McCain on the Housing Crisis: Quick, Do Nothing!
| Tue Mar. 25, 2008 2:47 PM PDT
Don't just do something, stand there! And wait for somebody else to suggest a course of action.
That appears to be John McCain's approach to the housing credit crisis. On Tuesday, he delivered what his campaign billed as a major address on the housing crisis. What made it notable was that it contained nothing notable.
McCain started off stating the obvious: there was a housing bubble: "speculators move into markets, and these players begin to suspend the normal rules of risk and assume that prices can only move up -- but never down....The normal market forces of people buying and selling their homes were overwhelmed by rampant speculation. Our system of market checks and balances did not correct this until the bubble burst." Lenders went wild and some Americans bought homes they could not afford. And, he added, "the housing bubble was made worse by a series of complex, interconnected financial bets that were not transparent or fully understood....Because managers did not fully understand the complex financial instruments and because there was insufficient transparency when they did try to learn, the initial losses spawned a crisis of confidence in the markets."
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Anyone who watches a cable business show--even only during the commercial breaks on American Idol--knows this. The question is, what would a President McCain do about it. Short answer: not much.
"I will not play election year politics with the housing crisis," he declared, adding, "I have always been committed to the principle that it is not the duty of government to bail out and reward those who act irresponsibly, whether they are big banks or small borrowers." That's a fine sentiment. Tough love. Let the markets take care of things. But does he have any idea how to make the system work better? How to make sure that people victimized by predatory lenders have a shot at solvency? How to ensure that whole neighborhoods don't collapse?
Not really. Instead McCain only offered guidelines for what might be acceptable; he did not offer any specific initiatives:
In our effort to help deserving homeowners, no assistance should be given to speculators. Any assistance for borrowers should be focused solely on homeowners, not people who bought houses for speculative purposes, to rent or as second homes. Any assistance must be temporary and must not reward people who were irresponsible at the expense of those who weren't. I will consider any and all proposals based on their cost and benefits.
He called for greater transparency and a high standard of ethics in the mortgage business and noted that home buyers ought to provide "responsible" down payments. "I am prepared to examine new proposals and evaluate them based on these principals," McCain said. In other words, let someone else come up with a good idea.
McCain did call for a "meeting of the nation's accounting professionals," and he urged the top mortgage lenders "to do everything possible to keep families in their homes and businesses growing." But his general approach was clear: hands off. He's not offering much to voters who are hurting financially or nervous about the housing crisis.
If this is a preview of McCain's fall campaign, Democrats ought to be heartened. Assuming that economic insecurity will be an issue in the general election, will voters be hankering for a laissez-faire champion who says that the markets will sort it all out and who is willing to do no more than to beseech big financial firms to do right by the little guy and gal? McCain's speech signaled he might be even less of an economic activist than George W. Bush. If so, that could set up a fall contest reminiscent of the Bill Clinton-George Bush match of 1992--whether or not a Clinton is involved.
Comments
I dunno. Anyone with common sense has been warning about this for years. Why should McCain do anything about it? Is that really the right solution? Most of the "crisis" is in unsustainable hell-holes like Vegas and South Florida. Let those places rot.
McCain is right here, though it may hurt him in the election. The only thing our government should be doing here is setting up laws that set guidelines for lending and transparency. Rewarding businesses and customers for irresponsible decisions are not the answer.
To typify MCcain as pro market is indefensible. Readers, and the public at large should recognize he's playing them, like any other politician. For him to claim he wants the market to work it self out is non-sensical. The Fed is the monetary arm of the federal government and there's no way he'd tell them to cease intervention. Only someone who understands economics and the science of liberty, such as Ron Paul, for example, could give such a recommendation.
And anyone who supports complete government control of the macro sphere of the economy (all economic schools of thought save the "austrian school") are economic interventionists to that same extent, and cannot in be legitimately referred to as proponents of free market capitalism. And this cannot be played down, since this position means in practice a completely different kind of economic system. And that system is not laissez-faire capitalism.
To postulate a "free market" based upon state monopolized central banking, and government enforced fiat currency should smack of complete inconsistency even to those ignorant of economic theory.
McCain clearly has no understanding of how the market works, but it's never obvious to the public since none of the other officials in Washington do either.
To suggest the "speculators" caused the bubble is reminiscent of every other recession, or depression when they are used as the scape goat. The great depression itself was.
