The 50 state AG settlement, which Peter has suggested is more accurately called a pardon, screws John Q. Public, twice.
First it screws over homeowners by immunizing robo-signing from criminal prosecution or large scale civil suit. Several attempts at class action cases have failed to obtain class status. Therefore, the only way to pursue a claim involving robo-signing is for each individual homeowner to do it on his/her own.
Further, without the imprimatur of Attorneys General making those same arguments, the arguments of the individual homeowners will be of even more diminished weight and the banksters’ claims of “sloppy” paperwork will be spun through their PR machines until the truth is lost.
The robo-signing is the smoking gun that is the key to proving every other part of this criminal conspiracy, which is why the banks had to have robo-singing immunized.
So, homeowners are screwed.
Yet that is not the end of the harm that this deal does to the public. The principal write downs in question are not being funded by the banks. No, they will be funded out from under the bond holders. Well, not ALL the bond holders.
Remember the bailout? And the creation of the “bad banks” to hold the toxic assets? Maiden Lane 1 and Maiden Lane 2? The banks already got bailed out for the RMBS they held themselves. Also, the RMBS held by Fannie and Freddie (about ½ of all mortgages in the US) are not covered in this deal. So, whose bonds are covered?
The bonds held by pension funds, municipalities, hedge funds, and even in the portfolios of individual investors. Yep, John Q. Public is raped at both ends of this deal.
This is the worst of outcomes. You will lose your house and then see your retirement gutted.
And the courts will have been permanently corrupted.