UNITED STATES
                           SECURITIES AND EXCHANGE COMMISSION
                                 WASHINGTON, D.C. 20549
                                ________________________

                                     FORM 10-QSB

(Mark One)

_X_  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

         For the Quarterly period ended:  September 30, 2004

___ TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
    SECURITIES EXCHANGE ACT



         For the transition period from _______ to _______.

                  Commission file number:  0-19154.



                AMERICAN ASSET MANAGEMENT CORPORATION
   (Exact name of small business issuer as specified in its charter)

          NEW JERSEY                             22-2902677
(State or other jurisdiction of                (I.R.S. Employer
 incorporation or organization)                Identification No.)

           1280 Route 46 West, Parsippany, New Jersey 07054
               (Address of principal executive offices)

              Issuers telephone number:  (973) 299-8713

     _____________________________________________________________
         (Former name, former address and former fiscal year,
                    if changed since last report)


     Check whether the issuer (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such
reports) and (2) has been subject to such filing requirements for the past
90 days.   Yes _X_  No___

APPLICABLE ONLY TO CORPORATE ISSUERS

     State the number of shares outstanding of each of the issuers
classes of common equity, as of the latest practicable date:  As of
November 18, 2004 there were 1,316,989 shares of the issuers no par
value common stock issued and 1,316,989 shares outstanding.


     Transitional Small Business Disclosure Format (check one): YES   NO_X_
PART I - FINANCIAL INFORMATION
Item 1.  Financial Statements
                AMERICAN ASSET MANAGEMENT CORPORATION AND SUBSIDIARIES
                             CONSOLIDATED BALANCE SHEETS

                                     (Unaudited)
_______________________________________________________________________________
                                                      Sept.30,     December 31,
                                                     ___2004__     ____2003____
______________ASSETS________________
Current Assets
  Cash and cash equivalents                         $   84,164       $  345,947
  Mortgage loans held for sale                         333,700          833,828
  Prepaid expenses & other current assets               11,180           15,971
     Total Current Assets                              429,044        1,195,746

Property & Equipment                                     5,478            8,179

Other assets                                            57,968           58,924

     Total Assets                                      492,490        1,262,849

__LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)__
Current Liabilities:
 Warehouse line of credit                              330,363          813,701
  Deferred income                                           -             5,619
  Derivative instrument                                     -            21,718
  Accounts payable, accrued expenses
   and other current liabilities                       154,580          156,985
  Current maturities of notes payable                  125,000           18,005
    Total Current Liabilities                          609,943        1,016,028

__COMMITMENTS & CONTINGENCIES___
Stockholders Equity (Deficits):
Series B Cumulative Convertible Participating
 Preferred stock, no par value; 300,000 shares
 authorized, 25,000 shares issued and outstanding
 (liquidation preference $25,000)                      25,000            25,000
Series A Cumulative Convertible Participating
 Preferred Stock, no par value; (liquidation
 Preference $210,000); 600,000 shares
 authorized, 210,000 shares issued and outstanding    205,000           205,000
Common stock, no par value; 10,000,000 shares
  authorized, 1,316,989 shares issued and
  outstanding                                       3,852,825         3,852,825
Additional paid in capital                            171,998           171,998
Accumulated deficit                                (4,372,276)       (4,008,002)

 Total Stockholders Equity (Deficit)                 (117,453)          246,821

TOTAL LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)  492,490         1,262,849


       See accompanying notes to Consolidated Financial Statements.

                                         -2-

                  AMERICAN ASSET MANAGEMENT CORPORATION AND SUBSIDIARIES

                        CONSOLIDATED STATEMENTS OF OPERATIONS
                                    (Unaudited)
_______________________________________________________________________________
                                  For the Three Months       For the Nine months
                                    Ended Sept. 30             Ended Sept. 30,
                               __2004__     __2003__       __2004__     __2003__
Revenues:
  Mortgage origination fees     $    50,224  $  348,984   $  286,864  $1,669,201
  Broker revenue                     66,797          -       122,524          -
  Land Sales                             -           -            -      175,000
  Application and commitment fees     7,458       9,372       39,283      45,292
  Mortgage interest income            3,526      49,917       32,673     219,990

