Don't worry. The Republican Socialist Party will have government pay you to continue being an idiot.

http://biz.yahoo.com/ap/070831/bush_housing_slump.html?.v=2

Quote :

"The official said Bush will direct Treasury Secretary Henry Paulson and Housing Secretary Alphonso Jackson to work on an initiative to help troubled mortgage holders get services and products they need to keep them from defaulting on their loans. The official spoke on condition of anonymity to discuss details of the initiatives ahead of the presidential event. Bush also planned to: -- Urge Congress to pass Federal Housing Administration overhaul legislation that would give the FHA more flexibility in assisting mortgage holders with subprime mortgages. "

Do not think for one second anyone this actually helps people getting foreclosed. Hillary Clinton and Chris Dodd were pretty much calling for this as well in the last couple weeks, both have heavily received money donation from Wall Street firms and banking institutions. This is merely so f***ed borrowers can continue paying their home payments. So who this actually benefits are the people receiving the money - the big banks, cause they will continue to receive a cash flow cause they did not do their job properly and took on bad loans.

Who pays for this? You and me. We work hard and save our money diligently, and because of that we are now going to help a person pay his home payment cause he is not smart enough to realize he can't afford a $500k house on a $50k salary paying only interest every month. You can help the guy all he wants, he'll never own his home. That wasn't his intention if he got an interest-only mortgage.

Just one more sign that the Republican and Democratic parties are corporatists at heart. The huge profits of the housing boom were profited and tucked away. Now, the house of cards has all fallen and these profits have "disappeared" and these companies are crying and screaming for Fed rate cuts and for a federal bailout.

Well, I'm thinking of going to Greensboro and buying a Ferrari. I've always wanted one. I'll take out a car loan to pay it, default after two months, and then the rest of you will help me pay the rest of it off. Have a good day!

[Edited on August 31, 2007 at 7:37 AM. Reason : /]

8/31/2007 7:28:42 AM

YOU HAVE NO IDEA!

NO IDEA!!11

8/31/2007 7:35:10 AM

Quote :

"Just one more sign that the Republican and Democratic parties are corporatists at heart."

Quote :

"Just one more sign that the Republican and Democratic parties are corporatists at heart."

Quote :

"Just one more sign that the Republican and Democratic parties are corporatists at heart."

Quote :

"Just one more sign that the Republican and Democratic parties are corporatists at heart."

Quote :

"Just one more sign that the Republican and Democratic parties are corporatists at heart."

Quote :

"Just one more sign that the Republican and Democratic parties are corporatists at heart."

Quote :

"Just one more sign that the Republican and Democratic parties are corporatists at heart."

kill the fascists

piss on their graves

I'm cranky this morning

8/31/2007 7:48:15 AM

Fucking stupid. Let's encourage retarded behavior!!!

8/31/2007 9:39:10 AM

Quote :

"Just one more sign that the Republican and Democratic parties are corporatists at heart."

I don't know if I'd call them corporatists at heart. More like self-interested tools holding on to power. Republican and Democrat are simply the two faces of the same shell game: pick an issue and Republicans and Democrats take opposite sides to keep their bases riled up...abortion, immigration, gay marriage, Iraq, etc. These issues will never be resolved because as long as they exist Republicans and Democrats can continue to use them as a basis of power. This is why there will never be a third party. It's all a game with the one and only goal of self-enrichment, regardless of the impact on others or the country.

Politicians in general are just another group of assholes exploiting the system to their own benefit. There's no particular allegiance to corportations or anything else. Only an allegiance to self.

[Edited on August 31, 2007 at 9:57 AM. Reason : ]

8/31/2007 9:55:56 AM

Quote :

"Politicians in general are just another group of assholes exploiting the system to their own benefit. There's no particular allegiance to corportations or anything else. Only an allegiance to self."

I disagree with that presumption. True, ultimately politicians are just another group of assholes exploiting the system to their own benefit.

But, who gives more campaign donations than corporations, both directly and indirectly?

