Gold and Silver Breakout as Fascist Business Model Crumbles, Mortgage Market Fraud

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Some significant
events are in progress, extremely important developments in the
grand pathogenesis that reflects the deep decay and deterioration
in the US financial structure. The most recent events pertaining
to mortgage loans, home foreclosures, and disclosed fraud carry
great potential to open extremely wide cracks in the American social
order. Revealed systemic fraud is slowly coming into the open. Civil
disobedience has already entered the arena of popular protest. However,
the recent events surrounding illegal home foreclosure seizure of
properties elevates the exposed fraud to a very clear high new level.
This is a boil ready to break open, releasing financial puss.

The cases where
people have been removed from their homes, even when no bank loan
exists (as in owned free & clear), by means of fraudulent, forged,
and counterfeited documents, has finally provoked RICO law provisions.
Witness organized crime extended from Wall Street, whose roots lie
most likely in Fannie Mae itself. The legal industry has finally
joined the fray in class action lawsuits. Defense citing errors
made have been met with accusations of fraud, quite a different

The Racketing
Racketeer Influenced & Corrupt Organizations Act of 1970 was
designed to fight organized crime. RICO has been invoked in class
action lawsuits in at least two states in the past month, each related
to mortgage fraud, securities fraud, and illegal property seizures.
At the center of the firestorm lie JPMorgan Chase, Bank of America,
and GMAC (now called Ally). Little did the USCongress realize that
RICO laws might be used to fight profoundly deep criminal fraud
on Wall Street. When the criminal activity is tracked with some
forensic analysis, the roots are found with REMICs, those perverse
financial instruments that functioned as umbilical cords to Fannie
Mae in past years, acting like powerful centrifuges. They fed the
housing bubble and mortgage finance bubble, each valued over $10
trillion in size. Bear in mind that RICO has been used primarily
against mafias and crime organizations dealing with gambling, drugs,
and prostitution, where property seizures are routinely carried
out. Abuses have been seen in states like Florida, where motorboat
owners guilty of owning small bags of marijuana have lost their
boats in legal seizure. It seems that selective enforcement is obvious.
The target within the crosshairs has moved to Wall Street banks
and Fannie Mae under the USGovt protective wing. These are dangerous

Recent cases
threaten to encourage the Strategic Defaults and highly charged
Civil Disobedience which could actually contribute in powerful ways
to commercial chaos, popular disorder, public disruptions, creeping
distrust, and even systemic failure. Hundreds of thousands of people
are not making their mortgage payments, intentionally stopping payments,
many when they do have the ability. Over 250 thousand Bank of American
mortgage holders have stopped making monthly payments, in open defiance
and some financial distress. The topic of Strategic Default, together
with challenges (even with attorneys) to the banks to produce legal
property titles, has grown sharply in practice. The RICO cases underway
threaten to toss an accelerant on that fire. Henry David Thoreau
would certainly be observing closely, perhaps smiling, at the current
developments of citizen action against corrupt bank practices, mortgage
bond fraud, and forgery of securities as well as critical legal
documents. His essay had a profound effect on me when young, when
cruel abuses were observed within my catholic school locally and
the Vietnam War globally. Of course, the Jackass does not sponsor,
endorse, or encourage any such action, believing that the highest
level bankers should receive their due. The question is what is
due? Objective reporting of the news, such as the viral news of
the fraudulent home foreclosures, seems to have escaped the mainstream
news, a consistent theme that hints of syndicate sympathy or culpability.
The last thing a network news systems wants is to encourage civil
disobedience. They prefer to promote vast herds of docile sheep.

For four years,
the Jackass has claimed that Fannie Mae lies at the core of a grand
criminal fraud enterprise, serving as the central clearing house
for USGovt agency sponsors of magnificent fraud. Their tools are
mortgage loans, mortgage bonds, REMICs, and more recently the MERS
title database. Real Estate Mortgage Investment Conduits were a
necessary piece to the housing and mortgage bubble, from which extends
colossal fraud. The REMIC acted like a mortgage futures contract,
clear of any supervision or regulatory oversight and thus permitting
an open door government green light signal to systemic fraud. Imagine
a leveraged futures contract on twin bubbles where unbridled fraud
was common. Recall that $1500 billion went missing from 1988 to
2000 in two HUD regional offices. One was Houston and the other
was Oklahoma City, the home grounds for sitting presidents. The
missing funds have fed black bag funds and diverse illicit financial
operations. Few connect any association between the pyrotechnic
events in April 1995 by Timothy McVeigh to big rooted branches and
critical data records, an open question. The entire set of prima
facie and secunda facie and tertia facie aspects of the mushrooming
story are to be covered in the October Hat Trick Letter reports.
But honestly, this is a huge moving target, whose capture is better
described as herding cats on an open field.


