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Wednesday, March 11, 2009

The OCCIDENTAL OBAMA




The OCCIDENTAL OBAMA

Wow this blog entry by Lee S. Gliddon, Jr. seems to fit some of the odd pieces of the puzzle in place. When he says obama is occidental this is the biggest piece of the puzzle. What if the puzzle had a flaw and it could not be completed because it was flawed from the beginning. The puzzle is of course obama and the flawed personality disorder is NPD a pervasive pattern of grandiosity, need for admiration and a lack of empathy.

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The OCCIDENTAL OBAMA

As the Obama meandering trail of life becomes the interstate highway of courtroom trials for our beloved leader, Birdie Obama, it perhaps is time to weave the fabric of Barack’s Muslim, Kenyan, Indonesian, Hawaiian serape to explain just what he is hiding by hiring his platoon of lawyers.

What is taking place is indeed conspiracy as in the sense a violation of the RICO Act. This involves the state of Hawaii and Occidental College, if not Columbia of New York and Harvard.

What requires explanation in this is a generation of crime in supplanting the United States for money. It is as simple as that in local government policy being fed huge sums of money at the behest of Ford Foundation incorporating globalist policy into American culture.
Barack Obama is simply the tip of this iceberg which he desperately must conceal, along with all these other benefactors or beyond embarrassment, people will go to prison.

The first task in need of explanation is why would Hawaii aid a known illegal of British birth in illegally obtaining a fake birth certificate?
The answer is in 1961 the American public had not yet been herded by Teddy Kennedy and socialists into providing welfare benefits to illegals. Hawaii had a large population of illegals who were slave labor, but were a huge burden to the system in poverty and crime.

The Hawaiian answer, as it was a Democratic state and still is was to start registering all those foreign kids by the thousands. The purpose being to tap into all those federal hundreds of millions then which would profit the state.
See all of those poverty programs flowed funds into the pockets of the retailers as the golden goose pipeline. If one makes citizens out of illegals, then Hawaii converts a debt into their asset in obtaining more funds and growing the socialist system which empowers Democratic liberals.

The fact is there are hundreds of thousands of Barack Obama’s registered in Hawaii. Do you think even a Republican governor sitting on this explosive mess wants any of this coming out?
An entire state sold out the United States for filthy lucre, because they were importing Asian slave labor. That does not make a great headline, nor, did they probably ever expect a money train welfare illegal would somehow get hisself installed as President which would expose the entire Hawaiian fraud, and you know very well that all of those records would have to be gone through and verified so an Obama repeat would not occur, in all 50 states.

Talk about a nightmare huh? The nightmare would be the removal of Obama under Quo Warrantus which is being attempted now and 49 other states suing Hawaii for the money it would cost to check all of their records over the Hawaiian fraud.

Hawaii has always been a corrupt enclave like Rhode Island. Hawaii was the conduit in the Clinton years to get Chinese communists a stake in the United States Stock Market, to which Hawaii had the first meltdown in this scheme in costing their investors a fortune and ruining their banks.

That is why Hawaii is in collusion with Barack Obama. There were involved in massive welfare fraud and do not want this coming out.

With this kind of background, in families being “informed” of the opportunities involved in engaging in illegal citizenship, one Stanley Ann Dunham, hauled her little African eastern boy to Indonesia, until the jungle fever wore off, and then dumped him into the Hawaiian system again where Grandma Dunham was stuck with the kid.
Grandma Madelyn Dunham did earn some money in BankHo, her bank in Hawaii, but I suspect that the prestigious school Barry got into, was the same game that brought Barack sr. to America on a free educational route.
Barry Obama Soetero was tapping into the welfare system of Hawaii, and in knowing what twisters the Dunhams were, this takes us into Occidental College.

Amusingly Occidental College, basically means round eye college as occidentals are of the European origin who reside in North and South America. The place Obama chose to be dumped into by the Dunhams, was like many of the colleges in that 1979 period in tapping into government resources of free money to “educate” foreigners.
One has to understand colleges in America do not operate to educate children. They are conduits of establishing globalist brainwashing into children and as dry cleaning of billions of dollars in funds in “research”.
For example Wisconsin has a female professor who took huge amounts of cash for global warming, and one of her subjects was studying how the Great Lakes absorbing carbon gases affected warming. One might as well studied your bathtub water for the effect as if you look at a map you see the Great Lakes are dots compared to the oceans.
There are numerous studies linked to this gravy train of funds which flow into colleges and back into corporations whose equipment and services are purchased.
It is the Warren Buffett money flow into Walmart for his Chinese investments. except in this case it is college money laundering.

So the Dunhams were adept at illegal activities in scamming the American system, so it is a conclusion by what Barack Obama has been up to with his platoon of lawyers that he is covering something up.
Remember it is public information that Barry Obama upon going into college became Barack Hussein Obama. Liberals have explained this away as, “Barack was more intellectual sounding”. Not a chance, because what was going on is this:

A college career recruiter shows up and says, “Barry come to Occidental as you will have fun”.

Barry goes home and tells Gram Dunham he wants to go have fun. Either money is tight or the Dunhams are basic welfare swindlers and being cheap as they are, Gramma and Mama, put their heads together and say, “Hey, we can get a free education if we dust off Barack sr. being a British subject.”
They tell Occidental that and Occidental says, “Great, but we need documentation”.

“Crapper in the wrapper, “Stan and Mad say as all they got is a bogus Hawaiian birth certificate making him Americans.

Then Stan and Mad remember that Barry was adopted by Indonesian Papa Soetero. They tell Occidental this and provide Barry Soetero school records from Indonesia and Occidental says, “Eureka, you have struck it rich pilgrims. There is golden grants in them Indonesian hills!”

So Birdie becomes Barack and Occidental gets a big ole Obama grant to go with all their other foreign student federal grants they have been milking the system for at the behest of the globalists.

The problem now is, Occidental never figured their scammer would produce a person in the White House. See this system was designed to Americanize 3rd worlders with globalist nonsense and then bury them back into Indonesia, Russia and Kenya to ruin those peoples lives.
Occidental now has a huge problem as it engaged in federal student loan fraud which gave them like many of these globalist programs huge bankrolls to profit off of in exchange for Rothschild plans.

None of these geniuses ever suspected a scammer scamming the system would have a parent who would eventually tap into the Ford Foundation money and fellow traveler contacts which would start opening doors, including psychiatric research doors in reprogramming a Birdie dope head in Columbia to become Barack the communist organizer of Chicago.
Stanley Ann Dunham got greedy in out of necessity. She tossed Barry away in abandoning him in trying to get rid of her reminder of jungle fever, but still had this reminder turning into an eyesore dope head. She took this looser, put him into a program to “fix him”, laying Bill Ayers mindset onto him, all for the purpose of making her sexual mistake into something which would soothe her troubled breast.
The problem is Stanley looks like she embezzled funds from Ford to give Birdie a jump start at life in making her mistake into her glory. As this blog noted, Birdie was only supposed to be the new Jesse Jackson in bringing in the black vote at the beginning.
He though was transformed by his programming to take the lead of self fulfillment in being President when Hillary was forced to take a dive.

Not for one moment though have the Rothschilds nor Rockefellers not known Barry Soetero is dripping wet with fraud. Bill Clinton constantly hinting at “Constitutional qualifications” means in the boardrooms where these people meet, they have discussed it, have the paper trail and have Obama by his testicles that Jesse Jackson wanted to cut off.
Jackson pronounced the race was now complete and there was no more need for “black affirmation” as the race has now reached the mark.

The globalists know all of this and are shedding the black vote for the hispanic vote with Obama as their judas goat in betraying blacks. The globalists know full well how precarious of position Obama is in. They know if this comes out the country will be in chaos and they know if Obama stays in office the continued economic attack on America will simply provide their conduit in establishing their global order.
These financiers win no matter what as they have set this out to play out this way.

Strangely Orly Taitz, the lawyer who has the best option to bring all of this out and shine a light on the sordid money fraud situation betraying the United States is a factor the globalists hope for as the more turmoil created the better it is for the global order.

At the very least in this, Barack Obama is guilty of federal money fraud. As Tom Daschle and Tim Geithner just said “Ooops sorry” and paid it back, it could end there for Obama in the foreign student loans IF he had not shown a pattern for the period from 1971 to at least 1982 in passing hisself off as Barry Soetero, resident of Indonesia as an adopted son from British Kenya all to tap into the American money supply.
A normal moral person would never have gotten themselves into this mess, but Obama because of his programming and what that did to his phobic compulsion disorder has been ploughing on in this using the shield of the patricians who created him as they are powerful and connected people.

Occidental College opens up the door to Barack Obama declaring in writing he is not American, but foreign. This progresses to Columbia in this fraud as Birdie at home with the racist base elements as he dope slides along, concludes he is owed a little summer vacation with his Pakistani buddies.
Always the Dunham corner cutter, he goes into Pakistan once again on an Indonesian passport which signifies again Barack Obama is Indonesian as Americans could not get into Pakistan.

Obama would have probably gotten away with the money fraud, if he had not been too cheap and decided he just had to flip the bird to the American system and get into Pakistan. Those records prove he is an affirmed triple citizen of British Kenya, Indonesia and America, if not Canada registration too.
Any part of which disqualifies him for President of the United States.

Birdie Obama is like the crook who steals a million dollars, but has to go back and pick up the bank President’s pen in greed and that is the 20 dollar item that gets him busted.

There are federal records for these Obama applications for funding in the Department of Education. As of Barack Obama attempting to further smear George W. Bush in releasing Bush documents, to take the heat off of Birdie, the Dunham, Obama, Soetero education files are now open to the Freedom of Information act as all papers associated with a President are, as Barack Obama made this a presidential issue when he hired attorneys to cover up what was being hidden at Occidental College.
This is a matter for the Justice Department as it is money fraud of college funds and it is a matter for the Republican minority in Congress to demand and hold hearings investigating this.

Those records all exist and if someone destroyed them and they are missing, that is a federal crime of which Barack Obama is benefited by, as in he is then a guilty co conspirator in another felony.
If you get money from someone illegally, and someone else burns the papers protecting you, you are just as guilty as the person who lit the match.

That is how all of this ties together from Hawaiian welfare fraud, Occidental College student finance fraud and Barack Obama currency fraud defrauding the American public of funds and places of education for it’s own citizens.