     Total revenues                 128,005     408,273      481,344   2,109,483

Expenses:
  Employee compensation & benefits  130,345      86,697      373,766     267,880
  Commissions                         5,780     197,287      103,509     945,598
  Other expenses                     56,987     115,242      237,225     421,347
  Land and development costs             -           -            -      186,765
  Interest expense                    3,246      55,073       34,225     248,030
  Losses on derivative
   Instruments, net                  40,937       8,000       82,500       8,000
     Total expenses                 237,295     462,299      831,225   2,077,620

Income/(Loss) from operations      (109,290)    (54,026)    (349,881)     31,863

Other income                             18         477        3,232       1,205

Income/(Loss) before benefit
  from income taxes                (109,272)    (53,549)    (346,649)     33,068

Benefit from income taxes                -       (7,460)          -           -

Net Income/(Loss)                  (109,272)    (46,089)    (346,649)     33,068

Dividends on Preferred Stock          5,875       5,875       17,625      17,625

Earnings/(Loss) Attributable to
Common Stockholders                (115,147)    (51,964)    (364,274)     15,443

Earnings/(Loss) Per Common Share
Basic                                $(0.09)    $ (0.04)      $(0.28)    $ 0.01
Diluted                              $(0.09)    $ (0.04)      $(0.28)    $ 0.01

Weighted Average Number of Shares
Of Common Stock outstanding:
Basic                             1,316,989    1,295,970    1,316,989  1,295,970
Diluted                           1,316,989    1,295,970    1,316,989  1,295,970


       See accompanying notes to Consolidated Financial Statements.

                                         -3-

                AMERICAN ASSET MANAGEMENT CORPORATION AND SUBSIDIARIES
                         CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (Unaudited)
_____________________________________________________________________________
                                                 For the Nine Months Ended
                                             _Sept. 30, 2004_ _Sept. 30, 2003_

Cash flows from operating activities:
  Net Income (loss)                                  $ (346,649)   $   33,068
  Adjustments to reconcile net income (loss) to
  net cash (used in) provided by operating activities:
   Depreciation and amortization                          2,701         2,012
   Losses on derivative instruments, net                 82,500         8,000

  Changes in:
    Mortgage loans held for sale                        500,128     2,591,575
    Prepaid expenses & other current assets               4,791         7,060
    Land & development costs                                 -        163,590
    Warehouse finance facility                         (483,338)   (2,552,937)
    Deferred income                                      (5,619)         (700)
    Accounts payable, accrued expenses
     and other current liabilities                       (2,405)      (17,394)
    Net cash(used in)provided by operating activities  (247,891)      234,274

Cash flows from investing activities:
    Change in other assets                                  956            -
    Purchases of fixed assets                                -         (8,386)
    Investments in derivative instrument               (104,218)      (13,000)
    Increase in restricted cash                              -        (39,000)
     Net cash used in investing activities             (103,262)      (60,386)

Cash flows from financing activities:
   Proceeds from notes payable, related parties         125,000           -
   Payments of notes payable                            (18,005)    (135,444)
   Payment of preferred stock dividends                 (17,625)     (11,750)
     Net cash provided by (used in)
     financing activities                                89,370     (147,194)

Net (decrease)increase in cash and cash equivalents    (261,783)      26,694

Cash and cash equivalents at beginning of period        345,947      376,425

Cash and cash equivalents at end of period            $  84,164   $  403,119

Supplemental Disclosure of Cash Flow Information:
Cash paid during the year for:
  Interest                                            $  35,596   $  255,334
  Income taxes                                               -            -

Supplemental schedule of non-cash investing and financing activities:
  Accrued dividend charged to accumulated deficit      $   5,875    $    5,875


       See accompanying notes to Consolidated Financial Statements.

                                        -4-

                AMERICAN ASSET MANAGEMENT CORPORATION AND SUBSIDIARIES
                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                     (Unaudited)
____________________________________________________________________________



1.  BACKGROUND AND BASIS OF FINANCIAL STATEMENT PRESENTATION


     The accompanying consolidated financial statements of American Asset
Management Corporation and subsidiaries (the Company) are unaudited.  In the
opinion of management, all adjustments and intercompany eliminations necessary
for a fair presentation of the results of operations have been made and were
of a normal recurring nature.  These interim consolidated financial statements
should be read in conjunction with the consolidated financial statements and
related notes thereto contained in the Companys 2003 Annual Report on Form
10-KSB.  Reference is made to the Companys annual financial statements for
the year ended December 31, 2003, for a description of the accounting policies
which have been continued without change.  Also refer to the footnotes within
those annual statements for additional details of the Companys financial
condition, results of operations and changes in cash flows. The details in
those notes have not changed except as a result of normal transactions in the
interim.  The results of the three and nine months ended September 30, 2004
are not necessarily indicative of the results of the full year.