Recessions, and bubbles, are symptoms of fractional reserve banking, not free market capitalism.
What Caused The Liquity Crunch? - Frank Shostak
http://www.mises.org/story/2667
Excellent essay on how the federal government and the Fed created the housing bubble,
http://www.mises.org/journals/scholar/Thornton13.pdf
I would recommend Jesús Huerta de Soto's Money, Bank Credit, and Economic Cycles;
http://www.amazon.com/Money-Bank-Credit-Economic-Cycles/dp/0945466390/re...
McCain is an economic fascist, as Hillary and Obama are as well. Don't expect them to have any idea what to do, no previous administrations of the past 190 years have either.
McCain is "right" ONLY if you assume that this situation was arrived at because all the actors were given proper information and advice, AND that they was intent on the part of many borrowers to be "irresponsible."
What we will find out in a few months is that people trusted that "the market" was making a rational decision about their credit worthiness. What they didn't know was that decisions and assumptions were made not on their credit worthiness, but the mortgage broker's ability to get more warm bodies thru the door, knowing that payment obligation was going to be "someone else's problem." It is easy to pass judgement on individuals for "not being responsible." I submit that the game was rigged against many prospective homeowners and people simply refinancing existing homes. And the losses go far beyond the now approaching millions of people who have or will be facing foreclosure: it is now affecting people who have a mortgage more than 8 years old who expected to use their home equity to send a child to college or make a scheduled, legitimate home improvement.
If a few "bad actors" get to escape very serious economic consequences because the impact of non-action on the overwhelming number of people who had good intentions -- who were led to believe they were following the rules and making good financial decisions -- so be it. This has become bigger than issues of "individual responsibility."
"We must not reward people who were irresponsible at the expense of those who weren't."
Ok first off, I am a Democrat and consider myself very liberal. As such, nothing aggravates me more than a government bailout of big business, but as someone who falls in the later category: someone who wasn't irresponsible and didn't buy a house because the prices were obviously ridiculous (even though I qualified). I have to side on with McCain on this issue. Obama and Clinton are preaching to the quire and I am sure it will pay off for them, but come on this was high school math and in the case of the Bay Area common sense. A 800 square foot, two bedroom, one bath house built in 1914 next to the train tracks in crocket just wasn't worth half a million dollars. Why dose a little guy like me who knows what he can afford, and didn't get the write off benefits, possibility of equity or even home ownership pride have to help pick up the bill for the irresponsible people. YES BUYER BEWARE, it was irresponsible. Markets do correct themselves, and I know it must be horrible for people losing their homes, but at least they had one to lose. People gambled and lost. If the market would have kept escalating at the same crazy rate and the gamble would have paid off then the broker and real estate agents would have been a gambler's best friend with sound advise...At the end of the day, the decision was the home buyer's alone, who honestly just wanted more than they could afford. Why make the non-gamblers pay the bill.
I do not like government bailout for anybody.
He is really pandering in a very dishonest way. Assuming he understands something about economics. I don't think we can survive another president who delegates because his brain is toast.
Governments ARE the last defense whether he likes it and says it or not.
Republican ignorance since Ronnie have taken us to the brink. So many reporters and columnists have worked this economic tsunami to death but not enough people read to be able to "get it". But we all are going to know it soon enough.
First, I hope that a credibly well-researched and healthily sassy rag like MJ will take the time and resources to pursue the following about the apathetic and abdicating McCain article on the sad and worsening housing foreclosure crisis and all other issues:
Has anyone taken notice and observed the programmed, systematic, de-humanized and mechanistically orchestrated signs of Senator McCain's lapsidasical attitude, flat and depressed behaviors and complete lack of personal presence as the classic picture-profile of someone under the terminal affliction of the "Stockholm Syndrome"?
Regardless of your party affiliation (or lack thereof), can't a semi-intelligent, observing, concerned and civilized American "see and hear" that this 72 yr. old former dead war-hero-ghost is now symbiotically identified with and remains in un-conscious alliance with his very former war perpetrators, accusers and torturers? This tragic fall-out condition (the loss of self, personality and identity) is the long result of being broken by your enemy, over and over again.
A respectful in-depth MMPI personality inventory on him would reveal and confirm who and what McCain is, and more importantly, who he has not been since his return from his Viet Nam torturers.
