Hey Kurtz...I Want Your Thoughts

[volimhtown]

In the Obama thread, you stated the following...

What I said was that under the threat of Congressional investigation/harassment, Lenders relaxed QUALIFICATIONS for MORTGAGES due to Leftists Democrats cow towing to organizations like Rainbow Push. This permitted folks that didn't HAVE the income to buy homes that they could not afford. While it let some Builders off the hook and delayed for a bit the looming collapse of Local and Regional Banks that extended these bogus loans, it all but cemented the severe injury to the entire market as the Huge Banks and Brokers absorbed and dispersed them on each other and in the secondary market. With the return of hundreds of thousands of homes to the market place through foreclosure and now from folks simply abandoning them, depression of real prices ensues and thus cheapens the capital basis of the whole financial market.

With your obvious knowledge regarding all of this, I'm curious about your thoughts regarding the government now coming to the rescue of the "victims" of the shady mortgage companies. Being in the home building business, I'm paying close attention to all of this.
Personally, I'm pissed about it.....I'm sick and tired of our government saving our selves from ourselves. Does personal responsibility not mean anything anymore?? I KNOW the tricks and deceptions that the lenders have played and are playing on people, but people have a responsibility to educate themselves on what it is they are REALLY getting into before they sign on the dotted line. They had a lady from New York on the Today Show a couple of weeks ago. She was a single mom with two kids...she makes $50k/year and bought a $250,000 home a little over a year ago and now can not afford the payments. Of course she claims she is a "victim". Certainly her ignorance was taken advantage of, but should we really have sympathy on her?? How much intelligence does it require to know that you REALLY shouldn't be buying a $250,000 home if your income is only $50,000 per year..... especially considering the amount of resources there are out there to help you make intelligible decisions.
I don't know.....am I being too harsh and not compassionate enough?? I DO know that I built a house 4 years ago for a family of 4. The guy was on his third wife with her kids and was their sole income. He had defaulted on two different credit card accounts, had a criminal record, and owed over $60,000 in back child-support from his previous marraiges. YET, we still found someone to finance his $150,000 mortgage with the standard down payment. Unbelievable, I know, but completely true!! Is our government going to bail these people out as well??
Since we can't go back and fix the wrongs, what is the next step and what is the solution out of this mess??

[azamugg]

well Im not Kurtz but Im in the real estate industry and certainly have viewpoints and ironically they're similiar to yours :)...........the Gov't has no business aiding these borrowers w/a bailout as there has to be a "societal correction".....you know, we expect corrections in the stock market, we're certainly experiencing corrections in the real estate market, well hell, let the average Joe take it on the chin and learn from living beyond his means and/or ignoring prudence when making significant financial moves in your life...................the crappy thing is the Gov't feels the need to bail them out to, in one way among many, plug a hole in the leaky dike by doing so

one of the major problems in all of this subprime BS is that Mortgage backed securities were being seeded fraudently w/these subprime loans ......Mortgage backed securities that shouldve only contained conforming loans and the best non-conforming loans.....so now you have people's 401k's, IRA's, Pension funds, etc being affected by the subprime fiasco

[volimhtown]

well Im not Kurtz but Im in the real estate industry and certainly have viewpoints and ironically they're similiar to yours :)

You DO realize that you're jeopardizing your membership to the Conservative Quilters of America by admitting that, right?? :laugh::thumpsup:

Well, the other side of it is that I'm sure the government does not bail out all of these idiots because of their moral conscience or because of their civic duty....I assure you that there are plenty of people that are getting their pockets lined and like most everything else, those of us in the middle are getting royaly screwed. Likewise, there is seemingly no detriment to the already rich and greedy ba$tards that started these sub-prime mortgage companies...they got in, cashed their checks, and bailed in a blink of an eye leaving their mess for somebody else to clean up. In steps the government with their cape and a with message of Patriotic Duty. The way this country's supposed free enterprise system works is really disguisting.

