Tuesday, January 18, 2011

« Balanced Budget Amendment: Hatch Will Try For 13th Time; Would Limit Federal Spending To 20% Of GDP »

Hatch, Koop and Arlen Specter.

A simple override is built into Hatch's legislation; this is merely for show.


Hatch pushes balanced budgets - again

Source - Salt Lake Tribune

Maybe the 13th time is the charm.

After attempting, and failing, a dozen times to amend the Constitution to require Congress to balance the budget every year, Sen. Orrin Hatch is drumming up support for another try.

The Utah Republican is partnering with Sen. John Cornyn, R-Texas, to push a balanced budget amendment that Hatch is optimistic will pass now as the country finds itself $14 trillion in debt.

“Everybody in this country knows that we have a fiscal crisis and it’s getting worse,” Hatch says. “People are getting serious about it, even Democrats are frightened. They know that this country cannot sustain the current spending binge.”

“It’s sort of desperately needed,” says Larry Hart, a lobbyist for the American Conservative Union, which backs Hatch’s bill. “What we used to look upon as bad deficits have become potentially catastrophic. It has been shown over and over again over the years that it is absolutely impossible with the shifts in congressional and White House control to keep the country in a sane fiscal path.”

If Hatch’s bill won approval of two-thirds of both the House and Senate and then 38 state legislatures, it would require Congress to pass a budget in which revenue didn’t outpace spending, unless three-fifths of each chamber voted to waive that restriction.

It would also cap the annual budget at 20 percent of the nation’s GDP.

All federal tax increases would need to be approved by two-thirds of the House and Senate, though any of these limitations could be waived during a declaration of war or if Congress deemed them a risk to national security.

Continue reading...


I'm not a big fan of Orrin Hatch but both these clips are solid...

Short clip - 2 minutes - transcript is here...


Video: Sen. Orrin Hatch (R-UTAH) with Don Imus -- May 31, 2010

  • "If he keeps spending us into bankruptcy, we're going to be $20.3 trillion in debt by 2020."
  • "We'll have a $1.3 trillion budget deficit in 2020 according to their own actuaries...$900 billion of it will be INTEREST ON THE DEBT!"
  • "That ought to tell you that we're going in the wrong direction."
  • "And I can tell you the people out there understand it, they're just sick and tired of the spending. We now have 18% of all wages are now being paid by the federal government. Now, tell me that's a good thing."


« MAN BEATS BANK - And Creates Mortgage Banking MERS Bomb - Lost Paperwork Means Free Homes For Borrowers »

Walter Keane poses for a portrait at his office. Keane filed and recently won a lawsuit that resulted in several homeowners in Utah getting title to their property, even if they owed the full mortgage, all because of chaos introduced into the nation's property recording system by MERS.

Utah Professor Chris Peterson weighs in on the significance of the rulings.


In Utah, missing paperwork means a lot; Borrowers gain title for free.


David Dayen at FDL

Salt Lake City Tribune

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.

The award of a title free of liens means that whoever owns the promissory note on the Draper property — likely a group of faraway investors — no longer has the right to foreclose to collect on a delinquent loan. Indeed, the townhouse owner has sold the property and kept the money. Those who own the promissory note probably don’t even know what occurred.

Decisions such as the one 3rd District Judge Glen Iwasaki handed down in the Draper case could have a big impact as the state wends its way through hundreds of lawsuits involving foreclosures, loans on properties for more than they’re worth and predatory lending practices that led Utahns to lose their homes as the real-estate bubble burst.

More from David Dayen...

This is all tied up with MERS, the online database that has stood in for the land records system in as many as 60% of the mortgages in America over the past decade or so. As we’ve seen, MERS is essentially a way for the largest banks to avoid recording fees, by naming them as the mortgagee on the original record and then transferring the mortgage and the note through their database. The problem is that MERS is named as an owner on loans in which it has no financial interest, and the judicial system doesn’t yet know how to manage that. This has confused the hell out of title insurance companies, who cannot determine who holds the note or even who can collect payments on it. As a result, in this case, the courts and the title company failed to figure any of that out, so they gave title back to the homeowner.

The attorney for the man in Draper, Utah, says he has won two other cases this way, and another attorney in Utah got a default judgment giving title to borrowers who owed $417,000 on a home.

The owners of the note could always go back and try to recoup this money, but as Christopher Peterson of the University of Utah says in the article, MERS calls into question their ability to succeed:

Under laws adopted by all 50 states, the owner of a “negotiable instrument” such as a promissory note must be in physical possession of the document, said Peterson. Otherwise it would be like someone trying to cash a photocopy of a check instead of the actual check.

“One cannot be a holder of a note unless one is in physical possession of that note,” he said.

But Peterson said evidence is coming out in courts that shows the actual promissory notes or mortgages signed by buyers were not transferred as the notes made their way into the mortgage-backed securities investment pools.

That could mean in these cases that no one is in a position to try to collect because the actual notes are lost or destroyed, potentially making some promissory notes investors think they hold worthless.


