w1ld wrote:
He goes way to far, but he is trying to make a point.

I dunno, man. Millions of people losing their homes is serious bad juju.

Dagmar wrote:

w1ld wrote:
He goes way to far, but he is trying to make a point.

I dunno, man. Millions of people losing their homes is serious bad juju.

Greg Saunders, a guest blogger on This Modern World, describes the situation succinctly:

http://thismodernworld.com/3903

So let me get this straight. For a few years now, the financial industry has made billions in risky subprime loans by essentially tricking people into believing they can borrow more than they’ll be able to pay back and now that this brilliant idea is going south, people are floating the idea of a government bailout. Well, screw ‘em. If you’re foolish enough to loan hundreds of thousands of dollars to people who can’t even balance their checkbooks, then you deserve to be as poor as your customers.

Then again, this is all assuming that these creditors were giving out loans in good faith in the first place. The way it looks to me is that these subprime loans were always about locking people into high interest loans for a few years until they went broke after which the banks would take back the house and any more money they can squeeze out of the debtors (thanks, bankruptcy reform!). Once they unload the house, which has almost certainly grown in value, they make a nice profit on top of the cash they gouged out of their now-homeless former customers.

The reason this has all come back to bite lenders in the ass is because they lacked the foresight to realize that when their customers were going broke, everybody else would be going broke as well, which would drive down the value of their repossessed houses and make them harder to unload to the next poor sucker who just wants to move out of an apartment.

In a truly free market economy, we’d be pointing these idiots towards the back of the line at the local soup kitchen, but these guys had a backup plan. They bribed (I mean, “lobbied”) every level of government that’s willing to cash their checks, insisting that if they pay the price for their moronic business practices, the entire economy will suffer. In short, they don’t need government bailouts to help themselves, but to help us.

Hijexx wrote:

Dagmar wrote:

w1ld wrote:
He goes way to far, but he is trying to make a point.

I dunno, man. Millions of people losing their homes is serious bad juju.

Greg Saunders, a guest blogger on This Modern World, describes the situation succinctly:

http://thismodernworld.com/3903

So let me get this straight. For a few years now, the financial industry has made billions in risky subprime loans by essentially tricking people into believing they can borrow more than they’ll be able to pay back and now that this brilliant idea is going south, people are floating the idea of a government bailout. Well, screw ‘em. If you’re foolish enough to loan hundreds of thousands of dollars to people who can’t even balance their checkbooks, then you deserve to be as poor as your customers.

Then again, this is all assuming that these creditors were giving out loans in good faith in the first place. The way it looks to me is that these subprime loans were always about locking people into high interest loans for a few years until they went broke after which the banks would take back the house and any more money they can squeeze out of the debtors (thanks, bankruptcy reform!). Once they unload the house, which has almost certainly grown in value, they make a nice profit on top of the cash they gouged out of their now-homeless former customers.

The reason this has all come back to bite lenders in the ass is because they lacked the foresight to realize that when their customers were going broke, everybody else would be going broke as well, which would drive down the value of their repossessed houses and make them harder to unload to the next poor sucker who just wants to move out of an apartment.

In a truly free market economy, we’d be pointing these idiots towards the back of the line at the local soup kitchen, but these guys had a backup plan. They bribed (I mean, “lobbied”) every level of government that’s willing to cash their checks, insisting that if they pay the price for their moronic business practices, the entire economy will suffer. In short, they don’t need government bailouts to help themselves, but to help us.

Oh, SNAP!

w1ld wrote:
He goes way to far, but he is trying to make a point.

as if just the FED was asleep in this administration. I think we might blow up the planet by 1/20/09

w1ld wrote:
He goes way to far, but he is trying to make a point.

Way too far? He might be the first market talking head to actually say what he thinks. Hoover indeed.

Decius wrote:
Why didn't he blow a head gasket a couple years ago when this bubble started?

YOU HAVE NO IDEA! Pretty lol. Make sure to watch the last 15 seconds...icing on the cake.

But wait a minute now - wasn't Bush's "more people than ever own their own homes' brag a big reason why he got re-elected? The economy is doing so well all these people have their own homes?

I just remember something like that....

BTW, my sister is one of the folks that lost her home. She paid 55k for it. Added on a lot to it, put a new pool in, owed 30k on it (had taken a second mortgage to add on to it)...came down with bad fibro and became disabled. Was struggling but making it, trying to get her disability - but then boom! She got thyroid cancer and was having surgery & chemo right as they were foreclosing - she walked away with nothing to show for years of putting money into that place - and it sold for 130k. (This is in a very rural area with low cost of living.)

She has her disability now, and she got her back pay, but it took her 2 1/2 years to get it - but its too late.

The bank made a killing on a very bad, sad situation. Now she goofed up and should have just paid the place off instead of turning it into a showplace...but that's what you get sometimes for working hard and hoping for better.

skullaria wrote:
The bank made a killing on a very bad, sad situation. Now she goofed up and should have just paid the place off instead of turning it into a showplace...but that's what you get sometimes for working hard and hoping for better.

Not to be too hard (terrible what your sister went through and continues to live with by the way) but that goes quite beyond "goofing up." "Buying" a house then taking a second mortgage to fix it up and add a swimming pool was stupid. Swimming pools add little to no value to a home anyway. They are luxuries.

Getting your house foreclosed on in that situation is not "something you get for working hard and hoping for better." It'd what you get when the financial impact of unplanned life events are exacerbated by poor financial decisions.