Discussion:
Honey, I Blew Up the Mortgage!
(too old to reply)
mpm
2008-07-11 01:36:20 UTC
Permalink
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?

Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??

This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!

-mpm
Jim Thompson
2008-07-11 02:38:15 UTC
Permalink
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.

...Jim Thompson
--
| James E.Thompson, P.E. | mens |
| Analog Innovations, Inc. | et |
| Analog/Mixed-Signal ASIC's and Discrete Systems | manus |
| Phoenix, Arizona 85048 Skype: Contacts Only | |
| Voice:(480)460-2350 Fax: Available upon request | Brass Rat |
| E-mail Icon at http://www.analog-innovations.com | 1962 |

Liberalism is a persistent vegetative state

Due to excessive spam, gmail, googlegroups, UAR, and AIOE blocked!
Tim Wescott
2008-07-11 03:07:20 UTC
Permalink
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.
...Jim Thompson
Many people were encouraged to lie on their mortgage applications.
That's not 'being conned'.
--
Tim Wescott
Wescott Design Services
http://www.wescottdesign.com

Do you need to implement control loops in software?
"Applied Control Theory for Embedded Systems" gives you just what it says.
See details at http://www.wescottdesign.com/actfes/actfes.html
Jim Thompson
2008-07-11 03:57:21 UTC
Permalink
Post by Tim Wescott
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.
...Jim Thompson
Many people were encouraged to lie on their mortgage applications.
That's not 'being conned'.
I don't think it was that so much as being conned. I was actually
approached by a broker offering a "no documentation" re-fi mortgage.
Since I already had a nice low interest rate, I declined.

...Jim Thompson
--
| James E.Thompson, P.E. | mens |
| Analog Innovations, Inc. | et |
| Analog/Mixed-Signal ASIC's and Discrete Systems | manus |
| Phoenix, Arizona 85048 Skype: Contacts Only | |
| Voice:(480)460-2350 Fax: Available upon request | Brass Rat |
| E-mail Icon at http://www.analog-innovations.com | 1962 |

It's what you learn, after you know it all, that counts.

Due to excessive spam, gmail, googlegroups, UAR, and AIOE blocked!
Bit Farmer
2008-07-11 13:20:34 UTC
Permalink
Post by Jim Thompson
Post by Tim Wescott
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.
...Jim Thompson
Many people were encouraged to lie on their mortgage applications.
That's not 'being conned'.
I don't think it was that so much as being conned. I was actually
approached by a broker offering a "no documentation" re-fi mortgage.
Since I already had a nice low interest rate, I declined.
...Jim Thompson
"This American Life" radio program did a hour on "The Global Pool Of Money".
Interesting study of how and why the industry ultimately moved to the
NINA (No Income, No Asset) loans. Ultimately, it was about those with
tons of money looking for a safe investment.

B. Farmer
Robert Baer
2008-07-12 07:25:21 UTC
Permalink
Post by Bit Farmer
Post by Jim Thompson
Post by Tim Wescott
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.
...Jim Thompson
Many people were encouraged to lie on their mortgage applications.
That's not 'being conned'.
I don't think it was that so much as being conned. I was actually
approached by a broker offering a "no documentation" re-fi mortgage.
Since I already had a nice low interest rate, I declined.
...Jim Thompson
"This American Life" radio program did a hour on "The Global Pool Of Money".
Interesting study of how and why the industry ultimately moved to the
NINA (No Income, No Asset) loans. Ultimately, it was about those with
tons of money looking for a safe investment.
B. Farmer
...and what the hell is "safe" about investing in FRAUD, GREED, and
CORRUPTION?
Bit Farmer
2008-07-12 14:52:50 UTC
Permalink
Post by Robert Baer
Post by Bit Farmer
Post by Jim Thompson
Post by Tim Wescott
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.
...Jim Thompson
Many people were encouraged to lie on their mortgage applications.
That's not 'being conned'.
I don't think it was that so much as being conned. I was actually
approached by a broker offering a "no documentation" re-fi mortgage.
Since I already had a nice low interest rate, I declined.
...Jim Thompson
"This American Life" radio program did a hour on "The Global Pool Of Money".
Interesting study of how and why the industry ultimately moved to the
NINA (No Income, No Asset) loans. Ultimately, it was about those with
tons of money looking for a safe investment.
B. Farmer
...and what the hell is "safe" about investing in FRAUD, GREED, and
CORRUPTION?
For those so inclined, here is the link to the program. You can listen
for free:

http://www.thisamericanlife.org/Radio_Episode.aspx?episode=355

Quick synopsis:
Essentially the American Mortgage market was considered safe. Values
were rising year after year, economy was good, and home owning was an
American tradition. With an ever growing pool of worldwide money looking
for a good return, this seem like a good investment opportunity.

Only problem is that no one really wants to hold an actual mortgage,
so mortgages were purchased and pooled together and shares in the pool sold
to investors. As with any pooling, the risk decreases. This worked quite
well and the demand for this type of investment increased. More mortgages
were needed to meet the demand. As the demand went up, those making and
selling the mortgages relaxed their requirements, ultimately ending up
with NINA (no income, no asset) loans.

When the pools started showing some weakness, then they were again pooled
into CDO - Collateralized Debt Obligations. This minimized the overall risk.
Any one pool could fail and not radically affect the return of aggregate.

The greed was essentially that of those who granted and then sold the mortgages
and those who packaged them into pools. The Global Pool of Money was just the end
customer looking for a good safe return.

B. Farmer
Jim Thompson
2008-07-12 15:05:06 UTC
Permalink
Post by Bit Farmer
Post by Robert Baer
Post by Bit Farmer
Post by Jim Thompson
Post by Tim Wescott
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.
...Jim Thompson
Many people were encouraged to lie on their mortgage applications.
That's not 'being conned'.
I don't think it was that so much as being conned. I was actually
approached by a broker offering a "no documentation" re-fi mortgage.
Since I already had a nice low interest rate, I declined.
...Jim Thompson
"This American Life" radio program did a hour on "The Global Pool Of Money".
Interesting study of how and why the industry ultimately moved to the
NINA (No Income, No Asset) loans. Ultimately, it was about those with
tons of money looking for a safe investment.
B. Farmer
...and what the hell is "safe" about investing in FRAUD, GREED, and
CORRUPTION?
For those so inclined, here is the link to the program. You can listen
http://www.thisamericanlife.org/Radio_Episode.aspx?episode=355
Essentially the American Mortgage market was considered safe. Values
were rising year after year, economy was good, and home owning was an
American tradition. With an ever growing pool of worldwide money looking
for a good return, this seem like a good investment opportunity.
Only problem is that no one really wants to hold an actual mortgage,
so mortgages were purchased and pooled together and shares in the pool sold
to investors. As with any pooling, the risk decreases. This worked quite
well and the demand for this type of investment increased. More mortgages
were needed to meet the demand. As the demand went up, those making and
selling the mortgages relaxed their requirements, ultimately ending up
with NINA (no income, no asset) loans.
When the pools started showing some weakness, then they were again pooled
into CDO - Collateralized Debt Obligations. This minimized the overall risk.
Any one pool could fail and not radically affect the return of aggregate.
The greed was essentially that of those who granted and then sold the mortgages
and those who packaged them into pools. The Global Pool of Money was just the end
customer looking for a good safe return.
B. Farmer
Yep.