This is really a large issue of global scale and Barack Obama is the tip of the felony iceberg. Someone is going to come forward with the papers which will light this up as it is in the globalists interests to do this. It will though come out as the scenario of operation is exposed here in tying it all together and as more people figure it out, then the conversation becomes, “I’m not following that crook in the White House”, and Barack Obama occupying that House or in exile does not matter as he will cease to be Prime Minister as America and then Congress ignores him.

Russia has figured this out people, President Medvedev brushed off Obama’s overture on European missiles linked to help in Iran. They know Obama is finished and are going to Jimmy Carter fillet him for concession as Obama needs them and they do not need Obama.
A simple alert for people who have not noticed this Nixonian Clintonesque Obama era, the Russians and Chinese have just declared the United States under Obama as unnecessary.

Richard Holbrooke pizzed on the President of Iran, well President Medvedev just pizzed on Barack Obama and America today.

You people at AOL, Politico and other mania outlets attacking “birthers” or this site, you had better do a reality check as your Obama on an issue you claim does not exist, just proved it matters to the people with nuclear missiles aimed at America.
You Obamaniacs did this and no matter how deluded you are into thinking he is your mahdi, the real world has just dismissed him as already not being leader of the United States.

The time will come when the American majority ignores him. Then what will Obamaniacs do as you have growing numbers of military already refusing to follow orders from Obama without those papers you claim do not matter?
Areas of America are already discussing not paying taxes and just going gopher with their guns and survival foods. You Obamaniacs are about to be facing this alone with a world class fraud who is looking to abort you abandoning you to wars you will be fighting as the US military stands down.
I warned of this in not wanting it in any way to come into the United States Military for the upheaval it can cause.

The Russians just slapped the person in the Oval Office across the face today as Obama gave them all they demanded. Every terrorist, every world leader just witnessed and noted what happened.
They are coming now for America and this all traces back to the Occidental Obama.

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President obama's language, posture and demeanor suggest that he may suffer from narcissistic personality disorder , or NPD. NPD is a pervasive pattern of grandiosity, need for admiration and a lack of empathy. The following are some of the symptoms of NPD that can be seen in Sen. Obama:

He subtly misrepresents facts, opportunistically shifts positions, ignores data that conflict with his fantasy world, is overly confident and acts presidential despite commensurate merits and his modest life achievements, considers himself above the law, talks about himself in the third person, has a messianic vision of himself and his "mission," displays false modesty while often evincing haughtiness, sublimates aggression, holds grudges and behaves as an eternal adolescent. These are narcissistic traits as seen in Sen. Obama by Dr. Sam Vaknin. The author of "The Malignant Self Love," Vaknin states, "Barack Obama appears to be a narcissist."

NPD is the prime disorder experienced by all the madmen of history – from Hitler to Stalin, Mao, Kim, Pol Pot, Osama, Khomeini, Saddam and Idi Amin. These men wreaked havoc and killed millions. They looked normal. Few suspected their insanity until it was too late.

Obama shares something else with these infamous narcissists: a chaotic childhood. One determining factor in the development of NPD is childhood abuse, such as the neglecting of his or her emotional needs.

Pathological narcissism is not run-of-the-mill narcissism – someone with a hedonistic or self-centered sense of self – but rather someone with a very weak sense of self. A child who feels inferior, due to real or perceived social rejection, will try to compensate his feeling of inferiority by a subconscious neurotic mechanism, which the pioneering psychiatrist Alfred Adler coined "Superiority Complex."

Such a person compensates his devalued and injured self with puffery, pomposity and by projecting a false image of majesty and authority. He retreats into a bubble universe of fantasy, in which he is loved, respected and omnipotent. All children create such a fantasy world. Narcissists simply don't leave it. Since, due to their extreme feeling of inferiority, they don't fit in the real world, they refuge into this bubble world of fantasy and never get out. This world of pretence becomes to them as real as the real world, to the point that they can't tell the difference. When Obama acts presidential, he is simply acting out his childhood fantasy of omnipotence and grandeur. Emotionally, he is still a hurt little boy neglected and unloved, in the body and mind of a grown up man. (This really explains who or what obama is)

Narcissists have the emotional maturity of a child, or even an animal, but the intellect of a man. They feel like a beast, but think like a human. What makes narcissists dangerous is their lack of conscience, combined with their superior intelligence and their superb performance ability that fool many. They are predators that outsmart you.

To a narcissist, reality and fantasy are intertwined. He does not just pretend to be omnipotent, omniscient and superior to others; he actually believes it to be so. His delusions of grandiosity are real to him. That is why Obama acts presidential, despite his nugatory life achievements, lack of experience and complete ignorance in economic, political and military matters, as his flip-flopping shows. Obama is a cipher, but in his mind and those of his worshipers, such as Oprah Winfrey, he is "the One," the messiah who holds the key to all human sufferings.

Narcissism is not just a character flaw, but a mental disorder. Pathological narcissists are dangerous because they look normal and they are intelligent, when in reality they live in a bubble world of fantasy. It is this incoherence, this disjunction between reality and fantasy that makes them overly confident, self-assured and authoritative. (This explains why obama is destroying America)

Narcissists disguise their feeling of inferiority by projecting unusual calmness, confidence, assertiveness, dominance and focus, and almost always possess superb thespian, communication and oratorical skills. These are traits that make one charismatic and attract a stampede of votaries like flies to sugar. Narcissists are needy people who crave attention. They develop these skills and act them out with regal exquisiteness to attract love, respect and admiration. They are performers, actors, slick chameleons.

Sadly, all the grace, exuberance, equanimity, charm, positive energy and magnetism that narcissists project, are pretence. They have the same function that the Styrofoam Greek columns at the Democratic National Convention had – to impress. The world of the narcissist is the magical world of smoke and mirrors. Obama is an illusionist.

NPD, and people's lack of understanding of it, has made it possible for many insane individuals to rise to the pinnacles of power. It is to this disorder that we owe most of the carnage of history.

When the Bible describes Satan, it gives a textbook definition of narcissism. Narcissists are charming, charismatic, intelligent, persuasive, but deceitful and ruthless. They can seduce multitudes.

When World War II ended and its horrors became known, the world said, "Never Again." "Never Again" can only work if we choose our leaders wisely. Once a madman is in power, it is already too late.

In an article entitled "Understanding Obama: The Making of a Fuhrer," Understanding Obama: The Making of a Fuhrer has shown many narcissistic traits that can be observed in Sen. Obama. Should the senator have NPD, all issues in this election would pale in comparison to what is at stake.

Imagine someone with the mindset of Hitler, Khomeini or Kim Jong-il in the White House, with Congress and Senate at his feet. Can you think of a more dreadful scenario?

In the case of Hitler, the only issue that really mattered was his sanity. Instead, the Germans were hoodwinked by his charisma, his oratorical skill and his vacuous promises of change. They paid a hefty price for their negligence. Shouldn't we learn from their mistakes?



It makes no sense that cops and pilots should be required to take psychiatric evaluation prior to being trusted with a gun or an aircraft, whereas there is no such requirement for those aspiring to run a country and be commander in chief, in charge of weapons of mass destruction. (Obama said to rely on factcheck.org to prove his identity. People did but there is no documentation to back it up!)

There is no basis upon which to assume Obama would become a murderous tyrant, but there are a number of disturbing traits he shares with murderous world leaders that are worrisome.

If Obama would submit to a psychiatric evaluation, he would be found mentally ill because of NPD. The evidence is his destruction of the US economy daily.

Friday, March 6, 2009

LEO DONOFRIO CAN TAKE OBAMA DOWN!!!!!



Leo's Band

A Real Super Hero

Thank You Leo For Not Giving Up On America!

QUO WARRANTO LEGAL BRIEF The Federal Quo Warranto Statute Is The Only Constitutional Means of Removing a Sitting President Other Than Impeachment LEO DONOFRIO CAN TAKE OBAMA DOWN!!!!!

quoa-warranto a new hopemilitary can now retreat in peace


The issue of whether the President can be removed from office other than by impeachment is the single most important question presented with regard to challenging the eligibility of a sitting President.

THE CONSTITUTION HAS PROVIDED CONGRESS WITH THE AUTHORITY TO REMOVE THE PRESIDENT FROM OFFICE IN CASES OTHER THAN IMPEACHMENT.

Evidence of this power is directly written into the Constitution. The most obvious section is Article 2, Section 1, Clause 6 which states in full:

In Case of the Removal of the President from Office, or of his Death, Resignation, or Inability to discharge the Powers and Duties of the said Office, the Same shall devolve on the Vice President, and the Congress may by Law provide for the Case of Removal, Death, Resignation or Inability, both of the President and Vice President, declaring what Officer shall then act as President, and such Officer shall act accordingly, until the Disability be removed, or a President shall be elected.


A comprehensive investigation appears to reveal that the framers intended Article 2, Section 1, Clause 6 - as it applied to the POTUS - for two distinct purposes.

- the first purpose is the commonly accepted purpose: to provide for a vacancy in the office of President

- the second purpose was to provide Congress a means to remove the President should it become clear that he is not entitled to hold the office, for example - a classic quo warranto situation or if the President becomes disabled.


The 25th Amendment is quite an amazing grant of power when you consider the President can be forced to step down if Congress believes he’s lost his mind. That’s certainly a much greater power than just being authorized to decide how to fill the vacancy if he loses his mind.

QUESTION: If Congress has the power to remove a President should it become known he was a usurper, then why doesn’t the 25th Amendment address that?

ANSWER: Because by 1967 - when the 25th Amendment was ratified - Congress had already exercised their authority on this issue by enacting the federal quo warranto statute which allows for the removal of any United States officer found to be a usurper.



Article 1 Section 8 Clause17 states:

The Congress shall have power…To exercise exclusive legislation in all cases whatsoever, over such District (not exceeding ten miles square) as may, by cession of particular states, and the acceptance of Congress, become the seat of the government of the United States,…

Compare the wording of Clause 17 with §16-3501 of the federal quo warranto statute:

A quo warranto may be issued from the United States District Court for the District of Columbia in the name of the United States against a person who within the District of Columbia usurps, intrudes into, or unlawfully holds or exercises, a franchise conferred by the United States or a public office of the United States, civil or military. The proceedings shall be deemed a civil action.

When you read the two back to back, it appears Constitutional that the office of President - being in the District of Columbia - should be governed by the federal quo warranto statute.


USC CODE: TITLE 3 THE PRESIDENT Chapter 1. Presidential Elections and Vacancies

Please review §19:

Vacancy in offices of both president and vice president; officers eligible to act

§ 19. (a) (1) If, by reason of death, resignation, removal from office, inability, or failure to qualify, there is neither a President nor Vice President to discharge the powers and duties of the office of President, then the Speaker of the House of Representatives shall, upon his resignation as Speaker and as Representative in Congress, act as President.


