Bail Out Failed (Smithtown, Brentwood: 2010, foreclosures, credit)

[ClarkStreetKid]

Exactly Prof.

DMan,
The "little guy", while not a sole cause, played his part in this mess and should have to pay for it just like the big guys.

[dman72]

Originally Posted by ClarkStreetKid

Exactly Prof.

DMan,
The "little guy", while not a sole cause, played his part in this mess and should have to pay for it just like the big guys.

I have a 30 year fixed mortgage that I pay off extra principal every month to counter the loss I've taken on my condo. Do you think I feel bad for people living in houses who make less money than me who should have never been given those loans? It would be a slap in the face for me to see them bailed out.

However, that is only the little tiny seed that created this whole situation. It's what the banks did after the fact with these "assets" that is putting the economy in jeapoardy.

We're getting the same reaction about this that we heard for years about lazy welfare recipients taking all of your tax money (trumpeted by the Republican Party for years) when if you look at the budget, it's just not honest for anyone to believe that most of their tax money is going there. But, if you repeat a lie often enough, some people believe it.

Right now, the Republican spin is that we have this crisis because of Democrats wanting to make home loans easier to get. That's PART of the problem, but that isn't why we've reached such a critical point.

[Kbinspections]

Originally Posted by nancy thereader

I just thought of a perfect solution :

DEAR UNITED STATES of AMERICA ,

URGENT AND CONFIDENTIAL BUSINESS PROPOSAL

I AM MARIAM ABACHA, WIDOW OF THE LATE NIGERIAN HEAD OF STATE, GEN. SANI ABACHA. AFTER HE DEATH OF MY HUSBAND WHO DIED MYSTERIOUSLY AS A RESULT OF CARDIAC ARREST, I WAS INFORMED BY OUR LAWYER, BELLO GAMBARI THAT, MY HUSBAND WHO AT THAT TIME WAS THE PRESIDENT OF NIGERIA, CALLED HIM AND CONDUCTED HIM ROUND HIS APARTMENT AND SHOWED HIM FOUR METAL BOXES CONTAINING MONEY ALL IN FOREIGN EXCHANGE AND HE EQUALLY MADE HIM BELIEVE THAT THOSE BOXES ARE FOR ONWARD TRANSFER TO HIS OVERSEAS COUNTERPART FOR PERSONAL INVESTMENT.

ALONG THE LINE, MY HUSBAND DIED AND SINCE THEN THE NIGERIAN GOVERNMENT HAS BEEN AFTER US, MOLESTING, POLICING AND FREEZING OUR BANK ACCOUNTS AND EVEN MY ELDEST SON RIGHT NOW IS IN DETENTION. MY FAMILY ACCOUNT IN SWITZERLAND WORTH US$22,000,000.00 AND 120,000,000.00 DUTCH MARK HAS BEEN CONFISCATED BY THE GOVERNMENT. THE GOVERNMENT IS INTERROGATING HIM (MY SON MOHAMMED) ABOUT OUR ASSET AND SOME VITAL DOCUMENTS. IT WAS IN THE COURSE OF THESE, AFTER THE BURIAL RITE AND CUSTOMS, THAT OUR LAWYER SAW YOUR NAME AND ADDRESS FROM THE PUBLICATION OF THE NIGERIAN BUSINESS PROMOTION AGENCY. THIS IS WHY I AM USING THIS OPPORTUNITY TO SOLICIT FOR YOUR CO-OPERATION AND ASSISTANCE TO HELP ME AS A VERY SINCERE RESPONSIBLE PERSON. I HAVE ALL THE TRUST IN YOU AND I KNOW THAT YOU WILL NOT SIT ON THIS MONEY.

I HAVE SUCCEEDED IN CARRYING THE FOUR METAL BOXES OUT OF THE COUNTRY, WITH THE AID OF SOME TOP GOVERNMENT OFFICIAL, WHO STILL SHOW SYMPATHY TO MY FAMILY, TO A NEIGHBOURING COUNTRY (ACCRA-GHANA) TO BE PRECISE. I PRAY YOU WOULD HELP US IN GETTING THIS MONEY TRANSFERRED OVER TO YOUR COUNTRY. EACH OF THESE METAL BOXES CONTAINS US$5,000,000.00 (FIVE MILLION UNITED STATES DOLLARS ONLY) AND TOGETHER THESE FOUR BOXES CONTAIN US20,000,000.00(TWENTY MILLION UNITED STATESDOLLARS ONLY). THIS IS ACTUALLY WHAT WE HAVE MOVED TO GHANA.

THEREFORE, I NEED AN URGENT HELP FROM YOU AS A MAN OF GOD TO HELP GET THIS MONEY IN ACCRA GHANA TO YOUR COUNTRY. THIS MONEY, AFTER GETTING TO YOUR COUNTRY, WOULD BE SHARED ACCORDING TO THE PERCENTAGE AGREED BY BOTH OF US.PLEASE NOTE THAT THIS MATTER IS STRICTLY CONFIDENTIAL AS THE GOVERNMENT WHICH MY LATE HUSBAND WAS PART OF IS STILL UNDER SURVAILLANCE TO PROBE US.

