Weekend Open Thread (2010-10-08)

Here is your open thread for the weekend beginning Friday October 8th, 2010. You may post random links and off-topic discussions here. Also, if you have an idea or a topic you’d like to see covered in an article, please make it known.

Be sure to also check out the forums, and get your word in the user-driven discussions there!

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About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.

44 comments:

  1. 1
    Dirty_Renter says:

    Pegasus – here’s a Canadian goldbug who hates US bankers as much as Karl & Mish. He’s been going at it for several years.
    Enjoy.
    http://seekingalpha.com/article/229048-mortgage-title-fraud-a-national-catastrophe?source=email

  2. 2
  3. 3
    Pegasus says:

    FLASH: Bank Of America Halts Foreclosures: All 50 States

    http://market-ticker.org/akcs-www?post=168584

    The next Black Swan event has arrived

  4. 4
    sleepwalker says:

    By Pegasus @ 3:

    FLASH: Bank Of America Halts Foreclosures: All 50 States

    http://market-ticker.org/akcs-www?post=168584

    The next Black Swan event has arrived

    Hardly.

  5. 5
    Gameboy says:

    If there is still anyone arguing that defaulting on a loan is morally reprehensible…

    http://www.thedailyshow.com/watch/thu-october-7-2010/mortgage-bankers-association-strategic-default

    It seems Mortgage Bankers Association disagrees. It really is breathtaking how brazen these A-Holes are…

  6. 6
    Pegasus says:

    RE: Gameboy @ 5 – That’s a great tape. Too funny. It has been a while since they defaulted but recycling the old story into the current environment on Comedy Central now is just great.

  7. 7
    Pegasus says:

    RE: sleepwalker @ 4 – Yup that’s what people in power said when the subprime event started to rear its ugly head. Its nothing. Its contained. Its under control. Its a full scale global nightmare and we need trillions to bail the crooks out. Will this get that big…maybe.

  8. 8

    I don’t know if anyone else is following the California budget mess, but it’s become a joke. 0% of the deficit is addressed through new taxes. 40% through spending cuts. 60% through rosy projections and fantasy.

    http://www.mercurynews.com/ci_16288013

    Not mentioned in the article is they are also using sale/leasebacks. That’s a solution that works for a year.

    It’s Washington’s future if that Eyman initiative passes.

  9. 9
    Snigliastic says:

    Can we get a “Pegasus and Kary” open thread so I don’t have to waste my time scrolling through all their personal arguments?

  10. 10
    Pegasus says:

    If you read just mine you will get all of the correct information about what is really happening so you can react accordingly……..

  11. 11
    Pegasus says:

    Janet Tavakoli On The “Biggest Fraud In The History Of Capital Markets”

    In the following interview with the WaPo’s Ezra Klein, Janet Tavakoli shares some more information on why every bank is about to shut down all foreclosures, in what she calls the “biggest fraud in the history of capital markets. Not very surprisingly, we are, so far, spot on in our 29th September projected timeline at this point: “We predict that within a week, all banks will halt every foreclosure currently in process. Within a month, all foreclosures executed within the past 2-3 years will be retried, and millions of existing home sales will be put in jeopardy.”

    http://www.zerohedge.com/article/janet-tavakoli-biggest-fraud-history-capital-markets

  12. 12
    Marc says:

    RE: Pegasus @ 3 – BofA is completely incompetent these days. A client of mine just bought a home and BofA was so lousy I wrote a post about it: http://walawrealty.com/news/. I feel sorry for the people that work there because it’s pretty clear that they know it sucks and they’re’re miserable.

  13. 13
    Pegasus says:

    Attorneys General in 40 States Said to Join on Foreclosures

    Oct. 8 (Bloomberg) — Attorneys general in about 40 states may announce a joint investigation into foreclosures at the largest banks and mortgage firms, according to a person with direct knowledge of the matter.

    State attorneys general led by Iowa’s Tom Miller are in talks that may lead to the announcement of a coordinated probe as soon as Oct. 12, said the person, who declined to be identified because a final agreement hasn’t been reached. The number of states may change because several are still deciding whether to join the investigation, the person said. New Mexico Attorney General Gary King said today in a statement that his state will join a multi-state effort.

    http://www.businessweek.com/news/2010-10-08/attorneys-general-in-40-states-said-to-join-on-foreclosures.html

  14. 14
    Sniglet says:

    Our conversation earlier this week about the self-righteousness the bubbleheads show to homeowners inspired me to write a post on my blog.