The mushroom
has a primary point of vulnerability that has received very little
attention. The Mortgage Electronic Registration Systems (MERS) was
originally an innovative process that simplified the way mortgage
ownership and servicing rights were originated, sold, and tracked.
MERS is a property title database, intended by Wall Street and Fannie
Mae to serve as a repository that kept order when mortgage bonds
were traded fast and furious. In recent court cases in at least
three states, the MERS database failed to attain legal standing
in mortgage foreclosure challenges. The holder of the note (home
loan) could not combine with the MERS database (title holder) to
win property seizure. The system began to unravel. Now in at least
one state, the MERS database is directly cited in a criminal fraud
class action lawsuit that invokes the RICO statutes. MERS is the
financial system’s Achilles Heel. Maybe a big bank like Bank of
America might collapse, fall into ruin, and dissolve from proof
of racketeering, its assets confiscated by aggrieved parties to
fraud. Obviously, Bank of America along with several other big banks
have been dead for a long time, since October 2008 in my estimation.
If not for the lax and complicit accounting rules by the Financial
Accounting Standards Board, which permit banks to declare their
own fictitious value for their balance sheet assets, imposed in
April 2009, the big banks would undergo liquidation. They cling
to control of the USGovt financial purse, its USDollar printing
press, its conduits to financial centers, and its extended arm to
legal prosecution control. Big bank liquidation is tantamount to
liquidation of the entire US financial structure, its power and
privilege, in plain words.

MERS has gained
unwanted damaging attention in the legal arenas, and it will not
go away. The class action lawsuits will establish the high ground,
grow in number, and gain attention. The proof of the malfeasance,
fraud, and forgery will be incredibly easy, breathtaking in implications,
and shocking to the sleepy public. The risk of civil disobedience
is acute. The directly associated risk of commercial degradation
from contract law moving toward a field of abandonment is also acute.
The domino effect carries risk to the business and thus the social
fabric of the American society. The United States is on the verge
of events leading to potential systemic failure. Few attribute causality
to the Fascist Business Model broad implementation and secretive
endorsement, but it lies at the center. The permitted criminal activity,
not just with bond fraud, mortgage fraud, and property theft, extends
far beyond white collar crimes. Take for instance the suspicious
suicide of Freddy Mac CFO David Kellermann, found hanging by the
neck in his Virginia living room in April 2009. He knew too much
and wanted out, some believe. His suicide probably had assistance.
My sources tell of a wave of middle level murders, where bankers
have been systematically eliminated. The victims knew too much about
the money trails, but lacked a critical level of protective support
from rank. They are the dead mules. They were high enough to have
knowledge, but not high enough to avoid being expendable. MERS is
the errant tool. RICO is the thick cloud. Fannie Mae (FNM) is the
grand sewage pit laced with fraud. The news is rarely reported unless
they must since it is already widely known. The mainstream news
finds itself competing desperately with the competent intrepid internet
sources. In a strange attempt to force an equation from a disorderly
situation, let it be simply stated that



One is left
to wonder if it is possible that foreign creditors can invoke RICO
laws and take over USGovt assets as part of a USTreasury default
process? They might do so agency by agency, but start with the helm
on Wall Street. By next year, national parks and lands will be sold
off to creditors. The deep fraud is easy to prove. Identification
of the participants is much more difficult. The movement of prosecution
and perhaps restitution will begin with private homeowners, the
vassals in the lost field of dreams. A crucial connection on legal
obligation is the formal USGovt guarantee of USAgency Mortgage Bonds,
which make them full blood brothers to USTreasury Bonds. They just
pay a different yield, although we are witnessing a convergence
between mortgage rates and USTreasury yields. The Fannie Mae cesspool
is certain to drag down the global confidence and prestige of the
USTreasury Bond itself, a process underway. Perhaps the USCongress
can hastily include a rider on some war appropriation bill or jobless
insurance bill or some other bill that is approved but not examined,
which exempts USGovt agencies and Wall Street firms from RICO prosecution,
even ex-post facto to cover past pecadillos. Harken back to Hank
Paulson as USTreasury Secretary, trying to explain Wall Street bond
fraud as errors of judgment. The ploy did gain some traction, but
the recent lawsuits over mortgage fraud, forged foreclosure documents,
and more, run the risk of opening the RICO window to the organized
crime that is central to the US financial system. Its three loci
of activity are the USFed, Goldman Sachs, and JPMorgan. This is
just the financial wing of the syndicate. Apart from that is the
war wing, with a common conduit in the USFed.