YOU CAN CONTACT ME THROUGH MY FAMILY LAWYER AS INDICATED ABOVE AND ALSO TO LIAISE WITH HIM TOWARDS THE EFFECTIVE COMPLETION OF THIS TRANSACTION ON TEL/FAX N0:xxx-x-xxxxxxx AS HE HAS THE MANDATE OF THE FAMILY TO HANDLE THIS TRANSACTION.

THANKS AND BEST REGARD

MRS. MARIAM ABACHA

lol.

[tofulovinvegan]

I HOPE NO BAIL OUT PLAN IS APPROVED.

it's because of bush, that we're in this mess. i really loved pelosi's speech.

give the people the money and give tax breaks for going green, don't go giving ceos 13.5 million...

[nancy thereader]

I guess it is all an illusion, that we have control over this money & all , a shell game with us set up as the losers .

[Jrprofess]

Originally Posted by dman72

Right now, the Republican spin is that we have this crisis because of Democrats wanting to make home loans easier to get. That's PART of the problem, but that isn't why we've reached such a critical point.

A large part of the problem is also what the Republican controlled congress at the time allowed as debt/leverage ratios. By raising the ceiling higher and higher, from say 10 dollars in leverage to 30 dollars for every actual dollar everybody had the pigs at the trough finally got slaughtered. This is a bipartisan screw-up in my opinion. But the Republican spin makes me chuckle as I think we would all agree most wall street types who were swapping/buying these toxic assets without much dilligence (their fault) and making tons of cash on these "minority" mortgagees (their spin) are probably...Republican.

I think what Clark Street is frustrated by includes all parties...the idiot who took a mortgage they could not afford, the idiot who approved its initial lending, the idiot who incorrectly/ineptly/deceiptfully rated these assets as triple "A", and the idiot investment houses that bought and sold the toxic assets and did so with enough risky leverage to bring down a Lehman Brothers...

Without a plan the stock market has not cratered...in some ways corporate balance sheets have never been healthier due to the transparency required by SOX, etc. A credit crisis does not necessarily erode that for all companies. Hopefully a compromise of the initial plan makes it way through and is easier to stomach for the every day citizen.

Dman, I understand the credit concerns, and you made valid points regarding businesses being able to run, but if this circumstance brings about some contraction, tightened lending standards for business (meaning healthier) it might be very painful, but the future economy will be better off as one founded on sound fundamentals versus another prop up from the government. Passing this plan will do NOTHING to stem a continuing correction in the housing market. That will only be handled by the free market.

I do not think I have ever been this disenchanted with our entire government...although I was shocked they listened to their constituents.

[OhBeeHave]

Originally Posted by dman72

I have a 30 year fixed mortgage that I pay off extra principal every month to counter the loss I've taken on my condo. Do you think I feel bad for people living in houses who make less money than me who should have never been given those loans? It would be a slap in the face for me to see them bailed out.

However, that is only the little tiny seed that created this whole situation. It's what the banks did after the fact with these "assets" that is putting the economy in jeapoardy.

We're getting the same reaction about this that we heard for years about lazy welfare recipients taking all of your tax money (trumpeted by the Republican Party for years) when if you look at the budget, it's just not honest for anyone to believe that most of their tax money is going there. But, if you repeat a lie often enough, some people believe it.

Right now, the Republican spin is that we have this crisis because of Democrats wanting to make home loans easier to get. That's PART of the problem, but that isn't why we've reached such a critical point.

I agree that for those of us who did the right hing, this is a slap in the face.

Not to point fingers, but the groundwork for the 'mortgages for all' was laid by former President Jimmy Carter in 1977. While Bill Clinton was in office, he brought this back to life.
full article:
Minorities' Home Ownership Booms Under Clinton but Still Lags Whites' - Los Angeles Times

Snippet:

"Minorities’ Home Ownership Booms Under Clinton but Still Lags Whites’

By Ronald Brownstein
May 31, 1999 in print edition A-5

It’s one of the hidden success stories of the Clinton era. In the great housing boom of the 1990s, black and Latino homeownership has surged to the highest level ever recorded. The number of African Americans owning their own home is now increasing nearly three times as fast as the number of whites; the number of Latino homeowners is growing nearly five times as fast as that of whites.

These numbers are dramatic enough to deserve more detail. When President Clinton took office in 1993, 42% of African Americans and 39% of Latinos owned their own home. By this spring, those figures had jumped to 46.9% of blacks and 46.2% of Latinos.

That’s a lot of new picket fences. Since 1994, when the numbers really took off, the number of black and Latino homeowners has increased by 2 million. In all, the minority homeownership rate is on track to increase more in the 1990s than in any decade this century except the 1940s, when minorities joined in the wartime surge out of the Depression.

All of this suggests that Clinton’s efforts to increase minority access to loans and capital also have spurred this decade’s gains. Under Clinton, bank regulators have breathed the first real life into enforcement of the Community Reinvestment Act (President Jimmy Carter, 1977), a 20-year-old statute meant to combat “redlining” by requiring banks to serve their low-income communities. The administration also has sent a clear message by stiffening enforcement of the fair housing and fair lending laws. The bottom line: Between 1993 and 1997, home loans grew by 72% to blacks and by 45% to Latinos, far faster than the total growth rate.