In the well-known best-seller, "The Stockholm Syndrone," based on true life war stories, Mr. McCain himself is now the ghosted war echo (not hero) and impotent savior from a war that was not won, redeemed or saved~from over 30 years ago!
What I find so bizarre and ludicrous about his run for the US Presidency in 2008 is his devastating lack of spirit, life, debate, inquiry and normalized responses as a healthy human being, as an older man, and as a humbled and grateful American citizen.
Why? He is a perpetutally haunted victim of the Stockholm Syndrone and unconsciously (do or die)wants his mission for the rest of this country to patriotically follow-suit in a similar fate.
His "fatal condition" has nothing to do with the times, needs and worries of the American people or the rest of the world~his war disease will never allow this to surface. He is still over in Viet Nam fighting for "whatver."
MJ, it is well worth your pursuit and publication of this "glaring observation."
(Just in case you are interested in my political leanings, I am a stewarding, conserving, constitutional independent). Thanks!
Dr. MMCarey (Psychologist)
If we start with your quote of McCain's,"...speculators move into markets, and these players begin to suspend the normal rules of risk..." He is stating the the problem was started by the (speculative)borrowers. He is wrong. This is a major RED FLAG!!! And I assert he is dangerous as a prospective next president.WE,The PEOPLE are in danger by his not addressing the social and economic escalating crisis in motion at this time. And is an echoe of the current "commander and chief" who distorts the facts at the expense of the People. //To set the perspective straight,the lender is the gate keeper. It is the lender who makes the Loan/money available to the borrower to borrow in the first place. //They put the loan products together: set the criterion that the borrower had to meet in order to borrow (that would also be enticing enough for the lender's investors to then purchase this equating to profits for the originating lender). After "qualifying" the borrower / getting inflated appraisals to boost property value (= more $$ loaned = moremoeny gained in the resale),doing 11th hour switch-n- bait tacktics on the borrower(meaning borrower walking into escrow being told one set of terms only to find out at signing time that they were now different than the initial terms offered,as well as the "Good Faith" figures/always higher). They then quickly bundled them up (even before I was done singing the papers!) and sold them off to the investors on Wall Street,(thereby taking themselves out of the risk equation). [In all fairness there were some (many?) fair practice lenders but I know first hand each of the tactics I mentioned. //Our Politicians and campaign donors dont know this experience. They are dealing abstactly with the situation so can be callous or ineffectual as McCain is being.//If "managers did not fully understand the complex financial instruments..." how could ordinary people? //What is being struggled with here is who is to be the deemer of accountability? Who(pural) to hold accountable and to what % of the of the correction is to be allotted to each involved? And could they even pay-up that accountablity? Especially when the ENTIRE SYSTEM is based on several tiers of credit and borrowing.'Money makes the world go round' and in this case moved like a hot potatoe...not held on to for very long but leaving an painful trail.
The fact is, that banks have been robbing the American people since 1913, when J.P. Morgan, John D. Rockefeller, Paul Warberg and a handful of other super-wealthy and ruthless bankers bribed members of Congress during Christmas time, when most Senators and Reps were home with their families, into giving up the government's most powerful and creative tool--the power to coin money and regulate the value thereof, to a private, central bank--the "Federal" Reserve, which is not a government entity, but a cabal of private, for profit banks centralized in the Federal Reserve.They did this without the neccesary Constitutional amendment, and now the government has to borrow money from this private, central bank, and pay interest on its loans--instead of just printing the money itself, with no interest, as the Constitution states. I believe it was Jefferson who said that "if we ever allow private banks to control the money of our country, our children will one day wake up homeless on the shores of the Country their forefather's conquered."
