Posted: April 4th, 2010 by Militant Libertarian
I am still receiving some demented emails from emotional readers upset about the following two articles of mine:
I’ve received almost no rational letters of disagreement from folks who offer up a better solution and try to persuade me to their point of view; all the disagreeing emails have all been confused, emotive hatefests that ignore every important – and objective – point in my articles. At about the same time I published my second article on the topic, “Why a Strategic Mortgage Default May Be Your Best Option,” this article appeared on Bloomberg news: “Obama May Prohibit Home-Loan Foreclosures Without HAMP Review.” Very few media outlets have covered this story (thanks David Kramer, for the link). This snippetfrom my article leads well into the rest of this blog post. Pay attention to my comments about John Courson:
The Obama administration, in its massive campaign to socially engineer America, is pressuring banks into renegotiating mortgage payments in order to keep people captive in their mortgages. The goal of the elites in power is to keep up the appearance of prosperity and keep folks in debt to the big banks. Mass defaults will injure Wall Street – Washington D.C’s favorite constituency. Additionally, there’s John Courson, an FOB (Friend of Banksters) who runs all over the country trying to spread the moral message to middle-class people who are pawns in this Bankster mess. Courson is the Chief Executive of the Mortgage Banker’s Association, so whose interests do you think he is representing? Courson advising homeowners on their moral and financial strategies is like a crocodile telling the neighborhood children they should take a shortcut home through the swamp. These so-called “leaders,” unfortunately, have the necessary wealth, political power, and media access that enable them to introduce their disingenuous platform and influence the masses. For those who aren’t empowered by the political establishment, there’s no equal opportunity for commanding the public stage.
The ultimate goals of the central planning elites have long been clear to me. The Wall Street Hoaxters and Government Liars want to separate you from your money and make you dependent on their products: credit and public assistance. Your needs and “crises” give rise to their massive surge of laws, and keeping you underfoot allows the government-financial complex to become omnipotent while you walk in your sleep.
The crux of the Bloomberg story is that the crooked and self-serving Obama Regime “may expand efforts to ease the housing crisis by banning all foreclosures on home loans unless they have been screened and rejected by the government’s Home Affordable Modification Program.” HAMP is the government’s program to “help” homeowners stay in their homes via mortgage modifications. They don’t do this to help you, the homeowner – he purpose of HAMP is to prop up the housing market and project the appearance that the economy is rolling along nicely, making all of you more prosperous in the end.
Big Guv’s proposal “prohibits referral to foreclosure until borrower is evaluated and found ineligible for HAMP or reasonable contact efforts have failed.” From the article:
The Treasury Department will soon release guidance “which will include a set of improved protections for borrowers” in HAMP, Phyllis Caldwell, chief of Treasury’s Homeownership Preservation Office, said today intestimony prepared for a House Oversight and Government Reform subcommittee. She didn’t provide details.
You might ask yourself why the Treasury Department has a “Homeownership Preservation Office.” On the other hand, I am slightly impressed with a Republican report (have they been attending Ron Paul’s luncheons?):
“By every empirical measure, HAMP has failed,” according to the 18-page report released by Republicans on the House Oversight and Government Reform Committee. “In its current form, HAMP both hurts homeowners who might otherwise spend their trial-period mortgage payments on rent and also distorts the housing market, delaying any recovery.”
If you can read between the lines, the real reason that this proposal is being advanced is to prevent mass walkouts from underwater borrowers who have had enough of the credit-housing bubble and its ensuing disastrous effects on their personal balance sheet. This is what I see forthcoming: the government is going to use HAMP to try and keep people who desire a strategic default from doing so on the basis that the federalistas have determined those people “can afford to make their mortgage payment.” The government will surely provide a means test to determine whether or not individual defaults are an “approved default,” and unapproved defaulters will face severe financial/tax consequences. The government will resort to force, under the guise of “laws to help you,” to keep you from peacefully turning over an asset to the holder of the debt upon the stoppage of payments.
The greatest nightmare of the government-banking complex is mass walkouts from underwater mortgage holders who realize the long-term implications of holding onto their homes and suffocating mortgages. What’s to blame? The Federal Reserve’s credit bubble; Wall Street’s corporatist shenanigans and blatant raping and pillaging of Main Street; massive taxpayer-funded bank bailouts, including some of the largest mortgage banks; corrupt legislation favoring the wealthy and powerful special interests; Fannie and Freddie bailouts; and the revolving doors between Wall Street and the Treasury Dept., where policy was manipulated to the advantage of the elites.