But I truly think that a deep recession will be a good thing... the
leftist loonies will learn their lesson they way I like them to
learn... the hard way.

Can't you just see them all out riding their bicycles to work... to
dig ditches ?:-)

...Jim Thompson
--
| James E.Thompson, P.E. | mens |
| Analog Innovations, Inc. | et |
| Analog/Mixed-Signal ASIC's and Discrete Systems | manus |
| Phoenix, Arizona 85048 Skype: Contacts Only | |
| Voice:(480)460-2350 Fax: Available upon request | Brass Rat |
| E-mail Icon at http://www.analog-innovations.com | 1962 |

Liberalism is a persistent vegetative state
Bit Farmer
2008-07-12 15:28:17 UTC
Permalink
Post by Jim Thompson
Post by Bit Farmer
Post by Robert Baer
Post by Bit Farmer
Post by Jim Thompson
Post by Tim Wescott
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.
...Jim Thompson
Many people were encouraged to lie on their mortgage applications.
That's not 'being conned'.
I don't think it was that so much as being conned. I was actually
approached by a broker offering a "no documentation" re-fi mortgage.
Since I already had a nice low interest rate, I declined.
...Jim Thompson
"This American Life" radio program did a hour on "The Global Pool Of Money".
Interesting study of how and why the industry ultimately moved to the
NINA (No Income, No Asset) loans. Ultimately, it was about those with
tons of money looking for a safe investment.
B. Farmer
...and what the hell is "safe" about investing in FRAUD, GREED, and
CORRUPTION?
For those so inclined, here is the link to the program. You can listen
http://www.thisamericanlife.org/Radio_Episode.aspx?episode=355
Essentially the American Mortgage market was considered safe. Values
were rising year after year, economy was good, and home owning was an
American tradition. With an ever growing pool of worldwide money looking
for a good return, this seem like a good investment opportunity.
Only problem is that no one really wants to hold an actual mortgage,
so mortgages were purchased and pooled together and shares in the pool sold
to investors. As with any pooling, the risk decreases. This worked quite
well and the demand for this type of investment increased. More mortgages
were needed to meet the demand. As the demand went up, those making and
selling the mortgages relaxed their requirements, ultimately ending up
with NINA (no income, no asset) loans.
When the pools started showing some weakness, then they were again pooled
into CDO - Collateralized Debt Obligations. This minimized the overall risk.
Any one pool could fail and not radically affect the return of aggregate.
The greed was essentially that of those who granted and then sold the mortgages
and those who packaged them into pools. The Global Pool of Money was just the end
customer looking for a good safe return.
B. Farmer
Yep.
But I truly think that a deep recession will be a good thing... the
leftist loonies will learn their lesson they way I like them to
learn... the hard way.
Can't you just see them all out riding their bicycles to work... to
dig ditches ?:-)
...Jim Thompson
My bet is that the ones doing the mortgages, packaging, and pooling
were not leftist weenies, but those of a more rightist conservative
leaning, e.g. Wall Street suits.

A deep recession does let the gas out of the balloon. People do
redefine their values in tough times. In a drought, the river will
run down, but the stream runs dry. Good time to have money. Tougher
time if you don't

B. Farmer
Jim Thompson
2008-07-12 15:50:18 UTC
Permalink
[snip]
Post by Bit Farmer
Post by Jim Thompson
Post by Bit Farmer
The greed was essentially that of those who granted and then sold the mortgages
and those who packaged them into pools. The Global Pool of Money was just the end
customer looking for a good safe return.
B. Farmer
Yep.
But I truly think that a deep recession will be a good thing... the
leftist loonies will learn their lesson they way I like them to
learn... the hard way.
Can't you just see them all out riding their bicycles to work... to
dig ditches ?:-)
...Jim Thompson
My bet is that the ones doing the mortgages, packaging, and pooling
were not leftist weenies, but those of a more rightist conservative
leaning, e.g. Wall Street suits.
A deep recession does let the gas out of the balloon. People do
redefine their values in tough times. In a drought, the river will
run down, but the stream runs dry. Good time to have money. Tougher
time if you don't
B. Farmer
It readjusts wage ratios to what the market will bear, not what the
leftist loonies want to impose as "minimum wage".

Personally a recession will be good for business, every time there is
a downturn, engineers get laid off and consultants get hired... we
represent no overhead or hidden costs to contend with... during the
Carter era I was paying over $100K in income taxes... last year I paid
$1878.

...Jim Thompson
--
| James E.Thompson, P.E. | mens |
| Analog Innovations, Inc. | et |
| Analog/Mixed-Signal ASIC's and Discrete Systems | manus |
| Phoenix, Arizona 85048 Skype: Contacts Only | |
| Voice:(480)460-2350 Fax: Available upon request | Brass Rat |
| E-mail Icon at http://www.analog-innovations.com | 1962 |

Liberalism is a persistent vegetative state
Rene Tschaggelar
2008-07-16 08:34:35 UTC
Permalink
Post by Bit Farmer
"This American Life" radio program did a hour on "The Global Pool Of Money".
Interesting study of how and why the industry ultimately moved to the
NINA (No Income, No Asset) loans. Ultimately, it was about those with
tons of money looking for a safe investment.
B. Farmer
Our retirement fund for example ... your retirements fund ...
to provide us our retirement money

Rene
James Arthur
2008-07-11 18:05:31 UTC
Permalink
Post by Jim Thompson
Post by Tim Wescott
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.
...Jim Thompson
Many people were encouraged to lie on their mortgage applications.
That's not 'being conned'.
I don't think it was that so much as being conned. I was actually
approached by a broker offering a "no documentation" re-fi mortgage.
Since I already had a nice low interest rate, I declined.
...Jim Thompson
But that "no documentation" re-fi still required you to state
your income, yes? "No documentation" just meant they'd take
your word on it and not bother to check.

Which they didn't. Hence the inducement to lie.

Count me with Tim on this one.

If you lie with dogs...don't be surprised if you get fleeced.


Cheers,
James Arthur
Joerg
2008-07-11 19:15:33 UTC
Permalink
Post by Tim Wescott
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.
...Jim Thompson
Many people were encouraged to lie on their mortgage applications.
That's not 'being conned'.
Exactly. Those people have either lied on the application which
constitutes mail fraud or they have lied to the taxman which constitutes
tax fraud. Or both. IIRC Rush Limbaugh had worded it in similar fashion.

Personally I do not think they should just be bailed out. If someone has
an income of $50k/year, wife and several kids and buys a $750k mansion
that's plain stupid.
--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.
James Arthur
2008-07-11 20:22:21 UTC
Permalink
Post by Joerg
Post by Tim Wescott
Many people were encouraged to lie on their mortgage applications.
That's not 'being conned'.
Exactly. Those people have either lied on the application which
constitutes mail fraud or they have lied to the taxman which constitutes
tax fraud. Or both. IIRC Rush Limbaugh had worded it in similar fashion.
Personally I do not think they should just be bailed out. If someone has
an income of $50k/year, wife and several kids and buys a $750k mansion
that's plain stupid.
Yes. And what have they lost? A few years' rent, which is what
they should've been doing anyhow, plus the inconvenience of
declaring belly-up. It's lenders who stand to lose big.

