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Old 03-03-2009, 10:17 AM
 
Location: MN
761 posts, read 2,961,049 times
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Is this the mortgage forum or the politics forum?
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Old 03-03-2009, 10:17 AM
 
596 posts, read 2,496,179 times
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Motley Crew, LOL, what I think this means is that your QUESTION has now taken a back seat, haha! My brain hurts. X-)

We all have varying opinions on Obama's plans. I am choosing to let the leader lead, and do my part to help drag this nation out of the dumpster in whatever way I can. I dont have much, but I wouldnt sit idly by and let anyone suffer if I had anything in me to help.
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Old 03-03-2009, 02:22 PM
 
1,134 posts, read 2,470,760 times
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<begin rant>

Why is it that no one is ever willing to discuss the merits of any given solution or ideology without partisan rancor?

This is the greatest economic challenge since the great depression. Obama proposed and the congress passed one of the largest if not the largest response to it in history. It wasn't the exact bill that Democrats wanted, in fact it was compromised in both nature (conservatives wanted more tax cuts and less spending - which was done) and size and STILL conservatives wouldn't vote for it (which, in truth, was nothing more than political grandstanding).

One side thinks that doing nothing but cutting taxes is the best way to jumpstart the economy; the other side thinks that government funded job creation is the way to jumpstart the economy. The latter philosophy believes that Budget Deficits in poor years are made up for by Budget Surpluses in boom years - unfortunately, Obama doesn't have a surplus to work with (and less debt)... thanks to the tax cutting of the prior administration during the good years.

Everyone seems so pissed about this $800 billion stimulus, but meanwhile you were all munching "Freedom Fries" during the march to war with Iraq... a war which won us nothing and cost $700 billion and counting. Where was the outrage then?? How can anyone reasonably damn Obama for deficit spending, when his predecessor did so even during GOOD years?

How about we give Reaganomics a break and see how Obamanomics turns out? Seems they rhyme a great deal with FDR... and he's remembered as being a pretty decent President. Anyone think history will look kindly upon Bush Jr?

This is a President who isn't about to sit on his duff and wait to see what happens from the stimulus. No, this country has other problems and so he's attacking them (Healthcare). Any reasonable person would applaud him for that. The problems in Healthcare aren't problems that should wait for when it is "convenient" to deal with them.

Its amazing how much fear this country has of anything socialistic. Most economists argue that the most efficient way to restore order to the financial system right now is to nationalize the banks that are "too big to fail". Its laughable that people object to this, but are okay with proping up dead banks and their shareholders with taxpayer money or worse, think its okay to let them fail and the financial meltdown that would ensue. Nationalize the zombie banks, clean them up, and re-privatize them down the road just as Switzerland did. The only reason the administration hasn't done so is to throw a bone to conservatives who insist the market does everything best (how 'bout that real estate bubble? How 'bout that .com bubble?). The market is a strong force, but it is not the end all answer to everything... it is as irrational as the people who act within it.

Speaking of socialism... the US is the ONLY industrialized nation to lack Universal Healthcare and yet pays the most per person for the healthcare that IS received. How is it that people have no problem with their Police and Fire departments being socialist institutions - but they object to having their healthcare socialized? Just think, all these people who are being laid off right now are losing their health coverage... but thank goodness the police and fire department don't work that way. The police and fire departments work for the people, ALL people... and so should the hospitals.

The healthcare system we have is a historical accident! Companies competed for workers during World War II by offering benefits (including Healthcare) because of government imposed wage controls.

If Universal Healthcare means more taxes, so be it... sign me up... lord knows my company and I are paying out the wazoo for my current coverage - but at least I know that with socialized medicine, I don't have to worry about what hospital I'm at or what doctor is treating me, and I don't lose it if I lose my job. I personally hope that Obama's healthcare initiatives are just the downpayment on Universal Healthcare in the US.

Obama's administration has come out with guns blazing. It pleases me to no end to have a President with such ambition.

<end rant>
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Old 03-03-2009, 05:01 PM
 
2,197 posts, read 6,595,746 times
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DvlsAdvc8, I agree with much of what you say, but you're assuming that everyone who doesn't agree with Obama is Republican or even conservative. Not so. People who think Obama is on the wrong track are from both parties or no party at all. Many who don't agree with Obama's economic policies are against the Iraq War and are no fans of Bush. Some are in favor of social reform, but question the volume of spending. And maybe people aren't afraid of socialism; maybe they just don't want it. America is a democracy. If people want to live in a socialist country, there are other countries that do it better. While some are supportive of Obama, others think he's bankrupting America with debt we simply can't repay. Time will tell who's right.

Hey, sbanawan, check out my blog sometime. I'll bet you can find it. I have yet to see you do anything but cheerlead or troll, but maybe someday you'll be able to think on your own. There certainly has been no evidence of it to date, but one can always hope.

You're absolutely right, Norsky1, this is not the political forum, so apologies! The topic is mortgages.

