Welcome to the Machine: MERS and The Shadow Banking System

A story is breaking upon the nation as I write this. It is a story I have been forced to live for the last year and a half. In that year and a half I have come to learn a lot of confusing truths about the way the money in this world really works. The mainstream media is talking more and more about the foreclosure scandal and at the heart of it all is MERS. Mortgage Electronic Registry Service. It’s the biggest littlest company you have never heard of before and in the thirteen years of its existence, it has utterly destroyed the real property ownership records system in every county in the United States.

The purpose of The Working Joe’s Guide to MERS & Mortgage Banking is to provide the every day average Joe & Joie the information they need to understand this tremendous scandal unfolding ahead. More importantly, use this information to arm yourself with truth so you can cry BULL—- when the talking heads try to spin the story for you. And they will.

Be warned. The story has so many facets that to sit down and take it from one end to the other leaves one a bit befuddled. Smoke comes out of your ears, if you know what I mean. Thinking and operating in the world of MERS is a testament to the infinite adaptability of the human condition. I recall when I first came to the realization of the Meaning of MERS and the smoke started to pour from my ears. It was late at night and I had been researching what had happened to me about a week earlier.

I had just invoked the “Produce the Note” defense in court and had won a stay on the sale in the foreclosure of my house. After the euphoria wore off, I really started to wonder what had just happened. I was geeking out trying to understand. It was late at night. I had been finding and reading court cases for about a week, the lights were out except for the screen, the kids were all asleep, and I sat bolt upright in my chair when the realization struck. “My God, they can’t deliver clear title!” I blinked into the darkness for about five minutes as the full impact of that washed over me. That was almost a year ago and I have managed to withstand the MERS monster’s siege upon my castle since then (not to worry, still plenty of food & water).

Living and thinking in a MERS world is common for me now. Newcomers look at their surroundings as if it were their first foray into Toon Town, the refuge of Roger Rabbit when he was running from the law. I’ve been here for a while and I’m used to it. “Oh, yeah,” I tell them, “that happens all the time.”

In order to really get into what is going on, you have to pile through a lot of boring mundane stuff. PJ O’Rourke calls it “Dictatorship by Tedium.” Any time regular people try to figure out what’s going on they feel like they are back in High School Algebra class and not having a clue as to what is going on. That’s how “they” get away with it. It’s not that you can’t understand. You can. It’s that they make it so boring, you don’t want to. In today’s specialized world, to a certain extent, you have to trust that “they” who are “the experts” are as well studied in their subject matter as you are in yours. Leave all that to people who are interested.

This is a complicated story. It is actually six stories interwoven into a larger narrative. Part of the problem is it is so easy to get caught up with one or two pieces of the story and miss the real story. It goes deeply into the arcane runes of the financial world. To tell it in detail would leave you glassy eyed and wondering what you were doing for lunch. So I leave a lot of details out and as a result, it may seem overly simple. That’s because it is. But it’s not.

This is a quick tour so you can understand the big picture. You will, no doubt, find various aspects of it curious and you will want to go back to explore more. All the subjects in here are available for further study through the internet. That’s what I did. This whole story is pulled together from late night google searches.

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