Both political parties love bailout though--it's great for the
buyers, who get discounted homes, great for city governments,
whose tax revenues are bolstered along with home prices, and
it's GREAT for lenders, because their bad loans get repaid.
By us.

It's bad for responsible, tax-paying people, people shut out
of the market by the speculation who were waiting for prices
to come back to earth, and bad for young buyers trying to get
into their first homes.

James Arthur
mpm
2008-07-12 00:29:40 UTC
Permalink
Yes. And what have they lost? �A few years' rent, which is what
they should've been doing anyhow, plus the inconvenience of
declaring belly-up. It's lenders who stand to lose big.
Well, not exactly. Or at least, not directly.
That Phil Gramm asshole I mentioned previously had the bright idea to
allow mortgages to be repackaged, and repackaged and repackaged as
"investment" grade paper - under the guise of mortgage-backed
securities.

So now, the stock market is bearing the burden of all this bad
debt.
Except for a notable few, the banks get off pretty light.

But as long as the Fed basically makes money "free", investors will
clamor (banks included) - always thinking they can repackage 'em again
and sell it at a profit. The banks meanwhile pawn off their risk to
pension funds, retirement funds, etc...

It's just one gigantic screwing.
James Arthur
2008-07-12 01:53:05 UTC
Permalink
Post by mpm
Yes. And what have they lost? �A few years' rent, which is what
they should've been doing anyhow, plus the inconvenience of
declaring belly-up. It's lenders who stand to lose big.
Well, not exactly. Or at least, not directly.
There are several nuances I skipped over.
Post by mpm
That Phil Gramm asshole I mentioned previously had the bright idea to
allow mortgages to be repackaged, and repackaged and repackaged as
"investment" grade paper - under the guise of mortgage-backed
securities.
That's not inherently bad. The problem is/was that some
packagers represented risky loans as prime. That's fraud.
They should be prosecuted.

The overall packages might even be reasonable: a few clinkers
averaged in with a bunch of good loans. Like the butcher
cutting his ground beef with a few lard trimmings. Problem
is of the loans we don't know and can't tell which are which,
or the extent of the deceit.

But even prime loans--20% equity, by definition--are now junk
by virtue of the (over due and under-done) drop in prices.
That's a lender's problem of lending into a bubble.

That should not cause any problems for the buyers--if they
got a good house for an affordable payment, what's changed?
If the paper value is different today, so what? If you bought
a pair of socks last week, and now see them on sale, how does
that hurt you?

It doesn't. Not unless you were planning to turn the thing
over quickly, i.e., speculating.
Post by mpm
So now, the stock market is bearing the burden of all this bad
debt.
Except for a notable few, the banks get off pretty light.
Investors deserve good information. To the extent they
bamboozled others about the investments, the perps should
fry.

Investors also take risks, expecting a return. It's each
investor's job to assess and assume those risks. No one
paid off the Enron shareholders, and no one should.

It's not the taxpayer's job to bail out investors,
lenders, or gamblers.
Post by mpm
But as long as the Fed basically makes money "free", investors will
clamor (banks included) - always thinking they can repackage 'em again
and sell it at a profit. The banks meanwhile pawn off their risk to
pension funds, retirement funds, etc...
It's just one gigantic screwing.
Don't forget Fannie Mae and Freddie Mac, who hold 1/2 the
mortgages in the country. Investor-owned, but implicitly
federally backed, not much can happen without their
consent. They'd be a lot more careful if they thought
they were really risking their own money.

Chalk up another success for government intervention.

Cheers,
James Arthur
Martin Brown
2008-07-14 10:06:57 UTC
Permalink
Post by James Arthur
Post by mpm
Yes. And what have they lost? �A few years' rent, which is what
they should've been doing anyhow, plus the inconvenience of
declaring belly-up. It's lenders who stand to lose big.
Well, not exactly. Or at least, not directly.
There are several nuances I skipped over.
Post by mpm
That Phil Gramm asshole I mentioned previously had the bright idea to
allow mortgages to be repackaged, and repackaged and repackaged as
"investment" grade paper - under the guise of mortgage-backed
securities.
That's not inherently bad. The problem is/was that some
packagers represented risky loans as prime. That's fraud.
They should be prosecuted.
But you can bet your bottom dollar that they won't be. Far too much
dirty banking linen out there to be washed in public.

Repackaging NINA mortgages as AAA was predicated on a rising market. In
a falling market all hell breaks loose - and amazingly the US taxpayers
will have to bear the brunt as Fannie Mae and Freddie Mac go to the
wall. Or rather to prevent that and the associated financial chaos the
Fed writes them a blank cheque crossed "not exceeding $5 trillion".

Indymac is effectively already nationalised. How many more will follow?
http://seattletimes.nwsource.com/html/nationworld/2008050120_indymac14.html

A few very smart hedge fund managers will likely make a mint by shorting
some of these low confidence stocks - considerably amplifying the damage
to the market and taking a hefty profit cut for themselves.
Post by James Arthur
The overall packages might even be reasonable: a few clinkers
averaged in with a bunch of good loans. Like the butcher
cutting his ground beef with a few lard trimmings. Problem
is of the loans we don't know and can't tell which are which,
or the extent of the deceit.
But even prime loans--20% equity, by definition--are now junk
by virtue of the (over due and under-done) drop in prices.
That's a lender's problem of lending into a bubble.
And also a buyers problem if they find they are out of a job due to the
recession. The cheapest houses on sale in the USA are now apparently
down to under £3000 - in places where the main corporate employers have
just closed.

If you are stuck with negative equity then there is no easy answer. And
the flood of repossessed homes drives down the prices even further.
Post by James Arthur
That should not cause any problems for the buyers--if they
got a good house for an affordable payment, what's changed?
If the paper value is different today, so what? If you bought
a pair of socks last week, and now see them on sale, how does
that hurt you?
It doesn't. Not unless you were planning to turn the thing
over quickly, i.e., speculating.
But lots of people were doing exactly that - and therein lies the
problem. What was going on only works in a rising market.
Post by James Arthur
Investors also take risks, expecting a return. It's each
investor's job to assess and assume those risks. No one
paid off the Enron shareholders, and no one should.
It's not the taxpayer's job to bail out investors,
lenders, or gamblers.
I agree entirely. Here the problem is one of moral hazard. And a
privately owned major bank would not significantly alter things. The
biggest banks and some hedge funds are now too large to be allowed to fail.
Post by James Arthur
Don't forget Fannie Mae and Freddie Mac, who hold 1/2 the
mortgages in the country. Investor-owned, but implicitly
federally backed, not much can happen without their
consent. They'd be a lot more careful if they thought
they were really risking their own money.
Chalk up another success for government intervention.
For once I find myself in full agreement with you.