So if a politician supports a bill that a corporation wants, they can expect to receive money from said corporation. I'm not saying that's wrong, just that I concede it's legalized bribery. So when times are great, corporations push for the removal of regulations. Once times go bad, they're asking for Fannie Mae and Freddie Mac to get involved, the FHA to get involved, to subsidize mortgagees, etc.

Although they might not be worshippers of Mussolini, their actions are still responsible for our country's path toward the merging of business with the state.

Anyway, passing on.

Quote :

"THERE'S NO SUCH THING AS A FREE BAILOUT by Paul L. Kasriel Senior Vice President & Director of Economic Research The Northern Trust Company August 24, 2007 PIMCO’s William Gross is now calling for a fiscal policy bailout for the U.S. housing market debacle rather than a monetary policy bailout (see “Where’s Waldo? Where’s W?”). On the surface, Gross’s arguments seem to make sense – on the surface. Gross argues that even a cut in the federal funds rate of several hundred basis points might not lower reset rates on adjustable-rate mortgages enough to prevent the massive looming foreclosures. In addition, Gross argues that such an injection of Fed-created credit could be the catalyst for a run on the dollar, which, in turn, would probably prevent 15-year or 30-year fixed rate mortgage yields from falling enough, if at all, to prevent massive foreclosures. Moreover, Gross argues that a large cut in the federal funds rate would perpetuate Greenspan’s moral hazard policy and would encourage further leveraging in the global financial markets. So as an alternative, Gross recommends that some federal government agency, either an existing one such as the Federal Housing Administration (FHA) or a newly-created alphabet soup, bailout those current home“owners” who otherwise are soon-to-be renters. I believe that Gross makes some valid points about the implications of a Greenspan-magnitude cut in the fed funds rate. But I do not believe that a fiscal policy bailout of prospective defaulting mortgagees would be “free,” economically speaking. Let’s assume that the FHA guarantees the refinancing of the approximately $683 billion of subprime and Alt-A mortgages that are scheduled to reset in the six quarters ended 2008:Q4 (dollar amount according to Merrill Lynch). An FHA guarantee is a full-faith-and-credit guarantee of the federal government. So, the market for these new FHA-guaranteed mortgages would overlap with the one for U.S. Treasury securities. That is, FHA-guaranteed mortgages and U.S .Treasury securities are close substitutes. Thus, all else the same, U.S. Treasury security interest rates would rise as investors shift out of Treasuries into FHA-guaranteed mortgages. But because the FHA would be guaranteeing massive amounts of subprime and Alt-A mortgages, market participants would anticipate higher defaults on these mortgages going forward, which, in turn, would cause market participants to expect higher Treasury borrowing requirements going forward to make buyers of these FHA-guaranteed mortgages whole after defaults. So, interest rates on Treasury debt would rise not only because of the substitution effect, but because a greater future supply of Treasury debt would be anticipated. In fact, the interest rates on all other fixed-income securities would rise because FHA-guaranteed mortgages are, to varying degrees, substitutes for other fixed-income instruments. So, the current federal deficit would rise because of higher interest costs on the public debt. In addition, expected future federal deficits would rise because of higher anticipated defaults on FHA-guaranteed mortgages. Private borrowers would cut back on their borrowing and spending because of the higher interest rates they now have to pay in order to obtain funding. Other private – and perhaps public – spending, then, would be “crowded out” by the increase in FHA guarantees on mortgages. The cost of funds to private equity syndicates would increase, so the dollar volume of “deals” would decline from what it otherwise would have been. This would reduce the amount of shares being bought from households, which, in turn, would reduce an important source of household deficit spending. (For a discussion of the impact on household spending of private equity buyouts and corporations’ stock buybacks, see "Wall Street and Main Street Are Joined at the Hip"). Again, other spending would be crowded out by the increase in FHA guarantees of mortgages. It is not even clear that the U.S. dollar would not come under downward pressure with a fiscal policy bailout of subprime and Alt-A borrowers. As alluded to above, private spending on research and development and business capital equipment would be crowded out by the government guarantee of less-than-prime mortgages. Slower growth in these types of private spending implies slower future growth in the U.S. economy. Slower future real growth in the economy implies slower growth in our standard of living, especially if we have to devote part of our future production/income to servicing our foreign debt. With the U.S. already a gargantuan net debtor to the rest of the world and with the bulk of our debt denominated in U.S. dollars, foreign creditors might wonder if political pressure would be brought to bear on the Federal Reserve to crank up the currency “printing press” in order to help make principal and interest payments on the debt owed to these creditors. The anticipation of this, of course, would induce investors – both foreign and domestic – to reduce their exposure to U.S. dollar-denominated financial assets, thus causing the dollar to depreciate vs. other currencies. For the FHA to guarantee the refinanced mortgages of subprime and Alt-A borrowers, a moral hazard policy still would be perpetuated, just not by the Fed. Subprime and Alt-A lenders would be bailed out by the federal government, thus reinforcing the notion that some form of government safety net would likely be there to mitigate the potential losses of investments in risky assets. "

