Massive mortgage fraud swept under the ‘Fed rug’ – American taxpayers lose

The Leviticus 25 Plan would deliver liquidity to American families – providing the opportunity to pay down (or pay off) mortgages and other consumer/installment debt.

Instead,  we are living through a massive Federal Reserve program (QE3) to buy up Mortgage backed securities (MBS) to the tune of $40 billion per month.  Of course the banks and other mortgage holders are not ‘selling’ (dumping off) to the Fed their high-quality mortgages. They are naturally ‘transfering’ first those low-quality (and often fraudulent) MBS.  At face value, by the way.

In some instances (read below) there aren’t even any properties standing behind the mortgages.  Massive levels of mortgage fraud are getting swept under the rug, and in the process  relieving those responsible of any accountability.

What’s worse – to purchase the MBS ($40 billion / month – ongoing), the Fed is printing and debasing the Dollar.  And Americans are paying a stiff price… and will continue to pay for years ahead.

The Leviticus 25 Plan.  The time is now.

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Excerpts from:   “QE3 – Pay Attention If You Are in the Real Estate Market” by Catherine Austin Fitts

[Note:  The Mortgage Electronic Registration System (MERS) is a private company that electronically tracks and records ownership and servicing rights of mortgages across the country.]

“The Fed is now where mortgages go to die. Thousands of mortgages on homes that do not exist or on homes that have more than one “first” mortgage are now going to the Fed to disappear. Thousands of multifamily and commercial mortgages will be bought up as well. As this happens, trillions of dollars that have been amassed offshore will be free to come back into the US to buy up and reposition land, farmland, residential and commercial real estate and other tangibles.”

With documents shredded, criminal liabilities extinguished and financial institutions made whole, funds can return without fear of seizure.

QE3 proves beyond any shadow of a doubt that the extent of the fraud was as bad as I said it was. You can count up the bailouts and QE1, QE2, QE3 the numbers speak for themselves. The fraud was indeed in the many trillions of dollars. It was intentional. It was a plan.

Now, the $64,000 question for those whose house is underwater or whose mortgage is in default is whether or not you still owe on your mortgage.  Certainly, you still do as a legal matter.  If the bank has been paid off, arguably in some cases several times, why not you? Let’s see if Fannie, Freddie and the big banks are under orders to quietly pass through a portion of their largesse to troubled homeowners in amounts sufficient to unfreeze the market. If you are in a workout situation, you need to take notice. If enough mortgage write-offs flow through, the Democrats will quickly amass a lock on the elections in November.

If you are in the market to buy a home or other real estate, you also need to pay attention – a major turn is now underway. Watch to see how much the banks pass through to homeowners and property owners to see how fast and big the turn may be. Watch to see the inflow of funds from offshore. This is not only funds returning but investors around the world looking to exchange their dollars for tangible assets to protect themselves from debasement of the dollar denominated deposits and securities they hold. Watch to see what the renegotiation of federal tax policy and the reengineering of the federal budget in response to the “fiscal cliff” do to reposition housing and real estate prices and cost of financing for an inflow looking for large accumulations.

Finally, the way the Fed has engineered the Slow Burn to date is to continually offset monetary inflation with labor deflation. It is worth contemplating how much labor deflation will be required to offset QE3 and how sufficient additional labor deflation might be engineered. Ben Bernanke was quite clever to tie QE3 to unemployment. The problem has become the solution, which is the basis for QE-Infinity.”

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More…   The following is an excerpt from Catherine Austin Fitts’ Money & Markets segment on the September 20, 2012 Solari Report. The Solari Report is a subscription-based, weekly briefing via bridge call. Learn more and become a subscriber…

“With QE3, we are essentially being bought out with our own money…and unemployment is being used to facilitate this process in a very clever manner. Monetary inflation is currently being offset by labor deflation. The way you avoid collapse is by printing money and stealing assets. The way you avoid inflation is with labor deflation.”

QE3 is fundamentally different from QE1 and QE2 in that the Fed has not put a limit on what they’re going to do. They are not saying ‘We’re going to stop at such and such a time.’

