Bad Housing Paperwork Matters

You know how the lax paperwork in securitized mortgages was just going to get cleaned up and then we’d go back to foreclosing as usual?

Maybe not (from the WSJ).

Ohio’s attorney general threw a wrench into the banking industry’s push to quickly restart foreclosures by fixing faulty paperwork, and pressed them to modify mortgage loans.

In two letters released Friday, Attorney General Richard Cordray criticized a number of banks and loan-servicing companies, including Wells Fargo & Co.; Ally Financial Inc.’s GMAC Mortgage; Bank of America Corp.; and J.P. Morgan Chase & Co. Mr. Cordray said the banks are trying to paper over fraud committed in foreclosures with temporary fixes that don’t address underlying problems in the banks’ practices.

“It is not acceptable for a party who believes they submitted false court documents to merely replace those documents. Wells Fargo and any other banks are not simply allowed a ‘do-over,'” he wrote in the letter to Wells. The other letter was sent to Ohio judges, who were asked to notify Mr. Cordray when banks file substitute affidavits.

He demanded that the banks vacate any court order or motion that was based on an improper paperwork. In an interview Friday, Mr. Cordray said the banks would “be well-served to work out a settlement with the borrowers to modify the loans and work out payments.”

It’s going to get interesting. The reality is that politics deeply impacts out interpretation of the law. Right now – in large part because the Administration has tipped so far in favor of the banks and large-scale finance community, I think we’re seeing the beginning of a wave in which law will be interpreted – by people like Cordray – in ways that leads to interesting remedies for homeowners.
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Are The AQ “Euro-Plots” About Hostage-Taking?

Via the indispensable Leah Farrall, from Der Speigel:

“I have information that I consider to be reliable, according to which al-Qaida in Waziristan is training how to carry out multiple parallel hostage takings in order to enforce the release of a prisoner,” Benotman says.

Benotman believes that the alleged plans for attacks on European targets that authorities have been warning about in recent weeks are real. He says the plan consists of storming buildings in Germany, France and Britain at the same time and holding the people inside hostage with the aim of forcing the release of Khalid Sheikh Mohammed, the mastermind behind 9/11 who is now sitting in jail in the United States awaiting trial for the attacks.

Wouldn’t that be a NATO meeting to listen in on?…I’m not sure that the alliance could service more than a few hours of televised hostage-killing.
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Jonah Goldberg Curses Darkness, Lights Match, Sets Self On Fire

…and calls for Assange to be assassinated.

One nice thing about being an amateur commentator is that I can simply go dark when I think I’ve got nothing to say. Professionals have to step to the plate, and occasionally spectacular misfires result.

Today is Goldberg’s turn.

So again, I ask: Why wasn’t Assange garroted in his hotel room years ago?

It’s a serious question.

He then goes on to make the Flashman case (institutional incompetence, not hypercompetence, is the rule) and then to explain that the fallout from killing such a public figure would be too severe to manage.

He concludes:

That’s fine. And it’s the law. I don’t expect the U.S. government to kill Assange, but I do expect them to try to stop him. As of now, the plan seems to be to do nothing at all.

Now there’s a much better post buried in there, which is a variant of the “if we’re living in such a fascist state why aren’t you in a gulag?” argument I make to people like Glenn Greenwald and my more hysterical friends.

But the plain reading of Jonah’s words is that he’d be quite happy if Assange showed up facedown in his bathtub one morning.

And as frustrated as I am with Assange’s bullshit, and as deeply as I’d like to see him in handcuffs in front of a judge, that’s kind of – scratch that – that’s completely outrageous.

Here’s hoping Jonah is smart enough and gets wise enough counsel to follow this right up with a “My bad, I was on deadline and just had a small brain melt.”

If not…well, if not I’m kinda worried.
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Project Valor-IT – GIVE!!

It’s that time of year again, and Soldiers’ Angels is fundraising for Project Valour IT, and I’ll be helping – again. The goal is to raise $15,000 dollars (team Army’s goal) and to – SHOCKINGLY! – beat the teams from the other services.

And I’m going to ask every other day for money from you folks, like I always do.

But here’s a small story that might make it feel a little more relevant to each of us. This afternoon, I’m headed up to Pasadena and the home of one of the guys working on one of the projects I’m heading up. He just moved into his new house, and wile doing some homeowner fiddling, managed to shove his right arm through a window, cutting two tendons, an artery, and a nerve.

He had surgery Monday, and won’t have use of the arm for a while. Because of Valor-IT, I suggested that he get Dragon Naturally Speaking and a good headset; he did and he spent yesterday working on documents for a contract we’re trying to close on Monday.

He was wildly enthusiastic about using it, and so relieved that he could function with his arm in bandages and a sling.

This is happening in the comfort of his own home, supported by his wife, and secure that he’ll heal and all will be OK.

Now transport him to Walter Reed; he’s just been flown ten thousand miles (no frequent flyer points!), he’s alone – isolated form his buddies, and probably from his family – and suddenly he can communicate, because someone gave him the use of a laptop that he could run while his hands and arms heal.

I’ve watched Chuck Z tear up as he explains what it meant to him to be able to connect and communicate without a nurse dialing for him and holding the phone to his ear.

So skip a few lunches, drink office coffee instead of Starbucks, and toss a few bucks into Team Army’s Valour IT account. It’s all for a massively good cause.

And if you know someone in Congress, get them to think about appropriating a few bucks to make this whole exercise unnecessary.

learn more

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Whose Parties Are They?