[Edited on August 31, 2007 at 10:54 AM. Reason : .]

8/31/2007 10:43:25 AM

And to think, most of these guys are probably libertarians.

8/31/2007 11:48:32 AM

Libertarians are libertarians all the time, they realize capitalism must allow for some people to fail in bad times because that is how the market gets rid of the idiots (survival of the fittest). In time that will allow new businesses to start up and thrive.

They do not go asking for government handouts when the s*** hits the fan. These guys are corporatists - their purpose for government is to act as an ancillary escape valve for their business. There's more to being a libertarian than being for tax cuts. You actually have to reduce government so that in the future tax raises won't be needed, like to cover a housing bailout for example.

A good quote I've seen a lot in the last couple weeks:

Capitalism without failure is like religion without sin, it does not work.



http://michellemalkin.com/2007/08/31/bush-pulls-a-hillary-on-housing/

[Edited on August 31, 2007 at 12:01 PM. Reason : /]

8/31/2007 11:54:42 AM

take that malkin shit out of here

8/31/2007 6:17:23 PM

the problem with libertarians is that they forget about the peasant mob



[Edited on August 31, 2007 at 7:04 PM. Reason : s]

8/31/2007 7:02:23 PM

Quote :

"capitalism must allow for some people to fail in bad times because that is how the market gets rid of the idiots "

So true. Big corporation leaders donate to politicians because they expect beneficial breaks and treatment in return. That is a key difference from libertarian thought. The classical liberal does not look to the gov't for help in economic matters. They wish to be left alone and let the invisible hand of the market work.

These corporatists are playing the gov't, manipulating it, using it to sqwash the competition. That is definitely not the libertarian way.

The way to fix this is to remove the power the gov't has to meddle in so much of our economy. Without the power to confer so much preferential treatment, corporations would leave the gov't alone. Lenders and borrowers would be more prudent if they knew for certain there was no way the gov't was going to bail them out.

[Edited on September 1, 2007 at 12:27 AM. Reason : .]

9/1/2007 12:26:57 AM

Yes, they would be more prudent. But as history demonstrates, they are unlikely to be sufficiently prudent to prevent financial crisis. Therefore, it turns out that the best policy is to pretend you are never going to rescue anyone, and then once the cards collapse try to rescue everyone.

This is because once the crisis hits there is no way to only save prudent firms, since the nature of a crash or crisis is that prudent firms also get pulled down.

But if we do as we say, and never rescue anyone, then we introduce a similar moral hazard. If the system is going to crisis and collapse every decade or so due to irrational speculators, what is the benefit of being prudent in long term investments when you still lose everything? Why not join the irrational speculation and try to make all the money you can before crisis develops?

9/1/2007 8:53:18 AM

The boom/bust cycles are more the result of incorrect signals sent to the market from gov't interference and so-called controls. If the market was allowed to operate more freely, there wouldn't be as many mistakes made by misinformed participants.

9/1/2007 11:39:20 AM

any bailout of individuals or corporations is fucking wrong.

Everyone who's getting burned on the real estate/mortgage debacle needs to take their lashes and move on. It's nobody's fault but their own. Fuck our government if they bail anyone out.

9/1/2007 12:52:45 PM

This kind of crap happens all the time,

from both sides,

and yet so many people still can't see

that the Republicans and Democrats are opposites ends of the same singular ideology.