Last edited by goodbyehollywood; 03-03-2009 at 05:17 PM..
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Old 03-03-2009, 05:29 PM
 
48,519 posts, read 81,086,895 times
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Remember that Taxes is not the onyl way of getting money from people. Where I live taxes have been raised in years but the taxes and fees people pay have gone way up.Obama hasn;t lie he said peoples income taxes would go up above 250'000. However their are other ways just as we saw in teh clinton administration. No way he can pay off that spening in four years to get it in half witht eh interest. Just watch;we will seeing rising deficit long into the future.
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Old 03-03-2009, 07:17 PM
 
Location: Durham, NC
426 posts, read 1,296,553 times
Reputation: 176
Quote:
Originally Posted by goodbyehollywood View Post
DvlsAdvc8, I agree with much of what you say, but you're assuming that everyone who doesn't agree with Obama is Republican or even conservative. Not so. People who think Obama is on the wrong track are from both parties or no party at all. Many who don't agree with Obama's economic policies are against the Iraq War and are no fans of Bush. Some are in favor of social reform, but question the volume of spending. And maybe people aren't afraid of socialism; maybe they just don't want it. America is a democracy. If people want to live in a socialist country, there are other countries that do it better. While some are supportive of Obama, others think he's bankrupting America with debt we simply can't repay. Time will tell who's right.

Hey, sbanawan, check out my blog sometime. I'll bet you can find it. I have yet to see you do anything but cheerlead or troll, but maybe someday you'll be able to think on your own. There certainly has been no evidence of it to date, but one can always hope.

You're absolutely right, Norsky1, this is not the political forum, so apologies! The topic is mortgages.
I guess you missed a few of my posts, then. That's ok. Let's start at the top.

With respect to effective economic stimulus:

Mark Zandi (McCain's former economic advisor; pdf link), at economy.com, has an analysis of the multiplier effect of various types of government efforts.

The effects of tax cuts range from $.30 to $1.28. The tax cut you favor, not letting Bush's cut expire, would net $.31 for every $1 invested. That's an awful return on investment.

The effects of infrastructure spending, which healthcare reform falls under, range from $1.38 - $1.73. The jobs created by spending on healthcare modernization would be under "infrastructure spending" at $1.59 created from $1 spent.

With respect to the small businesses being affected so detrimentally by letting the tax cuts expire, the non-partisan Tax Policy Center, has some real numbers for us:

Only 3.8% of small businesses make more than $250k/year (and this was in 2007 when businesses were doing much better). That is, only 3.8% of business could possibly be affected by the $250k tax increase.

To quote them:
Quote:
The vast majority of small businesses would not be affected by Obama’s income tax increases. Among those that receive at least half of their income from a business or farm, 335,000 (2.7 percent) are in the top two tax brackets that are targeted for Obama’s tax increases. (Table T08-0164) Among tax units with any income from a business, 663,000 (1.9 percent) are in those tax brackets. Clearly, most business owners are safe from Obama’s individual income tax increases.
In other words, your claim, while scary if true, is completely false.

I'll take a break now and allow you to respond with your own numbers. Please cite your sources. I know this isn't school, but it is common courtesy.
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Old 03-03-2009, 07:19 PM
 
Location: Durham, NC
426 posts, read 1,296,553 times
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Quote:
Originally Posted by texdav View Post
Remember that Taxes is not the onyl way of getting money from people. Where I live taxes have been raised in years but the taxes and fees people pay have gone way up.Obama hasn;t lie he said peoples income taxes would go up above 250'000. However their are other ways just as we saw in teh clinton administration. No way he can pay off that spening in four years to get it in half witht eh interest. Just watch;we will seeing rising deficit long into the future.
Have you got any analysis to support your claim? All the projections I'm seeing is a narrowing of the deficit with progressively improving economic numbers.
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Old 03-04-2009, 09:34 AM
 
1,134 posts, read 2,470,760 times
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At some point this thread will probably be moved to politics... but it should have been posted there to begin with.

Concerning the volume of spending... I don't like it either, but I do believe that spending is the fastest way to restore growth with the least amount of individual pain. I find it morally repugnant that the burden of recession is born most by those who lose their jobs... thus job creation and unemployment benefits are my top priorities. They have an added benefit of stemming the tide of losses and mitigating over-corrections in the economy... not to mention keeping human resources productive.

Tax cuts are nice, and low taxes are best for the economy in the long term... but as economists are fond of saying: "in the long run, we're all dead." There must be a balance with the here and now... the immediate need. Tax cuts are less efficient at creating jobs in the short run. A disproportionate amount of a tax cut goes to the people who pay the most in taxes - the wealthy. The wealthy are the least likely to spend. In economic speak, they have the lowest "propensity to consume" because they already own homes, cars, luxuries and have the majority of their needs and desires met by their post-tax income before cutting taxes. The additional amount they keep from any tax cut, is just added to their savings/investments. Perhaps good for the stock market, but in the end it is CONSUMPTION that drives the market. Companies don't perform well when people aren't buying, and people without jobs aren't buying. Pumping in extra investment dollars only artificially supports stock prices - absent demand for goods and services. Heck, with poor performing stocks, the wealthy will probably put their money in government bonds anyhow. Bottom line is, when people are losing their jobs en masse, savings rates go up.

