So how much coverage did this get in the mainstream media?

Well, just about none.

We have gotten so used to horrific trade deficits that it isn’t even news anymore.

But trade deficits are absolutely killing our economy.

How long do you think that the U.S. economy can keep shelling out 40 or 50 billion more dollars than we take in every single month?

If you look at the countries around the world that have become very wealthy, almost all of them have gotten that way by trading with the United States.

Meanwhile, many of our once great manufacturing cities are turning into open sewers.

Every single politician in the United States should be talking about the trade deficit.

But hardly any of them are.

Is it because Americans have all become so dumbed-down that we don’t understand these things anymore, or is it because we are so distracted by the various forms of entertainment that we are addicted to that we just don’t care?

But the trade deficit is not the only economic statistic that is getting worse.

We have an unemployment epidemic going on in this country, but what did the mainstream media do in response to this news?

They yawned.  Instead, many of the “financial experts” were busy talking about how wonderful it is that the Stock Market is going up, up, up.

Well, as someone recently said, if you want to evaluate an economy by how much the stock market is going up, then the economy of Zimbabwe has had an absolutely wonderful decade!

The truth is that the stock market is not a good barometer for what is actually going on.

What is really happening is that the U.S. economic system is literally coming apart at the seams.

Yet another piece of really bad economic news that just came out is that the number of home repossessions by banks set a new all-time record.  The record total of 102,134 bank repossessions in March was the first time ever that bank repossessions climbed over the 100,000 mark for a single month.

The good news is that bank repossessions are about to come to a screeching halt.

The bad news is that it is because the U.S. mortgage industry is about to become completely and totally paralyzed by this foreclosure fraud crisis.

The following are three basic points to remember about this foreclosure mess….

A) Massive Fraud Was Committed At Every Stage By The Mortgage Industry

One expert explained:

The truth is that there was fraud going on in every segment of the mortgage industry over the past decade.  Predatory lending institutions were aggressively signing consumers up for mortgages that they knew they could never repay.  Many consumers were also committing fraud because a lot of them also knew that they could never possibly repay the mortgages.  These bad mortgages were fraudulently bundled up and securitized, and these securitized financial instruments were fraudulently marketed as solid investments.  Those who certified that these junk securities were “AAA rated” also committed fraud.  Then these securities were traded at lightning speed all over the globe and a ton of mortgage paperwork became “lost” or “missing”.

Finally, when it came time to foreclose on these bad mortgages, a whole lot more fraud was committed.  Thousands upon thousands of foreclosure documents were “robo-signed”, but the truth is that investigators are starting to discover a lot of things about these mortgages that are a lot worse than that.

B) Nobody Really Knows Who Owns Or Who Has The Right To Foreclose On Millions Upon Millions Of Mortgages

The legal rights to millions of U.S. mortgages has been scrambled so badly that it might actually be impossible to fully sort this mess out.  In particular, MERS (Mortgage Electronic Registration Systems) has created a paperwork nightmare that may never be able to be completely remediated.

One explanation of the problem:

MERS – potentially the most serious problem because it affects who really owns the loans. Securitization mandates that loans be transferred into REMIC trusts within a strict timeframe. Late transfers are not allowed. In spite of the supposed “ease” of transfer through MERS, it now appears that perhaps 60% of US loans were never properly transferred. Absent remedial legislation, it is impossible to do so now. And the former owners may be out of business or bankrupt. So how do we get these loans to the trust beneficiaries who were supposed to own them? This is no simple paperwork correction. The train has left the station, with no more to follow.

C) Unprecedented Chaos Is Going To Erupt As Faith In The Mortgage System Completely Dies

So what is going to happen as a result of all of this fraud and confusion in the mortgage industry?  Well, basically everybody is going to sue everybody.  It is going to be absolute mayhem.

Charles Hugh Smith recently put it this way….

Real estate attorneys can rejoice: everyone will get sued, in every court in the land. Banks will get sued, title insurance companies will get sued, realtors will get sued, foreclosure mills will get sued, MERS will get sued, and so on. The attorneys general of the states will all sue the banks and mortgage mills, claiming billions in damages.

Meanwhile, virtually nobody will want to buy any house that has been foreclosed on in the past ten years or so until this mess is sorted out (which could take years and years).

Meanwhile, title insurance companies are going to avoid foreclosures like the plague.

Meanwhile, all of the investors that have been propping up the housing market by buying foreclosures are going to be fleeing the market in droves.

Meanwhile, the financial world is going to be trying to figure out which U.S. lending institutions are still solvent.  The value of most mortgage-based assets is now totally up in the air.

Meanwhile, millions more homeowners across the United States will be emboldened to quit making payments on their mortgages as they realize that those holding their mortgages may not have the legal right to foreclose on them.

And that is where the true horror of this entire situation may lie.  What is going to happen if millions upon millions of Americans holding underwater mortgages look at this situation and decide that they really don’t have to be afraid of the threat of foreclosure any longer?

If a massive wave of homeowners suddenly decides to simply quit paying their mortgages, it would basically wipe out nearly the entire mortgage industry.

That would likely mean more government bailouts, more government control, much higher mortgage rates and eventually a serious crash in housing prices.

This crisis is incredibly complicated and it has a ton of moving parts, so it is extremely difficult to describe accurately.  But the reality is that this mess has the potential to hurt the U.S. real estate market much more than “subprime mortgages” ever did.

Hopefully this crisis will not be “the straw that broke the camel’s back” for the U.S. economy, but with each passing day this thing looks even more horrifying.

One way or another, real estate law in the United State is going to be changed forever as a result of this crisis.  It is going to be extremely interesting to see how all of this plays out.

Whether they have fun or not, their coach sure does.

Tonight however, I’m having to “watch” the CMT awards.  Another concocted award show with no real purpose that I can discern.  That’s not even my complaint, not even close.  It’s the blurring of the lines between different forms of music that really gets my blood to boiling.  Kid Rock is the host.  Kid Rock.  Read that again.  Bobby Ritchie is the host.  Isn’t this the same guy who once sang Rock and Roll Jesus?  Killing Time?  American Badass?  Later, the show is promising a duet with the latest country pretty boy and Ludacris!  Yes, Ludacris.

Even the country music sounds like people trying to act country over a pop rock beat.  It’s all just the same music.

I guess I’m officially old, but does that mean I’m wrong?  In the words of another genre blending artist, “Just because I’m paranoid don’t mean they’re not out to get me.”