     Certain reclassifications have been made to the operating statement for
the three and nine month periods ended September 30, 2003 to conform with the
current period presentation.

Going Concern Uncertainty
     The Company has incurred operating losses over the past 12 months in the
amount of approximately $450,000.  During the nine months ended September 30,
2004, the Company incurred a net loss of $346,649 and used $247,891 of cash to
fund operating activities.  As of September 30, 2004, the Company had $84,164
remaining in cash and cash equivalents and the Companys net worth for HUD
compliance purposes has dropped below the required level of $250,000.  If the
Company is not able to generate profitable future operations, obtain
additional borrowings to fund its operations, and increase its net worth in
order to satisfy its HUD compliance requirement, the Company may not be able
to continue in existence in its present form.

Broker Revenue
     During the third quarter ended September 30, 2004, the Company began
generating revenue by acting as a broker of sub-prime credit quality loans.
The Company does not fund these loans from their warehouse line and,
therefore, does not sell them to investors.

     The Company recognizes revenue from these loans when it receives its
broker fee, which is typically when the loan closes.




                                    -5-


2.  EARNINGS/(LOSS) PER SHARE

     Basic EPS and Diluted EPS for the three and nine month periods ended
September 30, 2004 and 2003 have been computed by dividing the net income/
(loss) attributable to common stockholders for each respective period by the
weighted average shares outstanding during that period.  All outstanding 10%
Series A and B, Cumulative Participating Preferred Stock and options have
been excluded from the computation of Diluted EPS as they are antidilutive.

3. WAREHOUSE LINE
     On March 11, 2004, the Company obtained a new warehouse line of credit
from a commercial bank in the amount of $7,000,000.  This line has an
expiration date of March 31, 2005.  The line is secured by residential
mortgage loans and a personal guarantee of the Companys President.  The line
bears various interest rates from price plus three-quarters to prime plus one
and a half percent.  The percentage is directly related to the type of loan
written.  The Company is required to maintain several financial covenants
including:  1) maintaining a minimum adjusted net worth of $550,000 and 2)
not exceeding a maximum leverage ratio of 20 to 1. The Company did not meet
the minimum adjusted net worth requirement as of March 11, 2004 (the
inception date of the agreement) and September 30, 2004.  The bank has
informed the Company in writing that they will not consider a net worth
deficiency as an event of default under the line of credit.

4.  Notes Payable to Related Parties
     On March 30, 2004, the Company borrowed $100,000 from two board members
in the form of demand notes bearing interest at 10% per annum.

    During the quarter ended September 30, 2004, the Company borrowed an
additional $25,000 from a board member in the form of a demand note bearing
interest at 10% per annum.

     Accrued interest on the above notes payable totaled approximately $5,000
at September 30, 2004.

5.  Pending Litigation
     On March 25, 1999, the Company, its President, and the Companys wholly
owned subsidiary, Capital Financial Corp. (CFC) (the Company Defendants) and
one of the Companys former directors together with other individuals were
named in an action filed in the Superior Court of New Jersey, Chancery
Division by two New Jersey limited liability companies (the LLCs).  The
plaintiffs allege the Companys former director and other defendants other
than the Company Defendants (Other Defendants) misappropriated assets and
opportunities of the LLCs for their own use, engaged in self-dealing with
respect to the LLCs, breached the operating agreements of the LLCs and
converted and embezzled assets and funds of the LLCs.  The Company
Defendants are alleged to have aided and abetted the Companys former director
in converting the assets of the LLCs by accepting loans and payments from the
LLCs and the Companys former director and repaying loans to the Companys
former director in the form of cash and Company stock.




                                  -6-


     The LLCs seek declaratory and injunctive relief against the Company
Defendants; an accounting of (1) all shares of Company stock purchased by
the Companys former director and Other Defendants and (2) all payments to
or from the Company and the Companys former director and Other Defendants;
imposition of a lien or equitable trust in favor of the LLCs on shares of
the Companys stock issued to the Companys former director and Other
Defendants; and certain unspecified compensatory and punitive damages,
attorneys fees and costs.

