Bair: Foreclosuregate Is A ****show

The Market Ticker

Hattip Zerohedge:

• BAIR: LITIGATION FROM SERVICER ISSUES COULD BE `VERY DAMAGING’
• BAIR SAYS FORECLOSURE PROBLEMS WILL REQUIRE `GLOBAL SOLUTION’
• BAIR: CRISIS REQUIRES `DECISIVE’ ACTION FOR MORTGAGE SYSTEM
• BAIR: FDIC SECURITIZATION RULES `CONSISTENT’ WITH DODD-FRANK
• BAIR SAYS CRISIS REVEALED `CRITICAL FLAWS’ IN MORTGAGE FINANCE

No **** Sherlock.

Here’s reality:

• Lots of notes appear to have never been conveyed. When the MBS holders get their landsharks into this, the servicers and securitizers are screwed. Got it? Done, baked, cooked, finished.
• The only “Global Solution” is to put the institutions that did this into recievership. Right now. BEFORE the landsharks cause a VERY disorderly collapse. We have a resolution authority. Use it. These institutions must be forced to eat the crap that they foisted off on pension funds and insurance companies. If they claimed they had original endorsed paper for each loan (and they all did) and did not that is black-letter fraud. So is selling someone paper you claim is good when you know it is not, and again, we have under-oath testimony documenting that this was done willfully and intentionally. This is fraud in the inducement against MBS holders and those who committed it must be forced to eat the consequences.
• The question of fraud in the inducement against borrowers must be answered to. This is not a “technical matter.” Citibank’s former chief underwriter has testified under oath that he, and the rest of management, knew that 60% of production was bogus in 2006 and 80% in 2007. These loans are avoidable under long-existing law. You cannot create a binding contract where you have reason to know that the other party cannot perform, and long-standing law codifies this officially in terms of debts and security instruments - giving someone a loan where they retain insufficient assets and income to pay as agreed renders the security of the instrument and thus the loan avoidable. Period!

Dodd-Frank has a consistent procedure.

It’s called RESOLUTION and you need to employ it RIGHT NOW.