Start watching at the 1-minute mark. Includes excellent testimony from foreclosure lawyer Thomas Cox, and Utah professor Dr. Chris Peterson. Detailed article on MERS inside.

Hearing took place Dec. 15, 2010.


More detail on this clip is here, including a transcript...


Spoiler ALERT -- Do not miss #7:


Have you seen these photos...

New Slideshow - From Time Magazine - See a pic of Bernanke at age 13, hair slicked back, playing the saxophone - This is a True Must See


News of Interest -- Food Riots 2011, Detroit May Close Half of Schools a...

German Regime: Will 'good money bad money' juggle save Euro?

« DEATH PROFIT: Fallen Soldiers' Families Denied Cash as Prudential, MetLife Gain »

Editor's Note: We are bringing back this story in conjunction with today's news that JPMorgan is ripping off thousands of military families...


The package arrived at Cindy Lohman’s home in Great Mills, Maryland, just two weeks after she learned that her son, Ryan, a 24-year-old Army sergeant, had been killed by a bomb in Afghanistan. It was a thick, 9-inch-by- 12-inch envelope from Prudential Financial Inc., which handles life insurance for the Department of Veterans Affairs.

Inside was a letter from Prudential about Ryan’s $400,000 policy. And there was something else, which looked like a checkbook. The letter told Lohman that the full amount of her payout would be placed in a convenient interest-bearing account, allowing her time to decide how to use the benefit.

“You can hold the money in the account for safekeeping for as long as you like,” the letter said. In tiny print, in a disclaimer that Lohman says she didn’t notice, Prudential disclosed that what it called its Alliance Account was not guaranteed by the Federal Deposit Insurance Corp., Bloomberg Markets magazine reports in its September issue.

Lohman, 52, left the money untouched for six months after her son’s August 2008 death.

“It’s like you’re paying me off because my child was killed,” she says. “It was a consolation prize that I didn’t want.”

As time went on, she says, she tried to use one of the “checks” to buy a bed, and the salesman rejected it. That happened again this year, she says, when she went to a Target store to purchase a camera on Armed Forces Day, May 15.

‘I’m Shocked’

Lohman, a public health nurse who helps special-needs children, says she had always believed that her son’s life insurance funds were in a bank insured by the FDIC. That money -- like $28 billion in 1 million death-benefit accounts managed by insurers -- wasn’t actually sitting in a bank.

It was being held in Prudential’s general corporate account, earning investment income for the insurer. Prudential paid survivors like Lohman 1 percent interest in 2008 on their Alliance Accounts, while it earned a 4.8 percent return on its corporate funds, according to regulatory filings.

“I’m shocked,” says Lohman, breaking into tears as she learns how the Alliance Account works. “It’s a betrayal. It saddens me as an American that a company would stoop so low as to make a profit on the death of a soldier. Is there anything lower than that?”

Millions of bereaved Americans have unwittingly been placed in the same position by their insurance companies. The practice of issuing what they call “checkbooks” to survivors, instead of paying them lump sums, extends well beyond the military.

Touching Americans

In the past decade, these so-called retained-asset accounts have become standard operating procedure in an industry that touches virtually every American: There are more than 300 million active life insurance policies in the U.S., and the industry holds $4.6 trillion in assets, according to the American Council of Life Insurers.

Insurance companies tell survivors that their money is put in a secure account. Neither Prudential nor MetLife Inc., the largest life insurer in the U.S., segregates death benefits into a separate fund.

Newark, New Jersey-based Prudential, the second-largest life insurer, holds payouts in its own general account, according to regulatory filings.

New York-based MetLife has told survivors in a standard letter: “To help you through what can be a very difficult, emotional and confusing time, we created a settlement option, the Total Control Account Money Market Option. It is guaranteed by MetLife.”


Cuomo to investigate...

CBS reports...


U.S. Starts to Call in Loans to States for Unemployment Benefits

Things are not getting any easier for cash-strapped state governments. On top of the $82 billion deficit that states collectively face, more than half of them will soon have to pay interest on billion-dollar loans from the federal government to provide unemployment benefits.
The massive layoffs during the Great Recession left legislatures struggling to provide assistance to the unemployed, forcing 30 states to borrow about $40 billion from Washington. Until now, the loans were interest-free…but no longer.
Some states, like California and Michigan, face payments of more than $300 million this year, and the money owed can’t be repaid using unemployment insurance taxes. Borrowing more money from Washington is also out of the question. Federal Reserve Chairman Ben Bernanke has said that the central bank will not bail out states confronted with staggering debts.
This means state lawmakers will have to take funding from other programs in order to pay back the U.S. Treasury.
-Noel Brinkerhoff
Bernanke Rejects Bailouts (by Jon Hilsenrath and Neil King Jr., Wall Street Journal)
U.S. Bills States $1.3 Billion in Interest Amid Tight Budgets (by Michael Cooper and Mary Williams Walsh, New York Times)

The CEO and the New Feudalism

Typical leader of a top 100 firm makes in three days what average worker must toil a year to earn.