Regards,
Martin Brown
** Posted from http://www.teranews.com **
MooseFET
2008-07-14 13:42:43 UTC
Permalink
On Jul 14, 3:06 am, Martin Brown <|||***@nezumi.demon.co.uk>
wrote:

[... acting on the crimes in mortgage melt down...]
Post by Martin Brown
But you can bet your bottom dollar that they won't be. Far too much
dirty banking linen out there to be washed in public.
Also if you look at the list of foxes and chicken coop guards you will
find a lot of last names in common. This is no accident. In many
cases, you will also notice that the first names are the same too.
You will also see some family members on the opposing sides. One
example is Phil Gramm's wife, Wendy Gramm, was on Enron's board while
Phil Gram was making the "Enron loop hole", so she was the fox while
he was the chicken coop guard. He then went and got a job with EBS
before he took the job with McCain.

Free markets work a lot better when those involved are kept honest and
things are kept in the open. This is a case where they weren't kept
honest and an obvious failure happened. In other cases dishonesty has
just resulted in smaller losses or less growth than there would have
been otherwise.

[....]
Post by Martin Brown
Indymac is effectively already nationalised. How many more will follow?http://seattletimes.nwsource.com/html/nationworld/2008050120_indymac1...
FanyMae and FredyMac were national when they started. They privatized
their profits and kept the risk public. They were supposed to make
safe investments to have the money to cover the risk they were taking
in the mortgages. Unfortunately, they invested in mortgage funds as
their "safe investment". It was less safe but in made them more
earnings. Since they are "too big to fail" the tax payers have
assumed the risk.

[....]
Post by Martin Brown
A few very smart hedge fund managers will likely make a mint by shorting
some of these low confidence stocks - considerably amplifying the damage
to the market and taking a hefty profit cut for themselves.
I doubt that there is much to be made that way. We are seeing a
reduction in the total paper wealth. This means that there is no
growth to take a hunk of. The biggest thing that the smart folk will
be doing is making sure that it is others who take the loss.

[....]
Post by Martin Brown
And also a buyers problem if they find they are out of a job due to the
recession. The cheapest houses on sale in the USA are now apparently
down to under £3000 - in places where the main corporate employers have
just closed.
There have always been towns like that. The number of those is small
so while it is sad for that few that isn't the big story. It is the
large cities that are seeing a 20% drop in the prices of houses that
have 90% mortgages on them that are the bigger story. There are now
many people who have lost what little down payment they had. Some of
these have also had to move down the job market at the same time. For
them life will be rough. They may not have enough to send their
children to college resulting in a long term loss of growth to the
family.
Post by Martin Brown
If you are stuck with negative equity then there is no easy answer. And
the flood of repossessed homes drives down the prices even further.
Where I am the house prices have not dropped significantly if at all.
In a nearby city (Tracy Calif) they are dropping quite a bit. Tracy
is where the new growth in houses was. It is also where the long
commutes are seen. The high price of gas is also involved in the
decline of house prices. It isn't all due to the "mortgage crisis".
Nico Coesel
2008-07-14 17:19:18 UTC
Permalink
Post by James Arthur
That should not cause any problems for the buyers--if they
got a good house for an affordable payment, what's changed?
If the paper value is different today, so what? If you bought
a pair of socks last week, and now see them on sale, how does
that hurt you?
Well, there could be a problem. At least, over here you would have a
problem. A house represents a pawn to secure the loan. If the value of
the house drops, then the loan isn't covered enough. This may cause
the bank to require the home owners to reduce the loan.
--
Programmeren in Almere?
E-mail naar ***@nctdevpuntnl (punt=.)
James Arthur
2008-07-19 01:41:38 UTC
Permalink
Post by Nico Coesel
Post by James Arthur
That should not cause any problems for the buyers--if they
got a good house for an affordable payment, what's changed?
If the paper value is different today, so what? If you bought
a pair of socks last week, and now see them on sale, how does
that hurt you?
Well, there could be a problem. At least, over here you would have a
problem. A house represents a pawn to secure the loan. If the value of
the house drops, then the loan isn't covered enough. This may cause
the bank to require the home owners to reduce the loan.
Banks can't do that here. "Homeowners" whose houses have
lost value, however, will sometimes just quit paying and leave.
They aren't supposed to do that, but they do.

The bank then gets the house and takes the loss.

James Arthur

Eeyore
2008-07-11 09:33:33 UTC
Permalink
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
points. Be calm, stand back, and watch for the outcome.
Who APPROVED those mortgages ?

Graham
MooseFET
2008-07-11 13:47:23 UTC
Permalink
Post by Eeyore
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi.   Like we taxpayers need to securitize your home
makeover?  That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that.  I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone.  So
many people were conned into refi's, to fleece them for fees and
points.  Be calm, stand back, and watch for the outcome.
Who APPROVED those mortgages ?
Thanks to an amendment tacked onto a bill in (IIRC) Jan of 2000 by
Phil Gramm, the ones deciding to approve the mortgage didn't stand to
loose if the borrower couldn't pay. The market in (the term escapes
me right now) was deregulated and allowed to operate in secret. These
are basically an insurance that investors can buy and sell that insure
against a loss in an investment. The folks approving the loans were
turning them into investments that were insured and then divided up
into smaller chunks and re-insured and then sold and bundled together
and redivided and resold and re-insured to the point where nobody knew
what was going on.

There investors had a huge pool of money and didn't understand what
they were investing in. The borrowers were often betting that they
could resell the house in a few years into the ever growing market.
It was a classic bubble built around the powerful combination of greed
and ignorance.
mpm
2008-07-11 14:00:55 UTC
Permalink
Post by MooseFET
Post by Eeyore
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. � Like we taxpayers need to securitize your home
makeover? �That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. �I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. �So
many people were conned into refi's, to fleece them for fees and
points. �Be calm, stand back, and watch for the outcome.
Who APPROVED those mortgages ?
Thanks to an amendment tacked onto a bill in (IIRC) Jan of 2000 by
Phil Gramm, the ones deciding to approve the mortgage didn't stand to
loose if the borrower couldn't pay. �The market in (the term escapes
me right now) was deregulated and allowed to operate in secret. �These
are basically an insurance that investors can buy and sell that insure
against a loss in an investment. �The folks approving the loans were
turning them into investments that were insured and then divided up
into smaller chunks and re-insured and then sold and bundled together
and redivided and resold and re-insured to the point where nobody knew
what was going on.
There investors had a huge pool of money and didn't understand what
they were investing in. �The borrowers were often betting that they
could resell the house in a few years into the ever growing market.
It was a classic bubble built around the powerful combination of greed
and ignorance.- Hide quoted text -
- Show quoted text -
The same Phil Gramm who is now McCain's chief financial advisor??
The same Phil Gramm who just called us a "nation of whiners" whose
economic complaints are mostly "mental."??