Another of the founding fathers, said that "I truly believe private banks having the power to coin money is more dangerous to our Civil Liberties than standing armies." You should watch Aaron Russo's movie: "America: from freedom to facism" which explains not only this fraud but also the IRS taxing labor fraud..because, 1, the 16th amendment, or so-called "income tax amendment" (which just happened to be passed in the same year as the "Federal" Reserve Act, 1913, was never properly ratified by all the states. The very same bankers bribed Philander Knox to say it had been, but as recent as 2003, a Judge pointed out that if you truly studied the 16th amendment, one would find that several states never properly ratified it. 2, the Supreme Court, in several never-overturned rulings, declared that "the 16th amendment did not give Congress or the government any new powers of taxation." So, if they didn't have the right before--which they didn't--then they didn't after the 16th amendment, even if it were properly passed, either. See, the Constitution only allows for two types of tax: direct and indirect. An indirect tax is a tax one can avoid, an excise tax--like the tax on tobacco..if you don't want to pay the tax, you can avoid it by not smoking. Indirect taxes must be uniform throughout the states, accordingto the Constitution. The second type, a direct tax, is one you can't avoid--which a direct tax on labor would fall under this category. A direct tax must be apportioned equally among all the states. The income tax we pay is actually a 3rd, un-Constitutional form of tax--a direct, unapportioned tax. To apportion is to divide equally. Of course, the lower courts are not in compliance with the Supreme Court, as they're supposed to be, and the IRS gets its money through intimidation and coercion--like the mob, making people pay for "protection." But there is no law, even in the IRS tax code, that says an American citizen is required to pay a tax on their labor. There is a legal income tax, but that is paid by the company doing business. In one court case, the Jury requested to see the Law that says we have to pay an income tax. The Judge promised them the Law, but never delivered it--because it doesn't exist. Yet, when the Jury found the man, who was charged with not paying his income taxes--which he was willing to do, if someone would just show him the law--not guilty. The Judge was so angry, according to a Juror that Russo interviews in his film, that his face turnd red and he stormed out of the court room!
But I don't advise trying to get away with not paying your taxes, even though there really is no Law, because the people with the guns believe there is a law, and the lower courts will sentence you. The Supreme Court, in its current, fallen form, would probably never hear a tax case, anyway, even if you could make it to the Supreme Court.Besides, they've already ruled, and look what good it's done. None. Nobody has more contempt and disregard for the Will of the American people, the Constitution, Congress, and the Rule of Law than Bush and Cheney and their administration. Yet, Nancy Pelosi has taken impeachment "off the table," despite the fact that the decision is really up to John Jonyers, The Head of the House Judiciary Committee, and the members of that Committee. While innocent children lay suffering from the ffects of cluster bombs in hospitals with not enough medicine, Doctors, and beds for all the wounded, Nancy Pelosi laughed it up with George W. Bush, Dick Cheney, and other politicians at their dinner party, as the President looked around the Oval Office for the missing W.M.Ds he knew were never there to begin with. Chicken-hawks only attack helpless, defenseless countries. I wonder whathe would say to China if they wanted to start collecting on their loans to us. Meanwhile, we ship American jobs over there to further boost their economy and durther devastate ours..oh, yeah, a few of the already richest men alive make another billion while thousands of hard-working middle-class and lower-middle class men and women lose their jobs by the thousands.
Our dollar is actually worth about 4 cents right now. This housing crisis is just the tip of the iceberg. And if Bush and Cheney decide to bomb Iran before they leave office, we'll gas prices jump to at least 10 dollars a gallon..at least. Or, if Bush steals the election for McCain, same scenario. Nancy Pelosi said she was going to stand up to bush, to end the war, but it was all lies. In my mind, she's as guilty as he is for neglecting her duty as the Speaker of the House for not calling for and encouraging impeachment hearings beginning with Dick Cheney, for numerous high crimes and misdemeanors, and possible treason. Everyone with a brain knows they are hiding something really big about 9/11. Hijacked planes do not fly around our skies destroying buildings for 2 hours with no military response without someone on the inside sabotaging things. And Larry Silverstein admitted on T.V. that WTC 7, which was not hit by a plane and collapsed at around 5 on 9/11--another steel-framed skyscraper..as well as several police officers, firemen, and reporters demonstrating before-hand knowledge of its collapse...then suddenly the story was hushed up and the media wouldn't even show the collapse without authority from the very top. I guess they figured out that Americans would consult with demolition experts and learn that to rig a building of that size for wireless demolition takes at the very minimum 3 days...which means it was wired for demolition at least 3 days prior to 9/11. Because of its shape, like an unside-down pyramid with the tip cut-off, it's also the only way to explain its straight-down collapse; plus, it wasn't hit by anything, only had fires on a few floors, and a fire has never brought down a steel-framed skyscraper,at least before or after 9/11, including a skyscraper in madrid, Spain that burned ferociously for 18 hours. WTC 7 burned for a maximum of 8, and i believe it was more like about 2 or 3 hours; this building was Guliani's command bunker and was heavily re-inforced. Plus, as i said, they admitted it was demolished..and then changed their story, or just ignored it, as FEMA did.WTC 7 isn't even mentioned in the 9/11 Commission and NIST said "its best hypothesis (for collapse, which was fire)had only a very minimal probability.." Also, thermate, a smoking gun for demolition, a chemicalfingerprint that is unmistakeable, was found in the dust of the WTCs...which would explain the molten metal found in the basements of all 3 buildings. They knew there could be a problem that day; there were dozens of warnings, yet the people in the second tower weretold to just remain seated after the 1st building was hit...they needed casualties. they needed a "new Pearl Harbor" just like it was called for in the neocon, chickenhawks bible, "Rebuilding America's defenses." A lot of people also don't know that george W's grandfather, Prescott Bush, not only supplied the Nazis with steel and other materials through his company during WW2, but Prescott Bush was also involved in an attempted coup with the Nazis to over-throw the United States Government. That is not a conspiracy theory--sounds like one, but from what i've researched, it's actually true. You would think such a family history would bar any Bush from the White House, but Bush just took it, stole it outright.
