Why do we need a bailout?

I am sure there are plenty folks on the conspiracy theory bandwagon.

 

I think it is is intentional. WAMU was plain stolen from the stockholders.

 

My previous post proven. :laugh: :laugh:

 

Lenders will still remain tight with credit until the atmosphere changes. There are far more macroeconomic factors at work, but capitalization will help in the long run. Short run, it's just too tight.

So now you want the govt on the hook for more mortgages? Refinance mortgages that are already in default? Refinance bad paper that was bad to start with? You can probably add more taxpayer dollars to the mess, then. The costs of the refinances would be born directly by the taxpayers. Who are you going to get to buy these loans that already have two strikes on them? We'll either be right back where we started, or the govt is going to be holding risky paper for eeons. I want neither.

You just double-spoke and made my point all at the same time. If the govt is giving the banks/lenders a check for the amount in arrears or the whole sum, either way, the value goes down when the properties begin to flood the market. What happens when Federally subsidized mortgages or Sec 8 people land in homes that have suddenly been snatched up by flippers or unfettered investment owners? And if the market remains tight (which it will) the credit just won't be there.

I have the intention of doing a J.D and a Ph.D in theology at the same time when I finish my MBA. Not exactly being a spry young thing means my intentions may be good, but my realistic abilities may lead me to do less (probably just the doctorate) :thumbs: You get my point. People got loans that they couldn't handle. Whether that was a sour economy or people who bought house they couldn't afford (which for some was ANY house), they couldn't hack it. I'm in the business. I saw it all firsthand. People were taking ARMS left and right to be able to get into a $200,000 house with nothing down instead of a $150,000 house (since, after all, who wants that piece of junk). Balloons have been out of favor for the better part of this decade. No reason to do balloon notes when you can do payment flexes, ARMS, I/Os, etc.

I'd love to see people stay in the house they're in. However, if they couldn't afford it then, what makes us think they can afford it NOW? Artificial economics is just that. You cannot artificially produce these forces. It just creates a bubble that will eventually burst. I'll gladly forego some artificial value of my home for now so that it doesn't go to pot five years later when the housing economy bursts....again.

Besides, why do people want value out of their homes? Either so they can sell when they have to move due to mobility (a legitimate concern), or for the most part so they can use the equity like a piggy bank so they can roll that Visa-bought steak dinner into their 20 year HELOC or 30 C/O Mortgage. That's just not for me. I think this obsession people have with the "value of their home" is just unhealthy. It certainly never helped this mess. Artificial inflation of property values fed the ramping up of financing pressure. The bubble has burst. Let's let it stay deflated. I'd much rather have a true market based on realistic market forces, supplies, and demands.

 

I don't want to debate the entire subject again but I like to answer this point, this would only work for people who have the balloons, ARM's and subprime huge interest rates. My brother fir instance walked away from his home which was at 14%. I think if we can put these people in a reasonable 7% some of the people may work it out from there.

 

Where is Poncho when we need him?:thumbs:

I don't think it is humanly intentional... but it will be interesting to see what happens...

And it seems the Politicians are going to push it through no matter what the people want...

I wonder how much political collateral will be spent on this.

 

I'd be curious how he had 14% with the caps that are in place in many states and on most ARMs by design. Balloons are non-factors nowadays, and the subrpime rates were not high, relative to history. I do feel for your brother and as someone in the business, I am genuinely interested in how the rate was that high. If you'd like to PM me to discuss, feel free. Not looking for a debate about your brother's situation, just would like to know if his lender has a usury complaint due.

 

The bailout will not provide one working class job or save one person's house.

The bill is written so that foreign owned banks can transfer their bad paper to a U.S. branch and sell it to the American taxpayers.

 

Proof? Or at least, explain the rationale behind the opinion section of the post. I ask because there's a tremendous amount of theory that could disagree with everything you've said. I don't like 90% of the bailout bill (raising the FDIC coverage is okay even if one disagrees with it on Liberterian principles, but it begs why Congress has waited 26 years to do anything. Then again, this is the same body that refuses to do anything about AMT...or, well, ANYTHING). That said, we're at an awfully critical juncture. Maybe

Again, I'd like to hear evidence for your opinions. Thanks :thumbs:

 

Tiny, how did I miss this explanation completely exonerating all republicans? I guess the conservatives are the only ones without blame which makes it admirable for bush to save us from ourselves with a $700 Bil blank check... :thumbs:

 

I appreciate the offer but he has been out of his house for a couple of years. His credit was so bad I'm surprised he got a loan. We were asked to co-sign but my brother has never paid his bills for as far back as I can remember. I fact, he owes me money.

 

I hear you.

 

What happens to your investments if all the bad loan houses in your neighborhood get put on the market as a foreclosure?

I agree LE, the whole thing [offensive word deleted]