    I may be bearish on real-estate (and have been since the early 2000s when I sold my home), but I don’t blame anyone for the housing bubble, or its collapse. It’s not the fault of evil bankers, fraudulent real-estate agents or incompetent regulators. Neither was the bubble the fault of homeowners cashing out equity or hoping to build a nest egg.

    Instead, I believe that the credit bubble (of which housing was just one part) is simply the result of broad societal shifts in optimism and pessimism. One can no more complain about these generational patterns of sentiment than they can the ebb and flow of ocean tides.

    http://surkanstance.blogspot.com/2010/10/casting-first-stone.html

  15. 15
    Dirty_Renter says:

    RE: Sniglet @ 14
    Good write-up Mikhail.
    I’m not quite as generous as you, though…the securitization process worked very well for over 20 years, until some very bad people saw an opening, and ripped it to shreds. They broke a time-honored trust. The thought of bundling a group of loans made to deadbeats, and pfft, it’s now AAA, is beyond the pale. I want blood, but I’m quite sure the FCIC will solve nothing.

  16. 16

    Here’s an unpublished decision from the 11th Circuit Court of Appeals dismissing a case against MERS that made many of the same arguments that are being made today.

    http://courtlistener.com/ca11/jHV/sandy-s-trent-v-mortgage-electronic-registration/

    As I’ve indicated, these arguments are nothing new. It’s just that the press has finally noticed them, sort of like how they noticed shark attacks in 2001 when the attacks were happening at below average levels.

  17. 17
    Pegasus says:

    MERS goes on the offensive.. “The MERS System is not fraudulent, and MERS has not committed any fraud.” channeling that famous line from Richard Nixon…”I am not a crook”

    Statement by CEO of Mortgage Electronic Registration Systems (MERS) RESTON, Va.–(EON: Enhanced Online News)–Mortgage Electronic Registration Systems (MERS) Chief Executive Officer R.K. Arnold today issued the following statement regarding the organization…
    http://eon.businesswire.com/news/eon/20101009005011/en/Statement-CEO-Mortgage-Electronic-Registration-Systems-MERS

  18. 18
    Sniglet says:

    RE: Pegasus @ 17

    The MERS System is not fraudulent, and MERS has not committed any fraud

    It’s not an issue as to whether MERS is purposefully trying to defraud people. The question is whether the centralized registration system for titles is legal to begin with. There are plenty of business practices which are eventually determined to be illegal which were NOT fraudulent (i.e. they were done under good faith until the courts clarified they didn’t mesh with the law).

  19. 19
    Pegasus says:

    Too funny…

    http://www.zerohedge.com/article/subprime-mortgage-processing-visual-aids-part-ii

    The diagrams are partially covered at least on my browser so I right click on the images and open in a separate window.

  20. 20
    Pegasus says:

    RE: Sniglet @ 18 – I think you need to do some more homework. Three AG’s from different states have filed RICO lawsuits against MERS for what they are doing. Yes I know it will be ultimately up to the courts to determine but there is plenty of info that suggests all is not OK and there are some really bad things going on. All you have to do is look…

  21. 21
    laterite says:

    At this point is there really any reason to continue paying on an upside-down mortgage (I’m being about 33% serious)?

  22. 22
    Macro Investor says:

    In Kary vs. Pegasus… I think Kary is right for the wrong reasons. The whole system has been riddled with fraud from the get go. But no bank or banker has been, or will be, charged with anything because the politicians are bribed to protect them. Nothing will come of this because the government will give them another way out.

    The large banks are only still in business because the politicians have allowed them to ignore mark to market rules. This is unfair to the smaller banks who would instantly take over their business if the corrupt politicians would just let them die.

  23. 23
    Macro Investor says:

    By laterite @ 21:

    At this point is there really any reason to continue paying on an upside-down mortgage (I’m being about 33% serious)?

    No. Unless you have a recourse loan and assets you can be sued for (hide them the way banks do).

    BTW, don’t take a loan mod or refinance. Those are just sneaky ways to get you to sign a recourse loan which means you can be harassed for life.