     In April 1999, the Court granted a preliminary injunction, which among
other things, enjoins the Companys Defendants from allowing the transfer of
any Company stock held in the name of the Companys former director and Other
Defendants and directs the Company and related Defendants to provide an
accounting of all such stock.

    The Company denies any wrongdoing and believes that the claims against
the Company Defendants are without merit, and that it has meritorious
defenses and intends to defend the action vigorously.  The trial in this
case has been postponed by the court numerous times.  It is currently
scheduled to begin in January 2005.  However, at this time the Company
cannot predict its ultimate liability, if any, that may result from this
action.  There is no settlement offer pending from the Company.


Item 2.

                AMERICAN ASSET MANAGEMENT CORPORATION AND SUBSIDIARIES
                         MANAGEMENTS DISCUSSION AND ANALYSIS
             OF CONSOLIDATED FINANCIAL CONDITION AND RESULTS OF OPERATIONS
____________________________________________________________________________

    Safe Harbor Statement under the Private Securities Litigation Reform Act
Of 1995:  The statements which are not historical facts contained in this
report on Form 10-QSB are forward looking statements that involve a number
of known and unknown risks, uncertainties and other factors which may cause
the actual results, performance or achievements of the Company to be materially
different from any future results, performance of achievements expressed or
implied by such forward looking statements.  Such factors, include, but are
not limited to, those relating to competition, the ability to successfully
market new mortgage products and services, the economic conditions in the
markets served by the Company, the ability to hire and retain key personnel
and other risks detailed in the Companys other filings with the Securities
and Exchange Commission. The words believe, anticipate, expect, intend and
similar expressions identify forward-looking statements. Readers are cautioned
not to place undue reliance on these forward-looking statements, which speak
only as of the date the statements were made.

RESULTS OF OPERATIONS

THREE MONTHS ENDED SEPTEMBER 30, 2004 COMPARED TO THE THREE MONTHS ENDED
SEPTEMBER 30, 2003.

     Total revenues for the three months ended September 30, 2004 were
$128,005 compared to $408,273 for the three months ended September 30, 2003,
a decrease of $280,268 or approximately 68.6%. The decrease was primarily

                                   -7-
attributable to a decrease in mortgage origination fees of $298,760, due
primarily to the large reduction in closings where the Company acts as a
banker and the commencement of an increased amount of closed sub-prime
applications and closings.  This was offset in part by $66,797 in broker
revenue.  Mortgage interest income decreased by $46,391 or approximately
92.9% to $3,526 from $49,917.  In addition, there was a reduction in
application and commitment fee income of $1,914 or approximately 20.4% to
$7,458 from $9,372 during the comparable 2003 period.  The decrease in
interest income is attributable to mortgage interest received on a
decreased amount of loans that were owned and being warehoused by the
Company.  The reduction in application and commitment fee income is due
to a reduction in the amount of applications and commitments issued by the
Company.  In addition, the Company is not permitted to charge the borrower
a commitment fee on a loan where the Company acts as the mortgage broker.  The
Company may only charge a borrower a commitment fee when it acts as a banker.

     The Company continued to see a large percentage of its business in
mortgage refinance applications due to lower interest rates as compared to
interest rates prevalent in prior years.  The Company also continued focusing
its efforts on expanding its retail sales force.  During the three month
period ended September 30, 2004, the Company received the majority of its
mortgage applications from its retail sales force.  The Company believes that
increasing its own retail sales force will lessen its dependency on wholesale
customers as sources of business.  In this regard, during the three month
period ending September 2004, the Company replaced its retail sales manager
with another sales manager with over three years of mortgage banking
experience.  During the quarter ended September 30, 2004 the Company added
3 additional experienced retail loan officers to its sales staff which as of
September 30, 2004 totals 10 persons compared to 7 people in the prior quarter.

     The Company is aggressively recruiting experienced sale personnel.  It
believes that by having a larger amount of experienced sales people it has a
better chance of originating a sufficient amount of mortgage loans necessary
to become profitable.  There can be no assurance that the Company will be
successful in recruiting additional sales personnel or that its production
goals will be met to become profitable.