One of the things they’re doing – and it’s very unusual – is tying QE3 to the unemployment rate. So they’re saying ‘We’re going to keep doing this until we’re not worried about unemployment anymore.’

What are they really doing?

The Fed has decided that it is going to once-and-for-all extinguish all mortgage fraud – buy it all up in the market – and in the process extinguish all criminal liabilities and also protect sovereign governments and institutional investors from around the world from losing money on the mortgage fraud, let alone bringing actions … whether it’s nuclear attacks or actions in the courts complaining about the fact that they were sold AAA mortgage paper. Instead, what they got was something that was fraudulently issued. And fraudulently issued with the blessings of the U.S. government and the central banks.

So, this is a “clean-up” action and I think what the Fed is really saying is ‘We’re going to keep buying this toxic paper and pulling it off of the balance sheets of the banks, pulling it off the balance sheets of Fannie and Freddie, and pulling it off the balance sheets of wherever it is until it’s extinguished.’

Why would they want to do this?

One of the reasons is so that the market can clear. Right now, a great deal of the U.S. real estate market is frozen because we have houses and real estate that are underwater. But we also have a whole world of things that can’t mark-to-market and that’s because there is so much fraud and so much criminal liability involved.

What this means is that the $27 Trillion plus dollars that have been pulled out of the economy are now free to flow back into the U.S. economy and start to accumulate in large amounts of real estate, which I think has already begun to happen, particularly with respect to farmland. But, they can do it with respect to everything.

The thing that makes Bernanke’s tying this to unemployment so politically brilliant and really so vicious is that, to date, the way that we have offset the monetary inflation that comes from quantitative easing and the loose monetary policy is with labor deflation. I have spoken many times about the “slow burn.” In fact, the slow burn is a process by which you create monetary inflation and offset it with labor deflation.

 

Bloomberg: “$64 billion” in delinquent mortgages for Bank of America

(Bloomberg, Dec 19, 2012 – excerpts) –  “Bank of America Corp. has amassed $64 billion of mortgages that are at least six months delinquent and have yet to enter foreclosure, more than twice the amount held by its four largest competitors combined.”

“Bank of America’s stockpile of deteriorating debt is mostly from its 2008 acquisition of Countrywide Financial Corp., once the nation’s largest mortgage provider. Wells Fargo & Co. (WFC), the biggest U.S. servicer, has $15.3 billion of such unpaid loans.”

“Bank of America has about 930,000 loans that are at least 60 days delinquent, down from 1.5 million from the peak in January 2010, Chief Executive Officer Brian Moynihan, 53, said during a Dec. 14 event at the Brookings Institution in Washington.”

“The bank also has a large portion of delinquent Federal Housing Authority mortgages…”  Note:  taxpayers are ‘on the hook’ for these FHA guaranteed loans (and the FHA recently announced that its reserve fund is ‘dry’ and they are on the verge of defaulting).

Note:  Bank of America’s $64 billion in delinquent mortgage represents an amount greater than half of their current market cap.

Full article: Bloomberg 12-19-12

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Nationwide, November 2012: RealtyTrac reports that 1,547,825 homes are under a foreclosure filing in the U.S..

The Leviticus 25 Plan would provide a mechanism for American families to ‘clean up’ delinquent mortgages and engage in successful ‘work out’ plans to regain ownership of their homes.

This would stanch the banks’ balance sheet bleeding and stabilize the housing market.

The Leviticus 25 Plan would pay for itself over a 10-15 year period.

No other plan can make that claim.  And no other plan can deliver the power of economic liberty – and do so much to serve the interests of individual U.S. citizens.

The Leviticus 25 Plan – The $60,000 Solution. Economic liberty for Americans.

An open letter to America’s Governors and Congress:

The U.S. economic crisis is now four years old… and going strong.  Big-government, central-planning solutions are not working. In fact they have been a catastrophic failure. They are debasing the U.S. Dollar and are not accomplishing any meaningful liquidity benefits for American families.