CONCLUSION: The federal quo warranto statute provides the only Constitutional means by which a sitting President may be removed by the Judicial branch.

It appears there is a Constitutionally viable method available for the eligibility issue to be litigated which does not violate the separation of powers enumerated in the Constitution. I strongly believe the federal quo warranto statute provides the only Constitutionally viable means by which a sitting President can be removed from office if found to be a usurper, whether such usurpation is intentional or unintentional.


First petition the Attorney General or US Attorney in DC to institute an action in quo warranto.

According to the statute, a quo warranto action to challenge the eligibility of a United States officer - whether elected or appointed - can only be brought in the District Court of the District of Columbia.

A Quo warranto dispute is not related to official activity of the President’s office. It relates to whether the President is eligible to hold the office and that is not an “official action” undertaken by the President. The statute defines quo warranto as a civil action. I believe the President would have to hire private counsel to defend himself.

The federal quo warranto statute provides that the “United States attorney” may institute an action in quo warranto on his own motion. The US Attorney for the District of Columbia is Jeffrey Taylor. He was appointed to that position in 2006 by the Bush administration and certainly has no conflict of interest. I am not aware of anybody who has contacted US Attorney Taylor in this regard. It will only take one of those officials to bring the action, not both.

WHY EVERY EFFORT SHOULD BE MADE BY THE PUBLIC TO PRESSURE AG HOLDER AND US ATTORNEY TAYLOR TO INSTITUTE - ON THEIR OWN MOTION - AN ACTION IN QUO WARRANTO ON BEHALF OF THE UNITED STATES WITHOUT EX RELATOR PLAINTIFFS

U.S. ATTORNEY JEFFREY A. TAYLOR

While arguments about whether the military make the best plaintiffs have been raging, the simple truth is that a quo warranto case with the best chance of success ought to be initiated with no private plaintiffs at all. The federal quo warranto statute shows a preference for cases brought on behalf of the United States by the Attorney General or the US Attorney. And until respectful pressure is applied to those officials, the nation is deprived of the most perfect avenue to justice. Until this course of action is exhausted, I pray that all private attorneys briefly delay requesting consent from these officials while an effort is made to persuade them that it’s in the best interests of the nation for them to proceed on their own motion.

§ 16-3502. Parties who may institute; ex rel. proceedings.

The Attorney General of the United States or the United States attorney may institute a proceeding pursuant to this subchapter on his own motion or on the relation of a third person. The writ may not be issued on the relation of a third person except by leave of the court, to be applied for by the relator, by a petition duly verified setting forth the grounds of the application…



If either official bring an action in quo warranto upon their own motion, such an action is brought on behalf of the United States and no leave of the court is necessary.

As written, it’s possible any US attorney might be eligible to institute such a quo warranto action. Notice that in the statute - “attorney” isn’t capitalized in either 16-3502 or 16-3503 when the “United States attorney” is mentioned. Of course, US Attorney Taylor is certainly authorized, but this needs further research.

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Here is the danger Leo Donofrio doesn't mention. If obama thinks Atty Donofrio and thousands of Amercians are about to expose him as a FRAUD he will declare martial law to conceal his true identity. Obama can declare martial law for any reason and not tell anyone initially thanks to george bush and the "war on terror". The war on terror for some in the government could be any disagreement or "rebellion" as the government would call it, that seeks to expose the truth about obama or government corruption.
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Leo Donofrio:
If AG Holder and US Attorney Taylor refuse to institute an action in Quo Warranto on their own motion, the same statute provides for all “third persons” (any citizen) to request, via verified petition, that either of those two officials institute an action in Quo Warranto on plaintiffs’ behalf, subject to leave of the District Court of DC.

If AG Holder and US Attorney Taylor refuse to bring the action on their own motion, Mario Apuzzo and I are committed to acquiring as large a set of plaintiffs as possible to petition these officials on plaintiffs’ behalf [but in separate law suits]. “Third persons” are any citizens of the United States.

If the officials refuse consent to bring the action “ex relator” on behalf of such “third persons”, then the statute provides that any “interested persons” (a subset of “third persons”) may petition the court without the consent of the two officials.


Leo Donofrio explains:
An action in Quo Warranto should ask for two simple issues to be resolved:

1. That a court determine whether Obama’s birth status having been governed by the British Nationality Act of 1948 prevents him from eligibility as a natural born citizen under Article 2, Section 1, Clause 5 of the US Constitution.

2. That Obama produce his long form birth certificate to AG Holder and/or US Attorney Taylor.


(Yes Leo I am interested as many are who want to expose the FRAUD obama. Include me in any lawsuit. I will serve the papers also sir!)

§16-3501 of the federal quo warranto statute:

A quo warranto may be issued from the United States District Court for the District of Columbia in the name of the United States against a person who within the District of Columbia usurps, intrudes into, or unlawfully holds or exercises, a franchise conferred by the United States or a public office of the United States, civil or military. The proceedings shall be deemed a civil action.


§ 16-3502. Parties who may institute; ex rel. proceedings.

The Attorney General of the United States or the United States attorney may institute a proceeding pursuant to this subchapter on his own motion or on the relation of a third person. The writ may not be issued on the relation of a third person except by leave of the court, to be applied for by the relator, by a petition duly verified setting forth the grounds of the application, or until the relator files a bond with sufficient surety, to be approved by the clerk of the court, in such penalty as the court prescribes, conditioned on the payment by him of all costs incurred in the prosecution of the writ if costs are not recovered from and paid by the defendant.


§ 16-3503. Refusal of Attorney General or United States attorney to act; procedure.

If the Attorney General or United States attorney refuses to institute a quo warranto proceeding on the request of a person interested, the interested person may apply to the court by certified petition for leave to have the writ issued. When, in the opinion of the court, the reasons set forth in the petition are sufficient in law, the writ shall be allowed to be issued by any attorney, in the name of the United States, on the relation of the interested person on his compliance with the condition prescribed by section 16-3502 as to security for costs.



(Obama has usurped,intruded,unlawfully holds and exercises the office of the president of the United States!)


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Additional Information
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Quo Warranto:

The common law writ of quo warranto has been suppressed at the federal level in the United States, and deprecated at the state level, but remains a right under the Ninth Amendment which was understood and presumed by the Founders, and which affords the only judicial remedy for violations of the Constitution by public officials and agents. Revival of the writs must be combined with reviving standing for private prosecution of public rights, subverted by the decision in Frothingham v. Mellon, 262 U.S. 447 (1923)

A critical key to achieving federal constitutional compliance is to resurrect quo warranto and other common law writs. This involves reasserting and strengthening the original All-Writs Act and repealing or declaring unconstitutional legislation, such as the Anti-Injunction Act, and those Rules of Judicial Procedure, that have restricted the jurisdiction of federal courts to accept petitions for these writs and grant a fair hearing ("oyer") and a decision on the merits ("terminer") on such petitions.

The Practice of Extraordinary Remedies, Chester James Antieau, 1987, Chapter on Quo Warranto.

A Treatise on Extraordinary Legal Remedies, Embracing Mandamus, Quo Warranto and Prohibition, James L. High, 1896, Section on Quo Warranto.

A Treatise on the Legal Remedies of Mandamus and Prohibition, Habeas Corpus, Certiorari, and Quo Warranto, Horace g. Wood, 1896, Section on Quo Warranto.

Revival of the writs must be combined with reviving standing for private prosecution of public rights, subverted by the decision in Frothingham v. Mellon, 262 U.S. 447 (1923), which is discussed in this article by Steve Winter

Thursday, March 5, 2009

President Obama appears to have set the seal on a dollar collapse

This is more excellant information from by John Browne


When President Obama took over the reins of government just six weeks ago, he stood at a historic crossroads. His decision on which route to take will make a profound impact on the future of the American economy and its currency. He could have persuaded a frightened Congress to initiate a structural change that would transform the U.S. economy from its dependence on debt-fueled personal consumption back to a path of productive growth. Instead, he took the easy route: attempting to delay the pain with stimulus and inflation, rewarding his benefactors without truly addressing our structural deficits. Disappointing for a man who campaigned on ‘hope’ and ‘change.’

Obama could have remained true to his electoral promises to halt taxpayer abuse and to focus spending on infrastructure. This would have created some 35,000 new, wealth-creating jobs for each $1 billion spent. It also would have left the private sector to deleverage, allowing the desperately needed economic restructuring to take place in a productive, free-market manner. Instead, he bowed to a socialist Congress by boosting entitlements, the very programs which, over the past four decades, have depleted America’s wealth and encumbered future generations with some $60,000,000,000,000 of debt.

Rather than ‘hope’ and ‘change,’ Obama has chosen to expand existing programs, casting a cloud over our children and grandchildren. His program is as old as Marx: ramp up government spending on and control over health and education to increase the federal government’s share of GDP, in this case by two-thirds to some 34 percent. This will continue the serious erosion of American wealth, and with it the U.S. dollar.

In his budget last week, President Obama chose to raise taxes on individuals and businesses. In the face of a worldwide recession that is fast sliding into a depression and even towards an economic catastrophe, it was a surprising decision. It will likely serve only to deepen and prolong the economic decline. Despite the destructive tax hikes, the budget still forecast the largest deficit in world history.

For the foreseeable future, deficits will be measured in trillions, not billions. To put these vast sums into perspective, consider just one billion, or one thousandth of a trillion. A billion minutes ago, Jesus was alive. A billion hours ago, humankind was in the Stone Age. But in just the past eight hours and twenty minutes, even before Obama’s budget clicks in, the Government has spent $1 billion!

Investors will understandably conclude that Obama’s budget will put a near-mortal wound in the U.S. dollar and be tempted to sell or even short the greenback. Beware, as things are not that simple! While Obama’s budget has halted healthy economic restructuring and placed the U.S. dollar under long-term threat, several important short-term factors will postpone the inevitable.

First, it is vitally important to realize that the present recession is not restricted to the United States. It is worldwide. Asset prices are dropping around the globe and cash is already a king. As fear spreads, investors are running for safety in the world’s most widely held currency, the U.S. dollar. As a result, the dollar is rallying.

Second, the vast asset boom, from which the world is deleveraging, was based on a vast oversupply of cheap U.S. dollars. Investors borrowed low interest-cost dollars, converted them into their domestic currencies (driving down the dollar), and invested in local assets. Deleveraging is causing the dollar ‘carry trade’ to unwind, driving the dollar upwards.