  24. 24

    RE: Macro Investor @ 22 – Hell of a fraudulent scheme that starts with giving someone $xxx,xxx.xx and hoping they repay you. ;-)

    I think you do have a point though that the banks will be protected. One state has already passed legislation to help MERS with it’s arguments.

  25. 25
    Pegasus says:

    RE: Macro Investor @ 22 – I have stated my belief that in the end that there will probably some magic wand solution that allows the perps to go free, make all the fraud legal, clean titles, small settlement for the damaged, any big money will be on the backs of the taxpayers. I left out big payday for the attorneys involved. My point was when first I posted was that this is a big deal and potentially explosive. Within a few days it has become a big deal if you watch TV, read newspapers or look on the Internet. BOA shut down all 50 states. The financial implications could be huge blowing up the entire MBS market and some large banks. Will that happen? I don’t know that they can do a TARP II or a Resolution Trust 2 large enough to clean up the toxic mortgages and the liabilities created. My guess is it will be something else like a law that makes all the fraudulent docs legal, etc. You saw where Obama vetoed the digital notary law after everyone realized the public had come to believe it was passed in order to clean up all of the bad notarizations in the foreclosure docs? Can’t do that in front of an election. Afterwards….you bet.

  26. 26
    softwarengineer says:

    RE: Pegasus @ 25

    When Bush Was President

    The Democrats all screamed the economy was bad all the time. Now that Obama is President, the Dems use smoke and mirror stall tactics, attempting to distract us from a 17% U6 unemployment rate with concurrent uncontrolled population growth [which is the centerpiece of both the Dem/Rep platforms…LOL].

    See why I’m voting against all the incumbents.

  27. 27

    RE: softwarengineer @ 26 – I like the idea of voting against incumbents. That’s different than voting against Democrats.

  28. 28
    Pegasus says:

    Free Hush Money To Delinquent Homeowners In Ohio Where the AG Is Pursuing Criminal Action Against Fraudulent Foreclosures.

    Guess who pays for it? We do! Squarely on the taxpayers back. Unbelievable!

    http://www.youtube.com/watch?v=oxUrgIcFzLc

  29. 29
    Willy Nilly says:

    I went to the Seattle home show today. The extremely low foot traffic coupled with the palpable desperation of all the exhibitors was depressing to say the least.

  30. 30
    Pegasus says:

    RE: Willy Nilly @ 29 – Welcome to the “new normal” where homes are depreciating values and have additional expenses attached such as property taxes and maintenance. The baby boomers are moving on into lower priced housing or adult care facilities. They will be net sellers for the next ten years and they will be liquidating their other assets such as stocks and bonds to pay for Obamacare. Not surprisingly bulldozing surplus housing is being discussed in many communities by the builders and their complicit politicians.

  31. 31
    HappyRenter says:

    By softwarengineer @ 26:

    RE: Pegasus @ 25

    When Bush Was President

    The Democrats all screamed the economy was bad all the time. Now that Obama is President, the Dems use smoke and mirror stall tactics, attempting to distract us from a 17% U6 unemployment rate with concurrent uncontrolled population growth [which is the centerpiece of both the Dem/Rep platforms…LOL].

    See why I’m voting against all the incumbents.

    But if I don’t like neither the republicans nor the democrats, who am I going to vote for?

  32. 32
    Dirty_Renter says:

    Last night, the Seattle Symphony performed a 13 piece version of Copland’s ‘Appalachia Spring’ and folks, they did Seattle proud. The other symphonies of the world have nothing on us!!! Maybe it is special here?

    Anyhow, perhaps we can take solace in knowing things haven’t really changed in 40 years:
    http://www.youtube.com/watch?v=miZWYmxr8XE.
    Perhaps not.

  33. 33
    One Eyed Man says:

    RE: Dirty_Renter @ 32

    I really miss the early days of FM rock when they were still independent and the DJ’s could do whatever they wanted. You might hear them play Copland, followed by somebody like Emerson Lake & Palmer playing a bit of Copeland’s Rodeo or Fanfare for the Common Man, or some Jazz influenced by something Copeland had written. And that might be followed by a country influenced song by the Dead or the Stones and that might be followed by some Gershwin or Billy Holiday or Cole Porter or some Blues or Motown.

    Did that become extinct just because there wasn’t a narrow enough marketing demographic for the big money media guys to sell ads to? It really pissed me off.

