U.S. Economic/Financial News
Foreclosure Bar May Spread to Block Most Foreclosures
Sept. 29 (EIRNS)The halt to foreclosures announced two weeks ago by Ally Bank/GMAC across 23 states was by no means "voluntary," and is steadily spreading in its effect on theheavily fraudulentmass home seizures which Rep. "Bailout Barney" Frank (D-Mass.) and the Obama White House have refused to stop, or even slow down.
Ally Bank is the number 4 holder/servicer of mortgages in the United States, ahead of Citibank. Due to the auto bailout by President Obama, the U.S. Treasury is the bank's majority shareholder. The fact that Ally Bank was bringing its foreclosures before courts and magistrates without using any process to determine if the foreclosure was justified and lawful, was coming under preliminary investigation by the FBI, due to the qualms of an Ally bureaucrat who was supposed to be certifying these hundreds of thousands of fraudulent foreclosure papers.
Ally has stopped all foreclosures, foreclosure sales, and home seizures in the 23 "judicial foreclosure" statesthose which require that a foreclosure be brought before a judge or magistrate and court-ordered. It claimed the stoppage would be "temporary" to clear up "important but technical problems." That's not likely to be true.
Since Sept. 15, four additional, "non-judicial foreclosure" statesCalifornia, Ohio, Connecticut, and Coloradohave ordered the bank to stop foreclosing; and four othersTexas, North Carolina, Iowa, and Illinoisare moving to do so. This is likely to keep spreading into an effective nationwide ban on this bank's foreclosures.
In June, a Utah judge had briefly stopped all foreclosures by Wells Fargo (the number 1 holding/servicing bank in the U.S.) and Deutsche Bank (number 6), in a decision later overturned by Federal Circuit Court. The grounds were fundamentally the same: As economists like James Galbraith and William Black have long insisted, a majority of 2005-early 2007 mortgage issuances were fraudulently drawn up ("underwritten"), then fraudulently sold, broken up and resold in packages and derivatives instruments, without lawfully establishing the title of the repurchasers.
While legal challenges on these lines have generally failed or been overturned since 2007, now the Ally Bank breakdown is opening the floodgates for these challenges to be made effective by state authorities.
Nearly 8 million foreclosures have been filed, and 2.5 million American homes lost to repossession, since Barney Frank led the blocking of Lyndon LaRouche's Homeowners and Bank Protection Act in early 2008.
Depression Drives Millions into Medicaid
Oct. 2 (EIRNS)It would be no surprise to say that, in the throes of a major depression, millions more people have turned to Medicaid for their basic health-care needs. A new report by the Kaiser Foundation, on Medicaid and the uninsured, puts out some new numbers on the growth of the program over the past couple of years. Total spending growth in Medicaid averaged 8.8% across all states in fiscal year 2010, the highest rate of growth in eight years, and well above the projection for FY2010 of 6.3%. Enrollment growth averaged 8.5%, also significantly higher than the 6.6% growth forecast at the start. An additional 3.7 million people joined the program last year, driven there by loss of jobs and health benefits. States projected that Medicaid enrollment and spending growth would average 6.6% and 7.4%, respectively, in FY2011. However, given what happened in 2010, Medicaid officials in two-thirds of the states believe that FY2011 legislative appropriations could be insufficient.
The report also goes into some detail on the budget pressures Medicaid has put on states, which was relieved to some degree by extra Federal money appropriated by Congress in 2009 and 2010. The problem is, Obama's Nazi health-care reform will use Medicaid as one of the ways to increase insurance coverage, which will put further pressure on cash-strapped states.