Few developments in our era of savage capitalism are so powerfully symbolic of the new feudalism than the obscene compensation paid out to the new economic elite, the CEOs of the most powerful corporations in the country. The Canadian Centre for Policy Alternatives's Hugh MacKenzie now reminds us yearly of this economic and social sickness by identifying exactly when the average CEO (of the 100 largest firms) has earned as much as the average worker makes in a year (this time around it was by 2:30 p.m. on Jan. 3). The average total compensation for Canada's 100 highest paid CEOs was $6,643,895 in 2009.

The social and political implications of this grotesque overcompensation are more important than the actual dollars. Socially, in terms of class, it represents the ruling elite's deliberate and conscious declaration that they will take as much money as they want out of the system simply because they can. It is the most powerful way that the elite can make clear that they have nothing in common with the rest of us. Their excess compensation has little to do with their value to a firm, their contribution or their ability.

Yet, says MacKenzie, the disparity between CEO compensation and the average worker's pay continues to grow: "In 1995, the average pay of Canada's highest paid 50 CEOs was $2.66 million, 85 times the pay of the average worker. In 2009, the average pay of the highest paid 50 CEOs had skyrocketed to 219 times the pay of the average worker." The ratio for the top 100 went from 104 times in 1998 to 155 times in 2009.

It is the modern equivalent of the power and arrogance of the robber barons of the 1920s.

The CEOs' virtual control of the public policy process, which allows for this obscene level of inequality, delivers another message: democracy, whose essence is equality, will not be allowed to mess with the natural order of things. Samuel Huntington, one of the U.S. elite's longest-running apologists, pined 35 years ago for the good old days: "Truman had been able to govern the country with the cooperation of a relatively small number of Wall Street lawyers and bankers." He pines no longer. How is it any different today, as the financial sector, supported by the resource and manufacturing giants, effectively dictates economic policy to whatever government is in power?

There is nothing in this compensation pattern that benefits the corporation itself or the economy more broadly. In fact, it is clear that just the opposite is the case: compensating CEOs for the share price (over which they have almost no control) rather than profitability, stability, employee loyalty, long term growth, modernization and strong capitalization actually weakens the corporation and distorts proper management. And inequality, to which this disparity contributes, damages competiveness, innovation and productivity.

The flip side of the excess CEO compensation coin is the push by these same CEOs for so-called labour flexibility. Historically, this set of policies -- which have had the effect in Canada of flatlining real wages since 1980 -- are a reversal of Fordism, the principle established by Henry Ford whereby he paid his workers enough to allow them to purchase the cars they made. This reversal -- with workers receiving almost none of the productivity gains for two generations -- has resulted in the accumulation of unsustainable debt by Canadian (and American) working families. Government and corporate obsession with globalization and trade has allowed the domestic economy to erode. The geniuses in the economics departments and financial firms thought trade would grow forever. Now that it is faltering and they need the domestic economy to fall back on, planned inequality has critically weakened it.

It is rare for any commentators in the business press to even raise the question as to whether or not any of the CEOs receiving multiple millions in compensation are actually worth it. The pay levels, including bonuses, imply that the CEOs are geniuses, uniquely responsible for the success of their companies. But there is nothing in management theory or practice to support such a conclusion. One of the most famous management gurus, Peter Drucker, who conducted a ground-breaking study of General Motors, stated: "No institution can possibly survive if it needs geniuses or supermen to manage it. It must be organized in such a way as to be able to get along under leadership composed of average human beings. No institution has solved the problem of leadership... unless it gives the leader a sense of duty and a sense of mutual loyalty between him and his associates..."

Myth of loyalty

That "sense of mutual loyalty" has long since been tossed in the dust bin of business history. Loyalty now has to be paid for in the millions. It is not enough that the hundreds of top executives in the largest firms get huge salaries, something that was once enough to ensure loyalty. Now the financial firms that created the global meltdown claim they must pay huge bonuses to keep the loyalty of their highest paid employees. The leader who once inspired trust and loyalty of his employees has been replaced by what UBC psychologist Robert Hare calls the "sub-criminal psychopath" CEO. These men are extremely destructive to their companies and "... maneuver to have detractors fired and ruin the other peoples' careers without a hint of remorse."

Former Harvard University president Derek Bok believes that CEOs are paid their huge bonuses precisely because they are being asked to work against their better judgement as managers and human beings -- and against the best interests of their companies. But being paid huge sums to focus on the short-term returns means managers must consciously ignore the interests of their employees, the community and the long term interests of the company which is paying them.

The unconscionable compensation rates enjoyed by Canadian CEOs is part of a pattern of radical market ideology centred in the Chicago School of Economics. We are so accustomed to hearing about these gargantuan pay packages that we assume they are a global pattern. But in Japan the average CEO, by tradition, receives no more that 17 times the compensation of his lowest paid employee. In Germany (1999 figures) the ratio is twelve to one. There is no evidence that CEOs in these two countries suffer from lack of motivation or loyalty to their firms.

