PRESS RELEASE
Barney Frank, `Repo Man':
After a Year of Inaction on LaRouche's HBPA, Home Seizures Explode
July 10, 2008 (EIRNS)—The surge of bank repo seizures of American homes exploded in June to over 100,000, almost a full year after Congress was called on for the simple legislative action to stop them—Lyndon LaRouche's Homeowners and Bank Protection Act (HBPA). Led by House Speaker Nancy Pelosi and Financial Services Committee chairman Barney Frank, the Congress has instead spent that year debating various bank-designed bailout schemes for mortgage lenders.
Now, the seizures of homes has reached a level virtually equivalent to the depth of the Great Depression, in 1933—and is rising fast. In June, according to RealtyTrac, nearly 110,000 homes were repossessed, while 250,000 households received foreclosure notices. The home seizures increased by 37% just from May, and nearly tripled from June 2007. They are running at four times the level at the depth of the Great Depression in 1933—with mortgaged homes being about five times as numerous today, the rate of Americans' loss of homes to foreclosure is now essentially equivalent to the worst of the Depression years.
California alone had 20,624 homes seized by lenders and banks; Senator McCain's Arizona, another 4,297. RealtyTrac CEO James Saccacio noted that "repossessions are rising at a much faster pace than default and auction notices." One-third of all homes sold nationally in May were repos!
In a self-feeding cycle, the domination of sales markets by banks selling foreclosed homes, drives prices down more quickly, which in turn drives more waves of foreclosures and home seizures as mortgage borrowers walk away from the "debt traps" their homes have become. Some $3.5 trillion in homeowner equity has been wiped out since the spring of 2006, according to the estimate of Moody'sEconomy.com.
The Senate last night passed the latest Frank-Dodd bill, an attempt designed by Credit Suisse and UBS investment banks, to use Federal money to put a "floor" under this collapse in mortgage values. If the bill becomes law, when the home price collapse breaks through this "floor," massive U.S. taxpayer-funded "nationalized losses" will occur.
