Criminal charges for Goldman Sachs?

(9 am. – promoted by ek hornbeck)

Not yet, but Dylan Ratigan’s righteous rant needs to be seen by every American, because he is throwing gas into the strike zone, while keeping it at a level any eight year old can understand.

Pensions were screwed, investors were screwed, taxpayers were screwed, and jobs were screwed.  Screwed, screwed, screwed, screwed.

Now, foreclosures are ripping through our economy like a wrecking ball.

But the respite is over. Two weeks ago, the Irvine Housing Blog stated in Bank of America to Increase Foreclosure Rate by 600% in 2010 that Bank of America’s OREO department said that the bank would increase its foreclosure activity from 7500 per month to 45,000 per month. That’s 540,000 annualized for just one bank (granted, the biggest one). If this is substantiated, one of two things is true: either 2010 foreclosures will go well over 1 million, or 2011 ones will go so far over it should scare us all breathless. Moreover, there’s a solid chance that numbers like these in 8 months time will have debilitating effects on the overall economy, even before New Year’s.

Not only are foreclosures, short sales and the like devastating for homeowners, they are a death knell for many banks. For the past three years, Washington’s policy has been to sweep anything toxic under the carpet. Well, we’ve run out of carpet. And pondering this unequaled mess, it shouldn’t surprise anyone that jobless claims come in far worse than projected. The very foundations are starting to shake. And it no longer matters what tricks come out of the Fed, the Treasury, Wall Street, the White House or Capitol Hill. There was always just one possible end to the housing crisis: plummeting prices. The glut of newly foreclosed properties added to a hugely oversaturated market will see to it that they do fall, and fast and furious at that.

This will have a cascading effect throughout the economy. Falling home prices will put huge additional numbers of owners underwater. Fannie Mae, Freddie Mac, the FHA, they will all grow beyond salvation, suffering losses (even with funny accounting) that will run in the hundreds of billions of dollars. Property taxes, for many places in America the only thing that stands between mere austerity and full-blown bankruptcy, will have to come down with the home values.

And most and worst of all, the banks which hold large portions of the loans, and which have already received untold trillions of dollars in hand-outs courtesy of the house, will need to come knocking for more, because the process of increasing foreclosures will function to draw toxic paper out of vaults all over the nation, and beyond. Yes, there is a fake recovery in banking, and yes, consumers are fooled enough to go out and buy some more stuff on their credit cards. But there are not nearly enough buyers for all those millions of homes that are now part of the inventory, be it the official or the real one.

Memory Lane Update: Max Keiser about one year ago on Goldman scum: