Georgetown Professor Tells Congress: 'citigroup, Bank Of America, Jpmorgan & Wells Fargo Are All Insolvent'

[Scott Sando]

[hirop]

Beautiful, yet nothing changes

[General Congreve]

Tell me something I don't know

Oh well, TICK, TOCK, TICK, TOCK....

The axeman cometh!!!

[AvidFan]

http://www.youtube.com/watch?v=gEmJ-VWPDM4

[The Masked Tulip]

Didn't Warren Buffet buy a big chunk of Wells Fargo in 2009?

[interestrateripoff]

Extend and pretend.

[Live Peasant]

http://market-ticker.org/akcs-www?post=172781

Denninger getting more wound up about this.

Rep. Miller: Force Banks To Divest Servicing

Hoh hoh hoh....

Members of the Financial Stability Oversight Committee

c/o Secretary Geithner, Chairman of the FSOC

1500 Pennsylvania Avenue NW

Washington DC, 20220

In light of the recent report from the Congressional Oversight Panel regarding mortgage irregularities, we are writing to support the panel’s call for a new round of stress tests to examine stability issues arising from residential mortgages held in securitized pools. Stability issues that have not been included in previous stress tests include liabilities for breaches of representations and warranties in Pooling and Servicing Agreements, liabilities arising from systemic mortgage documentation irregularities, and conflict of interests for servicers affiliated with firms that hold significant portfolios of second liens. We urge the council to recommend that its members conduct specific, thorough reviews of the potential effects of these issues on the risk profiles of the institutions they regulate and also that the Federal Reserve incorporate these potential liabilities into the new round of stress tests it announced earlier this week. We urge that the Financial Stability Oversight Council consider, in light of those stress tests, requiring that some financial companies divest affiliates involved in servicing securitized mortgages.

Someone paid attention in the hearings the last couple of days, eh?

First, we urge that the members of the Council examine a representative sample of collateral loan files of each major servicer to determine if the files contain all the documents required by contract or by law, including the note; mortgage, deed of trust or equivalent document; and all documents evidencing or constituting the necessary assignment, delivery and recording of those documents. The Council should determine if the documents satisfy contractual representations and warranties in the pooling and servicing agreement or other governing instrument for the mortgages in question, and if not, any potential liability that may result. The collateral loan files examined should be selected at random, not by the servicers.

Oh, you mean what I and a few others have been talking about? The fact that there are likely no mortgages in the so-called "mortgage-backed securities"?

....