Back to Quack Off
Bonds” new mortgage gimmick by “Banksta Gangsta” Treasury Sec Hank Paulson
(Aug 01, 2008)
CEO corporate welfare recipients at Bank of America, Citigroup, J.P. Morgan
Chase, and Wells Fargo kissed their Washington Godfather’s Fascist Business
Model butt – Hank Paulson’s -- on national TV last week and said they would
be glad to issue banksta gangsta Paulson’s “Covered Bonds” as a new mortgage
scheme in their ongoing subprime slime mortgage crime. “Covered Bonds” is a
popular method of counterfeiting the money supply in socialist Europe to
finance their currently crashing mortgage market.
DC – Just when you thought the monetary gangstas down at the Federal Reserve
and U.S. Treasury couldn’t dream up another way to pump another coupla
trillion dollars into the hyper-inflated mortgage market, pour yourself
another hot cup of Rocket Java and listen up girl friends.
wondering why in hell it’s so important for the Administration, the U.S.
Congress, the Fed Reserve central bankers, the U.S. Treasury, and all the
major banking institutions and their affiliated mortgage companies to try
and keep housing prices higher than the Moon? I mean, think about that for
a moment. Nobody is screaming to keep oil prices high. Nobody is trying to
keep food prices high, or keep car prices high, or trying to jack up the
price you pay for utilities, computers, furniture, and yo-yos, right? In
fact, in a free market economy, the goal is to bring prices down, not up.
So why is
the entire banking industry, the Federal Reserve, and the Treasury Dept
bending over backwards to try and prevent America’s housing prices from
going down? One would think that the entire U.S. market is economically
dependent upon one commodity: homes. Not computers, not cars, not steel,
not nano-technology, not lollipops but only homes. Why?
reasons are simple.
the housing industry is the pipeline that the
central bankers are using to inject their counterfeit paper money into the
market to earn billions of dollars. Let me restate that:
the central bankers, the Federal Reserve, and their
member banking institutions have chosen the mortgage industry as the main
route by which to implement their fiat monetary schemes. “Fiat”
means “forced” money not backed 100% by gold or silver or any other tangible
asset, and not redeemable by the bearer upon demand.
the last thing the bankers want is for housing prices to go down because the
bankers would be holding, for example, $500,000 mortgages whose market
values are dropping to $250,000 with home owners walking away from their
upside down, or negative, mortgages. While on net – even after billion
dollar write downs -- the entire banking institution has earned billions of
dollars in their front-end subprime mortgage schemes and subsequent back-end
“selling” of funds supposedly “backed by” those same mortgages to, for
example, pension fund managers investing old folks’ pension savings into
those mortgage funds to earn interest, the bankers cannot allow the housing
market to collapse or their entire future house of cards – both the
front-end interest and the back-end funds selling – will come crashing down
around their ears.
mes amies, is why Treasury Secretary Paulson, Fed Reserve Chief Bennie
Bernanke, and the entire banking industry will do anything to prop up the
housing industry: because, once again, the home mortgage industry is the
major pipeline, the major vehicle, the main methodology by which the bankers
are injecting their counterfeit Dollars printed up out of thin air.
bankers have tried to claim that their mortgages are “collateralized debt
obligations” (CDOs) because the mortgages they issued are backed by physical
homes, two big questions are: (1) from where did the bankers originally
obtain their mortgage money if not by from the Fed Reserve who created it
out of thin air, and (2) if the physical home really is backing for the
paper mortgage, how can the bankers use the same physical home for “collateral” again
for another piece of paper called a "hedge fund" for people to invest
in? How can the banks use a CDO backed by a physical house
simultaneously as a Structured
Investment Vehicle (SIV) backing pension funds that they sell to old folks
If the old folks in the pension
fund held the actual mortgages, that's one thing. But they don't.
