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I guess it is a good thing for you if your house bubbles up in value.
But the thing is, this artificial inflation of housing prices is being MAINLY driven by STUPID government policies. Speculation runs rampant when people know that Big Brother is jackin tons of dough into the Mortgage Markets......atttempting to inflate another bubble.
The artificial inflation of housing prices hurts much more than it helps. A house in a blue-collar area that should be 3 times average yearly salary, say 3*30K=90K, is actually 200K.........oh-my, how is that a good thing?????????? So now you need 30 and 40 year mortgages just to buy a place to live.
Democrats including Obama voted against regulations so the poor can buy a home they could not afford. As simple as that.
Deregulation and easy money is what drove the house bubble and because of this more people are able to get loans and deregulation allows easy terms more people are able to buy homes. This drove the price of homes higher. The problem is, these people could not afford to buy but these mortgages were being pushed through. Add skyrocketing home prices with subprime loans and you have a housing meltdown.
Bush warned Democrats in congress against deregulating. Democrats including Obama voted against regulation of Fannie and Freddie which loosened loan terms (fancy subprime mortgages). and CRASH, there went the market.
Watch this video. PS this is not an argument about deserving it.
By the way, the student loan bubble is the same thing.
Easy money / easier to get loans / government backed / deregulation -> Drives costs up.
It worked just like subprime. The feds bankrolled it. Guaranteed it. Regulated it. Driving the cost of college tuition. And these poor graduates starting life with huge debt, many of them will not be able to find jobs and not able to pay the loans back, when it blows up, the government who guaranteed these loans or should I say taxpayers are on the hook. The Dems will be there again, pointing fingers and promising to “regulate” more heavily.
The key to the housing bubble is, I don't care how fancy the terms, how easy the money, bottom line is if you can't afford it you can't afford it. As for the argument that everyone deserves a house, I agree and everyone should work and save to so they can buy one. Easy money and easy terms made it worse. (Bush warned about it but it was voted in by democrats and Obama) and the just as Bush said, crash!
The kids who took school loans will be deep in debt, now they are in a bad place. They were damned if they didn't and because of the 8.2% unemployment rate and many people who just gave off and not counted in the unemployment rate but making the effectively around a 14% unemployment rate, there are no jobs after graduation. So these kids are damned if they did all in the name of giving money away.
Printing money, easy money, easy loan terms is not handling money responsibly and more importantly it only hurts the people who once could afford it. It does not work.
Republicans Believe
That the money you earn is yours and that government in a free society has the right to take only as much as is needed to perform those limited functions, which are appropriate to it. Republicans believe high taxes, runaway government spending, and over-regulation of business and farming punish initiative and stifle economic growth.
If you are Republican you expect to take care of yourself.
Democrats Believe
The government has a right to use your money as it sees fit to redistribute wealth, establish new spending programs. Democrats believe in higher taxes on acheivers and increased government bureaucracy and that goverment spending will not stifle economic growth but instead guarantee prosperity for everyone.
If you are Democrat you expect the government to provide.
The Dem thinks money is infinite. Their belief in bigger goverment cost more, they always spend more than they have trying to provide for the poor, deregulation and easy money which drives the price of everything up so the once solid middle class can't even afford it and when the people who got the easy money (and still afford to pay the loan), these people will default on their loans and government comes to the rescue. The Dems will throw more money at the problem by printing money, going deeper into debt and they take more (tax higher) who then will not or can not afford to hire people stifling the economy even more. People lose their jobs, which means less people paying taxes (drop in gov revenue). As people lose their jobs they get unemployment in these years more are on welfare, the government debt goes higher ever further, gov prints money, tax the people who are still working higher and businesses higher and deeper and deeper we go.
So for those who point the finger and say Bush did it. Bush and Republicans warned against the coming economic crash and housing crash and voted for regulation. Bush the the press but the Dems were in control and even though Senator Obama is on record for knowing the dangers he voted AGAINST tightening the regulations of Freddie and Fannie.
Republicans generally know how money and personal finance works and they educate themselves, work and run their finances and businesses accordingly. I am not saying that dems don't work, what I am saying is they generally don't understand their own personal finance let alone be able to judge how the gov should run the economy. As a result of financial knowledge and responsibility the rich end up with a bigger piece of the pie. On the other hand, the democrat even though they have first hand experience how the spend and debt to support the American dream mentality does not work, Dems think the gov pockets are an endless supply of money. They don't realize that for every dollar of assistance they get it is someone else who worked for that money or that the gov just printed the money (Q2, Q3) and someone else will have to pay the debt.
They don't understand how important it is to know and understand personal finance and just like the dem gov run their finances into the ground where they end up debt poor.