One can define elitism as, say, resistance to progressive taxation, and make a case that Republicans better merit that description. But, broadly speaking, the Democratic Party is the party to which elites belong. It is the party of Harvard (and most of the Ivy League), of Microsoft and Apple (and most of Silicon Valley), of Hollywood and Manhattan (and most of the media) and, although there is some evidence that numbers are evening out in this election cycle, of Goldman Sachs (and most of the investment banking profession). That the billionaire David Koch’s Americans for Prosperity Foundation supports the Tea Party has recently been much in the news. But the Democrats have the support of more, and more active, billionaires. Of the 20 richest ZIP codes in America, according to the Center for Responsive Politics, 19 gave the bulk of their money to Democrats in the last election, in most cases the vast bulk – 86 percent in 10024 on the Upper West Side. Meanwhile, only 22 percent of non-high-school educated white males are happy with the direction the country is going in. The Democrats’ overlap with elites leaves each party with a distinctive liability. The Democrats appear sincerely deluded about whom they actually represent. Democrats – who would have no trouble discerning elite solidarity in the datum that, say, in the 1930s the upper ranks of Britain’s media, church, business and political institutions were dominated by Tories – somehow think their own predominance in similar precincts is … what? Coincidence? Irony?

Republicans, meanwhile, do not recognize the liability that their repudiation by elites represents in an age of expertise and specialization – even in the eyes of the non-elite center of the country. Like a European workingman’s party at the turn of the last century, the Republican Party today inspires doubts that it has the expertise required to run a large government bureaucracy. Whatever one thinks of Obama’s economic team, and Bill Clinton’s before it, the Bush White House was never capable, in eight years, of assembling a similarly accomplished one. Nor is there much evidence that Republicans were ever able to conceptualize the serious problems with the nation’s medical system, let alone undertake to reform it on their own terms.

Christopher Caldwell, in today’s New York Times. Go read the whole thing.
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Dizzy Yet??

Jerome Armstrong writes a post I could have written…(checking the temperature in Hell…)

1. The Democrats became the face (you could argue they embraced it), of the DC banker bailout culture of the privileged (those with access), while the average American has been downsized.

2. For those of you who have been at the forefront of the attacking the Tea Party enthusiasts, bloggers or otherwise, give yourself a big pat on the back for going after (usually in a obnoxious elitist manner) this years swing voters.

3. Tim Kaine, with the status-quo Moving America Forward, delivered a faulty to the core messaging. Saying that the status-quo is just fine will go down as an out-of-touch, and helping to exacerbate the losses. He really should be fired, and so should the pollsters and consultants who advocated for this messaging disaster.

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MERS-ey Me – Why The Housing Crisis Is Worse Than You Think

I’ve been mulling a followup housing policy post, and meanwhile looking over the news about housing. One thing that stands out to me is the shadow that’s about to be cast on the legal structures of housing ownership, title, and finance.

I spent a few years doing RE Investment banking, and have some friends in that world still – mostly in the larger institutional-commercial space. And I’m guessing that many of the same issues apply there – except that the borrowers have the resources and skills to hire very smart lawyers.

The root of the problem is that we have a mortgage finance system – legal and administrative regime – that was deliberately undermined in the name of efficiency by a bunch of half-smart people who then made (and in many cases doubtless lost) zillions from the new financial conduits they established.

Here’s a great post on Barry Ritholz’s blog that sets out one major part of the problem.

You’ve heard the name Mortgage Electronic Registration Systems or “MERS” mentioned in relation to the foreclosure problems in the residential real estate market.

But what is MERS?

It is the company created and owned by all of the big banks to process title to property in the U.S. Approximately 60% of the nation’s residential mortgages are recorded in the name of MERS.

MERS is a shell corporation with no employees, but thousands of officers.

That’s not necessarily a problem. The way they managed it is.

And the implications are massive; a challenge to the validity of billions in mortgages, putbacks of mortgage securities to banks that are already stressed, and a frozen hosuing market because title is impossible to insure.

Go read the whole post, and think about it when you write your next mortgage check.
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Why Bill Clinton Is An Asset And Obama Is A Liability

Michael Gerson in the Washington Post

Obama clearly believes that his brand of politics represents “facts and science and argument.” His opponents, in disturbing contrast, are using the more fearful, primitive portion of their brains. Obama views himself as the neocortical leader — the defender, not just of the stimulus package and health-care reform but also of cognitive reasoning. His critics rely on their lizard brains — the location of reptilian ritual and aggression. Some, presumably Democrats, rise above their evolutionary hard-wiring in times of social stress; others, sadly, do not.

Though there is plenty of competition, these are some of the most arrogant words ever uttered by an American president.

The neocortical presidency destroys the possibility of political dialogue. What could Obama possibly learn from voters who are embittered, confused and dominated by subconscious evolutionary fears? They have nothing to teach, nothing to offer to the superior mind. Instead of engaging in debate, Obama resorts to reductionism, explaining his opponents away.

One thing I believed about Obama was that his cerebral style would possibly lead to a bridge across the disastrous, emotional partisanship – on both sides – that is keeping us from squarely facing the important problems of the day. That’s what he said he was going to do, and that’s what he’s flatly failed to even try and do.

I wrote off the “bitter clinging” quote, because I felt that Obama was just bonding with his audience (rich Bay Area liberals). My mistake; that’s his default position.

In all my years of blogging, I’ve made it clear that what pisses me off are arguments that attempt to delegitimize opposing views. The idea that ‘relatively conventional’ liberal or conservative views should be so demonized that it’s illegitimate to even make arguments based on them is outrageous to me.

That’s what Obama has just done. And I’m outraged, on top of being disappointed. Six or eight months from now, we’ll see what he’s made of. So far, I don’t see much to be encouraged about.
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