The bank holds two pieces of paper and is making money twice: (1) the
home mortgage paper on which the home owner pays the bank per month, and (2)
the hedge fund paper for which the bank has already received the total money
from the old folks who are investing and hoping to earn interest. Wow, double duty as the bank
collects twice the money on two pieces of commercial paper both backed by
one chunk of tangible property (whose current market price, by the way, is
crashing). This could best be described as
fractional reserve home mortgage banking
and is not much different than fractional reserve bankers issuing more gold certificates than
the amount of redeemable gold in a bank on the premise that not everybody
will run on the bank to redeem their certificates all at once. And
that's exactly what modern mortgage bankers have done: fractional
reserve banking using houses instead of gold.
But it gets worse.
By using the second piece of paper in this example, a hedge fund, as
supposedly legitimate backing for another hedge
fund backed by the original house, and then expanding more and more
pieces of new hedge fund paper in the same manner, the bankers have expanded the
concept of fractional reserve banking to the housing market and thereby
greatly expanded the U.S. money supply -- i.e., hyper-inflated the U.S. Dollar.
All this snowballing debt is
based upon the value of one house claimed as "collateral."
Multiply this scenario times several million home owners who are defaulting
on their mortgages and another umpteen million pensioners who have invested
in these same "mortgages masquerading as hedge funds" and you have our current
mega-trillion dollar mortgage market mess created out of thin air by
America's banking and investment community on Wall Street. This
mortgage mess could never have happened unless it was financially
fueled by the central bankers at the Federal Reserve and the U.S. Treasury
Department pumping trillions of new dollars into the U.S. economy via member
banks and their investment buddies on Wall Street.
Ponzi Scheme by America's bankers is
like me selling my ’57 Chevy twice, with each buyer holding fake copies of a
pink slip for one car. The first buyer pays monthly payments to own the car
and gets to drive it around town. The second buyer gives me $50,000
to own the car and earn interest on his “investment” but never sees the car
and never gets to drive it. Wow, tricky me. I'm using one car to
make the same money twice. If I want to get really
tricky, like today’s bankers, I could “sell” the pink slip for my ’57 Chevy
to a million people, mix that money with other debt paper instruments, feed
the total into a computer and “slice and dice” the total into different
non-traceable (non-traceable to my ’57 Chevy) SIVs, and
re-sell those new SIVs to other banks and investment institutions (hello
European banks). If the value of my ’57 Chevy collapses, everybody holding
the new SIVs have no traceability to the ’57 Chevy pink slip,
and that, mes amies, is exactly what is happening to
the bankers in the housing mortgage industry: home prices are collapsing
and thus endangering their future Ponzi Scheme for using the mortgage
industry as the main pipeline to inject future Fake Dollars into the
economy. And nothing is traceable to a real tangible commodity, especially
the houses that were touted as backing for the CDOs and SIVs.
That’s why banksta gangsta Hank Paulson and his partners in crime at the
Federal Reserve and its member banks are so worried about the nation’s
collapsing housing market. They created the mess based upon faulty
economic premises and don’t know how to get out of it.
the real mess is not a mortgage collapse but rather a U.S. Dollar collapse.
We have a U.S. Dollar bubble that will soon implode like Enron on anabolic
steroids. There is no shortage of houses; there is a huge oversupply of
Dollars. It’s called hyper-inflation of the money supply and the newly
enacted Mortgage Lending Act just signed off by President Bush will probably
push America into another huge round of more hyper-inflation or instigate
the final blow that will crash and burn the housing industry.
How did we
We are not
living in a free market economy. As soon as the U.S. created the
Federal Reserve in 1914, a private central banking cartel, and went off the gold
standard in 1971, we moved into a
“highly managed” socialist style economy with central bankstas driving the
monetary truck with a policy called “targeted inflation.” That’s right.