Wonderful! Maybe I should re-think my vote.
Wonderful!
MooseFET
2008-07-12 03:26:56 UTC
Permalink
Post by mpm
Post by MooseFET
Post by Eeyore
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. � Like we taxpayers need to securitize your home
makeover? �That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. �I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. �So
many people were conned into refi's, to fleece them for fees and
points. �Be calm, stand back, and watch for the outcome.
Who APPROVED those mortgages ?
Thanks to an amendment tacked onto a bill in (IIRC) Jan of 2000 by
Phil Gramm, the ones deciding to approve the mortgage didn't stand to
loose if the borrower couldn't pay. �The market in (the term escapes
me right now) was deregulated and allowed to operate in secret. �These
are basically an insurance that investors can buy and sell that insure
against a loss in an investment. �The folks approving the loans were
turning them into investments that were insured and then divided up
into smaller chunks and re-insured and then sold and bundled together
and redivided and resold and re-insured to the point where nobody knew
what was going on.
There investors had a huge pool of money and didn't understand what
they were investing in. �The borrowers were often betting that they
could resell the house in a few years into the ever growing market.
It was a classic bubble built around the powerful combination of greed
and ignorance.- Hide quoted text -
- Show quoted text -
The same Phil Gramm who is now McCain's chief financial advisor??
The same Phil Gramm who just called us a "nation of whiners" whose
economic complaints are mostly "mental."??
Yes Phil (Enron loophole) Gramm is explaining economics to McCain and
Carly (Destroy HP) Fiorina is being considered for the VP slot. May
God have mercy on us all.
Post by mpm
Wonderful!  Maybe I should re-think my vote.
Wonderful!
donald
2008-07-12 20:19:41 UTC
Permalink
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
These mortgage broker were all republicans, don't you read the paper.
Post by Jim Thompson
points. Be calm, stand back, and watch for the outcome.
...Jim Thompson
John Larkin
2008-07-12 19:37:43 UTC
Permalink
Post by donald
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
These mortgage broker were all republicans, don't you read the paper.
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x4485795


"Clinton, Republicans agree to deregulation of US financial system
(November 1999)

An agreement between the Clinton administration and congressional
Republicans, reached during all-night negotiations which concluded in
the early hours of October 22, sets the stage for passage of the most
sweeping banking deregulation bill in American history, lifting
virtually all restraints on the operation of the giant monopolies
which dominate the financial system.

The proposed Financial Services Modernization Act of 1999 would do
away with restrictions on the integration of banking, insurance and
stock trading imposed by the Glass-Steagall Act of 1933, one of the
central pillars of Roosevelt's New Deal. Under the old law, banks,
brokerages and insurance companies were effectively barred from
entering each others' industries, and investment banking and
commercial banking were separated."



http://www.motherjones.com/commentary/columns/2008/03/deregulation-economic-crisis.html

"Yet Bill Clinton, elected in large part because of that recession (a
la James Carville's "It's the economy, stupid"), was talking about
deregulation before he was even inaugurated. The National Review
reported that "Bill Clinton embraced at least one Reaganesque idea at
the Little Rock economic summit" he held in December 1992: "banking
deregulation."


So, which hundred-millionaire in the USA was most responsible for the
current worldwide mortgage meltdown?


John
donald
2008-07-12 22:01:12 UTC
Permalink
Post by John Larkin
Post by donald
Post by Jim Thompson
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
I don't think it's quite as simple as that. I don't know if it's been
reported in the leftist weenie newspapers, but the Feds have arrested
many unscrupulous mortgage brokers, some 300 in Arizona alone. So
many people were conned into refi's, to fleece them for fees and
These mortgage broker were all republicans, don't you read the paper.
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x4485795
"Clinton, Republicans agree to deregulation of US financial system
(November 1999)
An agreement between the Clinton administration and congressional
Republicans,
Yes

reached during all-night negotiations which concluded in
Post by John Larkin
the early hours of October 22, sets the stage for passage of the most
sweeping banking deregulation bill in American history, lifting
virtually all restraints on the operation of the giant monopolies
which dominate the financial system.
The proposed Financial Services Modernization Act of 1999 would do
away with restrictions on the integration of banking, insurance and
stock trading imposed by the Glass-Steagall Act of 1933, one of the
central pillars of Roosevelt's New Deal. Under the old law, banks,
brokerages and insurance companies were effectively barred from
entering each others' industries, and investment banking and
commercial banking were separated."
http://www.motherjones.com/commentary/columns/2008/03/deregulation-economic-crisis.html
"Yet Bill Clinton, elected in large part because of that recession (a
la James Carville's "It's the economy, stupid"), was talking about
deregulation before he was even inaugurated. The National Review
reported that "Bill Clinton embraced at least one Reaganesque idea at
the Little Rock economic summit" he held in December 1992: "banking
deregulation."
So, which hundred-millionaire in the USA was most responsible for the
current worldwide mortgage meltdown?
John
Bob
2008-07-11 03:20:03 UTC
Permalink
The USA had better hope my views on economics are wrong.
Post by mpm
Is anybody else angry that the government seems poised to
bail out homeowners who made BAD financial decisions?
If you look at the big picture it doesn't really matter.
It's not going to stop people in the USA suffering
some serious economic pain in a few years.

The USA has had a trade deficit since the 1970's.

You have been paying for oil, chinese TV's and DVD
players with pieces of paper promising payment.

The US government can print as many dollars as
they like, so why have they borrowed trillions
of dollars by issuing treasury bills?

The answer is that printing money now creates
inflation now. Printing money to pay T-bills
in the future creates more inflation long
after the current politicians have lined
their pockets and gone.

The foreign central banks and oil selling country
holding t-bills are on the brink of realising
that they have swapped goods for near worthless
paper.

When that confidence trick unwinds the USA
has the choice of serious inflation or
defaulting on their debts.
Plenty of people say that can't possibly happen,
but a bit like the estate agents who assured
people that house prices would never going
down in every property boom this century,
they will be proved wrong.

The financial people believed that sovereign
countries never defaulted on their debts until
Russia defaulted and LTCM had to be
bailed out to stop the global financial
system having big problems.

The amount of money going around in
circles in derivatives contracts is larger
than the GDP of the whole world.
That money has been recorded as a profit
on the accounts. Remember the massive
profits that Enron reported, which one
day turned out to be a fantasy?

When the derivatives contracts start to
unwind and the trickle of hedge funds going
bankrupt turns into a flood the property
downturn and "credit crunch" will seem
insignificant.

If the USA has hyperinflation then the
morgages that people can't pay will cease
to matter.

If they default on their debts then
oil will be much more expensive for them and
the flow of consumer goods like cheap
chinese DVD players will stop.

Either way the USA's standard of living
will plumet.
The people with their McMansions will
suffer wether or not they are bailed out
of their mortgagues.

I'm not a resident of the USA so I'm
more concerned about the global effects.

On one hand I think stupid people should
suffer so I think the countrys that
hold billions of the USA's debt should
suffer.

On the other hand it will be nice to
see republican assholes like Jim
Thompson suffer. It's people like
him who have built a country where
people generally need a car to get
from their house to the shops so
it will really hurt when they
have to reduce their profligate
oil consumption.