Woodrow Wilson, who signed the "Federal" Reserce Act into Law, later deeply regretted doing so: " I have unwittingly ruined my country. A great industrial nation is now controlled by its system of credit. We are no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of a small group of dominant men."--President Woodrow Wilson, 1916. Imagine if it was already that bad just 3 years after the "Federal" Reserve Act was signed into law, imagine how corrupt it is today.The reason I put quotation marks around "Federal" is because it's not a true government instituition, but a for-profit, private bank. Russo said that it was no more "Federal" than Federal Express, which I thought was funny and an excellent way to phrase his point. And as far as the IRS goes, several IRS agents looked for this law themselves, because at one time there was a sizeable reward--like about $5000.00--for anyone who could show the law. But they couldn't find it, and several of them quit the IRS and never filed another tax return...that's why there are these companies that say, "we can settle your tax problems for half of what you owe," and this kind of thing. Now, if the IRS really had such a law in writing, you know they would show it; they would also never settle for a penny less than the entire amount supposedly owed them. But these corporations and companies, they know there's no law, and they call the IRS and say they'll take them to court, where there's always the possibility that you might get a Judge who takes the Rule of Law and Justice seriously, and sets a terrible precedent for the IRS
by ruling in the defendent's favor. But if they can get most of what they owe, and without having to dispatch agents, and doing other things that are effective for them usually, but also costs them money. Thse companies are just smaller fish that are profiting from the same enormous fraud perpetrated on the American people.
Furthermore, our income tax money doesn't go for education or roads, or infrastraucture: every penny goes to pay the interest on the debt to the FED. We have property taxes that go to pay for education. We have a 42 cents per gallon tax on gasoline that goes to pay for roads, many of which are tol roads and payed off, but yet they continue tocollect from us. In the American economy, the consumer is bled to death from a million small cuts..administrative fees, and processing fees, and proprietary fees...every time I move and reconnect with a power company, or cable company, it seems there are more and more of these little cuts. Then, when you're half dead from blood loss, your car breaks down, and..that's it, you're screwed, especially if you are a person like me who doesn't believe in credit cards (and has bad credit)and doesn't trust banks (so no payday loans) you can easily get evicted from your apartment, then lose your job, and fall right throught the cracks and end up living on the street, where only the most ruthless predators survive, and although I'm no wimp, and can actually hold my own in hand to hand combat, I don't have that ruthless drive, I don't like to hurt people..I want to trust them, but ti seems every time one does, they mess you over--which ruins it for the truly honest people like myself, who will repay a dollar loan. Meanwhile, while I'm sleeping, or trying to, on a park bench, which there are fewer and fewer of, it seems--both parks and benches-
there are others with 5 homes, all costing in the millions, five or 6 cars, all costing in the upper hundred thousnds and yet get tax breaks from our President, which they don't need, as they offshore their money anyway.
To make matters even worse, Nixon went and killed the "Gold Standard" and created a fiat money system in its place. See, money is paper, and paper has very little value. Money used to be a receipt for true wealth; you used to be able to take your receipt, your paper money, to the bank, and exchange it for the true wealth, which is gold or silver. This limited the amount of moneythat could be printed, and insured its value. When Nixon (aka Satan, who had two sons Cheney and Bush)got rid of the gold standard and replaced it with a fiat--or unbacked--currency, he seeded the ground for eventual total economic collapse, of which we are now witnessing the beginning, although it's been festering for a long time.
