Are mortgage bonds safe?

Traditionall mortgage bonds have been considered a very conservative and safe investment because mortgage bonds are backed by real estate or physical equipment you can see and touch. Mortgage bonds have been a used to secure long term investments in pension funds and life insurance. However with the current turmoil in the housing and real estate market and all kinds of tricks played with loans on physical equipment, people realize that the mortgage bonds are not as secure any more as private investors have assumed. Bankers now discover e.g. in Germany that the safety net provided by mortgage bonds was never tried. Would you trust a safety net which never was tested? The German Hypo Real Estate bank recieved more the 110 billion $ in capital and government guarantees  but is not capable of securing their mortgages > 900 billion $.  A break down of Hypo Real Estate (HRE) would have a major impact on life insurance and government loans.

The HRE crisis is another example how important trust in banking products is. As soon somebody starts to investigate and to test the basic scheme the system breaks. The recommended solution of the banksters to private investors: all your investments are secure but please do not ask and do not investigate!