Third, many investors, including major corporations and central banks, have diversified their currency holdings into the Euro. The world recession is hitting Europe extremely hard, particularly the large international exporters such as Germany, and the newly capitalist countries of the former Soviet Union. The plight of Eastern Europe has widened political cracks within the European Union to the point where there is now a serious risk that the euro and even the European Union could fail. David Charter of The Times writes, “…The lack of EU leadership and direction…threatens to wrench apart both the euro and the EU itself.”

If the Euro appears under serious threat, there could be a massive financial panic and a stampede into U.S. dollars, driving it to unexpected highs. This is likely to add temporarily to a recessionary fall in the dollar price of gold. In light of this unfolding evidence, it is becoming increasingly risky to sell short the U.S. dollar. In the long-term however, President Obama appears to have set the seal on a dollar collapse.


Obama’s budget has halted healthy economic restructuring and placed the U.S. dollar under long-term threat, several important short-term factors will postpone the inevitable. Obama appears to be an idiot but is in fact a communist.

Wednesday, March 4, 2009

Commercial real estate collapse will lead to financial collapse in 2009

Gerald Celente , the world's #1 Trends forecaster states that we're moving into the Greatest Depression in history - starting in 2009!

Commercial real estate collapse in march will lead to financial collapse in 2009


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The US Collapse Of 2009 - This Will Blow Your Mind......



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The United States of America will shortly be known as the USSA United Socialist States of America.

Obama and his useful IDIOTS are changing the USA into the USSA (United Socialist States Of America

(A Georgia Gentleman // Feb 7, 2009 at 9:57 am)

Maybe one should open a history book, going back to the 1860’s, and take a look at the war of Northern oppression ( commonly called the “Civil War” ). Might it really needed to be termed the War of federal oppression.

Might we not need to stop at ascension of State sovereignty, and continue on to a
possible thought of succeeding from a union of states, governed by an oppressive
socialist regime, which is hell bent on destroying the United States of America,
and reducing OUR country to another communist government controlled , state owned gulag for those, once of a free nation of the people, by the people, and for the people.

We might only need to turn to the history of communism, and to the writings of Karl Marx , and the communist manifesto, to understand the new demoncratic plan of federal governance of all people, business and institutions, all state governments included, that is now in motion in the chambers of the house, senate, and in the office of the presidency.

They socialists inside the beltway are moving quickly to consolidate their power, and once consolidation is complete, the power will only be to the federal government, and the states now will be totally subservient to federal control. The will of the people will only bring on the imprisonment,(the useful idiots) and deaths of those who will question the authority of the federal government, this as seen in every instance where socialism and communism has come to power.

The lead in to this can currently be seen in the attack by the socialists in the federal government on the free speech of the people through dissent of the current
activities of the new socialist congress, senate, and office of the presidency. If the people, and the states allow this cancer to spread, and consolidate its power, the United States of America will shortly be known as the USSA. United Socialist States of America.

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To keep and bare arms is not limited to just fire arms, it is an all inclusive statement. Shall not infringe is an all inclusive command, Look it up. Therefore no state and no federal gun laws are valid. Shall not infringe is an absolute prohibition to writh any laws pertaining to ones self defense choice of weapons. Some may be great with a sword other are excellent with a bow and arrow, you can not qualify what arms are, because anything can be used as a weapon.

Plain and simple no gun laws or any kind of weapons laws are valid and are in fact a crime against the constitution which is defined as an act of High Treason. This exactly what it boils down to, all government agencies state and federal are violating the constitution which under the laws voids the authority they attempt to exercise. A direct violation of their oath of office and an inpeachable criminal offense.

Until the constitution is restored and all of the unconstitutional laws on the books are repealed, government does not exist legitimately. (ie Obama is illegitimate or a bastard) They are in breech of contract and have self terminated any authority we gave by consent. We as individuals have to answer to the law and government is required to do the same or there is no constitution and therefore no authority to be governed. This is the way the writers of the constitution menat it to be, read their notes!

We must understand Marxism for what it is. “Father Karl” himself laughed at the idea that he had propounded an economic theory. The Communist Manifest sums itself up as “the abolition of private property.” Read correctly, it is the destruction of private property.

THE book exposing this from his Marx’ own writings in by the late Rev. Richard Wurmbrand , The title is Marx & Satan, and is available from Voice of the Martyrs US website for a mere $5. (Marx & Obama)


On the real economic side, we have Keynesian economics. John Maynard Keynes explained the real intent himself in his book The Economic Consequences of the Peace:

“”By a continuous process of inflation, governments can confiscate secretly and unobserved an important part of the wealth of their citizens. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction - and does it in a manner in which not one man in a million is able to diagnose.”

( I would agree with this, "one man in a million". I am the one man in a million. Become aware of Obama and he fellow communists and reason why you are seeing the daily destruction of the US economy and its financial system! You could be the next "one man in a million".)

We must end the Fed and its fiat currency. We must assert states’ rights. We must elect Constitutionalists. And we must do it, however small a minority freedom-lovers may be. As George Washington said. “Let us raise a standard to which the wise and honest may repair. … The event is in the hand of God.”

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We must assert states’ rights!
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You may not have heard much about it, but there’s a quiet movement afoot to reassert state sovereignty and stop the uncontrolled expansion of federal government power. Almost half of the state legislatures are considering or have representatives preparing to introduce resolutions which reassert the principles of the 9th and 10th Amendments to the Constitution and the idea that federal power is strictly limited to specific areas detailed in the Constitution and that all other governmental authority rests with the states.

The founding fathers believed in a balance between state and federal power. This state sovereignty movement clearly arises from the belief that the balance of power has tilted too far and for too long in the direction of the federal government and that it’s time to restore that lose balance.

The emergence of this movement is a hopeful sign of the people asserting their rights and the rights of the states and finally crying “enough” to runaway government. With the threat of increasingly out of control federal spending, some of these sovereignty bills may stand a fair chance of passage in the coming year.


These sovereignty bills are not the first step towards secession or splitting up the union, nor are they an effort to block collection of the income tax, appealing though that might be. For the most part, they are not so much political statements of independence as they are expressions of fiscal authority directed specifically at the growing cost of unfunded mandates being placed upon the states by the federal government. Despite the movement picking up steam as he came to office, the target of these bills is not "President" Obama, but rather the Democrat-dominated Congress whose plans for massive bailouts and expanded social programs are likely to come at an enormous cost to the states.

What this movement is most similar to is the Nullification Crisis of 1832 where the State of South Carolina asserted that it had the right to nullify the authority of federal laws within its borders. In this case the states are not asserting anything as broad as the Doctrine of Nullification, but are merely reasserting the limits which the 10th Amendment places on federal authority, specifically as it applies to spending, the idea being that they don’t have to pay for federal mandates if their legislators choose not to.

As things stand right now it looks like Oklahoma, Washington, Hawaii, Missouri, Arizona, New Hampshire, Georgia, California, Michigan and Montana will all definitely consider sovereignty bills this year. They may be joined by Arkansas, Colorado, Idaho, Indiana, Alaska, Kansas, Alabama, Nevada, Maine and Pennsylvania where legislators have pledged to introduce similar bills. Twenty states standing up to the federal government and demanding a return to constitutional principles is a great start, but it remains to be seen whether legislatures and governors are brave enough or angry enough to follow through. As the Obama administration and the Democratic Congress push for more expansion of federal power and spending that may help provide the motivation needed for the sovereignty movement to take off.

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HISTORY OF LEGISLATIVE ACTIONS SOUTH CAROLINA

Date Body Action Description with journal page number
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2/12/2009 House Introduced HJ-6
2/12/2009 House Referred to Committee on Invitations and Memorial
Resolutions HJ-6
2/18/2009 House Member(s) request name added as sponsor: Haley
2/19/2009 House Member(s) request name added as sponsor: Clemmons
2/24/2009 House Member(s) request name added as sponsor: Horne, Wylie,
Huggins, Allison, Parker, A.D.Young, Millwood,
Simrill, Willis, Herbkersman
2/24/2009 House Committee report: Favorable Invitations and Memorial
Resolutions HJ-8
2/25/2009 House Member(s) request name added as sponsor: Cato
2/25/2009 Scrivener's error corrected
2/26/2009 House Member(s) request name added as sponsor: Littlejohn,
J.R.Smith, Hiott, Erickson
2/26/2009 House Adopted, sent to Senate [emphasis added]

South Carolina now joins Oklahoma as having officially passed a 10th Amendment-based resolution through their respective House chambers.

Saturday, February 28, 2009

The US Govenment is now under the control of THUGS



February 13, 2009

An Indiana county municipal official in the vicinity of Chicago reveals the contents of his meetings with FEMA and the Department of Homeland Security. The initial requests seem reasonable enough when FEMA asks the county officials to prepare a Hazard Mitigation Plan to deal with flooding, fires, high winds and tornadoes.

But as the required meetings and calls with FEMA and DHS continue over a two year period their request become more unusual, raising suspicions of county officials

Listen to the audio:




“We want to know every important thing in this county. We want to know where police departments are. Where weapons are stored. Hazardous material. Where can we land a helicopter. Where are the airports. How big a plane can you land at the airport. Where are all the bridges. Where are all the power stations. Where are all the generating stations.Where are all the substations. They literally wanted to know where everything was. I’m sitting there thinking man if there was ever martial law. This kind of information is exactly the kind of stuff they are going to want. We’re just laying it all out for them right there.”

fema is preparing for mass graves and martial law



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Obama is the antichrist


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Obama Recites The Islamic Call To Prayer In Perfect Arabic


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Martial LAW IS COMING The example is new orleans and what the government did. Took away guns of Lawful US citizens!

Friday, February 27, 2009

Why letting judges modify mortgages is bad for all

Obama is destroying the US economy

The fix is simple yet painful. The assets must be allowed to re-price through the system that is in place. If you change the rules halfway through the game it will cause economic disaster in the near future! There will be pain for individuals and for organizations – but there will be pain under any scenario and the only “fair” one is the set of rules that we all started the game with.



This will lead to disaster. Obama is trying to DESTROY the US economy on purpose!

It will drive up the cost of borrowing. In the long run, it will keep people in homes they couldn't afford and it will prop up unsustainable prices by artificially curtailing supply.

It will lead to inflation as personal incomes rise to meet artificially inflated, but real housing prices. Consumer goods will rise to meet the increased consumer income. There will be a short term boom in spending from it, but eventually it will lead to inflation and leave more American with less spending power.