We live in a one party state people, open your eyes.

9/1/2007 1:49:44 PM

my eyes are open. thx 392

9/1/2007 3:38:02 PM

Hmm, yes, perhaps the frequency is made higher by government interference and the like, but the occurance of irrational exhuberance does not require government. It is a natural phenomenon of the human psyche, after-all.

And it is not a function of just letting the idiots go bankrupt: they tend to take non-idiots with them into bankruptcy, disrupting the banking system, and slowing (or even reversing) money creation. the resultant deflation hurts everyone in every sector, not just the idiots. So while doing nothing does punish the idiots more than if you did something, you are allowing the bad decisions of the few to punish the many, perhaps severely (30% unemployment or so).

9/1/2007 4:32:18 PM

like it or not, there's something to be said for temporarily helping private citizens avoid homelessness. That's almost an economic death sentence - not akin to "take their lashes and move on"

Now, when it comes to corporations, the same doesn't necessarily apply, although there can be some exceptions (bailout of the airlines after 9/11, for example)

everything is good in moderation - the government can help a family make its mortgage payments for 4 months and avoid having to pay for a lifetime of prison and social services after the 8 year old kid is forced out onto the streets with his homeless parents and falls in with gang activity

9/1/2007 4:52:53 PM

Quote :

"avoid homelessness."

People who are losing their homes due to foreclosure can rent. These people aren't losing their jobs, they're unable to pay the higher payments after ARMs reset. These people aren't going to be homeless.

They just think that they are entitled to a McMansion whether they can truly afford it or not. Fuck them.

9/2/2007 1:48:34 PM

we have a winner. good job Solinari with another dumb assertion. Good game bobby for the quick and simple response.

9/2/2007 3:05:14 PM

1. this is not a bailout. make sure you read up on it before you go calling it a bailout.

2. when the plebeians don't get their grain, there will be blood on the streets.

3. read what LoneSnark writes. i can't say it any better

9/2/2007 3:48:32 PM

^bobby already summed up why Lonesnark and you are both wrong.

Foreclosure only wipes out a burden, it doesnt remove the source of income. Unemployment is not going to rise.

And it will hurt us FAR worse to continue to prop up the un-natural subsidized growth of our housing and lending markets, because it's going to cause an even LARGER fall down the line. A small fall now would be much easier to bear for everyone involved. The bigger the descrepency gets, the more everyone is going to get hurt by it in the end.

9/2/2007 3:55:44 PM

I am talking generally as to why we have a Federal Reserve Bank which, BTW, with no direction from congress is playing lender of last resort throughout this entire situation. It doesn't matter whether congress votes to bail out homeowners or not, the Fed is already providing loans to all takers, even those individuals unable to pay the money back.

As such, we don't need a bailout from congress, the Fed already has the system covered.

9/3/2007 9:38:36 AM

Quote :

"People who are losing their homes due to foreclosure can rent. "

yes, i'm sure that they will have a very easy time getting any reputable landlord to rent to them after a credit check shows a foreclosure.

I agree that people who've bought McMansions don't really deserve assistance, but temporary assistance won't help them avoid losing their home anyway. Those people who just need a little help to maintain their footing are the ones that this should be targeted towards. Not unlike unemployment benefits in the event of an unexpected layoff.

I mean, I'm a fiscal conservative, but you guys have no foresight at all.

p.s. Noen, troll.

9/3/2007 12:33:38 PM

Hmm, the problem of bad credit does not go away in a few months. It doesn't go away for years. But landlords have means of dealing with high risk tenants: it's called a deposit. The deposit can be two months or rent or more, something they should have because if they're being foreclosed then they have probably not paid for housing in months. As they knew they were going to be on the street, hopefully they saved all that money up to use as collateral in a rental property.

Quote :

"Those people who just need a little help to maintain their footing are the ones that this should be targeted towards"

People that just need a "little" help already have it. No bank is eager to foreclose, especially when the housing market is down. On the house we just bought, they made it very clear that if we fell on hard times and gave them ample notice, sufficient to present our financial situation to a bank agent, we could get away with reduced mortgage payments for a period of time with no penalties.