Recent (November-December 2012) headlines from the financial press:

“47.7 million Americans Now Living in Poverty”  Dec 9, 2012

“Record Number of Americans Will Use Foodstamps For Thanksgiving”  November 2012

“Food Pantry Sees 400% Increase in Demand”  November 2012

“Foodstamps Soar by Most in 16 Months: Over 1 Million Americans Enter Poverty in Last Two Months.”  December 9, 2012

“US Foreclosures Report for October 2012,” RealtyTrac – “foreclosure filings —default notices, scheduled auctions and bank repossessions — were reported on 186,455 U.S. properties in October, an increase of 3 percent from September but still down 19 percent from October 2011. The report also shows one in every 706 U.S. housing units with a foreclosure filing during the month.”

“General Business Conditions expected six months forward dropped to its lowest level since March 2009.”  November 2012

“October US Exports Plunge By Most Since January 2009 As Trade Deficit With China Hits Record.”  December 2012

“Looming Crisis: State Budgets Soon to Be Under Siege.”  December 2012

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America needs a bold, new economic recovery plan – one that employs a qualitatively new approach.  The Leviticus 25 Plan is that solution.

The Leviticus 25 Plan will deliver liquidity and debt relief to American families – first. And this should be our country’s highest priority.

The benefits of this plan will ripple out to the economy (re-igniting economic growth), to banks (improved cash balances, improved loan quality, shrinking delinquencies), and to government (reduced expenditures and increasing tax revenue growth – without raising taxes).

The Leviticus 25 Plan is a voluntary plan – U.S. citizens may or may not choose to participate. And it treats all citizens the same. It doesn’t ‘take’ from one group and ‘give’ to another group.

The Plan has recently undergone a major upgrade.  Each U.S. citizen will now qualify for a $60,000 direct credit extension from the Federal Reserve. Funds would be electronically deposited into a family’s Medical Savings Account (25%) and a Family account (75%). A family of four would receive $240,000 ($60,000 in the MSA and $180,000 in the FA).

The Leviticus 25 Plan ‘recapture’ provisions involve participating citizens:

 Giving up their income tax refunds for a period of 5 years

Giving up most ‘means-tested welfare’ and ‘income security’ benefits for 4 years.

Giving up unemployment insurance benefits for 4 years.

Paying a higher deductable ($2,000) for specific state/federal healthcare benefits (Medicare, Medicaid, VA, FEHB) for 4 years..

   The Leviticus 25 Plan ‘recapture’ provisions would provide an annual ~10% return for each of the first five years. These provisions may be reviewed in detail on the website.

The Plan assumes that ongoing recapture inertia would continue on for an additional 5-10 years, so that the plan would eventually pay for itself over a 10-15 year period.  Additional (indirect) benefits – economic liberty for families and economic growth for America – would be significant and long-lasting.

The Plan assumes an 80% participation rate – many wealthy would not participate – due to their larger tax refunds.  And certain citizens with high value benefits would not participate, if it meant giving up those benefits.

The Federal Reserve balance sheet would expand (over the course of the year – as people signed up) by approximately $13.2 trillion. Note that the White House OMB has officially forecast that the government will add $8 – $10 trillion to the national debt by 2022 – taking the national debt to over $25 trillion. And that will solve nothing at the family level.

America needs a big, bold, new plan. One that is Biblically sound.

The Leviticus 25 Plan.  Review at: www.Leviticus25Plan.org  (‘Overview’ to “FAQs’)

The Federal Reserve and QE4 – A ‘non-winning’ formula for America

The Federal Reserve announced today another layer of liquidity injections (QE4 – $45 billion / month to purchase Treasureis) on top of the previous QE3 ($40 billion / month to purchase mortgage backed securities) .

QE4 will hold short-term rates down near the zero percent level, and is needed ($45 billion per month for the purchase of Treasuries), because nobody else wants to, or has money to, buy America’s massive, ongoing debt load.  So the Fed feels it has no other choice but to  ‘print’ and soak it all up.

