This is the second time they failed and regulators are justifiably worried.
THE FOLLOWING ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
The 5 Major Banks once again failed both stress tests and the “living will” provisions of the Dodd/Frank Act. This means they have no viable plan to break themselves up in the event their assets need to be sold off. This is the second time they failed and regulators are justifiably worried. It also means that if they do fail again — and given the valuation of MBS as assets this is a likely outcome — the taxpayers would once again be called upon to float these monster banks while everyone else is left paying the bill.
There is a simple reason for this — in order to come up with a viable plan they must disclose their real condition, the value of mortgage backed securities, if any, and the liability arising from wrongful foreclosures and abandonment. AND then there is liability, vastly understated, to investors whose money was supposed to be put under management in REMIC Trusts and instead ended up in orbit.
My comment is the same as it has always been — that everyone should share in the loss and that nobody should escape liability. The “loan” closing documents are as worthless as the MBS that were sold using many of the same false representations.
Filed under: foreclosure