So long as the English speaking developed world is infected by the radical market ideology that caused the economic meltdown, the issue of CEO compensation -- and the specific issue of bonuses for bankers -- will not be dealt with. And the bankers know it. In testimony before the British House of Commons, Bob Diamond, Barclays' CEO, refused to commit to lower bonuses. Demonstrating appropriate contempt for a toothless state, he replied to tough questioning by simply declaring: "There was a period of remorse and apology; that period needs to be over."

Indeed, it is over -- until we find a way to recover democracy and the principle of equality which is at its core.  [Tyee]

« "It's Been A Living Nightmare" - JPMorgan Admits To Illegally Overcharging Thousands of Troops on Mortgages, And Wrongful Military Foreclosures »

This pushes the boundaries of outrage. Don't skip this one. Full story inside.

Video - Today Show - Jan. 17, 2011

A Chase official tells NBC News that 4,000 U.S. service members may have been illegally overcharged on their mortgages and that as many as 14 military families were wrongly foreclosed on.


Source - MSNBC

The overcharges may never have come to light but for Rowles, 31, and his wife, Julia.

  • “It’s been a nightmare. It’s been my living nightmare,” Julia Rowles said of her experience with Chase, in an interview with NBC News in Beaufort, S.C.

The saga began in 2006 when Rowles went on active duty. Under the SCRA, he could get his mortgage interest rate, which was adjustable and rising, lowered to 6 percent.

But Chase took a few months to lower Rowles' rate, overcharging the family, Rowles says, by as much as $900 a month. In the fall of 2006, Chase finally began charging Rowles the correct 6 percent rate. For the next year or so, everything went relatively smoothly.

Then, two years ago, the Rowles family says, Chase began hitting them with collection calls that escalated to sometimes three a day, claiming they owed as much as $15,000.

  • "Saturday, Sundays, middle of the night. It did not matter if it was a holiday," Julia said. “Collection calls at 3 in the morning. He would state, "I'm in California. I'm stationed here in Miramar. It's 3 in the morning. What are you doing calling me?" "Well, sir, this is an attempt to collect a debt."

She said they threatened to take the house and report the family to a credit agency, even though the Rowles family didn't owe the bank anything and never missed a payment.

The Rowles' records show that while they kept making payments on their mortgage at 6 percent, the bank wrongly had been charging them at rates above 9 or 10 percent. They kept calling the bank to explain there had been a huge mistake but say no one would listen. They say they kept being harassed for money they did not owe.

Fed up, Capt. Rowles got a lawyer and sued Chase, for himself and other members of the military.

"They ought to only have to worry about fighting the fight and keeping alive, not about whether their wives and children and going to be put out on the street," said Dick Harpootlian, an attorney for the Rowles family.

The lawsuit is still pending. But a Chase official now tells NBC that Rowles did everything right, and the bank did a lot wrong. (The bank maintains, however, that it previously refunded the initial overcharges of the Rowles family. The couple disputes that.)

"We made mistakes here and we are fixing them," said Chase spokeswoman Lemkau.

"We now have a dedicated team in place devoted to servicing home loans for military personnel —the members of our military deserve nothing less. We welcome the opportunity to talk to Captain Rowles and others who would like to discuss their accounts," she added.


Gwynne Dyer: Riots spread as global food shortage worsens

If all the food in the world were shared out evenly, there would be enough to go around. That has been true for centuries now - if food was scarce, the problem was that it wasn't in the right place.

But there was no global shortage. However, that will not be true much longer.

The food riots began in Algeria more than a week ago, and they are going to spread. During the last global food shortage, in 2008, there was serious rioting in Mexico, Indonesia and Egypt. We may expect to see that again, only more widespread.

Most people in these countries live in a cash economy and a large proportion live in cities. They buy their food, they don't grow it. That makes them vulnerable, because they have to eat almost as much as people in rich countries do but their incomes are much lower.

The poor, urban multitudes in these countries (including China and India) spend up to half of their entire income on food, compared with only about 10 per cent in rich countries.

When food prices soar, these people quickly find that they simply lack the money to go on feeding themselves and their children properly - and food prices now are at an all-time high.

"We are entering a danger territory," said Abdolreza Abbassian, chief economist at the Food and Agriculture Organisation. The price of a basket of cereals, oils, dairy, meat and sugar that reflects global consumption patterns has risen steadily for six months, and has just broken through the previous record, set during the last food panic in June 2008.

"There is still room for prices to go up much higher," Abbassian said, "if, for example, the dry conditions in Argentina become a drought, and if we start having problems with winter kill in the Northern Hemisphere for the wheat crops."

After the loss of at least a third of the Russian and Ukrainian grain crop in last summer's heat wave and the devastating floods in Australia and Pakistan, there's no margin for error left. It was Russia and India banning grain exports in order to keep domestic prices down that set the food prices on the international market soaring.

Most countries cannot insulate themselves from this global price rise because they depend on imports for a lot of domestic consumption.

But that means that a lot of their population cannot buy enough food for their families, so they go hungry. Then they get angry, and the riots start. Is this food emergency a result of global warming? Maybe, but all these droughts, heat waves and floods could also just be a run of really bad luck. What is nearly certain is that the warming will continue, and that in the future there could be many more weather disasters because of climate change.