Bob
John Larkin
2008-07-11 04:28:38 UTC
Permalink
Post by Bob
The USA had better hope my views on economics are wrong.
Post by mpm
Is anybody else angry that the government seems poised to
bail out homeowners who made BAD financial decisions?
If you look at the big picture it doesn't really matter.
It's not going to stop people in the USA suffering
some serious economic pain in a few years.
The USA has had a trade deficit since the 1970's.
You have been paying for oil, chinese TV's and DVD
players with pieces of paper promising payment.
The US government can print as many dollars as
they like, so why have they borrowed trillions
of dollars by issuing treasury bills?
The answer is that printing money now creates
inflation now. Printing money to pay T-bills
in the future creates more inflation long
after the current politicians have lined
their pockets and gone.
The foreign central banks and oil selling country
holding t-bills are on the brink of realising
that they have swapped goods for near worthless
paper.
When that confidence trick unwinds the USA
has the choice of serious inflation or
defaulting on their debts.
Plenty of people say that can't possibly happen,
but a bit like the estate agents who assured
people that house prices would never going
down in every property boom this century,
they will be proved wrong.
The financial people believed that sovereign
countries never defaulted on their debts until
Russia defaulted and LTCM had to be
bailed out to stop the global financial
system having big problems.
The amount of money going around in
circles in derivatives contracts is larger
than the GDP of the whole world.
That money has been recorded as a profit
on the accounts. Remember the massive
profits that Enron reported, which one
day turned out to be a fantasy?
When the derivatives contracts start to
unwind and the trickle of hedge funds going
bankrupt turns into a flood the property
downturn and "credit crunch" will seem
insignificant.
If the USA has hyperinflation then the
morgages that people can't pay will cease
to matter.
If they default on their debts then
oil will be much more expensive for them and
the flow of consumer goods like cheap
chinese DVD players will stop.
Either way the USA's standard of living
will plumet.
The people with their McMansions will
suffer wether or not they are bailed out
of their mortgagues.
I'm not a resident of the USA so I'm
more concerned about the global effects.
On one hand I think stupid people should
suffer so I think the countrys that
hold billions of the USA's debt should
suffer.
On the other hand it will be nice to
see republican assholes like Jim
Thompson suffer. It's people like
him who have built a country where
people generally need a car to get
from their house to the shops so
it will really hurt when they
have to reduce their profligate
oil consumption.
Bob
Hate to disappoint you...

http://en.wikipedia.org/wiki/List_of_countries_by_public_debt

http://www.globalaging.org/health/world/depopulationeuropejapan.htm

http://www.data360.org/dsg.aspx?Data_Set_Group_Id=230

John
Bob
2008-07-11 05:43:26 UTC
Permalink
On Jul 11, 5:28 am, John Larkin
Post by John Larkin
Post by Bob
The USA had better hope my views on economics are wrong.
Post by mpm
Is anybody else angry that the government seems poised to
bail out homeowners who made BAD financial decisions?
If you look at the big picture it doesn't really matter.
It's not going to stop people in the USA suffering
some serious economic pain in a few years.
The USA has had a trade deficit since the 1970's.
You have been paying for oil, chinese TV's and DVD
players with pieces of paper promising payment.
The US government can print as many dollars as
they like, so why have they borrowed trillions
of dollars by issuing treasury bills?
The answer is that printing money now creates
inflation now. Printing money to pay T-bills
in the future creates more inflation long
after the current politicians have lined
their pockets and gone.
The foreign central banks and oil selling country
holding t-bills are on the brink of realising
that they have swapped goods for near worthless
paper.
When that confidence trick unwinds the USA
has the choice of serious inflation or
defaulting on their debts.
Plenty of people say that can't possibly happen,
but a bit like the estate agents who assured
people that house prices would never going
down in every property boom this century,
they will be proved wrong.
The financial people believed that sovereign
countries never defaulted on their debts until
Russia defaulted and LTCM had to be
bailed out to stop the global financial
system having big problems.
The amount of money going around in
circles in derivatives contracts is larger
than the GDP of the whole world.
That money has been recorded as a profit
on the accounts. Remember the massive
profits that Enron reported, which one
day turned out to be a fantasy?
When the derivatives contracts start to
unwind and the trickle of hedge funds going
bankrupt turns into a flood the property
downturn and "credit crunch" will seem
insignificant.
If the USA has hyperinflation then the
morgages that people can't pay will cease
to matter.
If they default on their debts then
oil will be much more expensive for them and
the flow of consumer goods like cheap
chinese DVD players will stop.
Either way the USA's standard of living
will plumet.
The people with their McMansions will
suffer wether or not they are bailed out
of their mortgagues.
I'm not a resident of the USA so I'm
more concerned about the global effects.
On one hand I think stupid people should
suffer so I think the countrys that
hold billions of the USA's debt should
suffer.
On the other hand it will be nice to
see republican assholes like Jim
Thompson suffer. It's people like
him who have built a country where
people generally need a car to get
from their house to the shops so
it will really hurt when they
have to reduce their profligate
oil consumption.
Bob
Hate to disappoint you...
http://en.wikipedia.org/wiki/List_of_countries_by_public_debt
http://www.globalaging.org/health/world/depopulationeuropejapan.htm
http://www.data360.org/dsg.aspx?Data_Set_Group_Id=230
John
That list just lists government debt. The USA
has a huge amount of private debt as well.

So the USA is not in as bad a state as Zimbabwe
and some other countrys, it's still going to be painfull.

The US standard of living is based on increasing
debt. When the debt can't be increased any more
somthing has to be cut.

Treasury bill yield is being increased to
keep money rolling over into new t-bills instead
of them being cashed in. Just storing up
more inflation for the future.

David Walker resigned as comptroller of the
US government in february after causing
minor embrassment by going around giving
talks saying the USA's debt and policys
of spending more money in future are unsustainable.
The politician's didn't want to hear it,
they want to spend now, be popular by
the giving the people luxurys they can't
really afford and leave the debt for
someone else to deal with.

The aging population of Europe and Japan
causing a labour shortage is a red herring.

We live in an industrialised society,
we don't need lots of labours working in
the fields to produce food.
The UK govenment seems to be engaged in
mass manipulation to reduce the unemployment
figures, employing hundreds of thousands
of useless paper pushers in the health
service and creating all sorts of
schemes to keep the ill-educated
youth off the unemployment figures.

If the number of paper pushers drops I don't
think it will matter, their jobs are really
creating any value anyway.

Most of the jobs requiring physical effort
like picking potatoes and constructing
buildings are done by immigrants anyway.

Bob
MooseFET
2008-07-11 13:56:28 UTC
Permalink
Post by Bob
On Jul 11, 5:28 am, John Larkin
[.. debt ..]
Post by Bob
Post by John Larkin
Hate to disappoint you...
http://en.wikipedia.org/wiki/List_of_countries_by_public_debt
http://www.globalaging.org/health/world/depopulationeuropejapan.htm
http://www.data360.org/dsg.aspx?Data_Set_Group_Id=230
John
That list just lists government debt.
It doesn't really even list that. It only lists the amounts that the
governments have borrowed. It doesn't include all the other promised
payments that haven't yet come due. Many, perhaps all, countries have
huge amounts of outstanding debt beyond those figures.
Jim Thompson
2008-07-11 14:28:30 UTC
Permalink
[snip]
Post by Bob
On the other hand it will be nice to
see republican assholes like Jim
Thompson suffer. It's people like
him who have built a country where
people generally need a car to get
from their house to the shops so
it will really hurt when they
have to reduce their profligate
oil consumption.
Bob
[snip]

If "Bob9" were paying attention he would have already noted that I
said yesterday that I like $4 gas... it's already thinned down the
rush hour enough to make it tolerable.