The problem with the Gold Standard was that the government--mainly the DOD, (or the DOO now, Dept. of Offense, or doo doo)and the military industrial complex, which Eisenhower warned us of in his last speech. America had to keep up with the Russians in the arms race, we had to wage these stupid wars, like Vietnam, which drained our morality and money--except for those who make a killing from the killing. So, the "government" needed more and more money, and with the fiat money system, it just printed the money up, even though there was less and less capital with which to back it.
All fiat money sytems have failed. Every time it's been tried, the currency has ended up being destroyed, and the country has suffered a catastrophic financial collapse. Imagine this: the odds of being killed in a real terrorist attack in America today are 40,000 to 1. Yet the odds of having a heart attack are 350 to 1. But instead of having a Universal HealthCare system like France's #1 rated in the world, we spend more than all the other counties combined making bombs, nuclear missiles, biological agents that with one accident could kill us all (or what if a terrorist really did strike and blew up one of these under-regulated (like everything now) labs? We continue to make and use chemical weapons like white phosphorus, which was used on the people of Faluja. White Phosphorus sticks to you like sand, but you can't wash it off..it immediately eats through whatever you're wearing and burns you alive, right to the bone...
We hanged the German Nazis for "agressive wars" and "holding people without charges and access to a trial or lawyer" and for Torture and Crimes against Humanity--the very same things we are doing to the citizens of Iraq and Afganistan. The recent Pentagon report--which was not released to the press unless a reporter specifically asked for a copy--proved, without a doubt, once and for all, that there were absolutely no ties between Al-Qaeda and Saddam Hussein or Iraq, pre-invasion.
We said we wanted to take out Saddam Hussein--that was the first sell. That would have been achieved most effectively
by deploying several SpecialForces teams, or possibly a Predator decapitation..although the former is a much better idea. We were told that there nuclearweapons there, chemical agents, biological agents, etc. So, if this were true, how stupid was it to bomb the place to smithereens like we did? We didn't get Saddam Hussein. What we did was destroy almost the entire country's infra-structure, and kill hundreds of thousands of innocent men, women, and children. And, if there had been chemical and biological, especially, agents stored over there, the bombing would have probably released these chemicals and deadly, highly contagious viruses upon not just the citizens of Iraq, but also upon our soldiers!!! It is already known that the military has been using depleted uranium in its munitions for a long time..the uranium is hard, and it is a way of cleaning up toxic radioactive waste out of our backyards. The big problems is that when these munitions explode, or punch through a bunker, the D.U. (depleted uranium) is blown up and reduced to particles as small as .1 or point 2 microns, which is small enough to pass right into your body, right through gas masks..through anything and everything, making it radioactive, but only for a billion years.
Since the invasion of Iraq, the number of birth defects has skyrocketed--horrible things...babies born without heads, or without arms or legs..others are just unspeakable abominations. And anyone and everyone over there is subject to contamination by this radioactive material. Gulf War Syndrome..they say it's a mystery. That's total B.S. It's radiation poisoning mixed
with P.T.S.D. So now our finest young men and women, who are over there in 130 degree heat, with 40 to 50 pounds of gear on, making it about 145 inside their suits, they not only have to worry about being killed or blown up, or how the images and deeds they've commited or witnessed will affect their dreams and reality for the rest of their lives, they not only have to worry about Stop-Loss, now they have to worry about getting cancer from radiation poisoning, or, if they escape all these evils, make it home, and want to have a child, they have to worry whether that baby will be healthy and normal.
It's an abomination. 400 Billion so far, expected to end up costing between 1 and 3 trillion dollars.
With this money, we could have given every American a million tax free dollars; heck,we could have given them a billion tax free dollars. Or they could have created a program where every American could receivefirst-rate medical treatment for free. Or we could have put thatmoney into research and development to perfect solar, wind, water, and other clean, renewable energy sources. We could have perfected the electric car, which G.M. created years ago, ran quiet, zero emisions, was fast..people loved them. and they plugged into a regular outlet (there may have been a converter)to charge. The only downside was that they could only run for 60 miles on a single charge, but that would have covered most of people's everyday driving, and done a lot to help stop Global Warming. With all that money, we could have funneled some into R&D to make the electric cars run for 200 hundred miles or longer on a single charge. Apparently they worked too well, because, despite intense customer protest, these sparkling new cars were recalled and all destroyed, except for one that's in a museum. I guess these oil baron's think they can take it with them, or live long enough to buy new cloned body parts..but they can't clone your brain..well, they could i suppose, one day, but they can't transfer yur thoughts to that brain--it wouldn't be you!! You can't cheat death! And I can't wait till you old filthy rich, but penny pinching, uncharitable, un-empathetic, evil men finally die.