Government spending on the other hand has the benefit of putting resources to good use immediately. People to build bridges and roads and whatever else. The good news is that this sort of stimulus goes to those with the greatest propensity to consume - formerly unemployed people, or those in lower incomes... and coincidentally, those who feel the pinch of a recession the most. These people don't already have 4 or 5 cars - they are more likely to need to buy a car, a couch, a home, a refridgerator... whatever... they stimulate demand and companies hire once again to meet the demand. The perception of job security returns and the remainder of the people return to spending... further boosting demand and creating more jobs. There ends the recession.

Obama's strategy is right out of John Maynard Keynes' playbook. Leave ideology at the door. Its not a matter of Government being Robin Hood - its a matter of increasing demand by putting money in the hands of those who will spend it and putting idle resources (the unemployed) to some good use. In the end, it truly is the best solution for all parties - rich and poor... because the rich stand the most to gain from a quick recovery as more of their wealth is tied to stocks and investments.

Just to put the emphasis on this point, Ben Bernanke - the Fed Chairman, has intensly studied the Great Depression - it was sort of one of his greatest interests in economics. He is also a Republican. Even he is calling for increased spending...

Today's NY Times:
Quote:
Originally Posted by Ben Bernanke via the NY Times
“All else equal, this is a development that all of us would have preferred to avoid,” Mr. Bernanke told the Senate Budget Committee, referring to record-breaking deficits expected this year and in the next two years. “But our economy and financial markets face extraordinary challenges, and a failure by policy makers to address these challenges in a timely way would likely be more costly in the end.”

Mr. Bernanke, warning that the economy had yet to show hardly any sign of recovery, brushed aside objections by Republicans that Mr. Obama’s plans would lead to a dangerous growth of government.
Republican lawmakers tried to draw the Fed chairman into their corner, to no avail. “There is in this budget a massive movement of the government to the left, in other words a massive expansion of the government,” warned Senator Judd Gregg of New Hampshire, the committee’s ranking Republican.
But Mr. Bernanke simply said that Congress and the White House needed to start thinking now about how to bring the federal budget back to normal.

http://www.nytimes.com/2009/03/04/us...l?ref=business
We have a thoughtful President who is more concerned with solving problems right now than playing politics:

“You know, the stock market is sort of like a tracking poll in politics,” Mr. Obama said. “It bobs up and down day to day, and if you spend all your time worrying about that, then you’re probably going to get the long-term strategy wrong.”

And we have a Fed Chairman who has expert knowledge of what worked and didn't work with regard to the Great Depression - the closest comparable recession to this one. He knows that in the end, it was the tremendous spending and deficits of World War II that brought the economy out of the Great Depression, thus they are hell bent to make sure the response to this recession is not too small.

You can always dial back spending if the economy recovers unexpectedly soon, but you can't go back in time and increase spending when it could have made the most difference.

The important thing about running deficits is to remember to be responsible and as the economy and public revenue improves to surplus, not to get stupid and cut taxes. Run surpluses! Pay down the debt, and get yourself prepared for the next downturn... where you will again likely need to run deficits to smooth out economic volatility. In other words, government should slow growth (by maintaining surpluses / paying down debt) during good times, and government should stimulate growth during bad times (by deficit spending). Doing so makes for a more stable economy and greater long term benefits/efficiency. Volatility is counterproductive... good only for speculators trying to game the system for an easy buck, but contributing nothing.

Last edited by DvlsAdvc8; 03-04-2009 at 09:46 AM..
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Old 03-04-2009, 12:05 PM
 
48,519 posts, read 81,086,895 times
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God;many wish he would pay more attention to the markets and what he says in speeches.The spending theory was the same for those that took out loans for houses thinking that one their income would increase and that houses would only go up in value not down.It seems even the smartest people are limitng what they spend.Responsibl9oty is not spending more than you make as americans have doen for years at 140% of average income and saving a per centage.
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Old 03-04-2009, 02:43 PM
 
Location: Durham, NC
426 posts, read 1,296,553 times
Reputation: 176
Quote:
Originally Posted by texdav View Post
God;many wish he would pay more attention to the markets and what he says in speeches.The spending theory was the same for those that took out loans for houses thinking that one their income would increase and that houses would only go up in value not down.It seems even the smartest people are limitng what they spend.Responsibl9oty is not spending more than you make as americans have doen for years at 140% of average income and saving a per centage.
That's just not true. Sometimes you take out a mortgage or a loan with an eye towards being able to pay it back in the future. This forum is the *mortgages* forum, fer pete's sake. It's not irresponsible to take out a loan. Are you really saying that it is?
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