Inflation on purpose. It’s part of modern economic theory today and you can
see where it has gotten us. Just take a trip to the grocery store or a gas
station and eyeball the prices. Remember, the bankstas did it on purpose:
inflation of your money. And they did it, mostly, through the housing
above, the bankstas earn their money at both ends of their loans: (1)
interest on the mortgage loans to home buyers and (2) brokerage fees from
selling the same home-backed homes (now collapsing) as hedge funds to investors.
In other words, the genius of the central bankers is that they have
contrived an extremely clever method by which to counterfeit the U.S.
Dollar, loan the counterfeit money to the U.S. Government as a “National
Debt” or loan the counterfeit money directly to the Federal Reserve’s major
member banks as a “Treasury” or other type of loan, then restructure the
counterfeit money into subprime and other mortgage loans, use the mortgage
loans (the homes) as so-called “backing” for fancy-sounding hedge funds, which are then
sold to investors so the bankers can make more money.
Central Banking Merry-Go-Round continues until this artificially-created
boom-bust cycle bursts its hyper-inflated bubble and all hell breaks loose
in the inflated housing market when home prices start falling and home
owners default on their mortgage payments. Then, as predicted by free
market economists, it spills over into the general market such as gas and
food and -- in a faux attempt to "save" everybody from this mystery madness
-- all the deficit spending whores in Congress run around like
chickens with their heads cut off blaming everybody except themselves and
the bankers for
inflated prices. The deficit prostitutes in Congress immediately start
babbling about, and then implementing, stupid “recovery” programs that do
nothing but exacerbate the original problem, which can be summed up as: going off the gold
standard and allowing fractional reserve banking by a central bank.
gangsta banksta Hank Paulson and his banking buddies are working overtime in
dreaming up new methods to keep their hyper-inflated housing market not only
from collapsing but also to reach new pricing heights of absurdity. Fannie
Mae and Freddie Mac have just been granted unlimited access to counterfeited
Dollars from the Treasury Department and Jumbo Loans have been increased
from $417,000 to $729,000 to keep this counterfeit monetary fiasco going.
At this rate, billion dollar houses are just around the corner. (By the
way, Zimbabwe just erased ten zeroes off its hyper-inflated currency and
devalued its money by 10 billion to one. The cost for a loaf of bread had
reached over 100 billion Zimbabwe Dollars. The U.S. would never go in that
direction, would it? Nooooo.)
we know why Treasury Secretary
Paulson and his banksta gangstas need to continue propping up their
hyper-inflated mortgage industry, the question is: what’s next on their
agenda regarding how to continue
Camouflaged as an “aid for mortgage lending,” Paulson and his Monetary
gangstas have devised another subprime mortgage method – imported from
European central bankers -- called “Covered Bonds” to inject even more
counterfeited U.S. Dollars into the market to keep home prices sky high and
urge the banks to keep on injecting those Funny Money Dollars into the
economy. The big diff, says Paulson, is that the banks will hold a pool of
counterfeited Dollars on the bank’s books instead of the bank’s off-book
accounting subsidiaries. Wow. Like how is that supposed to stop the
current housing crash? Or even solve the problem of “bundled” SIVs and no
mark to market prices?
is, “Covered Bonds” are no different from the previous hyper-inflated
subprime slime and the Structured Investment Vehicles (SIVs) that the
bankers ridiculously issued the last time around to create the current
mortgage mess. In fact, by expanding the mortgage market to “Covered Bonds”
instead of letting the housing market collapse and clear its prices through
a free market process, Paulson is simply pouring more fuel on the housing
fire. Then again, we know why the bankers are attempting to keep their
monetary Ponzi Scheme going: the mortgage
market is their major pipeline for injecting their counterfeit Dollars into
if America dumped the Federal Reserve central bankers and used real
commodity money such as gold and silver, and no fractional reserve paper –
as mandated by the U.S. Constitution -- we would not have gotten into our
current economic mess. The simple solution: time to get back to the U.S.
Constitution and real commodity money. – FM Duck
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