[azamugg]

one of the terrible ironies is that the Mortgage brokers that take subprime apps have the lowest entry barriers into the business therefore the potential for nontrustworthy slugs and hell there are still alot of states that don't have licensing in the mortgage industry

[geechee]

I dislike political discussions and and dislike even more having to disagree with one of my favorite Dogs on here but this statement "What I said was that under the threat of Congressional investigation/harassment, Lenders relaxed QUALIFICATIONS for MORTGAGES due to Leftists Democrats cow towing to organizations like Rainbow Push." is factually wrong. The loosening of the mortgage laws happened under the leadership of Newt Gingrich and Tom Delay; neither one of which can be considered a "Leftist".

[ColonelKurtz]

Vol & Aza, here's my take on this:

Washington is pandering to the very folks it sought to buy off with easy credit. Washington is today SCREWING the Lenders for doing their bidding. You are damn right Vol that 99.9% of these folks you see on TV whining knew EXACTLY what they were doing and so as to be completely fair here, the majority of loan writers to them did too. And both parties knew who was going to get screwed in the end......neither of THEM! They are CRIMINALS and should be pursued to the fullest extent of the Law.

By overstepping its authority, Congress created a mess and then stepped all up in it. Now it is the population who will ultimately foot the bill, for Congress will never take away the ability of businesses to bankrupt without all the severe repercussions an individual faces, heaven forbid! The real losers here are those whose retirements are invested in one of the many plans available, for they cannot act like a Trader and get out of the market when it moves against them. Our loving Congress will not rescue them however for they aren't the block of the population who seeks Peter's money to pay off Paul....and because they are not going to vote Democratic.

State and local oversight of the lending industry is one answer and total reform of our entire finance & banking system is the other. I shared this link several years ago and it is still dead on the money with a common sense
view of the mess we are in thanks to Washington:

Grandfather Economic Report - Home Page - by MWHodges (http://mwhodges.home.att.net/)

Our student buddy Emilio should spend an afternoon absorbing the volumes of information and explanations as to how we arrived at our mess today.

[volimhtown]

Vol & Aza, here's my take on this:

Washington is pandering to the very folks it sought to buy off with easy credit. Washington is today SCREWING the Lenders for doing their bidding. You are damn right Vol that 99.9% of these folks you see on TV whining knew EXACTLY what they were doing and so as to be completely fair here, the majority of loan writers to them did too. And both parties knew who was going to get screwed in the end......neither of THEM! They are CRIMINALS and should be pursued to the fullest extent of the Law.

By overstepping its authority, Congress created a mess and then stepped all up in it. Now it is the population who will ultimately foot the bill, for Congress will never take away the ability of businesses to bankrupt without all the severe repercussions an individual faces, heaven forbid! The real losers here are those whose retirements are invested in one of the many plans available, for they cannot act like a Trader and get out of the market when it moves against them. Our loving Congress will not rescue them however for they aren't the block of the population who seeks Peter's money to pay off Paul....and because they are not going to vote Democratic.

State and local oversight of the lending industry is one answer and total reform of our entire finance & banking system is the other. I shared this link several years ago and it is still dead on the money with a common sense
view of the mess we are in thanks to Washington:

Grandfather Economic Report - Home Page - by MWHodges (http://mwhodges.home.att.net/)

Our student buddy Emilio should spend an afternoon absorbing the volumes of information and explanations as to how we arrived at our mess today.

Awesome!! Thanks for the link.... me has some reading to do!! :thumpsup:

How much, if any, of this attempt to bail people out is politically motivated?? I really haven't heard the Pres Candidates talking too much specifically about it, so.....

