Sunday, November 21, 2010

Just When You Thought...

Zero Hedge is a biggie with me. Smart, irreverent and really cogent about the inner workings of Wall Street and high finance, the articles posted there are spot on regarding the follies the US is plagued with regarding big banks and our money. The gem seen here depicts the Cuisinart process of how a mortgage is turned into a mortgage securitization.

To me, turning sirloin into mystery meat kind of describes the procedure here or...

Dan Edstrom is a guy who is in the right place at the right time.

His profession? He performs securitization audits (Reverse Engineering and Failure Analysis) for a company called DTC-Systems.

The typical audit includes numerous diagrams including the following:

Transaction Parties and Flow (similar to the chart below, but much easier to understand)

Note exchanged for a bond Foreclosure parties

Priority of Payments from the Security Instrument (Mortgage, Deed of Trust, Security Deed or Mortgage Deed)

Priority of Payments from the Pooling and Servicing Agreement

This diagram (shown above) shows that they are not following the borrowers instructions in the security instrument...

The following flow chart reverse engineers the mortgage on the Ekstrom family residence. It took Dan over one year to take it this far and it clearly demonstrates what happens when there are too many lawyers being manufactured. 

Take a look at this chart and then decide how long you think it will take for Barney Frank and Eric Holder to sort everything out. Click here to see the expanded chart again.

This Old Saw never dies :)
 Question: What do you have when you have 10,000 lawyers at the bottom of the ocean: 
Answer, A good start.

Archimboldo's The Jurist says it all regarding this writer's opinion of lawyers, an all too sizable percentage of same being bottom feeders of the first order. The infestation of lawyers in the tech industry is unprecedented as it's all about the money regarding smart phones/mobile computing, the emerging financial sweet spots of the digital universe.

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