And what about my comments (above) about John Courson, the slimebag Chief Executive of the Mortgage Banker’s Association? Here’s a quickie test of your common sense: If you are a troubled homeowner, do you really think that the Chief Executive of the Mortgage Banker’s Association is working in your interests?
It seems that Mr. Courson has been giving you moral advice about adhering to your “moral obligations” (I repeat again: mortgage contract are not moral obligations), while he has taken the DeCoster strategy, meaning he has objectively assessed financial strategies and has chosen the most financially prudent course. Read about Courson’s latest strategy for financial survival:
This past week, the Co-Star Group, Inc., indicated that it had agreed to buy the MBA’s 10-story headquarters building in DC for $41.3 million. The only problem is that $41.3 million comes up a skosh shy of the $75 million first mortgage on the building that the MBA took out from PNC Financial Group way back in 2007, when they purchased the property for $79 million.
You remember 2007, don’t you John? That was the last year that all of those irresponsible homeowners, thinking real estate prices would go up forever, kept over leveraging themselves, buying properties without the traditional 20% down payment. What a bunch of irresponsible idiots, right Johnny Boy? Now that the bubble has popped, those homeowners should just be taking their medicine like men, don’t you agree John? The last thing they should do is walk away from their lawful debts, isn’t that what you said?
Here’s the quick-and-dirty: Courson sold short the Mortgage Banker’s Association office for a huge loss because his organization, the MBA, bought the building at an inflated value at the height of the housing bubble. It was a short sale, and meanwhile, he gets paid to travel ’round the country and tell all of you little people that you must “honor your obligations” in spite of the fact that you can fulfill your contractual obligation by turning over the keys to your worthless asset – your house.
The writer, Mandelman, also reports that the “Mortgage Banking Association also defaulted on their payments and secured a forbearance agreement, prior to the short sale.” The Wall Street Journal also reports that,
On Friday, CoStar Group Inc., a provider of commercial real estate data, said it had agreed to buy the MBA’s 10-story headquarters building in Washington, D.C., for $41.3 million. That is well below the $79 million the trade group agreed to pay for the glass-walled building in 2007, near the top of the property bubble, while it was still under construction. The price also falls short of the $75 million of financing that the MBA got from a group of banks led by PNC Financial Services GroupInc. for the purchase.
When asked to discuss whether or not the MBA would pay off the full amount of the deficit, Courson replied, “We’re not going to discuss the financing,” The Wall Street Journal includes this snippet about the MBA’s real view of property ownership post-housing bubble bust:
When the MBA announced the purchase of the building in early 2007, the trade group’s president at the time, Jonathan Kempner, said: “We have come to the inescapable conclusion that owning our own building was the smartest long-term investment for the association.” In October 2009, however, the MBA informed its members that it had put the building up for sale. At that time, the MBA said that continued ownership of the building, which was financed with $75 million of variable-rate debt, would be “economically imprudent.”
“Economically imprudent.” But it’s not economically imprudent for middle-class Americans to keep sinking dough into a money pit called a house in an environment where the federal government has destroyed the financial system and wrecked the economy with its years of central planning, social engineering, and wars, while it manipulated the monetary system to fund all of it.
Keep in mind that this building is only five blocks from the Obama House, as the MBA likes to brag. That has meaning. The MBA is a very powerful lobby in alliance with the government to represent the Banksters’ fraudulent financial machinations at the expense of the poor, powerless souls who have been fed lies, a destructive credit bubble, and a piranha financial system in order to divert peoples’ attention from the government’s extensive interventionism, and redirect those attentions to their bits and pieces of leftover bread and circuses.
According to Glenn Hall in The Street,
You expect more from a group whose directors include executives fromJPMorgan Chase(JPM), KeyCorp(KEY) and other notable financial companies and whose sponsors for its 2009 annual convention included big banks such as Citigroup (C), Wells Fargo (WFC) along with Fannie Mae (FNM) and Freddie Mac (FRE).
And yet people think this circle of vultures represents their best interests, as homeowners.