    In 1972 a bunch of us were talking about world affairs and one person started saying how we had it so easy. That our parents had to deal with a war and a depression. Then one of the other people said, ya, all we have is a war and a recession. Maybe Sniglet’s right and the current economic issues are just the depressed phase of the worlds chronic emotional mood swings. I know one thing, I get depressed anytime I hear someone say Lady Ga Ga.

  34. 34
  35. 35
    corncob says:

    By One Eyed Man @ 33:

    I really miss the early days of FM rock when they were still independent and the DJ’s could do whatever they wanted.

    Check out KEXP, 90.3

  36. 36

    Just saw an anti Patty Murray ad on TV, naming all the bad things that have happened on her watch. One of the big things they focused on was falling home prices.
    First of all, how is Patty Murray responsible for falling home prices? If Dino Rossi is elected, is that all it’s going to take to reverse the slide in home prices?
    Second of all, why are falling home prices a bad thing? Why is it a bad thing if housing becomes more affordable? If Patty Murray caused home prices to fall, and falling home prices are actually a good thing, doesn’t she deserve your vote?
    I’m not a Patty Murray fan, nor am I a Dino Rossi fan. But geez, this advertising is really getting to me. I’m ready for all of them to just STFU.

  37. 37

    RE: One Eyed Man @ 33 – KEXP. Opps, even though I started at the bottom I missed the other comment regarding this.

    Anyway, two votes, and I think Ira has said he likes it too.

  38. 38

    By Ira Sacharoff @ 36:

    First of all, how is Patty Murray responsible for falling home prices?

    I’ve taken the position that these self-righteous politicians who are so quick to blame everyone should be voted out if they didn’t see the crisis coming and try to do something about it. By that standard there probably wouldn’t be 5 people left in Congress, even though they would all claim to have done something (as both McCain and Obama tried to claim in 2008).

  39. 39
    Lurker says:

    RE: Ira Sacharoff @ 36

    Since our good supreme court approved campaign ad contributions from corporations and unions now (and they can do so anonymously! double yay!) expect the mud slinging to go into hyper-drive.

  40. 40

    RE: Lurker @ 39 – Personally I never understood the old rule. Seemed to be a clear violation of the First Amendment. A gag rule just prior to elections. How could that possibly be okay?

    I know the argument is they aren’t people, but that has little support in theory. The New York Times is not people either. Could you stop them from covering an election the two weeks prior?

    “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances. “

  41. 41
    Lurker says:

    RE: Kary L. Krismer @ 40

    The New York Times falls under freedom of the press, Kary.

    But yes, it all comes down to corporate personhood which in my opinion is a slippery slope. Who knows, maybe in twenty years I can vote for GE as my senator, or Microsoft as a judge.

  42. 42

    RE: Lurker @ 41 – Yes, that’s why I set forth the language of the Amendment. Based on the language there is no way to distinguish between the two rights. It’s “freedom of speech, or of the press; . . ..” If one protects the rights of corporations, so does the other, absent finding some damn compelling authority from the 18th Century otherwise.

    Also, other Amendments, such as the Fifth, specifically refer to the rights of “persons” and although corporations don’t have all the rights under the Fifth (e.g. the right to remain silent), they do have many/most of the rights under the Fifth, despite the use of the word “persons.” Since the First doesn’t have the limiting word “persons,” but instead just says Congress may not restrict the rights, it’s very difficult to have a corporation/individual distinction.

  43. 43
    Lurker says:

    Right. It’s not exactly in there which means we must rely on our good supreme court judges for constitutional interpretation. That reminds me of a bit I watched on Colbert recently. Funny stuff.

    http://www.dailykos.com/storyonly/2010/9/30/906627/-Stephen-Colbert-destroys-Scalias-interpretation-of-Constitution

    from Wikipedia: “Appointed to the Court by President Ronald Reagan in 1986, Scalia has been described as the intellectual anchor of the Court’s conservative wing.”

  44. 44

    By Lurker @ 43:

    Right. It’s not exactly in there which means we must rely on our good supreme court judges for constitutional interpretation.

    But what I don’t understand is how so many people could support an interpretation which limits the First Amendment. Especially people who are members of the press.

    The new case on anti-gay demonstrations at military funerals provides some interesting issues. I could see that one going either way. The soldier is not a public figure, so there aren’t quite as many protections for the speaker.

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