Now screaming how unfair it all is and expect the government to do something (some vote to punish the rich just because they are do not know how to become rich and some vote because they bought the Dems tax and spend and increase debt banter, and they could not do it so they hope the gov will give them a better life). The sad truth is just like your personal finance, if you spend more than comes in then you get debt, bad debt makes everyone poor.
This is a put in simplest of an explanation. Of course this will all fall on deaf ears and the blame game and ballyhooing will rather than go on a google search to debate, they will spit out insults.
OK, what were the poiticians spewing a while ago.....around 2008 or 2009...............unwinding Fannie and Freddie.............hahahaha!!!! You have heard next to nothing along that same line for quite a while...............F&F will never go away.....may be renamed and tweaked a little.
"Popular" and good are not the same. FDR set in motion the mess we have with Social Security, not to mention planted the seed in people's minds the fiction that government had unlimited resources to bail them out financially (instead of family and local community).
All politicians have to do to be popular is appeal to people's short term interests. Since humans rarely think about the long term, this is easy to do.
Ask your Grandma if she thinks Social Security is a mess. She may think so, but she will surely accept her monthly Treasury check.
If your Great-Grandma is still alive, and lived through the Great Depression, ask her what she thinks of FDR.
I completely agree with you that short term interests rule elections. We have to count on our politicians to think and act in ways that will affect longer term plans and goals, and we mostly fail in that regard. But once in a while, there is someone out there who will, and gets elected. And, as often as not, that person will establish something that is truly in the public good, even though it is usually unappreciated at the time. If a forward-looking plan is excellent, it will probably result in that person losing his seat the next election unless it benefits enough of us right off the bat. Even then, the real worth of a plan that sticks around and changes us as a society has to be strong enough to get beaten up by about half of us for a long time.
Given enough time, everything runs down. It is called entropy, and it is a part of nature that happens in everything, including everything humans create. Any good plan will eventually need revision or change to keep it good, and the best plans are the ones that are most fragile and prone to stupid tinkering by opportunists.
That's what happened as a result of unregulated free capitalism- a hell of a lot of money was made by everyone for a little while with no controls on the throttle and no brakes on the locomotive. A lot of people jumped on that train, so the crash, which was inevitable, was a big one when the locomotive hit the end of the line at full speed.
It's also what happened when a lot of young men were called away to war to fight the Axis, and came back very ready to settle down and make a lot of babies with young women. That's what the young do best. The baby boom could have been predicted- the same thing happened before often, here and in other countries, but hadn't happened here for a long time. Social Security could have been modified long ago, but we as voters never elected the guys who would have made it a mission, so now we are playing catch-up. This is the way Americans always tend to do, and we like it that way.
If this was not true, we would choose our leaders differently and we would have different priorities for the way we want our government to be.
Last edited by banjomike; 06-26-2012 at 06:00 PM..
We have plenty of experience with what trillion dollar deficits and $15 trillion debt are doing for us. Bush, and his band of extravagent spending Rs were nearly as bad as the current Ds and contributed to the problem. Obama and Reid have kept the tradition alive.
Tell ya what. We've been experimenting with an extremely liberal, anti-business president, senate, and until a couple of years ago, house. Lets try a clean sweep and ensure that fiscally conservative "tea party" Republicans gain control of all three branches and make some meaningful changes and spending cuts in DC and see what happens to the economy. We haven't tried fiscal responsibility in decades...just might make a difference.
If the economy continues to tank after spending is reduced to something approaching a responsible level, you have a point to make.
From $400 billion to $1.5 trillion is more than just keeping the tradition alive.
Come to think of it, when Bush was Prez, and the GOP ruled, my home doubled in value. He stank as a president, but increasing everyone's net worth like that was terrific. When the Dem. gained shared power, the values plummeted. With Obama, things got really ugly. I am sure that is his fault.
Now, if I just vote for Romney, my house will double again, right?
But if it doesn't, can I say the bum was hampering the recovery?
Just wondering how this logic works.
Uh, the financial crisis started under Bush, and had nothing whatsoever to do with his presidency. Gore, Clinton, anyone, the bubble was going to burst. That's the reality about bubbles...they come along from time to time, and always burst. You will probably never see gains like the ones you saw (on paper) in the years before the Great Recession again in your lifetime.
From $400 billion to $1.5 trillion is more than just keeping the tradition alive.
Comparing the Bush economy to the Obama economy is absurd. The Great Recession required extraordinary Federal financial spending. That's basic economics. if Bush hadn't run up the deficit (while Republicans were silent), the impact of the Great Recession spending would not have been as severe.
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