     During the three months ended September 30, 2004, the Company received
44 mortgage loan applications for processing from borrowers aggregating
approximately $10,454,970 as compared to 56 mortgage loan applications in an
aggregate of approximately $11,812,741 in the comparable 2003 period.  Of the
44 loans originated during the three months ended September 30, 2004, 39 loans
or approximately 88.6% of the total were refinance applications and 5 loans or
approximately 11.3% of the total were purchase applications.  There were no
second mortgages included in the 44 applications received during the period
ended September 30, 2004 as compared to 5 second mortgage applications
received during the comparable 2003 period which aggregated approximately
$180,020.  There was 1 FHA insured loan during the 3 month period ended
September 30, 2004 in the amount of approximately $203,000 as compared to
5 FHA insured loan aggregating approximately $680,406 received during the
comparable 2003 period.



                                -8-



     During the three months ended September 30, 2004,the Company closed 20
residential mortgage loans in the principal amount of $5,288,370 compared to
51 loans closed in the principal amount of $10,068,105 in the three months
ended September 30, 2003.  Of this amount 11, or approximately 55% were
sub-prime loans aggregating approximately $3,152,150 as compared to an
absence of sub-prime loans during the 2003 period.  At September 30, 2004,
the Company had approximately 47 residential mortgage loan applications in
process in the principal amount of $11,190,750 compared to 42 residential
mortgage loan applications in process in the principal amount of $10,008,550.
At September 30, 2004, 35 of the 47 loan applications in process, totaling
approximately $7,741,550 or approximately 74.5% in number and approximately
69.2% in amount, are sub-prime loans.  Of the 47 applications, 10, or
approximately 21.3% were purchase mortgages and 37, or approximately 78.7%
were refinance applications. While interest rates remain relatively low
compared to rates in prior years, it seems unlikely that interest rates will
again see the lows set in early June 2003.  Purchase mortgage demand in the
marketplace remains strong although any further increase in interest rates
will likely lessen the demand for purchase mortgages.  Any further increase
in interest rates will reduce the amount of refinance mortgages in the future
and will also have a negative impact on the purchase market.

     Total expenses for the three months ended September 30, 2004 were
$237,295 a decrease of $225,004 or approximately 48.7% from $462,299 in the
comparable 2003 period primarily due to a reduction of $191,507, or
approximately 97.1%, in commissions paid from $197,287 in the comparable
period in 2003 to $5,780 in the three months ended September 30, 2004.  This
was offset by an increase of $43,648 in employee compensation and benefits
resulting from maintaining the Companys retail sales support personnel while
the Company rebuilds its retail sales staff, the rate of compensation paid
and benefits of approximately 150.3% to $130,345 from $86,697 in the
comparable 2003 period and a loss on derivative investments of $40,937 as
compared to an $8,000 loss during the same three month period in 2003.  This
was partially offset by a decrease of $58,255 in other expenses or
approximately 50.5% to $56,987 from $115,242 in the comparable 2003 period
due primarily to lower investment and warehouse fees and a decrease of
$51,827 in interest expense or approximately 94.1% to $3,246 from $55,073 in
the comparable 2003 period due to a shorter borrowing time on a lesser amount
of closed mortgage warehouse loans owned.  As a percentage of revenues,
expenses were approximately 185.4% in the current period compared to
approximately 111.3% in the comparable 2003 period.

    As a result of the foregoing, Preferred Stock dividends of $5,875 and
other income of $18, the Companys loss attributable to common stockholders
for the three months ended September 30, 2004 was $115,147 or $0.09 per share
compared to a loss attributable to common stockholders of $51,964 or $0.04
per common share for the comparable 2003 period.





                                   -9-




NINE MONTHS ENDED SEPTEMBER 30, 2004 COMPARED TO THE NINE MONTHS ENDED
SEPTEMBER 30, 2003.

     Total revenues for the nine months ended September 30, 2004 were
$481,344 compared to $2,109,483 for the comparable 2003 period.  The decrease
in revenue was primarily attributable to a decrease in mortgage origination
and broker fees to $409,388 during the 2004 period from $1,669,201 in the
comparable 2003 period, a decrease of $1,259,813 or approximately 85.1% in
mortgage interest income to $32,673 from $219,990 in the comparable 2003
period, a decrease in mortgage application and commitment fees of $6,009 to
$39,283 from $45,292 in the comparable 2003 period, and an absence of revenues
from land sales during the 2004 period as compared to $175,000 from land sales
during the comparable 2003 period.  Since the last quarter of 2003 through the
9 month period ending September 30, 2004 the Companys revenues were adversely
affected by the decision of the Companys primary fixed rate mortgage loan
investor to cease conducting mortgage business in New Jersey.  This happened
as a direct result of certain provisions contained in a new New Jersey law
which took effect during November 2003.  The law contained potential
liability for subsequent mortgagees (owners of mortgages) of loans originated
in the State of New Jersey including loans purchased in the secondary market.

