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Post by psychecc on Sept 19, 2008 15:30:11 GMT -6
Whoever ends up owning these homes, one thing is certain. The rich wil benefit far more than the rest of us from this "stabilization" move. It was all about keeping the housing bubble inflated. Those who played by the rules will suffer; those who behaved like maniacs, engaging in risky investment, will be rewarded. I'm frankly sick of hearing how this is all necessary because we never could have anticipated this financial meltdown resulting from the massive leveraging of wall street balance sheets. The fact is that it was all engineered to happen just this way, in my opinion. Am I the only one who noticed that the first Resolution Trust happened under the watch of Bush 41, famous for his State of the Union reference to the coming "new world order," (code for global domination by the rich)? Yes, Regan began the process, but Bush 41 followed up with a vengeance, and now his son has spent eight years allowing unregulated transfer of wealth in a further move toward globalization. Future generations can expect a much lower standard of living as a direct and intended result of the policies of those who brought you the Security and Prosperity Initiative (code for North American Union), "free trade," open borders, expanded Visas, the Iraq War, and the list goes on. Kiss national health care goodbye. Bush 43 made sure to spend every last cent we could afford, and then some, for generations to come. I'm furious with both parties of this government and incredibly frustrated that there isn't one thing I can do about any of this. Will the Government Own Your Home?By Diana Olick CNBC Real Estate Reporter cnbc.com | 19 Sep 2008 | 01:51 PM ET Let me just preface by saying we don’t and can’t know any of the details of the financial rescue plan that will come out of the negotiations between Treasury Secretary Henry Paulson and members of Congress.
Even the insiders I’m talking to, who know far more than I do, and who will be at the table, are answering my questions with: “Honestly, I’m just not sure.”
However, Treasury officials have said that the plan would likely involve the government purchasing mortgage backed securities as well as whole loans. Now the mortgage securitization process is so ridiculously complex, that I’m not even going to begin to explain where in the process the government could step in, so let’s stick to the whole loan side of the equation.
If the government is buying loans in order to get them off the balance sheets of distressed banks, and these loans are expected to be delinquent at some point soon, then what is the government's course of action once they take ownership of the loans?
Last fall, Henry Paulson spearheaded the “Hope Now” coalition of lenders and investors, the purpose of said coalition being to save borrowers by modifying and restructuring troubled loans. Does the government now join "Hope Now" itself and get in the loan modification business? But wait, if the government’s goal is to maximize taxpayer return, then that is in direct conflict with letting borrowers off the hook, right? ....
What I’ve heard is that the government would hold these assets to “maturity.” But again we’re faced with the unknown. We don’t know how many of these assets (loans) will perform and how many won’t. .... www.cnbc.com/id/26793305/
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Post by unlawflcombatnt on Sept 19, 2008 17:01:07 GMT -6
I'm frankly sick of hearing how this is all necessary because we never could have anticipated this financial meltdown resulting from the massive leveraging of wall street balance sheets. The fact is that it was all engineered to happen just this way, in my opinion. I completely agree. I could see this coming before the 2004 election. Many saw it even earlier. Our economy was being sustained on debt. Overvalued homes were being used to collateralize loans that were not only used to finance Corporate and consumer spending, but were used to further overvalue homes themselves. A rhesus monkey could have seen this coming by mid 2005. Since 2005, financial "experts" have spent all of their effort trying to concoct stories about how our economy was doing well, and there were no problems on the horizon. Had they spent a fraction of the time studying the situation that they spent propagandizing, they would have seen exactly what was coming. In fact, most of them really did, but claimed otherwise. Now the government is dumping all of the debt that created the artificial wealth onto the taxpayer. Meanwhile, those who profiteered from the fake wealth increase have taken the money and run with it. Most of the individual financiers are insulated from losses through Corporate bankruptcy protection. But even more are being protected by the governments' exuberant willingness to give taxpayers' money to stem their well deserved losses. Middle class taxpayers, especially those who wisely rented, instead of buying at the peak, will be paying the price for those who were unwise, greedy, or both. This is the opposite of a "meritocracy." It's an "un-meritocracy." It's piracy. It's grand theft on a scale never seen before in recorded history. Everyone needs to vote 3rd party in the Presidential election. With a few rare exceptions, every last one of our Senators and Congressional representatives should be voted out of office. Many should be investigated for fraud. As someone else on this board once stated, we have a "kleptocracy." I'd call it a Corporate kleptocracy. And a bipartisan one at that.
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Post by redwolf on Sept 19, 2008 21:32:13 GMT -6
I disagree, uc. A chimp could have seen it coming, but definitely not a rhesus monkey. I still think more blame lies with the Republicans. They are the deregulators and supply-siders. And they got us into a very expensive, unnecessary war. Both parties are free traders, though.