---------- over 2/3 of article has been cut from this point on-----------

[max7418]

I'm a wall street guy and my wife works for JP Morgan. We are both against this bailout, have taken steps to solidify our net worth, and just want the chips to fall. Thats what capitalism is all about. The reason we got here IMHO has to do with 2 main reasons:
1. Democrats pushing banks into lending to people who could not pay their loan. This has been discussed alot on business channels and the notion that this happened is an utter lie to democrats.
2. The second and more important reason is wall street securitizing of loans. All throughout history loans were given to people based on their ability to REPAY the loan. Wall street banks reversed this and qualified people based on their own ability to PACKAGE and RESELL the loan.

Most of my friends who worked in the mbs business have been layed off months ago. Three of my friends who didn't even have titles were making $400,000 plus bonuses in 2004-2006 time frame working on these desks. Anyway read up about the mbs market if you are interested in how we got here.

[ClarkStreetKid]

Originally Posted by Jrprofess

I think what Clark Street is frustrated by includes all parties...the idiot who took a mortgage they could not afford, the idiot who approved its initial lending, the idiot who incorrectly/ineptly/deceiptfully rated these assets as triple "A", and the idiot investment houses that bought and sold the toxic assets and did so with enough risky leverage to bring down a Lehman Brothers...

Bingo Prof! My favorite term from this that should have red-flagged this a while back is "AAA sub-prime".
The insanity went from the guy on the street all the way to the halls of congress. This thing couldn't have happened if one of those groups you mentioned said "No, this is crazy and I'm not joining in". But of course people jumped in with both feet.
I remember the first Pick-a-Pay ad I heard on the radio and wondered who would loan a big bag of money to that person who years before would have been given a lollipop and walked out of the bank?

Originally Posted by Jrprofess

I do not think I have ever been this disenchanted with our entire government...although I was shocked they listened to their constituents.

I'm incredibly angry at my so called fellow conservatives in DC and how they behaved. They've tossed their values in the gutter. A sad time.

[Jrprofess]

Originally Posted by OhBeeHave

I agree that for those of us who did the right hing, this is a slap in the face.

Not to point fingers, but the groundwork for the 'mortgages for all' was laid by former President Jimmy Carter in 1977. While Bill Clinton was in office, he brought this back to life.
full article:
Minorities' Home Ownership Booms Under Clinton but Still Lags Whites' - Los Angeles Times

Snippet:

"Minorities’ Home Ownership Booms Under Clinton but Still Lags Whites’

By Ronald Brownstein
May 31, 1999 in print edition A-5

It’s one of the hidden success stories of the Clinton era. In the great housing boom of the 1990s, black and Latino homeownership has surged to the highest level ever recorded. The number of African Americans owning their own home is now increasing nearly three times as fast as the number of whites; the number of Latino homeowners is growing nearly five times as fast as that of whites.

These numbers are dramatic enough to deserve more detail. When President Clinton took office in 1993, 42% of African Americans and 39% of Latinos owned their own home. By this spring, those figures had jumped to 46.9% of blacks and 46.2% of Latinos.

That’s a lot of new picket fences. Since 1994, when the numbers really took off, the number of black and Latino homeowners has increased by 2 million. In all, the minority homeownership rate is on track to increase more in the 1990s than in any decade this century except the 1940s, when minorities joined in the wartime surge out of the Depression.

All of this suggests that Clinton’s efforts to increase minority access to loans and capital also have spurred this decade’s gains. Under Clinton, bank regulators have breathed the first real life into enforcement of the Community Reinvestment Act (President Jimmy Carter, 1977), a 20-year-old statute meant to combat “redlining” by requiring banks to serve their low-income communities. The administration also has sent a clear message by stiffening enforcement of the fair housing and fair lending laws. The bottom line: Between 1993 and 1997, home loans grew by 72% to blacks and by 45% to Latinos, far faster than the total growth rate.

---------- over 2/3 of article has been cut from this point on-----------

Really now...enough of this Democrats wanted minorities to have loans BS. The root cause has as much to do with lilly-white couples trading up into McMansions with zero down or condo speculators trying to flip properties in Miami...and this had zero to do with the fair housing act...in fact it was Republican leaning fat cats at the helms of these institutions that churned this garbage through. Enough with the political spin and finger-pointing...this was a bi-partisan multi-idiot screw up. Blame Bush, Blame Clinton, blame the early republican congress, blame the democrats of the last two years...blame everybody. Being in my mid-30's I blame my generation. Too few, if any, of my peers wait for things and pay for them...credit cards and minimum payments. Too many "how much a month" people not realizing they should be concerned with how much things will actually COST them. To illustrate my point, go out to any decent restaurant on a Saturday night in LI and ask the crowd to only pay in cash..not a credit card advance...the restaurants would end up 50% full.

Grumpy,
JRP