     During September 2004, the original November 2003 law was amended to
clarify and remove concerns within the lending community about subsequent
lender liability.  As a direct result of this amendment the Company was
notified by the investor on September 13, 2004, that the investor was
resuming the purchase of closed mortgage loans in New Jersey to be effective
on September 27, 2004.  This renewed relationship has allowed the Company to
revise its mortgage rate schedule to include better rates that become
available to the Company through this investor.  The Company believes it has
gained back its competitive advantage which was lost approximately one year
ago due to the original law.

     During the nine months ended September 30, 2004, the Company closed 75
residential mortgage loans in the principal amount of $18,808,946 compared to
292 loans closed in the principal amount of $61,477,127 in the nine months
ended September 30, 2003.

     Total expenses for the nine months ended September 30, 2004 were $831,225
a decrease of $1,246,395 or approximately 60.0% from $2,077,620 in the
comparable 2003 period due to an absence of land and development costs during
the 2004 period as compared to $186,765 of land and development costs during
the same period in 2003, a decrease in interest expense of $213,805 to $34,225
from $248,030, or approximately 86.2% during the same period in 2003 due to a
reduced amount of interest charged on borrowed money due to a lesser amount of
warehoused mortgage loan closings during the period, an approximately 139.5%
increase in employee compensation and benefits to $373,766 from $267,880 during
the same period of 2003, a decrease in other expenses of $184,122 to $237,225
from $421,347 or approximately 43.7% in the same period of 2003, and a decrease
in commissions of $842,089 or approximately 89.1% to $103,509 from $945,598
during the same period of 2003.  This was due to a lesser amount of mortgage
closing volume during the period.  In addition the Company lost $82,550 on
derivative instruments during the nine month period ended September 30, 2004
as compared to a loss of $8,000 during the same nine month period in 2003. As
a percentage of revenues, expenses were approximately 172.6% in the current
period compared to approximately 98.5% in the comparable 2003 period.

                                   -10-

     As a result of the foregoing and the payment of Preferred Stock dividends
of $17,625, the Companys loss attributable to common stockholders for the nine
months ended September 30, 2004 was $364,274, or $0.28 per common share,
compared to earnings attributable to common stockholders of $15,443 or $0.01
per common share for the comparable 2003 period.



LIQUIDITY AND CAPITAL RESOURCES

     As of September 30, 2004, the Company had cash and cash equivalents of
$84,164 compared to $345,947 at December 31, 2003, a decrease of $261,783 or
approximately 75.7%.  This decrease is attributable to net cash used in its
operating activities of $247,891,net cash used in investing activities of
$103,262 which was partially offset by net cash provided by financing
activities of $89,370.

     The Company utilizes one $7,000,000 warehouse line of credit for its daily
mortgage loan funding operations.  Interest on this line of credit is charged
at the rate of Wall Street Journal Prime Rate plus one and one half percent
and expires on March 31, 2005.  Whenever possible the Company employs its
available cash to fund mortgage loans which generate mortgage interest income,
as well as save interest costs and other fees associated with utilizing its
warehouse credit line.  The warehouse line enables the Company to borrow funds
secured by residential mortgage loans which will be temporarily accumulated
or warehoused and then sold.  At September 30, 2004, the Company had borrowed
$330,363 from its warehouse line of credit representing approximately $333,700
in closed loans ready for sale.

     In October 2003, the Company was notified by its primary
institutional mortgage banker which it sold loans to that the institution
would no longer purchase loans on properties in New Jersey as a direct
result of a new New Jersey State law which went into effect on November 27,
2003.  The law, called The New Jersey Home Ownership Security Act of 2002
covers most of the residential loans originated in the state and deals
primarily with lender fees and lender liability including secondary market
lenders.  The Company, as well as other mortgage banking companies who do
business in New Jersey, had been notified during October and November of 2003
by numerous institutional purchasers of mortgage loans originated in New
Jersey, that the language contained in the new law was unacceptable to them
in its original form.