Global food prices are already spiking whenever there are a few local crop failures, because the supply barely meets demand even now. As the emerging economies grow, Chinese, Indian and Indonesian citizens eat more meat, which places a great strain on grain supplies. Moreover, the world population is now passing through 7 billion, on its way to 9 billion by 2050. We will need a lot more food.

Some short-term fixes are possible. If the United States Government ended the subsidies for growing maize (corn) for "bio-fuels", it would return about a quarter of US crop land to food production.

If people ate a little less meat, if more African land was brought into production, if more food was eaten and less was thrown away, then maybe we could buy ourselves another 15 or 20 years before demand really outstripped supply.

On the other hand, about a third of all the irrigated land in the world depends on pumping groundwater up from aquifers that are depleting rapidly. When the flow of irrigation water stops, the yield of that highly productive land will drop hugely. Desertification is spreading in many regions and a large amount of good agricultural land is simply being paved over each year. We have a serious problem here.

Climate change is going to make the situation immeasurably worse. The modest warming that we have experienced so far may not be the main cause of the floods, droughts and violent storms that have hurt this year's crops, but the rise in temperature will continue because we cannot find the political will to stop the greenhouse-gas emissions.

A rule of thumb is that we lose about 10 per cent of world food production for every rise of 1C in average global temperature. So the shortages will grow and the price of food will rise inexorably over the years. The riots will return.

In some places the rioting will turn into revolution. In others, the rioters will become refugees and push up against the borders of countries that don't want to let them in.

Or maybe we can get the warming under control before it does too much damage.

Gwynne Dyer is an independent journalist based in London.

« Fraud At The Heart Of Social Security: It's Really $76B In the Hole THIS YEAR »

Photo: What's in store for America's retirees (Fancy Feast?)

By Dr. Pitchfork

This is an amazing piece of analysis by Charles Hugh Smith. Most articles on Social Security are (let's be honest) boooor-ing, but this one uses publicly available data to show that Social Security is $76B in the hole -- THIS YEAR! That's $76B, plus interest. No other analyst has actually looked at the flow of funds at Treasury to see exactly what's going on. If you were told that Social Security is "solvent" until 2037 or some-such, then you were being lied to. Read this if you want the truth. Be sure to click through to the full article so you can see the numbers for yourself.


The Fraud at the Heart of Social Security

by Charles Hugh Smith

To understand the fraud at the heart of the Social Security Trust Fund, we start with a very simple fact: cash can only be spent once.

There are two frauds at the very heart of the Social Security system, and I am going to describe and source them in detail. After spending a number of hours poring over public data from the Social Security Administration (SSA), The U.S. Treasury and the Congressional Budget Office (CBO), and additional hours searching the Web for other published analyses, I can state with some authority that there are no published analyses or accounts of Social Security which incorporate the actual outlays and receipts from fiscal year 2010 in a context which includes the Social Security Trust Fund.

In other words, all published analyses are based either on SSA or CBO estimates, not the actual numbers from the Treasury, and all media reports I could find are simply cut-and-paste repetitions of these estimates. I cannot find a single source which provided any evidence of digging through the data and assembling a coherent picture of the Social Security system.

The media simply repeats "conclusions" published by "official sources" based on estimates, not facts. The laziness this implies is staggering. Meanwhile, pundits such as Paul Krugman and Robert Reich, however knowledgeable and talented they may be, have obviously never performed a single minute of original data collection and analysis of the voluminous public accounts available to anyone with a computer and web browser.

If this is the best our most prestigious pundits and media resources can manage, then we truly are in dire straits.

All claims that Social Security is "secure for decades" are based on bogus fantasy-estimates, as are claims that the Trust Fund is anything but a carefully contrived fraud. I am rather shocked--and I don't shock that easily--that it comes down to me, the classic independent-journalist "blogger in old blue jeans" to actually assemble the data and draw the simple common-sense conclusions which reveal Social Security as a fraud with two components: the bogus estimates, and the bogus Trust Fund.


Kotlikoff says we're already bankrupt...

Just listen...


Personal Bankruptcies in 2010, by State

Personal bankruptcies rose 9% to 1,530,078 in 2010 from a year earlier, reaching their highest level since a revamp of the bankruptcy law took effect in 2005, according to the American Bankruptcy Institute, an association of attorneys and other bankruptcy professionals, and the National Bankruptcy Research Center.

But some states fared better than others. Southern states such as Tennessee, South Carolina, North Carolina, Alabama and Kentucky posted declines in the number of bankruptcies recorded last year. Meanwhile, states still struggling with housing busts, such as California, Arizona and Florida were among those with the largest increases.

Bankruptcy Filings, by State

Click on the top of a column to resort the chart.

