The foreclosure fraud crisis or “Foreclosure Gate” seems to escalate with each passing day. Now its being reported that all 50 U.S. states have launched a joint investigation into alleged fraud in the mortgage industry. With many like Bank of America halting foreclosures in all 50 States!
Renowned investor Jim Sinclair recently wrote about the effects that would come from this and the fact that so many pension funds would be affected by the economic tsunami.
From Jim’s Mine Set blog:
I am asking for your attention again because of the depth of the fraud and now the size of the securitized mortgage debt OTC derivative pile of garbage that is in the trillions. This entire mountain of weapons of mass financial and social destruction is now in question. I have been telling you this for more than 2 years since the manufacturers and distributors of this crap were called by the NY Fed due to the loss of control over the paperwork.
I had dinner with my former partner, then lead director of and CEO of Bear Stearns. I could not contain myself so I asked him why he did so much business in OTC derivatives which were certain to bankrupt them. The answer I got was it was more than 50% of their profit. The right answer should have been it was more than 80% of their earnings.
Securitized mortgage debt is going to be the final shot that kills all kinds of financial entities in the Western world. The biggest holder of this putrid junk is pension funds.
I remember having lunch with my former girlfriends Father a few years back warning him of this mess because he works for the State of Arizona and has his pension with them. He barely considered the idea responding that the “government pension plans are guaranteed!”
John Stewart & Dylan Rattigan put the lunacity of the banks and pension funds into perspective. It may be time to do something different like start shopping for your first investment property!
Just FYI: Nothing is guaranteed. It may be time to look at other options… options that allow for cash flow and appreciation… options like buying your first investment property.
These videos would be funnier if you weren’t relying on a pension, right? I encourage you to look at the benefits of owning Arizona investment property today.