When gas gets to $10/gallon we "republican assholes" will have the
roads all to ourselves ;-)

...Jim Thompson
--
| James E.Thompson, P.E. | mens |
| Analog Innovations, Inc. | et |
| Analog/Mixed-Signal ASIC's and Discrete Systems | manus |
| Phoenix, Arizona 85048 Skype: Contacts Only | |
| Voice:(480)460-2350 Fax: Available upon request | Brass Rat |
| E-mail Icon at http://www.analog-innovations.com | 1962 |

Liberalism is a persistent vegetative state

Due to excessive spam, gmail, googlegroups, UAR, and AIOE blocked!
Jamie
2008-07-12 22:59:20 UTC
Permalink
Post by Jim Thompson
[snip]
Post by Bob
On the other hand it will be nice to
see republican assholes like Jim
Thompson suffer. It's people like
him who have built a country where
people generally need a car to get
from their house to the shops so
it will really hurt when they
have to reduce their profligate
oil consumption.
Bob
[snip]
If "Bob9" were paying attention he would have already noted that I
said yesterday that I like $4 gas... it's already thinned down the
rush hour enough to make it tolerable.
When gas gets to $10/gallon we "republican assholes" will have the
roads all to ourselves ;-)
...Jim Thompson
Sure, lots of space for that bicycle ride ay!
--
http://webpages.charter.net/jamie_5"
YD
2008-07-13 20:01:30 UTC
Permalink
Late at night, by candle light, Jim Thompson
Post by Jim Thompson
[snip]
Post by Bob
On the other hand it will be nice to
see republican assholes like Jim
Thompson suffer. It's people like
him who have built a country where
people generally need a car to get
from their house to the shops so
it will really hurt when they
have to reduce their profligate
oil consumption.
Bob
[snip]
If "Bob9" were paying attention he would have already noted that I
said yesterday that I like $4 gas... it's already thinned down the
rush hour enough to make it tolerable.
When gas gets to $10/gallon we "republican assholes" will have the
roads all to ourselves ;-)
...Jim Thompson
Sums up nicely what you're really worth. In effect, just about
nothing.

-YD.
--
Remove HAT if replying by mail.
Jim Thompson
2008-07-13 20:29:37 UTC
Permalink
Post by YD
Late at night, by candle light, Jim Thompson
Post by Jim Thompson
[snip]
Post by Bob
On the other hand it will be nice to
see republican assholes like Jim
Thompson suffer. It's people like
him who have built a country where
people generally need a car to get
from their house to the shops so
it will really hurt when they
have to reduce their profligate
oil consumption.
Bob
[snip]
If "Bob9" were paying attention he would have already noted that I
said yesterday that I like $4 gas... it's already thinned down the
rush hour enough to make it tolerable.
When gas gets to $10/gallon we "republican assholes" will have the
roads all to ourselves ;-)
...Jim Thompson
Sums up nicely what you're really worth. In effect, just about
nothing.
-YD.
Whatsa matter little baby YD, can't afford gasoline? Why did you buy
a car if you can't afford to drive it?

...Jim Thompson
--
| James E.Thompson, P.E. | mens |
| Analog Innovations, Inc. | et |
| Analog/Mixed-Signal ASIC's and Discrete Systems | manus |
| Phoenix, Arizona 85048 Skype: Contacts Only | |
| Voice:(480)460-2350 Fax: Available upon request | Brass Rat |
| E-mail Icon at http://www.analog-innovations.com | 1962 |

Liberalism is a persistent vegetative state
legg
2008-07-11 15:59:14 UTC
Permalink
On Thu, 10 Jul 2008 21:28:38 -0700, John Larkin
Post by John Larkin
Hate to disappoint you...
http://en.wikipedia.org/wiki/List_of_countries_by_public_debt
I note that the map and chart disagree with each other.

Questions the accuracy of either.

Neither gives an indication actual volume of debt, per capita debt, or
trends in same.

The unsettling thing about the 'economy', is it's tendency to react to
perception, rather than reality. A confidence trick.

RL
John Larkin
2008-07-13 21:19:55 UTC
Permalink
Post by legg
On Thu, 10 Jul 2008 21:28:38 -0700, John Larkin
Post by John Larkin
Hate to disappoint you...
http://en.wikipedia.org/wiki/List_of_countries_by_public_debt
I note that the map and chart disagree with each other.
Questions the accuracy of either.
Neither gives an indication actual volume of debt, per capita debt, or
trends in same.
It uses debt/GDP, which seems reasonable to me. Per capita debt
ignores productivity; a person with a high income is less threatened
by a $10,000 debt than a person with little income.
Post by legg
The unsettling thing about the 'economy', is it's tendency to react to
perception, rather than reality. A confidence trick.
RL
Feel free to do your own research. Let us know if you find evidence
that the Wiki table is incorrect.

John
Glenn Gundlach
2008-07-11 05:24:16 UTC
Permalink
Post by Bob
The USA had better hope my views on economics are wrong.
they probably are
Post by Bob
Post by mpm
Is anybody else angry that the government seems poised to
bail out homeowners who made BAD financial decisions?
If you look at the big picture it doesn't really matter.
It's not going to stop people in the USA suffering
some serious economic pain in a few years.
The USA has had a trade deficit since the 1970's.
You have been paying for oil, chinese TV's and DVD
players with pieces of paper promising payment.
The US government can print as many dollars as
they like, so why have they borrowed trillions
of dollars by issuing treasury bills?
The answer is that printing money now creates
inflation now. Printing money to pay T-bills
in the future creates more inflation long
after the current politicians have lined
their pockets and gone.
The foreign central banks and oil selling country
holding t-bills are on the brink of realising
that they have swapped goods for near worthless
paper.
When that confidence trick unwinds the USA
has the choice of serious inflation or
defaulting on their debts.
Plenty of people say that can't possibly happen,
but a bit like the estate agents who assured
people that house prices would never going
down in every property boom this century,
they will be proved wrong.
The financial people believed that sovereign
countries never defaulted on their debts until
Russia defaulted and LTCM had to be
bailed out to stop the global financial
system having big problems.
The amount of money going around in
circles in derivatives contracts is larger
than the GDP of the whole world.
That money has been recorded as a profit
on the accounts. Remember the massive
profits that Enron reported, which one
day turned out to be a fantasy?
When the derivatives contracts start to
unwind and the trickle of hedge funds going
bankrupt turns into a flood the property
downturn and "credit crunch" will seem
insignificant.
If the USA has hyperinflation then the
morgages that people can't pay will cease
to matter.
If they default on their debts then
oil will be much more expensive for them and
the flow of consumer goods like cheap
chinese DVD players will stop.
Either way the USA's standard of living
will plumet.
The people with their McMansions will
suffer wether or not they are bailed out
of their mortgagues.
I'm not a resident of the USA so I'm
more concerned about the global effects.
On one hand I think stupid people should
suffer so I think the countrys that
hold billions of the USA's debt should
suffer.
On the other hand it will be nice to
see republican assholes like Jim
Thompson suffer. It's people like
him who have built a country where
people generally need a car to get
from their house to the shops so
it will really hurt when they
have to reduce their profligate
oil consumption.
Bob
_When_ has the US defaulted on debts? We forgive plenty and will
likely bail somebodies butt out when the next natural disaster or
'civil unrest' occurs.


MooseFET
2008-07-11 13:59:40 UTC
Permalink
[....]
Post by Glenn Gundlach
_When_ has the US defaulted on debts? We forgive plenty and will
likely bail somebodies butt out when the next natural disaster or
'civil unrest' occurs.
The US devalued it debt under Nixon. Before Nixon a dollar was worth
a fixed amount of silver. Nixon unhooked the money from silver
because there wasn't enough silver to make good on the debt.