Ultimatly, future first time home buyers will be foresaken by higher costs of ownership across the board in order to save the irresponsible home home owners who will be the benificiary of this action.

This is a mistaken, which is being conducted by rank amateurs who have no business meddling in economic affairs.


Mortgage Modifications in Bankruptcy Would Undermine Homeownership, Prevent Few Foreclosures

Mortgage Modifications Are Another Example Of Obama Socialism


Federal housing policy, we now know, has caused catastrophic economic failures. Programs designed to expand homeownership did so at the expense of sound lending and borrowing, to the ultimate detriment of economic stability and many families' finances.

But one federal housing policy worked to reduce the price of housing credit and to extend its availabil­ity without contributing to the mortgage mess: deny­ing bankruptcy judges the power to modify home mortgages, a practice known as "strip-down" or "cram-down." This added certainty allowed lenders to accept smaller down payments and offer lower inter­est rates to millions of American homeowners without providing any incentive to make irresponsible loans.

Now Congress is considering snuffing out this one bright spot by giving judges the power to discharge mortgage debt in bankruptcy and rewrite repayment terms. If enacted, these proposals would increase the cost of homeownership and put it out of reach for many Americans, especially those of lesser means. They would also deal a blow to banks and other lend­ers at a time when many are faltering, thereby under­mining government efforts to increase stability in that sector. Worst of all, allowing bankruptcy judges to rewrite mortgages would prevent few foreclosures while causing harm to those it is intended to protect.

Fundamentally, strip-down is a poor "fit" for the problem of rising foreclosure rates. Its benefits would fall disproportionately to those who can afford their mortgage payments and do not need relief, while those whose homes are at risk would typically obtain only temporary relief at a great personal cost. The result would be to impose enormous expenses on mortgage and consumer lenders—at a time when doing so would be destabilizing and counterpro­ductive—in exchange for extremely limited benefits for vulnerable homeowners.

Congress should look beyond the following myths about mortgage strip-down and recognize that its costs, in the form of unintended conse­quences, would far outweigh its limited benefits.

Myth: Current law provides no relief from fore­closure for primary residences.

Reality: Under Chapter 13 of the Bankruptcy Code, individuals can stop foreclosure proceed­ings and spread delinquent payments over a period of time, and most mortgage servicers are willing and able to renegotiate loans when mutu­ally beneficial.

The current Bankruptcy Code carefully balances the need for predictability and stability in mortgage lending with the needs of borrowers who have tem­porarily fallen behind on their payments. Unlike a Chapter 7 liquidation, in which most of an individ­ual's assets are sold to pay his or her debts, a Chap­ter 13 bankruptcy puts an immediate halt (known as the "automatic stay") to foreclosure proceedings from the moment of filing and then gives the indi­vidual an opportunity to catch up on late payments.

Specifically, instead of being forced to bring a mortgage up to date all at once, a borrower suffering a temporary financial setback can spread the burden over a period of up to three to five years, depending on his or her income and expenses. During this period, the borrower must also continue to make regular scheduled mortgage payments. Once the deficiency has been made up, the payment schedule continues pursuant to the terms of the mortgage until the house is paid off or sold.

Moreover, homeowners can obtain relief by rene­gotiating the terms of their mortgages with those who hold or service them. When the alternative is a foreclosure valued at far less than the principle remaining in the loan, both homeowners and mort­gage investors benefit by modifying the loan to reduce the principle and ease the terms of repay­ment. This standard is the same that bankruptcy courts would apply under mortgage strip-down proposals but is applied in a way that avoids the blunt, one-size-fits-all approach of strip-downs. Though some mortgages have been privately secu­ritized in ways that present barriers to renegotia­tion, the vast majority are not subject to such limitations.

The current Chapter 13 process, as well as vol­untary and mutually beneficial relief provided by mortgage servicers, serves to separate borrowers whose income is likely to be sufficient to make pay­ments that exceed the foreclosure values of their home from those who have borrowed beyond their means and lack the earning capacity to afford the home that they nominally own but in which (usu­ally) they have little equity. Granting judges new power to modify mortgage terms would blur this line, encouraging both those who have taken on excessive debt and those who have borrowed rea­sonably and need no relief to reject voluntary rene­gotiation and seek better terms in bankruptcy.

Myth: Allowing strip-down will not increase the cost or reduce the availability of mortgage loans.

Reality: If forced to shoulder greater risk and expense, mortgage lenders will demand higher interest rates and bigger down payments, put­ting homeownership out of reach for many low- and middle-income Americans.

Congress cannot repeal the laws of economics. Thus, it is unreasonable to expect that lenders would not adjust their up-front terms in response to changes in the law that weakened loan enforce­ment. Experience and research show that any pro­posal that has the effect of undermining the certainty of mortgage agreements or imposing losses on mortgage lenders will serve to reduce the availability and increase the cost of mortgage loans.

Strip-down proposals would impose massive and unjustifiable costs on lenders. Despite the cur­rent state of the economy, less than 5 percent of homeowners are more than 60 days behind on their mortgages—the usual measure of delinquency. Yet strip-down would be available as well to the more than 50 million homeowners who are current on their mortgages if they filed bankruptcy. If even a small percentage of these homeowners chose to take advantage of bankruptcy to discharge some of their mortgage debt, their numbers, as well as the total value of the debt they would discharge, would far exceed the number of those in dire straits obtaining strip-downs. Thus, hundreds of billions in debts that likely would have been paid would be relieved.

These costs, in turn, would be reflected in the availability and price of mortgages. To protect them­selves from future strip-downs, lenders would have to demand increased down payments from mort­gage borrowers. Requiring that borrowers put down enough money to cover any foreseeable decline in the value of their homes is the only way to avoid the risk of a future strip-down.

Home price volatility provides some indication of the magnitude of the down payments that would be required. Over the past year, U.S. home prices have declined by about 12 percent, with some regions seeing drops as high as 30 percent, and prices are still falling. Under current law, down pay­ments are typically 10 percent to 20 percent of the price of a home, but this amount would be insuffi­cient to protect lenders in a volatile market. If the risk of strip-downs led to down payments of 20 per­cent to 30 percent, a down payment on the median house, valued at just over $200,000, would be $40,000 to $60,000—far more than many families could scrape together. Hardest hit would be first-time home buyers, who cannot draw upon existing home equity, and lower- and middle-class families.

Additionally, lenders would demand higher interest rates and fees as compensation for taking on the added risk of losing money if the loan is stripped down. Because strip-down is such a blunt and indiscriminate tool, all borrowers, no matter their creditworthiness, would face higher rates on mort­gages. The biggest increases, though, would fall on first-time home buyers and lower-income families, as lenders demand larger risk premiums.

Recent research confirms this effect. In one study, Karen Pence, a senior economist at the Federal Reserve Board who studies household and real estate finance, determined that state laws that impose costs on lenders (as much as 10 percent of the value of the loan balance) prior to foreclosure reduce the availability of credit for residents of those states. As a result of these laws, families "may pay more for their mortgages, purchase smaller houses, or have difficulty becoming homeowners." If strip-downs impose larger costs on lenders, they would likely have an even greater effect on interest rates and mortgage availability.[1]

Similarly, economists Emily Lin and Michelle White found that unlimited homestead exemptions, which allow individuals to shelter home equity from creditors in bankruptcy, significantly reduce the availability of mortgages and home-improve­ment loans.[2]

The result, then, of allowing the discharge of home mortgage debt in bankruptcy would be to put home lending out of reach of many Americans and to raise the cost of borrowing for those who are able to secure mortgages, further weakening the housing market. This is a perverse result, considering that the long-standing aim of U.S. housing policy has been to encourage homeownership by promoting affordability in the mortgage market.

That some proposals are temporary in nature would not prevent this outcome, because mortgage lenders (as well as borrowers) would reasonably expect Congress to reinstate strip-downs in the next economic crisis. Indeed, a repeat of this policy would be even more likely once the precedent is set and lenders' and borrowers' expectations are altered.

Myth: The Bankruptcy Code allows mortgages on vacation homes, boats, and expensive cars to be stripped down.

Reality: Instead of changing loan terms, courts regularly require the liquidation of luxury and "lifestyle" assets to increase distributions to other creditors.

Proponents of strip-down proposals make much of the fact that Chapter 13 allows for the modifica­tion of most debts other than those secured by a pri­mary residence. Current law, notes Representative John Conyers (D-MI), who has sponsored legisla­tion that would permit strip-downs, permits judi­cial modification of "loans secured by second homes, investment properties, luxury yachts, and jets" but not primary residences.[3]

In reality, luxury and "lifestyle" assets are rarely afforded this treatment because they are not consid­ered to be necessary to the support of the filer or his family. Though a filer may propose a plan that mod­ifies claims secured by luxury items, bankruptcy judges have extremely broad discretion to reject such modifications when they impair the rights of other creditors.

Further, unlike mortgage strip-down proposals, current law requires the filer to pay off in full any secured claim that is modified, including any arrearages, during the duration of the plan within just three to five years. For example, a debtor who manages to strip down a $300,000 mortgage on a vacation home to $200,000 would have to make equal monthly installments over the course of just a few years to retire that debt.

Thus, in most cases, luxury and "lifestyle" items— things like vacation homes and yachts—that are en­cumbered by debt are surrendered to the creditor and liquidated to pay off the debt and, in many instances, obtain funds that can be used to pay other creditors. The debts encumbering them are not stripped down. And in the rare cases where this does not occur and the debt is stripped down, the filer is required to pay off the remaining secured portion of the debt, includ­ing arrearages at the time of filing and any penalties and fees, over the course of the Chapter 13 plan and may also have to pay off a portion of the remainder of the loan—that is, the part that was crammed down—which remains as an unsecured debt.

Myth: Allowing strip-downs will help consumers.

Reality: Encouraging more families to file for bankruptcy will undermine more promising means of refinancing mortgage debt, hurt consumer credit, and ultimately prevent few foreclosures.

Filing for Chapter 13 bankruptcy is an expensive and disruptive process. While the total fees for filing are only about $300, guideline attorney's fees range from about $2,500 to $5,000 in simple cases, depending on the district; in complex cases, the fee can be much higher. Indeed, the difficulty of strip­ping down a home mortgage could be expected to increase fees by several thousand dollars.

In addition, filings are included on credit reports immediately upon filing and remain there for seven years. Thus, Chapter 13 bankruptcy damages credit scores and impairs access to credit for a significant period of time.