State 2010 Change from year earlier
Alaska 13.3%
Alabama -2.3%
Arkansas 0.0%
Arizona 23.9%
California 25.0%
Colorado 17.4%
Connecticut 12.5%
Washington DC 10.5%
Delaware 10.6%
Florida 16.5%
Georgia 6.1%
Hawaii 28.9%
Iowa -3.6%
Idaho 8.9%
Illinois 11.7%
Indiana -1.1%
Kansas 2.8%
Kentucky -2.7%
Louisiana 2.2%
Massachusetts 13.9%
Maryland 15.2%
Maine 9.0%
Michigan -0.9%
Minnesota 4.5%
Missouri 6.8%
Mississippi -2.1%
Montana 14.3%
North Carolina -2.5%
North Dakota 4.0%
Nebraska 5.2%
New Hampshire 7.4%
New Jersey 15.3%
New Mexico 8.7%
Nevada 1.1%
New York -0.4%
Ohio 0.1%
Oklahoma 5.8%
Oregon 10.2%
Pennsylvania 5.0%
Rhode Island 7.3%
South Carolina -4.1%
South Dakota 8.3%
Tennessee -7.2%
Texas 6.2%
Utah 24.4%
Virginia 2.7%
Vermont 5.2%
Washington 9.3%
Wisconsin 10.4%
West Virginia -7.1%
Wyoming 17.3%

Sources: National Bankruptcy Research Center

No. 2 bank overcharged troops on mortgages

One of the nation's biggest banks — JP Morgan Chase — admits it has overcharged several thousand military families for their mortgages, including families of troops fighting in Afghanistan. The bank also tells NBC News that it improperly foreclosed on more than a dozen military families.

The admissions are an outgrowth of a lawsuit filed by Marine Capt. Jonathan Rowles. Rowles is the backseat pilot of an F/A 18 Delta fighter jet and has served the nation as a Marine for five years. He and his wife, Julia, say they’ve been battling Chase almost that long.

The dispute apparently caused the bank to review its handling of all mortgages involving active-duty military personnel. Under a law known as the Servicemembers Civil Relief Act (SCRA), active-duty troops generally get their mortgage interest rates lowered to 6 percent and are protected from foreclosure. Chase now appears to have repeatedly violated that law, which is designed to protect troops and their families from financial stress while they’re in harm's way.

A Chase official told NBC News that some 4,000 troops may have been overcharged. What’s more, the bank discovered it improperly foreclosed on the homes of 14 military families.

“We are deeply appreciative of those who fight to protect our country and Chase funds a number of programs that provide benefits to military personnel and veterans, and while any customer mistake is regrettable, we feel particularly badly about the mistakes we made here,” Chase chief communications officer Kristin Lemkau said in a statement to NBC News.

She said that beginning this week Chase will be mailing a total of about $2 million in refunds to families that may have been overcharged. She says most of the families improperly foreclosed on have gotten or will get their homes back. A bank official described what happened here as “grim,” but emphasized the mistakes were inadvertent, not malicious.

The news comes as millions of Americans are struggling to keep their homes. Banks have come under fire for allegedly improperly foreclosing on homes across the country.

JP Morgan Chase had over $2.14 trillion in total assets as of September, second only to Bank of America Corp., which had $2.34 trillion.

The overcharges may never have come to light but for Rowles, 31, and his wife, Julia.

“It’s been a nightmare. It’s been my living nightmare,” Julia Rowles said of her experience with Chase, in an interview with NBC News in Beaufort, S.C.

The saga began in 2006 when Rowles went on active duty. Under the SCRA, he could get his mortgage interest rate, which was adjustable and rising, lowered to 6 percent.

But Chase took a few months to lower Rowles' rate, overcharging the family, Rowles says, by as much as $900 a month. In the fall of 2006, Chase finally began charging Rowles the correct 6 percent rate. For the next year or so, everything went relatively smoothly.

Then, two years ago, the Rowles family says, Chase began hitting them with collection calls that escalated to sometimes three a day, claiming they owed as much as $15,000.

"Saturday, Sundays, middle of the night. It did not matter if it was a holiday," Julia said. “Collection calls at 3 in the morning. He would state, "I'm in California. I'm stationed here in Miramar. It's 3 in the morning. What are you doing calling me?" "Well, sir, this is an attempt to collect a debt."

She said they threatened to take the house and report the family to a credit agency, even though the Rowles family didn't owe the bank anything and never missed a payment.

The Rowles' records show that while they kept making payments on their mortgage at 6 percent, the bank wrongly had been charging them at rates above 9 or 10 percent. They kept calling the bank to explain there had been a huge mistake but say no one would listen. They say they kept being harassed for money they did not owe.

Fed up, Capt. Rowles got a lawyer and sued Chase, for himself and other members of the military.

"They ought to only have to worry about fighting the fight and keeping alive, not about whether their wives and children and going to be put out on the street," said Dick Harpootlian, an attorney for the Rowles family.

The lawsuit is still pending. But a Chase official now tells NBC that Rowles did everything right, and the bank did a lot wrong. (The bank maintains, however, that it previously refunded the initial overcharges of the Rowles family. The couple disputes that.)

"We made mistakes here and we are fixing them," said Chase spokeswoman Lemkau.