Since that point, anyone accepting a US dollar knew that it was a fiat
money debt they were accepting.
Robert Baer
2008-07-11 06:39:36 UTC
Permalink
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
-mpm
Mmmmm seems to me that the BIG bailout was for the (technically
bankrupt) lenders that caused the problems in the first place.
Eeyore
2008-07-11 09:32:39 UTC
Permalink
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
The banking system worldwide is wholly corrupt and run no better than a
casino.

Heads need to roll and salaries plus benefits need to reduce to $1m max.

Graham
Joe Chisolm
2008-07-11 20:36:31 UTC
Permalink
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Hey, if you couldn't pay the mortgage, maybe you should have held off that
re-fi. Like we taxpayers need to securitize your home makeover? That
new hot tub on the Lanai, or your recent family vacation to Monte Carlo??
This entire situation is completely UN-AMERICAN and UNFAIR.! We are
rewarding stupidity, greed and corruption. No wonder the country's in the
shitter.!!!
-mpm
Let's compare:
better by that house now, it's going up in value every day. Cant afford
it, dont' worry - here's a zero interest loan, miss a payment, no
problem. Dont worry about that ARM rate in (insert your number) of years,
the house will be worth more and you can always sell your house
(investment).

and:
better by Cisco now, it's going up every day. Cant afford all you want,
no problem, buy a little and take out a margin loan. Dont worry you will
be able to sell off some of the shares in the future and pay the loan
back.

I dont remember Congress running around waving their arms and bailing out
all the folks that lost billions in the tech meltdown. Shit, they
would not even help folks trying to deal with all the tax owned on
phantom income from their stock options that became worthless.

In the US the gene pool has gotten a little to full of algae.
--
Joe Chisolm
Marble Falls, TX
Paul Hovnanian P.E.
2008-07-14 01:39:56 UTC
Permalink
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Define 'bad financial decisions'. Some people got talked into big ARMs
with low teaser rates with no explanation of what they'd have to pay
after the first adjustment. The brokers faked the paperwork to make them
qualify without adequate income.

These people I don't mind helping.

Then, there are those who speculated on housing prices rising fast
enough to cover the interest rate rise by flipping the property before
they got hit.

These people should be left hanging.
Post by mpm
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
Leave the home equity borrowers to hang as well.
Post by mpm
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
I agree completely. Its the government's job to borrow without limits
and stick us with the debt, not private individuals. Think of all the
payments made to Blackwater and other defense contractors as being made
from a giant second mortgage on the nation. No hot tub for you, buddy.
If you want a refreshing dip, we'll send you to Gitmo for waterboarding.
--
Paul Hovnanian mailto:***@Hovnanian.com
------------------------------------------------------------------
Error: Keyboard not attached. Press F1 to continue.
JosephKK
2008-07-14 04:59:59 UTC
Permalink
On Sun, 13 Jul 2008 18:39:56 -0700, "Paul Hovnanian P.E."
Post by Paul Hovnanian P.E.
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Define 'bad financial decisions'. Some people got talked into big ARMs
with low teaser rates with no explanation of what they'd have to pay
after the first adjustment. The brokers faked the paperwork to make them
qualify without adequate income.
These people I don't mind helping.
I most certainly do mind, they participated in the fraud. Destroy
the brokers first.
Post by Paul Hovnanian P.E.
Then, there are those who speculated on housing prices rising fast
enough to cover the interest rate rise by flipping the property before
they got hit.
These people should be left hanging.
Heartily agreed.
Post by Paul Hovnanian P.E.
Post by mpm
Hey, if you couldn't pay the mortgage, maybe you should have held off
that re-fi. Like we taxpayers need to securitize your home
makeover? That new hot tub on the Lanai, or your recent family
vacation to Monte Carlo??
Leave the home equity borrowers to hang as well.
For the ones that were speculating (the vast majority of them) fine.
The ones that understood what they were doing aren't hurt
Post by Paul Hovnanian P.E.
Post by mpm
This entire situation is completely UN-AMERICAN and UNFAIR.!
We are rewarding stupidity, greed and corruption.
No wonder the country's in the shitter.!!!
I agree completely. Its the government's job to borrow without limits
and stick us with the debt, not private individuals. Think of all the
payments made to Blackwater and other defense contractors as being made
from a giant second mortgage on the nation. No hot tub for you, buddy.
If you want a refreshing dip, we'll send you to Gitmo for waterboarding.
Paul Hovnanian P.E.
2008-07-14 17:40:41 UTC
Permalink
Post by JosephKK
On Sun, 13 Jul 2008 18:39:56 -0700, "Paul Hovnanian P.E."
Post by Paul Hovnanian P.E.
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Define 'bad financial decisions'. Some people got talked into big ARMs
with low teaser rates with no explanation of what they'd have to pay
after the first adjustment. The brokers faked the paperwork to make them
qualify without adequate income.
These people I don't mind helping.
I most certainly do mind, they participated in the fraud. Destroy
the brokers first.
Perhaps not willingly. There are quite a few people out there who do not
understand the mechanics of ARMs. Keep in mind that this newsgroup and
probably many of your acquaintances represent societies 'intellectual
elite'. Scary, isn't it?

Many years ago, the gov't passed laws requiring mortgage brokers to
divulge simple interest rates in a standard way, since most people
didn't understand the subtleties of the periodic calculations. Perhaps
the brokers need to hand prospective customers a chart with both the
teaser interest/monthly payment plus a range of possible payments for
probable future values of the ARM's underlying index.
--
Paul Hovnanian ***@hovnanian.com
-----------------------------------------------------------------------
Have gnu, will travel.
MooseFET
2008-07-14 13:55:37 UTC
Permalink
Post by Paul Hovnanian P.E.
Post by mpm
Is anybody else angry that the government seems poised to bail out
homeowners who made BAD financial decisions?
Define 'bad financial decisions'. Some people got talked into big ARMs
with low teaser rates with no explanation of what they'd have to pay
after the first adjustment. The brokers faked the paperwork to make them
qualify without adequate income.
These people I don't mind helping.
We also need to take step to prevent a whole new batch of these folks
in the future. Since these deals are often more complex than the
borrower can be expected to understand, we need some regulation that
pushes the risk towards the more expert. I think that doing away with
the selling of the mortgage is too extreme but keeping some of the
risk at the original seller needs to be done. The down side is that
it would make all mortgages a bit harder to get.
Post by Paul Hovnanian P.E.
Then, there are those who speculated on housing prices rising fast
enough to cover the interest rate rise by flipping the property before
they got hit.
These people should be left hanging.
We should do them the courtesy of cutting them down and burying them
in the potters field. Dead bodies hanging around tend to be
depressing.

[...]
Post by Paul Hovnanian P.E.
I agree completely. Its the government's job to borrow without limits
and stick us with the debt, not private individuals. Think of all the
payments made to Blackwater and other defense contractors as being made
from a giant second mortgage on the nation. No hot tub for you, buddy.
If you want a refreshing dip, we'll send you to Gitmo for waterboarding.
Change "stick us" to "stick our children"
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