[azamugg]

I dislike political discussions and and dislike even more having to disagree with one of my favorite Dogs on here but this statement "What I said was that under the threat of Congressional investigation/harassment, Lenders relaxed QUALIFICATIONS for MORTGAGES due to Leftists Democrats cow towing to organizations like Rainbow Push." is factually wrong. The loosening of the mortgage laws happened under the leadership of Newt Gingrich and Tom Delay; neither one of which can be considered a "Leftist".

somewhat right and somewhat wrong.l..........Fannie Mae and Freddie Mac, while quasi-gov't agencies were the ones relaxing the guidelines w/in conforming lending and yes they are influenced by people hollering "redlining", the federal term for discrimination in lending

[geechee]

Vol & Aza, here's my take on this:

Washington is pandering to the very folks it sought to buy off with easy credit. Washington is today SCREWING the Lenders for doing their bidding. You are damn right Vol that 99.9% of these folks you see on TV whining knew EXACTLY what they were doing and so as to be completely fair here, the majority of loan writers to them did too. And both parties knew who was going to get screwed in the end......neither of THEM! They are CRIMINALS and should be pursued to the fullest extent of the Law.

By overstepping its authority, Congress created a mess and then stepped all up in it. Now it is the population who will ultimately foot the bill, for Congress will never take away the ability of businesses to bankrupt without all the severe repercussions an individual faces, heaven forbid! The real losers here are those whose retirements are invested in one of the many plans available, for they cannot act like a Trader and get out of the market when it moves against them. Our loving Congress will not rescue them however for they aren't the block of the population who seeks Peter's money to pay off Paul....and because they are not going to vote Democratic.

State and local oversight of the lending industry is one answer and total reform of our entire finance & banking system is the other. I shared this link several years ago and it is still dead on the money with a common sense
view of the mess we are in thanks to Washington:



Now this whole post is hard to argue with but, Colonel I need you to explain the part in red to me. How exactly is Washington screwing the lenders?

[ColonelKurtz]

I dislike political discussions and and dislike even more having to disagree with one of my favorite Dogs on here but this statement "What I said was that under the threat of Congressional investigation/harassment, Lenders relaxed QUALIFICATIONS for MORTGAGES due to Leftists Democrats cow towing to organizations like Rainbow Push." is factually wrong. The loosening of the mortgage laws happened under the leadership of Newt Gingrich and Tom Delay; neither one of which can be considered a "Leftist".

That would place the writing of today's collapsing sub prime mortgages back in the mid 1990's......don't sound right does it? In my area, the "liar loans" became available in the Summer of '03 for we were refinancing then and the "Interest Only-ARM" were available.

[ColonelKurtz]

Now this whole post is hard to argue with but, Colonel I need you to explain the part in red to me. How exactly is Washington screwing the lenders?

Washington forced the Banks to carry the worthless paper extended in the form of these liar mortgages and today is demanding that they somehow fix the resulting mess. Problem is that the Fed Reserve & the Treasury Department have swamped the market with so many fiat Dollars that Congress will not permit the issuance of any more Treasury Notes, Bills, etc. to back them. Without the full faith of the US Government behind this debt (issued in the form of Dollars), then it isn't honorable or recoverable. As balance sheets head into deeper shades of red, poor stockholders are along for a ride to the poor house as there is no market for them to bail out into.

This is a very complex subject and sadly I don't have the time today to break it down into pieces easily absorbed but the bottom line is that only so long as the US Government will back all of this debt with Treasury Notes & Bills, the Economy will sputter along. The day that Washington says no, look for a run on your nearest bank. Already in violation of Federal Law, the Federal Reserve is teetering on being out of backed reserves altogether and its failure would trigger a global depression.

[GatorHunter]

I'm not going to pretend to know very much about real estate...however, I do watch the market...look for good deals from time to time...buy land when it gets low and have flipped a couple of houses with my father who's a licensed contractor. A lot of these issues can also be blamed on these speculators that bought up property and houses in an attempt to earn easy/fast cash. Some of these idiot people thought they could buy a house costing twice what they could afford...live in it until the ARM increased...and then sell it for a profit. Problem is...the housing market collapsed and now, their houses aren't worth what they paid, they can't afford the payments and can't get out of them...many are just walking away...credit be damned. I know a guy that did this...spent nearly $300,000 on a house....he earns about $70,000 a year...married with 3 kids. Anyway, he got a low ARM...payments were barely $1,000 a month...lived in the house for nearly a year...when the payments were due to increase...he tried to sell...problem was, his house is now only worth about $250,000. He can't sell it for what he owes and has defaulted.