"We now have a dedicated team in place devoted to servicing home loans for military personnel —the members of our military deserve nothing less. We welcome the opportunity to talk to Captain Rowles and others who would like to discuss their accounts," she added.

“JP Morgan's treatment of our military personnel is inexcusable," said Sen. Richard Shelby (R-Ala.), the senior Republican on the Senate Banking committee. "I expect them to make this right without any further delays.”

To read a statement from JP Morgan Chase about this NBC News investigation, click here .

© 2010 msnbc.com Reprints

WOWSA WOWSA!! 10000 Foreclosures TOSSED OUT in ONE Ruling in Maryland - Fraud Notary! AWESOME!




I have new HEROES! The University of Maryland, stopped talking and took action to SUE GMAC and their foreclosures due to Robo Signing Notary! The judge TOSSED OUT ALL THE FORECLOSURES!

btw: GMAC is a MERS Bank

A Consumer Protection class taught by Peter Holland, took it upon themselves to STOP the FRAUD OF MERS BANKS AND FORECLOSURES AND THEY WON!




Portion of Article:

In a major ruling Friday, a coalition of nonprofit defense lawyers and consumer protection advocates in Maryland successfully got over 10,000 foreclosure cases managed by GMAC Mortgage tossed out, because affidavits in the cases were signed by Jeffrey Stephan, the infamous GMAC “robo-signer” who attested to the authenticity of foreclosure documents without any knowledge about them, as well as signing other false statements.
The University of Maryland Consumer Protection Clinic and Civil Justice, Inc., a nonprofit, filed the class action lawsuit, arguing that any case using Jeffrey Stephan as a signer was illegitimate and must be dismissed. In court Friday, GMAC agreed to dismiss every case in Maryland relying on a Stephan affidavit. They can refile foreclosure actions on the close to 10,000 homes, but only at their own expense, and subject to new Maryland regulations which require mandatory mediation between borrower and lender before moving to foreclosure. Civil Justice and the Consumer Protection Clinic also want any cases with affidavits from Xee Moua of Wells Fargo, who has also admitted to robo-signing, thrown out, but that case has not yet been settled

My Plea for everyone to Call the Universities to Start Class Actions against MERS in all the States! Also the latest MERS info from last week. (I don't know why my videos never sync correctly when I upload them - so sorry it is out of sync)

Prepping Minds for War Against China

You'd think the U.S. was already at war with China, given the immense amount of anti-China rhetoric spouting from the government and media. But selling wars takes time. The average American hasn't bought in to this false advertising yet. So the big lie will be repeated until its roots are deeply sunk into the American psyche: China, says the U.S. government, is a threat that needs to be "dealt with.”

This propaganda assault is multi-faceted, taking aim from all directions. Any China-related issue -- military, economic, and social -- is open for attack. For example, the head of the U.S. Department of Defense, Robert Gates, recently visited Asia and focused much of his trip talking about China as a "military threat.”

What is this threat? Gates answers that China has shown a "rapid buildup of military capability,” proven by its production of a "stealth fighter.” The U.S. media had a field day with this news, intending to sow terror in the psyche of the American public.

A quick glance at the numbers reveals that Mr. Gates and the unquestioning U.S. media are unabashed hypocrites: China is nowhere near the U.S. when it comes to military expenditures: the U.S., under Obama, will spend $725 billion in 2011(!), while China will spend $80 billion.

When it comes to overseas military bases, China has zero; the U.S. has at least 737!

While Gates was traveling throughout Asia on his Chinese provocation tour, Hillary Clinton joined the attack, targeting China's human rights record in a lengthy, inflammatory speech, which included this slight:

"... when China lives up to its obligations of respecting and protecting universal human rights, it will not only benefit more than one billion people, it will also benefit the long-term peace, stability and prosperity of China."

Yes, China is a violator of human rights, but in voicing her criticism Mrs. Clinton managed to raise the bar of hypocrisy to new heights.

Has Clinton forgotten that Guantanamo Bay remains open, filled with tortured people who are charged with no crimes? Has she forgotten that Bagram Air base in Afghanistan continues to deny the International Red Cross access to its "black site" detention center, since they would discover the torture chambers described by ex-detainees? Need we mention Bradley Manning, who remains in solitary confinement without any criminal charges, for allegedly informing the American public about U.S. war crimes in Iraq and Afghanistan and all kinds of secret machinations?

But before Clinton's speech became yesterday’s news, Treasury Secretary Timothy Geithner provided anti-China reinforcements, this time blasting China's economy. The Washington Post reports:

"China's unwillingness to allow its currency to rise in value is hampering U.S. competitiveness in the global marketplace and harming the Chinese economy, Treasury Secretary Timothy F. Geithner said Wednesday... " (January 12, 2011).

Once again, utter hypocrisy. No single government has caused more damage to the global economy than the United States, whose corporations sparked the global downturn by saturating the world with trillions of dollars in fraudulent housing mortgages sold as top-rated investments.