9/3/2007 3:29:01 PM

true, true, but when the scope is suddenly increased dramatically, there can be unintended consequences to letting capitalist tough-love take its course...

I think the peasant mob bears repeating:




[Edited on September 3, 2007 at 7:22 PM. Reason : s]

9/3/2007 7:20:13 PM

Are you fucking kidding? No one is going to revolt because some fucking idiots don't understand what interest rates are. The tough love of 1981 was much worse than this, and no one did shit.

9/3/2007 10:02:02 PM

I'd prefer the tough-love. Why do we care about what happens among the general public? We are a part of the peasant mob. I doubt TWWers on here are part of the social elite that run the country and control the banks with teh j00z.

9/3/2007 10:05:38 PM

I don't foresee a violent revolution being very successful.

9/4/2007 12:22:35 AM

while i don't really agree with him about this matter, i think i should point out that the revolt of the peasant mob doesn't have to be--and in our country, wouldn't be--a violent uprising.

9/4/2007 12:47:55 AM

Peasant mob? 0.33% of U.S. households are facing foreclosure. If all of them got together it would be some riot, but I doubt all of them would be willing to cross the country just to start the revolution.

9/4/2007 1:44:13 AM

What part of adjustable rate mortgage didn't those borrowers understand?

9/4/2007 2:16:17 AM

Quote :

"while i don't really agree with him about this matter, i think i should point out that the revolt of the peasant mob doesn't have to be--and in our country, wouldn't be--a violent uprising."

bingo - how about thinking of the peasant mob as voting for a Carteresque (or worse) populist president who then enacts all kinds of shit that's 10 times more destructive to our economy than helping low income families to refinance their mortgage in order to avoid homelessness

like I said - you guys have no fucking foresight at all. Start researching the law of unintended consequences and then get back to us

[Edited on September 4, 2007 at 7:12 AM. Reason : s]

9/4/2007 7:06:40 AM

Actually, to the best of my knowledge Carter's policies were quite good. He started the policy of deregulation and appointed an inflation hawk as Fed. Chairman (Paul Volker). By the time Reagan won election all he had left to do was cut taxes, Carter had already started the ball rolling on everything else.

Now, Nixon was a populist bastard, enacting ruinous price controls and driving inflation.

9/4/2007 8:44:17 AM

close enough. my point wasn't presidential, it was policy

9/4/2007 9:49:02 AM

Quote :

"yes, i'm sure that they will have a very easy time getting any reputable landlord to rent to them after a credit check shows a foreclosure. "

Yes they will. Too many condos and apartments were built and not enough people to fill them. If you're a landlord, you will receive more money from a maybe unreliable tenant than an empty room.

[Edited on September 4, 2007 at 10:04 AM. Reason : /]

9/4/2007 10:01:44 AM

Quote :

"2. when the plebeians don't get their grain, there will be blood on the streets."

metaphor for the recession that might be on the way. being a permabull, i don't think we'll see a recession. however, the most recent overnight rate increase rationale was that of inflation.

now if inflation is under control but cost of capital (rates) stay higher than needed, and the few bad debts/subprime population drags down overall home values at an unhealthy rate, the chances of recession increase (led by lower consumer confidence, slower hiring, and lower capex). noone wants that. that said, i think the capital markets are already pricing in a rate cut in the near future.

...and just to clarify, i am against bailouts too.

9/4/2007 10:16:56 AM

Quote :

"Solinari: close enough. my point wasn't presidential, it was policy"

Read: I have no idea what I'm talking about! I'll go with LoneSnark cause he seems smart.


Pussy.

9/11/2007 8:01:53 AM

Ah ha. I was about to make that comment and I see you have already done it.

Even if your point was about policy, you cited the wrong policy in making your point, so just what the fuck were you trying to say?

9/11/2007 8:31:52 AM

I think you really need to lookup the definition of socialism.

And also point out other socialist countries that carry as much debt as the United States.

Also, if you want to be extremely technical then you'd state that the money for any bailout would, ironically, most likely come from some of the same foreign financial sources that fueled the original housing boom.

9/11/2007 1:49:28 PM