At great risk
is ruin of the threads, tissue, and fiber of the nation. Many have
called it the moral hazard in countless citations. The USDollar
rests on the faith and trust of the USGovt. Enter systemic fraud
and organized criminal activity, demonstrated in open court cases,
and POOF, the faith and trust vanish. The USGovt might block some
cases for national security reasons, the standard blanket to cover
prevalent criminal behavior, a precedent started by Nixon. The same
trust and faith underpin the USTreasury Bond complex, the debt securities
for the USGovt debt. When the Fannie Mae failed toxic pool was adopted
hookline & sinker in September 2008, the USTreasurys took on
added risk, infected by the spread of toxic tissue and corrupted
threads and absent moral fibers.

The original
roots of the Fascist Business Model are difficult to trace in the
United States. They could be from Big Oil, Wall Street Finance,
Defense Contractors, even Big Pharma, but with timing in the 1970
or 1980 decades. The Vietnam War and deficit financing went hand
in hand, a little recognized phenomenon. Full blossom of the business
model, identified by a merger of the state with large corporate
interests, took on new meaning after September 2001, when national
security trumped everything, including the US Constitution, and
certainly civil liberties. What came was license to commit financial
crimes with impunity, provided the locus of criminal operations
was a large corporation with direct association with the US Govt.
Witness the ruinous fruit of the tight embrace endemic to the fascist
business model. Witness the lack of prosecution for the perpetrators
of criminal fraud. In fact, the larger the crime, the closer to
zero is the likelihood of prosecution. Witness the popular backlash
in civil disobedience from non-payment of mortgage bills. Witness
the entrance finally into the arena of state courts, even some Supreme
Courts like in Florida, Kansas, and elsewhere. Again, the defendant
banks claim errors and mistakes, when the prosecutors are screaming
fraud, forgery, theft, and corruption. A series of public spectacles
comes soon.

The Fascist
Business Model is so broadly affecting the USEconomy, like a grand
latticework, that it is considered part of the American landscape,
even grudgingly accepted as part of the system. It is diverse. A
culture of fraud is engrained nationally, clearly perceived from
foreign vantage points. See Halliburton and the missing $50 billion
from the Iraq Reconstruction Fund. The firm is tied to former Vice
President Cheney, and is the object of endless fraud accusations,
prosecutions, and settlements related to the wars and their provided
services. See Goldman Sachs and the 2004 reduction of the unleaded
gasoline portion to the GS Commodity Index they manage, as the percentage
was taken from 9% to 2%. Coordinated were drops in the price of
gasoline, crude oil, and diesel. For some unexplained reason, the
USMilitary decided to sell huge amounts of crude oil and diesel
fuel at the exact time following the Goldman Sachs index alterations.
The events occurred leading to the re-election of Bush Jr. The USMilitary,
few realize, is the largest consumer of crude oil and diesel on
the planet. See the Seven Sisters from Big Oil and the steady friendships
forged with Saudi Arabia and points on the Persian Gulf. See the
Citigroup tipoffs to Prince Al-Waleed, whose investments thrived
for a while. See the cozy relationships between certain Big Pharma
firms and the Swine Flu vaccines. See the British Petroleum oil
disaster in the Gulf of Mexico. This one is trickier. The US Environmental
Protection Agency engaged in numerous ocean water data tampering
examples. Clean-up crews were photographed in numerous instances
dumping dead fish, each punishable by a $10 thousand fine, ostensibly
with BP at risk. The EPA levied no fines.

The US Coast
Guard was involved cordoning off numerous sites where dead whales
were disposed of. The public was not permitted nearby access, but
that did not stop intrepid photographers from capturing the events
on film. Again, BP was at risk of heavy fines imposed. The most
egregious violations involve Goldman Sachs and JPMorgan, the agents
for the USFed and USDept Treasury. Past actions featured gold leasing
from Fort Knox (now empty), for the benefit of Wall Street gold
short positions and corresponding USTreasury Bond long leveraged
positions. That chapter was labeled the Decade of Prosperity. Insider
trading and numerous illicit financial schemes prevail, while front
running of policy is constant. These have become important income
sources for the twin towers of syndicate finance. See Working Group
for Financial Markets, hardly run by an independent pristine office.
They operate with full impunity and even access to FBI usage. Refer
to the UNIX box and stolen software taken from Goldman Sachs offices
in 2009, retrieved dutifully by the FBI, a powerful sophisticated
illicit tool used to read incoming stock trade orders.

the rest of the article

7, 2010

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