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Post by judes on Sept 20, 2008 9:42:24 GMT -6
...... I'm frankly sick of hearing how this is all necessary because we never could have anticipated this financial meltdown resulting from the massive leveraging of wall street balance sheets. The fact is that it was all engineered to happen just this way, in my opinion. ..... Right on psychecc. I share your frustration. I am sick of hearing Paulson, congressional suckups, and Bush continue to say we have to bail these rich "bankstas" out because the consequences for the taxpayer would be worse if we didn't. Excuse me, how!? Why can't someone just once ask for the clarification on that. How will I be worse off if these wallstreet criminals and bankers aren't bailed out? Home prices will go up, along with the cost of everything else as a result of all the bailouts. We will pay for it twice, not only through increased taxes but in inflation as well. Why do I, or most people care if banks tighten up on their lending? Maybe that is exactly what is needed. If we are an economy that is so dependent on loans that the entire system collapses when everybody can't get them then something is seriously wrong, and this correction needs to happen. A society dependent on deep debt and credit is one doomed to fail, this will only prolong the inevitable. Why do I care if people stop investing in Wallstreet? I don't, I never took risk with my money because I knew I couldn't afford it if it didn't go my way. Almost all the money flowing into Wallstreet investments is flowing overseas anyway. Point to the investments being made in this country. Most of the investment in this country including multi billion dollar ball stadiums, and the black mailing of companies to keep a factory in anytown USA comes from taxpayer dollars anyway. For all I care wallstreet could wither away, it is like a virus, sucking up dollars from the working class and sending them to rich fraudsters here and overseas. (Ohhh there it is again, in the background the CNN pundent just repeated, congress saying the risk of doing nothing is far greater than the risk of bailing these crooks out.) HOW EXACTLY!? And watch, there will be no conditions put on the biggest bailout in history. Like the money should be used in this country, or you can't do this crap again. I mean really, what is to stop these crooks from continuing to repeat the con games that got us here? So now that they have our trillions in taxpayer and newly printed greenbacks they can just go back to business as usual and lend money to people for over inflated assets that they have no way of ever paying back, because all the good paying jobs have been shifted to third world slave labor!! This makes me absolutely sick. These people made out huge on the payout from this risk taking and rode it all the way up. Now that they are getting bailed out they get to keep all their ill gotten gains and continue to make out. Not only that all the money they earned in the way of capital gains came very cheap. God forbid they should have to pay more in taxes. The biggest transfer of wealth from working taxpayers is taking place, and once again the rich benefit disproportionally.
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Post by unlawflcombatnt on Sept 20, 2008 10:32:17 GMT -6
I disagree, uc. A chimp could have seen it coming, but definitely not a rhesus monkey. You're right. I stand corrected. I still think more blame lies with the Republicans. They are the deregulators and supply-siders. And they got us into a very expensive, unnecessary war. I agree. Republicans deserve at least 90% of the blame, if not more. The current bailout plans, however, are receiving a disappointingly large amount of support from Democrats, especially those with ties to the financial industry (Dodd, Schumer, Frank, etc.). The few voices of reason are coming mainly from Republicans, like Senator Bunning, Congressman Ron Paul, and even Senator Grassley. Sadly true. And this is despite the fact that a majority of the rank-and-file of BOTH parties oppose free trade. But then again, who cares what the rank-and-file want. The only thing that matters is what the richest campaign contributors want. Both parties' elite want cheap labor to keep production costs down, and easy credit to offset American wage loss, enabling them to keep consumer prices high. If Americans wages aren't sufficient to keep prices high, they can always be supplemented by increasing consumer credit lines. And if Corporate financiers lose money by expanding credit, Uncle Ben and Uncle Hank are right there to inject "liquidity." Ben & Hank are more than happy to pick taxpayers' pockets to help their rich friends. After all, what's a few trillion dollars among friends. It's only money.
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Post by Cactus Jack on Sept 28, 2008 10:28:04 GMT -6
Bankers, Lenders, Financial institutions, and their D.C lobbyists are the root of evil in this crisis. Add in the politicians who control Congress and the Whitehouse and you'll see who's responsible for the financial mess. Had the Repub party not taken over power on Capitol Hill, the Dems would be the fall guy -- on the strength of being the party holding the majority 'n controlling the day-to-day legislative sessions including committee chairships.
Historians trace the current financial crisis back to the mid 1970s. During that run of time, Dems had control of Congress from 1976-1995 under presidencies of Carter, Bush 41, and Clinton. From 1995-2007 (January when congressmen are sworn in), power on Capitol Hill lay with the Repubs under presidencies of Clinton and Bush 43. Over the past two years, it's been a Dem-controlled (Pelosi-Reid controlled) Congress under a Repub president.
