By Neil Garfield:
Editor’s Note: The cost of taking over foreclosed homes greatly exceeds the principal reductions that are inevitable anyway. Either way the taxpayer foots the bill. As usual, big business and government have taxpayers paying the higher bill.
Here is how the narrative ran. The trillion dollar banks and some “smaller” ones used all their influence over the media and lawmakers to get the narrative going in the direction of “why should anyone get a free house?” or “Why should HE get a break on HIS mortgage just because he stopped making payments? I’ve been the good citizen making my payments and I don’t see anyone giving me a break.”
The answer is as simple as it was when I first voiced it three years ago. This is not a mortgage problem, it is a fraud problem that will bring down the whole economy. And victims of fraud have a right under our existing laws to be made whole, if possible or at least given some relief from the fraud enabled by highly sophisticated financier leveraging off asymmetry of information.
By getting us fighting amongst each other about a non-issue, the banks, media and lawmakers distracted us from the real issue. The result was a bailout for the fraudsters and a nightmare for the rest of us whether we got hurt directly or not. In fact, we are all hurting from the foreclosure mess either directly or indirectly. Property values are going lower and lower, nice neighborhoods have turned to urban blight, and upscale neighborhoods are seeing ugly signs go up inviting unwanted buyers who either look for the quick buck or who don’t fit with the old context of the neighborhood. Jobs are being lost by everyone, not just people who are losing their houses in foreclosures.
The plain truth is that both the homes and the securities sold to finance the mortgages were inflated through fraudulent means. The resulting fall-out continues to drag median income down and with it, the price of housing. Everyone knows the securities were overvalued, everyone knows they are worth far less than represented, and that the reason is the appraisals of the homes and viability of the loans were simply a lie. The ONLY possible end to this under any scenario, is that the real value is going to be reflected in the market place whether we like it or not.
That means in simple language that the securities are going to be marked down to their real value and the home loans, which were also securities in this scheme must meet the same fate. It doesn’t matter what people in or out of power want. The cat is out of the bag and nobody is going to pay the premium that sellers and banks are looking for.
http://livinglies.wordpress.com/2010/06/20/were-all-working-for-the-government-now/Pretty good summary if you ask me.
Get involved.
http://www.foreclosurehamlet.org
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