And where does this leave American families?  Americans are the ones who will end up getting ‘soaked.’

There will be no change in household debt status.  No near-term liquidity benefits at the family level.  No change in the record number of Americans on food stamps.  Very little change, if any, in the employment picure.  No meaningful change in nationwide foreclosure activity (October 2012:  1 out of every 706 homes in the U.S. was under a foreclosure filing).  And very little, if any, change in the 47.7 million Americans currently living under the poverty threshold.

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Here is how things would be different with The Leviticus 25 Plan.

Participating U.S. citizens would receive substantial direct credit extension from the Federal Reserve – with the primary aim of debt reduction at the family level.

American families would then pay off (or substantially reduce) the mortgage debt (rather than have the Fed continuing to purchase that debt on a monthly basis under QE3).   And American families would pay off additional consumer debt and credit obligations.

Result:  economic liberty for American families.

The Fed would be ‘repaid’ under The Leviticus 25 Plan ‘recapture provisions’ over a period of 10-15 years.

America’s banks would be flush with cash.  And they could buy the Treasuries (that the Fed is currently set to purchase under QE4).

There can be very little doubt that the current course that the Fed is on will lead to an ongoing debasement of the U.S. Dollar.  Energy, food, raw materials costs will all rise significantly over time.  And Americans will pay the price.

It’s time for a bold, new plan.

The Leviticus 25 Plan.

 

September 2012: U.S. finalizing “international assistance package” for Egypt – will forgive $1 billion in debt.

More from The New York Times:

“In addition to the debt assistance, the administration has thrown its support behind a $4.8 billion loan being negotiated between Egypt and the International Monetary Fund. Last week, it dispatched the first of two delegations to work out details of the proposed debt assistance, as well as $375 million in financing and loan guarantees for American financiers who invest in Egypt and a $60 million investment fund for Egyptian businesses.

The assistance underscores the importance of shoring up Egypt at a time of turmoil and change across the Middle East, including the relatively peaceful uprisings in Egypt and Tunisia, the still-unfinished transition in Libya, the showdown over Iran’s nuclear program and the war in Syria.

Given Egypt’s influence in the Arab world, the officials said, its economic recovery and political stability could have a profound influence on other nations in transition and ease wariness in Israel about the tumultuous political changes under way.”

Note:  The U.S. government is a 17% stakeholder in the International Monetary Fund.  What does that mean?

WSJ Sep 5, 2012:  “The IMF is akin to a global credit union. Members kick in money. The institution’s board lends it out.

Each member has a “quota”—that is, a financial stake in the IMF, expressed as a percentage—and contributes accordingly. The U.S. quota is 17.09%, followed by Japan at 6.12%, Germany at 5.98% and France and Britain at 4.94% each.

Does that mean that the U.S. is responsible for 17% of the IMF’s portion of the Greek package? Not exactly.

First, though all countries are theoretically responsible for investing in the IMF’s lending pool, not all of them have currencies that potential borrowers can use. (Think of Zimbabwean dollars or Venezuelan pesos.)

The IMF doesn’t say that outright. Instead, it uses the concept of “usable resources,” meaning it uses money from countries that are considered financially sound. About 21% of the quota contributions to the IMF were “non-usable,” according to the IMF, as of January 2010.

Because the U.S., Japan and big European countries are in the “usable” camp, they finance a larger percentage of IMF funding than their quota would suggest.”

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The U.S. taxpayer is ‘standing behind’ a large share of the $4.8 billion IMF loan package to Egypt – well over $800 million.  Egypt also receives $1.3 billion per year as a military assistance package from the U.S..  And they just received a $1 billion loan write-off from the U.S. Government.

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There is no legitimate reason why, if the U.S. Government can extend funds to foreign countries (no collateral involved) and forgive loans to those same countries (with no collateral obligation required), that U.S. citizens should not also be granted the same equal access to direct credit extensions.

After all, it is our money.

The Leviticus 25 Plan would pay for itself – over a 10-year period.  And it is fully collateralized.

The Leviticus 25 Plan.