While the President always gets the blame in the media 'n press, fault must be shared ..but.. since our Constitution prohibits the President from passing laws, most of the fault lies in the lands of lawmakers. From 1976 to 2008, the Repubs controlled Congrees 12 of 32 years and Dems controlled it 20 of 32 years, while the Presidency was held by Dems 12 of 32 years and Republs by 20 of 32 years.
If we are to lay blame where it belongs, the pawns in this crisis have been the Democrats and the Republicans (in Congress 'n Whitehouse) while the really guilty ones have been the Lobbyists and Special Interest concerns from the financial industry.
Those are the guilty parties, and bailing them out only reinforces their ability to run the scam again thru influence peddling and political contributions to politicans of both parties. The only way to STOP this from ever occuring again is to reform the way lobbyist operate, limit financial contributions to pols, and prosecute lawbreakers.
Unfortunately, I'm afraid our leaders haven't got the guts or the will power to do that ..so let's blame all the parties and their corrupters, bail the industry out, and try to educate ppl to be self-sufficient, self-reliant, and live within their financial means or else this crisis will rear its ugly head once more in the future.
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Post by Waltc on Oct 4, 2008 0:55:08 GMT -6
Judes wrote:
Why do I, or most people care if banks tighten up on their lending? Maybe that is exactly what is needed. If we are an economy that is so dependent on loans that the entire system collapses when everybody can't get them then something is seriously wrong, and this correction needs to happen. A society dependent on deep debt and credit is one doomed to fail, this will only prolong the inevitable.
Exactamundo, our economy is totally dependent on easy credit for its survival since we no longer have a manufacturing base to supply us with well paying jobs and a robust tax base to pay for services. Then factor in our out of control trade deficit and our oil addiction the sends trillions of dollars overseas to people that hate us and you end up in the great credit implosion of 2008.
Of course most economists and financial gurus won't mention any of this since they were the biggest promoters of this lie around and still are.
Kinda of like that other lie that there is no inflation.
However restarting the credit/lending system won't fix anything. Because its not the underlying problem. The problem is the average American is tapped out, no savings, carrying a average of $15,000 of credit card debt. Working at a job with rotten pay and benefits, and more money going to necessities such as fuel and food.
Also too many Americans are under or unemployed which further downgrades any attempts at getting Americans to buy again.
But I forgot there is no under employed or unemployed problem according to financial experts.
The sad thing is, a lot of this could have been avoided had Congress used that $700 billion rebuilding our bridges, highways, rail system, power grid, massive solar arrays in the South West, etc. Stuff that would have put perhaps millions(by making it manpower intensive vs. tech intensive) to work and keep a lot of suppliers and businesses afloat as well.
Then putting a tariff on all imported goods that impact American manufacturers.
Basically a WPA for the 21st century.
Instead they chose to bail out the elite that put us into this position.
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Post by unlawflcombatnt on Oct 4, 2008 2:07:22 GMT -6
The sad thing is, a lot of this could have been avoided had Congress used that $700 billion rebuilding our bridges, highways, rail system, power grid, massive solar arrays in the South West, etc. Stuff that would have put perhaps millions(by making it manpower intensive vs. tech intensive) to work and keep a lot of suppliers and businesses afloat as well. Then putting a tariff on all imported goods that impact American manufacturers.Excellent ideas, especially putting tariffs of foreign imports. Tariffs increase domestic production demand, and raise Federal revenues without raising taxes.
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Post by judes on Oct 4, 2008 7:13:27 GMT -6
Waltc, you are so right!! If not for the easy credit this would have happened a long time ago. This is an income and wage problem, not a credit problem. Let's see who the bankers lend to now that they have our money. With job creation, at least people who need it, would have an increased propensity to spend and save. We need tariffs, it worked for a long time, let's get back to those days. Tariffs could be calculated by looking at the average wages and benefits of a countries work force compared to ours as a starter.
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Post by Waltc on Oct 4, 2008 13:42:35 GMT -6
However its going to be almost impossible to convince the market gurus and economists that this is a jobs/income/trade problem not just a credit crisis.
For example when I read market gurus such as Barry Ritholtz at BigPicture and Nouriel Roubini's blog they utterly ignore the wage/employment issue. To them there is nothing intrinsically wrong with our economy. its just a matter of recapitalizing the banks and some button pushing and the party will be on again.
It's both scary and bizarre that bright people like this can factor out of their analysis the financial status of working men and women who are in fact the engine of our economy.
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