Many Chapter 13 bankruptcies fail; that is, the filer never obtains a discharge of his debts. Nearly 20 percent of Chapter 13 cases fail before the court has confirmed the filer's plan. Another 55 percent fail between confirmation and discharge because the filer has been unable to carry out his plan. This means that only one-third of all Chapter 13 filers complete the process successfully and get the fresh start that bankruptcy promises. The rest—two-thirds of all filers—pay court fees, pay attorney's fees, pay fees to the bankruptcy trustee, invest time and money to restructure their financial affairs, and then wind up with nothing more than temporary relief. It is therefore not surprising that a substantial number of Chapter 13 filers—nearly one-third—go on to file for bankruptcy again.[4]

These statistics suggest that holding out the promise of significant relief from mortgage debt to encourage more individuals to file for Chapter 13 bankruptcy is bad policy. At best, Chapter 13 would serve only to delay foreclosures in most case where the home is at risk while imposing enormous costs on those who are already financially vulnerable and losing their access to credit.

Worse, allowing discharge of home mortgage debt in bankruptcy would undermine more prom­ising approaches to preventing foreclosures. While there have been difficulties in renegotiating certain types of securitized mortgages, the bulk of out­standing mortgages are controlled or owned by Fannie Mae and Freddie Mac, private banks, and portfolio lenders, all of which have the power to renegotiate mortgages and face strong incentives to do so to preserve the value of homes.

Strip-downs, however, would undermine their efforts by eliminating homeowners' incentives to accept modification offers, even ones that are tar­geted to their situation and less disruptive than bankruptcy is likely to be. In this way, strip-down proposals would only delay foreclosures while blocking more promising alternatives that protect consumers' financial security.

Myth: Allowing strip-downs will help the economy.

Reality: Undermining the certainty of loan agreements threatens the availability of credit, and thereby market stability, and will only delay recovery, especially in the housing sector.

Some claim that allowing strip-downs in bank­ruptcy would ease turmoil in the housing markets and slow or reverse declines in home prices. This is a pipe dream.

Merely allowing strip-downs in bankruptcy could be enough to trigger bank instability and fail­ures. U.S. banks and thrifts hold about $315 billion worth of highly rated mortgage-backed securities that would suffer immediate and permanent down­grades. This, in turn, would force banks to write down these assets to reflect their lower value and set aside additional capital to satisfy regulatory require­ments. Some banks' already overburdened balance sheets could not absorb those hits.

And as described above, allowing strip-downs could push millions of Americans, who are current on their mortgages and whose homes are not at risk of foreclosure, into bankruptcy. Any reductions in loan principle that they achieved would come at the expense of lenders, increasing the likelihood of their insolvency and further tightening credit markets. Resulting declines in the valuations of mortgage-backed securities and other "troubled assets" could also affect banks' capital statements, leading to more failures and the need for additional capital on top of that already being provided by the federal govern­ment. Some of these losses would fall to taxpayers through Fannie Mae and Freddie Mac (which guar­antee over $5 trillion in mortgage debt), other gov­ernment entities, and recent government investments in the financial sector. The drawn-out bankruptcy process would also put a brake on efforts to value mortgage-backed securities and begin to clean up banks' balance sheets, thereby prolonging current financial instability.

Further, increases in bankruptcy filings would harm the financial health of many additional indus­tries. In Chapter 13, unsecured creditors (those whose loans are not backed by property that can be repossessed or foreclosed) typically receive less than 20 percent of what they are owed. Facing this risk, lenders would further tighten the availability of credit, dealing a new blow to the demand side of the econ­omy. This result would be perfectly opposed to Con­gress's current efforts to stimulate consumer demand.

Conclusion

It should not be surprising that there is no free lunch. Congress cannot enact a policy that imposes major, unexpected losses on home lenders without raising the cost of and reducing access to home loans. Claims to the contrary are unsupported either by experience or by the available data.

What is a surprise, though, is the minuscule ben­efit that such a policy would achieve. Allowing the strip-down of home mortgage debt in bankruptcy would prevent very few foreclosures even as it undermined better alternatives for homeowners.

That this policy would have any positive effect at all is premised on wishful thinking: that Chapter 13's deliberately weak protections for debtor assets, which are ultimately unavailing in the majority of cases, will do anything more than delay some fore­closures at an enormous cost to the economy. At the same time, this policy would open the door to achieving mortgage reductions for tens of millions of homeowners who can afford their mortgage pay­ments and whose homes are not at risk.

The growing but still relatively small foreclosure rate may warrant a policy response, but Congress must take care not to rush into ill-conceived fixes that threaten to cause more harm than they would alleviate. To avoid that risk, proposals must be care­fully targeted and proportionate to the problems they are intended to address.

Opening the door to modification of all home mortgages is both overbroad and extreme and, for that reason, risky. Rather than risk adding to the turmoil in the housing and financial markets, Con­gress should consider approaches that do not undermine investors' expectations and, ultimately, homeownership.

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Letting Judges Rewrite Loans Is Toxic Itself

REP. ED ROYCE

"At first blush it seems somewhat strange that the Bankruptcy Code should provide less protection to an individual's interest in retaining possession of his or her home than of other assets ... (but) favorable treatment of residential mortgages was intended to encourage the flow of capital into the home lending market."

That was Supreme Court Justice John Paul Stevens in 1993. Yet today that sound reasoning is turned on its head with President Obama's proposal to allow bankruptcy judges to rewrite existing mortgage contracts.

Despite a vocal opposition to this "cram-down provision," it is being pushed through Congress by the administration and Democratic leadership and will likely be voted on in the House on Thursday.

Beyond the long-term damage this provision will have on our private mortgage market, the precedent this legislation will set risks permanently undermining the sanctity of private contracts upon which our country's economic model is based.

The consequences of the cram-down will likely be felt by homeowners for years to come in the form of tighter credit markets and higher interest rates. Because of the uncertainty that will result from bankruptcy judges abrogating private contracts, institutions will avoid investing in the private mortgage market.

As our capital markets struggle to recover, we should be looking for ways to encourage, not discourage, capital back into the system. The less capital in the system, the more expensive it will be to obtain a mortgage. Some economists predict that a 2% risk premium will be added to every mortgage should this proposal be implemented.

Credit cards and auto loans have typically seen higher interest rates because the ability of the lender to recover collateral, if any exists, is more difficult than with less-risky mortgage loans. With the implementation of the cram-down, however, mortgage debt will likely be treated more like credit card and auto loans because lenders' ability to recover collateral will be further restricted.

Advocates for the cram-down got a boost earlier this year when Citigroup had a change of heart and endorsed this proposal. After years of opposing cram-down, Citi's reversal is likely a reflection of influx of public sector dollars into the firm and the growing influence of regulators over day-to-day operations rather than any logical policy shift.

Citigroup believes this provision is "a temporary solution" that will be implemented for outstanding mortgages and then allowed to expire following this difficult period in our economy. Unfortunately, in Washington nothing is more permanent than a temporary solution.

Much of the past success of our country's capitalist system is based on a solid foundation of free and flexible markets and respect for the sanctity of contracts and the rule of law. As a member of the Foreign Affairs Committee in the House, I have seen the stark contrasts between societies that respect private contracts and those that opt to change the rules as they go. The bankruptcy cram-down has the potential to lead us down a path toward the latter.

Private mortgage foreclosure-mitigation efforts currently under way by the Hope Now Alliance and various financial institutions throughout the country are at risk of hitting a significant obstacle should the cram-down go into effect.

Almost 2.3 million foreclosure prevention workouts were completed in 2008 -- all on a case-by-case basis. An effort to allow a third party to wipe out the interest rate and principal of the loan provides a perverse incentive for those borrowers that would otherwise work together with their lender to restructure the loan.

As Congress and the administration work to stabilize the housing market, we must avoid at all costs policies that will hinder the private sector's ability to recover. Enacting the bankruptcy cram-down legislation will restrict the flow of capital into the housing sector, make it more expensive for individuals to obtain a mortgage, hinder the broader housing sector's ability to fully recover and set a disturbing precedent of the government's treatment of private contracts.

It is critical that the administration and Democratic leaders in Congress understand the long-term consequences of this misguided policy before it is too late.

Royce, a Republican, represents California's 40th congressional district in northern Orange County.

Wednesday, February 25, 2009

Commercial Real Estate Bubble Is Set to Burst

What we have done is guaranteed hyperinflation in the United States. We have guaranteed the destruction of the United States. We will have riots starting in the first quarter of next year; we will default by the summer of 2009.

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America will see a major economic collapse followed by riots, martial law (??) , food shortage… etc will follow. Why is US Army redeploying troops to America? Why is the Pentagon openly discussing possible collapse of American society? Martial Law?? These are all very dire predictions for the future of America.


Here’s what we’ve got: the Fed has committed to $8.5 trillion of taxpayers’ money to bail out the worst run companies and banks. It hasn’t worked. Now, they’re at a 0% to .25% on the Fed Funds rate for funds for banks, which means if you go down and you pay $100,000 for a T-bill for 90 days, your return is zero, which is to imply that there is zero risk to investing with the government. Anybody who actually believes that is going to be in for a real shock in the first quarter of next year.


http://www.thedeal.com/newsweekly/features/the-coming-commercial-crash.php

Global systemic crisis – New tipping-point in March 2009: 'When the world becomes aware that this crisis is worse than the 1930s crisis'

LEAP/E2020 anticipates than the unfolding global systemic crisis will experience in March 2009 a new tipping point of similar magnitude to the September 2008 one. According to our team, at that period of the year, the general public will become aware of three major destabilizing processes at work in the global economy, i.e.:

• the length of the crisis
• the explosion of unemployment worldwide
• the risk of sudden collapse of all capital-based pension systems

A whole range of psychological factors will contribute to this tipping point: general awareness in Europe, America and Asia that the crisis has escaped from the control of every public authority, whether national or international; that it is severely affecting all regions of the world, even if some are more affected than others (see GEAB N°28); that it is directly hitting hundreds of millions of people in the “developed” world; and that it is only worsening as its consequences reveal throughout the real economy. National governments and international institutions only have three months left to prepare themselves to the next blow, one that could go along severe risks of social chaos. The countries which are not properly equipped to cope with a surge in unemployment and major risks on pensions will be seriously destabilized by this new public awareness.








