished. Not in the US.
The good news- The midterms are looking like an anti-incumbency race. That means that the office of President, probably renamed the Mad Hatter, will also be up for grabs in two years time- If they can find anyone dumb enough to want it.
Then everyone can have a big party and bask in self congratulation.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of
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