     The law was amended by the NJ State Legislature during the 3 month
period ended September 2004 to clarify certain provisions of the law that
primarily pertain to subsequent lender liability.  The language of the
amended law is now satisfactory to the Companys primary fixed rate
mortgage investor and on September 13, 2004 the Company was notified by
this investor that it would resume the purchase of New Jersey closed loans
originated by the Company.




                                     -11-



     During the three month period ended June 30, 2004, the Company continued
marketing its services to the public through the Internet using its website
home page linked to a major website belonging to a national provider of
mortgage lending statistics.  The national providers website provides the
public with the Companys lending programs and interest rates on a daily
basis, in addition to the rates of other lenders that the Company competes
with.  As a result of its marketing through the Internet, the Company has
received numerous inquiries which have resulted in mortgage loan
applications and closings from persons seeking mortgage financing.

     During March 2004, the Company modified its website to include sub-prime
credit loans on a brokered basis (e.g. broker revenue)to borrowers with
impaired credit and has increased its Internet exposure to potential
borrowers by linking its website to a sub-prime lender showcase of a national
provider of consumer loan statistics.  In addition, during the third quarter
of 2004 the Company contracted to purchase borrower inquiry leads from an
additional national internet source that provides potential borrowers with
four mortgage rate quotes from lenders who compete with each other for the
borrowers mortgage.  The Company also began accepting credit cards from
borrowers for payment of application and commitment fees in the first quarter
of 2004.  The Company continues to be encouraged with this new source of loan
originations and the results of its Internet marketing.  The Company continues
to accept credit card payments from borrowers seeking mortgage financing from
the Company and has maintained its internet marketing during the third quarter
of 2004.

     To date, the number of domestic mortgages originated over the Internet,
relative to the total mortgage origination market, while small, is still
growing.  Industry wide in recent years, only a small percentage of total
mortgage originations were generated via the Internet.  However, according to
certain mortgage banking industry sources, by the year 2005 the Internet could
comprise 25% to 30% of total mortgage originations.  The Companys marketing
strategy is to supplement its current personal retail relationship based
origination business with marketing conducted over the Internet.  There can
be no assurance that the Company will be successful in the future in using
the Internet as a source of mortgage loan applications.

     The Company will require additional capital in order to conduct its
business in its current form and to successfully implement its future
operational plans beyond December 2004.  As a result, the Company is seeking
additional capital through, among other means, an infusion of
noncollateralized loans and the sale of additional equity in the Company.
However, there can be no assurance that the Company will be able to obtain
additional capital on terms acceptable to the Company, if at all.  If the
Company is unable to obtain such capital and increase their net worth for
HUD compliance purposes, it may not be able to continue in existence in its
present form.

Item 3.  Controls and Procedures.

     An evaluation was carried out under the supervision and with the
participation of the Companys management, including the Chief Executive
Officer (CEO) who also serves as the Chief Financial Officer (CFO), of the


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Effectiveness of the Companys disclosure controls and procedures as of the
end of the quarter ended September 30, 2004.  Based on that evaluation, the
CEO/CFO has concluded that the Companys disclosure controls and procedures
are effective to provide reasonable assurance that all information required
to be disclosed by the Company in reports that it files or submits under the
Securities and Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in Securities and Exchange
Commission rules and forms.  In addition, during the quarter ended September
30, 2004 there were no changes in the Companys internal controls over
financial reporting that have materially affected or are reasonable likely to
materially affect its internal controls over financial reporting.


                                PART II OTHER INFORMATION

Item 1.  Legal Proceedings

     Reference is made to Part 1 - Item 3 contained in the Companys 10-KSB
For the year ended December 31, 2003 for further information relating to the
pending action commenced against, among others, the Company and its President
described below.  See also Note 5 to the Consolidated Financial Statements
included in Item 1 of this Form 10-QSB.

Item 6. Exhibits

     (a)  Exhibit No.
          31.1   Certification of Chief Executive and Financial Officer pursuant
                 Section 302 of the Sarbanes-Oxley Act of 2002.
          32.1   Certification of Chief Executive and Financial
                 Officer pursuant to Section 906 of the Sarbanes-Oxley
                 Act of 2002.


                                      SIGNATURES

     In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.


                                        AMERICAN ASSET MANAGEMENT CORPORATION
                                                    (Registrant)



Date:  November 18, 2004               By:_s/Richard G. Gagliardi__________
                                            Richard G. Gagliardi
                                            Chairman, President and Chief
                                            Executive Officer (Principal
                                            Executive and Financial Officer)



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