In early November, General Electric Co.'s General Electric Capital Corp. moved to foreclose on a downtown Phoenix office building in a hearing scheduled for February. The 18-story office building is just another one of those nondescript rectangles that seem to punctuate the skylines of city centers across the United States. The owner: a San Diego company with the innocuous sounding initials of BCL Inc. The foreclosure makes that Phoenix office building special, in a gloomy sort of way, and a harbinger. Throughout the U.S., massive numbers of foreclosures have swept through residential real estate. By contrast, commercial real estate foreclosures remain relatively few and far between, even in cities the economic downturn has hit hardest. Bankruptcies are even rarer.

"Lenders don't want to default. Borrowers don't want a default. So lenders have extended to the extent they can," says independent real estate investor Terri Gumula. "Everybody's holding out."

The fate of the building on 111 West Monroe Street then is a "precursor," says Christopher Toci, executive director for Cushman & Wakefield of Arizona Inc., of what he and others expect is a massive problem to come.

"It has the potential for being a God-awful mess," adds David Jones, a longtime real estate attorney with K&L Gates LLP of Charlotte, N.C.

Right now we are witnessing what in many respects may prove to be the proverbial calm before the storm. Commercial real estate owners will soon face gale-force winds on two fronts. The rapidly deteriorating real estate market has only recently hit commercial properties. More critically, loans issued in the boom years are only now coming due, with little or no prospect of refinancing. "The velocity [of distress] is going to increase tremendously," says Ed Casas, managing director for Navigant Capital Advisors LLC, which advises hedge funds and private equity on distressed real estate. "It's just begun."

Just how bad the destruction will get is difficult to say. No one predicts the kind of unprecedented devastation residential real estate has experienced, where subprime mortgages alone, which reached $600 billion in 2006 and formed the underpinnings of several trillion dollars in mortgage-backed securities, collateralized debt obligations and credit default swaps, created vast wastelands. But the commercial mortgage failure numbers could be staggering as well.

"What worries people the most is that even healthy assets can't get refinanced," says Dan Fasulo, managing director of New York research firm Real Capital Analytics. "There's so much dislocation in the debt market. It no longer has the capacity to refinance all the loans that are coming due."

Real Capital Analytics considers about $21 billion worth of commercial real estate in distress, while almost $81 billion worth of additional property faces potential troubles in 2009. In all, roughly 5,000 individual properties are on Real Capital Analytics' watch list. Fasulo believes his current forecast errs on the conservative side.

Others believe the numbers could get much higher and that distressed commercial property in potential default may actually exceed $400 billion. Everyone expects the crisis will worsen in 2010 and remain nasty through 2011. "There will be a significant increase in default rates of commercial mortgages," says Stephen Tomlinson, senior partner in the real estate practice at Kirkland & Ellis LLP. But "you may not see a spike begin until the fourth quarter."

Christopher Grey is managing director and co-founder of Third Wave Partners LLC, which both invests in distressed real estate and advises investors. He predicts it will take three years before the market begins to recover. "There's a tremendous amount of adjustment to be made, but very little adjustment has taken place," he says.

There are ominous signs. The CMBX Indexes, which track 25 tranches of commercial mortgage-backed securities, now show "an unbelievably wide spread," says Grey, with an implied default rate of 20%.

Unsecured REIT bond spreads "are at all-time highs," Fitch Ratings Inc. reported in an outlook last month, which tagged office, industrial and retail REITs with negative outlooks. The stock market has already hammered commercial REITs, many of whose market caps have declined by more than 90% in a year. One dramatic example of a REIT teetering on the edge is General Growth Properties Inc., America's second-largest mall operator. General Growth narrowly avoided bankruptcy last year, when it was able to extend $900 million in debt repayments until February. General Growth still faces huge uncertainties with billions of dollars of short-term debt maturing soon.

Understanding why commercial foreclosures have lagged so significantly behind residences helps explain a great deal about what transpired during real estate's boom years. What's likely to happen in 2009 and 2010 offers a sobering look at assets that were considered robust and fairly safe until the fourth quarter of 2008. Now they are poised to become yet another part of the economic devastation.

Working through all this distress will be extremely difficult and time-consuming. Wrapped within those numbers is an often complex jumble of securitizations, debt tiers, priorities and liquidation preferences. In the best of times, these make decisions and workouts difficult. Now it's even more daunting.

Most of these properties are in bankruptcy-remote vehicles, which make it easy for lenders to take back assets without bankruptcy filings. What's more, current laws discourage commercial real estate-related bankruptcy filings. So it's more likely that borrowers would be inclined to just give up the keys and walk away.

However, most lenders don't want the property back, since there are few potential buyers. Money for refinancing remains almost nonexistent. With securitized assets, lenders are often at odds with each other on what course of action to take, depending on what part of the debt structure they fall. "It's a recipe for short-term paralysis," Casas says.

Commercial real estate encompasses everything from the toniest retail shopping complexes to modest strip malls, from low-rise office buildings to luxury hotels and skyscrapers. All face huge problems.

What's more, the economic distress will be wide-ranging, not just in the boom towns of California, Florida or Nevada, but in cities that stretch north to south and coast to coast, lawyers and commercial real estate advisers around the country say. "It's the same phenomenon all over," says Andrew Schwartz, a Boston-based partner at law firm Foley Hoag LLP. "The trouble is nationwide."

Schwartz cites his city as a prime example. In the past few years, real estate consortia paid huge sums for trophy properties. At the same time, star-crossed developers unveiled ambitious new developments. Now several major projects are on hold, including the $2.5 billion Fan Pier development and the $700 million redevelopment of the storied Filene's department store site. Developers can't get construction loans. At the same time, landlords of existing properties face rising vacancies and an inability to service loans.

Or take Phoenix, which was "one of the poster children for subprime mortgages," Toci says. That led to overbuilding in retail shopping centers and suburban office complexes. "A lot of [commercial] projects that were planned have either been reduced or are in trouble. One project in Tempe, a boutique hotel, just stopped," says Jeffrey Pitcher, a Phoenix-based real estate partner at Ballard Spahr Andrews & Ingersoll LLP. "We're at the stage where developers delay as long as possible the construction."

But Toci believes it's the economic downturn that is really doing his city in. "We've lost 58,000 jobs through November, and now Phoenix faces an oversupply of offices," he says. Tenants are going bankrupt, vacating properties or not renewing leases. "Operationally, there are serious weaknesses. Commercial real estate is just starting to tank."

Nearby Las Vegas is the site of one of the worst examples of residential speculative frenzy. Long after the housing bubble burst and residences were foreclosed on a massive scale, the city thought its economy safe, given its dependence on gaming and tourism. So ever-more-opulent casinos, upscale shopping centers and multibillion-dollar multiuse development projects continued to launch. But the economy has wreaked havoc on Las Vegas. That in turn has put enormous pressure on the city's livelihood.

"It all started feeding on itself," says David Barksdale, a Las Vegas-based partner at Ballard Spahr and the co-head of the firm's distressed real estate initiative. "Now it's spreading into the commercial side."

The city's most dramatic foreclosure to date came in September, when Deutsche Bank AG took over the $3.9 billion Cosmopolitan Resort and Casino project after developer Ian Bruce Eichner defaulted on $900 million in construction loans and the bank couldn't find willing buyers. But many more problems loom. Several new office complexes sprang up in the southwest part of the metropolitan area.

They broke ground two to three years ago, when "things looked great," says Barksdale. Now they're completed, but deserted. "Those buildings are empty," he says. "Those are see-through buildings."

Atlanta, on the other hand, thought itself relatively immune to commercial real estate pain. Not anymore. "I foresee a lot of commercial deals going sour," says Nicholas Sears, an Atlanta-based partner at Morris, Manning & Martin LLP. "Folks want to sell. They can't sell. Purchasers can't get new financing or assume existing debt, which can't be reduced."

Even a city like Milwaukee, which hardly went crazy during the property boom, is feeling the effects. "Banks have closed down their lending. Ninety percent of commercial lenders are just not lending right now," says Nancy Haggerty, a Milwaukee-based partner at Michael Best & Friedrich LLP. "Even some long-term lenders like life insurance we're just not seeing any more."

As the crisis unfolds, there will be inevitable comparisons to the savings & loan crisis of the late 1980s and 1990s. Easy money created a speculative boom and massive supply in commercial property, followed by a banking failure, a wholesale takeover of distressed properties by the federal government and a yearslong sorting out. Professionals, however, caution against a quick analogy.

"A lot of people are trying to draw parallels to the early '90s, but I think it's certainly a different animal," says Martin Caverly, a Los Angeles-based principal at private equity real estate fund O'Connor Capital Partners. Unlike two decades back, there isn't a huge oversupply of commercial property, except for retail, he explains. But the ownership structure of property is far more complicated and opaque, with crippling debt structures and a lack of affordable financing, which make workouts and disposition difficult.

"More and more my belief is that it will be a larger and deeper correction," Caverly says. "The deleveraging process will go on for quite a long time."

What's certain is that in terms of debt to value, many commercial properties of various shapes and sizes are well underwater.

"From a 90% loan-to-value, it's now a 130% loan-to-value," Tomlinson says.

Transactions are pretty much stalled right now. Grey estimates commercial deals in 2008 declined 90% more than in 2007. Even distressed players are in no hurry to buy. At a real estate conference late last year, a panel of private equity principals divided their world into two camps: Those with properties admit they're overbought and want to sell. Those with cash are sitting on their hands.

"It's very much a wait-and-see," says Pitcher. Potential buyers "want to see where everything settles out. They're looking, but they don't know where the floor is."

The shift has been dramatic. In early February 2007, Blackstone Group LP paid a staggering $39 billion for Equity Office Properties Trust. Most of the 100 million square feet of commercial real estate was financed by debt. During the next six months, Blackstone recouped $28 billion by selling off a little more than half of the properties. That included $7 billion New York property mogul Harry Macklowe forked out for some prime Manhattan real estate. Macklowe financed his purchase primarily through bridge loans from Deutsche Bank. At the time, Blackstone's maneuver was hailed as a brilliant model of leveraged dealmaking: Buy a property portfolio with short-term debt and quickly reduce debt levels by offloading a portion of the properties.

The music stopped in June 2007, when the credit crunch hit. Macklowe, for one, flamed out in spectacular fashion. He was stuck with loans he couldn't service and hugely overpriced real estate he couldn't hold. Deutsche Bank ended up taking back seven properties, selling five for huge losses. The sale of the other two fell through, and they are back on the market.

The Blackstone-EOP deal, it turns out, represented the last great hurrah. How Blackstone will dispose of its remaining properties is as yet unanswered. "They can't sell that stuff," says a rival PE investor. "There's not enough debt on the planet to float those trades."