This policy was encouraged by the U.S. government, which gave the corporations cheap money with little oversight, a strategy that continues to this day with the Federal Reserve printing dollars non-stop that U.S. corporations are using to speculate on foreign currencies and drive the prices up of oil and other raw materials worldwide.

The above-mentioned Obama administration officials have no problem peddling their anti-China bias to the U.S. media, which stumble over themselves to provide assistance whenever possible. The New York Times recently published an editorial entitled, The Real Problem With China:

"For the United States, the No.1 problem with China’s economy is probably intellectual property theft.” (January 12, 2011).

In reality, the real problem that the U.S. government has with China is two-fold: China's growth is pushing aside U.S. influence/power all over the world, which has negative influence on the profits of U.S. corporations, which are losing contracts to Chinese companies.

In response, the U.S. is provoking China in the media and militarily, encircling China by arming U.S. allies in the region, especially India, Japan and South Korea. Hillary Clinton responded to this allegation by denying it, while the Obama administration immediately contradicted her by its actions. The New York Times published an article addressing the issue while failing to connect the dots:

"The United States is not bent on containing China, Secretary of State Hillary Rodham Clinton said Friday, but the Obama administration is cultivating other allies across Asia to help it manage Beijing’s increasingly bold projection of military and economic power." (January 12, 2011).

This policy of encirclement and provocation can easily lead to war. As Obama continues to tighten the noose while China struggles to squirm its neck free, the odds grow that military "incidents" may happen, especially as the U.S. throws additional military force in waters just off China's coast in the South China Sea.

The Obama administration joins the right wing in trying to blame both the recession and the startling U.S. inequality in wealth on China. The real culprits are the corporate friendly politicians in the Democratic and Republican parties, which have both spent decades cutting taxes for the rich and corporations, while encouraging the wealthy to flee the U.S. and its living wage jobs for the third world, where slave wages equal larger profits.

The best way for working people to deal with this situation is to ignore the anti-China hype and focus their fire on the U.S. government and U.S. corporations. Demanding jobs from the government NOW that are paid for by taxing the rich is the best way to overcome the economic problems of the U.S. Working people cannot be distracted by fake overseas threats, whether they are alleged terrorists or foreign governments. The real threat continues to be closer to home.

Shamus Cooke is a social service worker, trade unionist, and writer for Workers Action. He can be reached at shamuscook@gmail.com




Shamus Cooke is a frequent contributor to Global Research. Global Research Articles by Shamus Cooke

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

college degree level

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:

retirement account data

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

global stock markets

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.

inflation commodities

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.

Bank earnings could give sector another boost

JPMorgan Chase's strong results last week raised expectations for other top U.S. banks, many of which will announce earnings this week.

U.S. bank stocks are flying high, and this week's earnings could give investors more reason to be optimistic about the sector.

Strong results from JPMorgan Chase & Co. on Friday bolstered expectations for top U.S. banks, many of which are scheduled to report in the coming week, including Citigroup Inc. and Goldman Sachs Group Inc.

Financials have been among market leaders in the recent rally, with the Standard & Poor's 500 index posting its seventh straight week of gains Friday.

While the earnings outlook is keeping alive hopes that stocks have more room to run higher, the rise in bank shares has pushed sector indexes to near resistance levels, which could signal a rest stop for the shares in this holiday-shortened week.

The market will be closed Monday in observance of Martin Luther King Jr. Day.

JPMorgan on Friday reported profit and revenue that were stronger than analysts had expected, and the chief executive said the bank could start to increase its dividend once regulators give the go-ahead, probably at the end of March.

Analysts said the news bodes well for other financials.

"Financials could very easily be one of the real darlings of this particular earnings cycle," said Burt White, managing director and chief investment officer of LPL Financial in Boston.

Financials are projected to have the highest growth rate in earnings for the fourth quarter, largely because of easy year-ago comparisons, according to Thomson Reuters data.

Overall, S&P 500 earnings are expected to have increased 32% from a year ago, the data showed.

Besides the banks, economic bellwether General Electric Co. as well as marquee tech names Apple Inc., Google Inc. and EBay Inc. are due to report.

« Bernanke No Longer Denies that the Purpose of QE2 Is to Drive Stock Prices Higher »

Have you seen these photos...

New Slideshow - From Time Magazine - See a pic of Bernanke at age 13, hair slicked back, playing the saxophone - This is a True Must See


Bernanke pulls a QE2 bait and switch...

Last November, after it started to become apparent that rates were moving in the wrong direction, Bernanke pulled a QE2 bait-and-switch, defending quantitative easing on other grounds:

  • "This approach eased financial conditions in the past and, so far, looks to be effective again. Stock prices rose and long-term interest rates fell when investors began to anticipate the most recent action. Easier financial conditions will promote economic growth. For example, lower mortgage rates will make housing more affordable and allow more homeowners to refinance. Lower corporate bond rates will encourage investment. And higher stock prices will boost consumer wealth and help increase confidence, which can also spur spending. Increased spending will lead to higher incomes and profits that, in a virtuous circle, will further support economic expansion."


QE2 for dummies...