In fact, the kind of flips Blackstone pulled off had been popular at least since 2005, when commercial real estate really began to heat up. The returns were equally dramatic as the Blackstone-EOP shuffle, although not necessarily on the same mega-scale. Biltmore Holdings LLC, for example, bought the 111 West Monroe Street building in Phoenix along with a vacant downtown redevelopment site in April 2005 for $20 million. After investing a further $6 million in upgrades on the office building, Biltmore Holdings sold the two properties for $52 million in February 2007. BCL paid $40 million for the building alone.

Why commercial real estate, which mirrored residential real estate, boomed is easy enough to understand. Financing was plentiful. Securitization was commonplace.

In some ways, the more expensive the asset, the easier it was to finance the purchase.

Why the collapse of the commercial real estate market didn't occur sooner is equally obvious: cash flow. Tenants filled buildings and paid rent. Because the terms of most loans were anything but onerous, as long as borrowers made interest payments, they were safe. "Rents haven't backed up far enough. Vacancies haven't ballooned high enough" to reach crisis point, says Richard Hollowell, a managing director with Alvarez & Marsal Real Estate Advisory Services. That won't happen for another three to six months, Hollowell believes.

"Until the fourth quarter of 2008, you didn't see a significant deterioration of property fundamentals. Even deals done at the top of the market were covering debt service with cash flow or reserves," says Tomlinson.

"Defaults won't materialize until reserves are depleted, and they can't [cover debt service]."

Even through the summer of 2008, with credit markets frozen, there wasn't the kind of wholesale panic that was sweeping through residential real estate, and a false sense of hope prevailed. The Macklowe debacle wasn't repeated, and more optimistic observers viewed it as an outlier. "Overall, businesses were treading water. Underlying fundamentals were holding up," says Gumula. Commercial real estate owners "could make their debt service, so defaults were rare."

All that changed after the mid-September financial meltdown. "Up until Lehman, we were pleasantly surprised by tenant activity," she says. "Yeah, deals took longer to get signed, but up until September, plenty of leases were getting done."

Since then, it's been a dramatically different story. The economic downturn began take its toll on commercial occupancy rates. Typically made for three, five or seven years, commercial real estate loans are coming due, with few financial institutions willing to offer refinancing even at onerous terms. The combination can be deadly.

In boom days, borrowers could regularly obtain 90% financing. Those days are long gone. According to a Cushman & Wakefield Sonnenblick-Goldman LLC survey last month, the few financing deals quoted or completed were typically 60% loan-to-value.

Retail complexes were the first to exhibit signs of distress. That makes sense, since many shopping centers got whacked by both the residential real estate meltdown and the more general economic malaise. With the residential real estate boom came exurban sprawl. "One of the first amenities is a neighborhood retail center," Jones explains.

After the subprime crisis, however, residential developments were stillborn. The population that retail developers had expected never materialized.

Local retailers find it increasingly difficult to pay the rent, and they close stores. The retail developer defaults on an existing loan. He can't refinance, because there's no retail stream. A lender is forced to take that property back but doesn't want to because there are no buyers.

"It's a daisy chain," Jones says. "In some ways it's related to residential real estate, in some ways it's related to the general slowdown of the economy. The two feed off each other. It's a race to the bottom."

Shopping centers may have been the first to go. But it's the huge trophy acquisitions that are poised to cause the largest headaches. "A tremendous number of assets were bought in '06, '07, using short-term money. These were megadeals," says Casas. Now they're coming undone.

When Casas is asked to name those transactions that must be restructured, his partner, Neil Luria, pipes up with "any building sold within the last two years." Luria, a Navigant managing director based in Cleveland, is sitting in the lobby lounge of the Waldorf-Astoria Hotel in Manhattan. He gestures outside. "Just walk down the street," he says. "L.A., Chicago, New York, all the major markets have a number of high-profile trophy properties that will go through major turmoil. They are dropping precipitously in value, 40% to 50%."

Securitization enormously complicates these large transactions. Residential mortgage-backed securities may dwarf the amount of commercial mortgage-backed securities issued, but $40 billion worth of CMBSs is due this year, $55 billion in 2010 and $73 billion in 2011.

Like pools of residential mortgages, big commercial mortgages were sliced and diced into various bits and pieces. A single building may have a dozen different tranches of debt. Senior debt alone may have been parceled out into a dozen different pieces. Those pieces could have been combined with other commercial mortgages.

The complex financing structure makes the most fundamental decisions difficult. The senior-most debt holders may want to foreclose, since they're still in the money, even with a highly distressed sale. But junior debt holders would be wiped out in such a sale, so they'd be much more likely to choose some kind of restructuring and resist foreclosure.

Who makes the decisions complicates this even further. In normal times, a servicer is responsible for collecting interest payments from the borrower and distributing that money to lenders, with amounts dependent on returns within the various risk levels. So, for example, a senior lender may get 5% a year, while the junior-most doubles that.

If a borrower defaults, however, the role of the servicer is replaced by a so-called special servicer. That entity is appointed by the junior-most debt holders still in the money and is often an affiliate of the lender. The special servicer's loyalties and desired course of action may be very different from the senior lender.

You can imagine what a workout meeting looks like. "To get 50 partners together to work at a deal for pennies on the dollar, forget about it," Fasulo says.

Expect plenty of litigation to follow, say some lawyers (naturally). "More junior classes are not going to go quietly," says Schwartz. "Hedge funds playing with other people's money are not going to go quietly." Schwartz foresees a rash of valuation-oriented litigation. Servicers, especially, "are treading in very treacherous waters," he says.

Bankruptcies don't appear to be a particularly good alternative, either, especially for owners. After the S&L fiasco, when developers routinely put their bad properties into bankruptcy while keeping their good projects, loan contracts now carry what are termed "bad-boy" clauses. These state that owners can be held personally liable for their bankrupt properties.

Pretty much all the securitized buildings are housed in special-purpose entities. Because they are single-asset LLCs, they get only 90 days from the time they file to fashion a reorganization plan with a good chance of success, or creditors can petition the court to lift any stays. That kind of timetable isn't at all realistic in these times, when just finding debtor-in-possession financing is a major undertaking.

One of the very few property-related bankruptcies so far focused on a Chicago property called Hotel 71. The complicated case was anything but satisfactory. Distressed private equity shop Oaktree Capital Management LLC actually tried to foreclose on the equity of the holding company. The developer put the company in bankruptcy to prevent foreclosure. At that point, secured lenders of the actual property commenced a second foreclosure, this one of the hotel itself. The lenders eventually carried out an auction. Bids were well below value. "We ultimately decided to take the property back," says Brad Erens, a Chicago-based partner with Jones Day, which represented the special servicer.

Erens, for one, believes commercial property-related bankruptcies will inevitably follow. "At some point, borrowers will file. We just haven't seen it yet."

But Tomlinson counters that the bankruptcy-remote structures coupled with the bad-boy-type springing guarantees will "significantly dampen foreclosures that turn into bankruptcies." He adds that bankruptcy judges will probably have to rule on the legitimacy of bankruptcy-remote vehicles. "I think they ultimately will be upheld," he says, but cautions: "There's no playbook. A lot of things will be done for the first time. Literally."

What could really bring the crisis to a head is a crackdown by regulators on financial institutions demanding they clean up bad loans. If regulators demand lending institutions revalue the assets that secure the loans and institutions demand that borrowers fork over a hefty percentage to pay down the loan, financial institutions will have to foreclose.

Even now, banks are taking a chance by holding on, says Barksdale. If they modify the loan for 12 or 18 months, "they might have an asset worth significantly less," he says. But if they foreclose, "no one is buying."

Or offers they do extract may be going for a quarter of the value banks have on the books, he says. To date, the impetus has been to do nothing, if at all possible. "Things will continue to be pushed out until there's pressure from the outside accountants and regulators," Hollowell says.

Only when owners can't pay their debt will lenders be forced into action. That was the case with 111 West Monroe Street in Phoenix. Principals at BCL didn't return phone calls seeking comment. But those familiar with the building's fate say BCL defaulted after an equity partner collapsed.

That partner: a bankrupt firm called Lehman Brothers.

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As economic activity and PONZI finance fall off the face of the earth, we enter the stretch run of the CON game known as the Bond and FIAT currency markets. Although both are headed for their ultimate demise, the path will be quite different. In 2009, these challenges will be headed your way. Prepare properly and thrive, or fail to do so and fall to your demise.
….
As every government policy failure appears, public servants will stroke the fear in the ‘something for nothing illiterate’ and use it to nationalize and destroy more and more of the private sector. They will double down on the spending, borrowing, printing and taxing required to pay for the next absurd idea to come out of the G7’s capitals. Look no further than Obama’s “Economic Recovery and Stabilization” stimulus package which spends 12 cents of every dollar on economic stimulus and 88 cents for sustaining and enlarging government spending and programs. A perfect name to DUPE America the Illiterate.

Morally, fiscally and intellectually BANKRUPT public servants and crony capitalists. Now we know why the banks and financial sectors were the greatest campaign contributors in the last election cycle and Obama’s inaugural election. Decisions are being made upon political considerations, not economic ones.

This is a nightmare on WALL STREET and MAIN STREET . A one percent loss on outstanding loans and derivatives turns ALL the biggest banks in the G7 into TOAST. What do you think the odds are of this happening? 100%. Once you see the picture you will understand why they are extremely cautious with their lending; they are on a tight rope. I don’t care how much the mainstream financial media hoot and howl, these banks are WORTHLESS and so are their debt offerings.

Black clouds are gathering above the horizon. The IMF just announced that the world trade collapsed by staggering 45% in the last quarter of last year. Even the euphoria of Obama’s inauguration didn’t last long. The same day Dow closed below 8,000 as banking fears were gripping the European markets and bringing shockwaves from the United Kingdom too. British Banks got a £1TN injection which didn’t prevent RBS shares to plunge 70%. London is faced with a bloodbath. Brown admitted there is not yet a limit on how much risk taxpayers must bear as a result of his rescue plan, but he even promised financial institutions that they will get more cash if they pass it on . Looks like the Brits are too being set up for the mother of all crashes. With the UK government debt alone and future liabilities not included, this means that every new baby is born with £17,000 debt.

The industrialized economies are on the verge of bankruptcy. China will not be of much help. It has its own set of problems preventing its economy from dropping below 5%. The question is: when will the global collapse be, not whether? Will fiat currencies tank? Will there be financial chaos? Time will tell. Celente and GEAB forecast by March 2009. We will know soon!