If America does not quit letting the oil and gas corporations, and other special interests, dictate its foreign policy, get out of Iraq and worry about real threat (not Iran, but places like North korea, India, and China,who actually do have nuclear,biologicl and chemical standards), take away the power of the bankers by slowly phasing out the Federal reserve with a return to sound money backed by gold, silver, and other forms of Capital, concentrate on true internal security, instead of fear-mongering as an excuse to attack middle eastern countries for their oil, end the war on drugs, devlope and perfectsustainable energy, and do it yesterday, we're going to be remembered as the 20th Century Rome. I know I rambled around a lot, but i was trying to paint the big picture, but instead of painting, i used more of a collage form.
There seems to be a lot of moralistic huffing and puffing here about people who should have known better than to buy houses they couldn't really afford, and of course they should have. And of course the bubble (and the crash that followed) was a direct result of slack regulation of a financial industry that got too clever for its own good and didn't seem to know that it was buying and selling junk dressed up as low-risk financial products.
And, of course, if this were just a matter of bailing out hairbrained speculators (on Main Street as well as Wall Street), the huffing and puffing would get a more sympathetic hearing from yours truly. I didn't buy a house I couldn't afford (or any house at all, for that matter), nor did I buy or sell the dressed-up financial garbage and fancy loan instruments.
But all of this begs the larger question, because I lost my job anyway as a direct result of this financial crisis. (And, no, I wasn't working in the mortgage, banking, or real estate industries.)
If the fallout of the problem was limited to bad actors and stupid speculators, then it would make sense to say "to hell with the bad actors and stupid speculators." But it isn't limited to them by a long shot.
The cold fact of the matter is that we live in a highly interconnected economy whether we like it or not, and the disaster precipitated by the bad actors and stupid speculators has a direct and real impact on those of us who neither acted badly nor speculated stupidly.
So we need to lay off the high-toned moralism a bit and figure out how to fix the mess we're in and how to keep it from happening again in the future, and McCain channeling Adam Smith isn't likely to solve the very real problems this thing is causing for ordinary working people.
I'd like to complain about the brain of McCain (which gets used in vain).
Uhhh... Who were those insurgents again? Yeah. What Joe Leiberman said.
The McCain brain doesn't understand economics (he has people for that). Someone should interview his people to find out what he thinks.
And I should vote for this guy why?
The other side to the "housing crisis"is it will bring prices back down where they should be where people can afford them and build equity. People like teachers. The problem is the new bankruptcy laws that penalize people for years to come and create an unlevel playing field. If I invest in a high risk dot com and it goes bankrupt I loose all my $ and no one owes me for being stupid. If a credit card company sends a pre approved card to a high risk persprective they now expect to get paid back no matter how long it takes. Same with the mortgage companies. Both are investments with risk for a return in investment. Both should be subject to the same market forces. To bail them out would only keep housing prices at an artificial level. I do support McCain on this one; although I am an independent and liberal leaning. McCain lost my support overall when he abandoned the only thing that can truely help us in the long run ""Campaign finace reform".
1. Banks should hold their own mortgages, forcing them to vet the borrowers.
2. Mortgages should be based on the value of the property at the time of the loan.
3. Lenders should provide funds based on a formula of the borrowers ability to pay the amount of the present value of the property.
Moral High Horse?
You are not responsible for stupid mistakes I make. Your business is your business and this liberal approach to nanny state every aspect of our lives will surely lead to another revolution...I pray it does before knuckleheads like you destroy what GOD has given us, these United States a Republic not a democracy.
Submitted by Ron W (not verified) on Fri Mar. 28, 2008 8:26 AM PDT.
Let's see...if the average price of a house in the US is around $250,000 and if the mortgage is 100% of that value, based on 3.5 persons per household, that is about 2 trillion. Right? How did Wall Street leverage that into 39 trillion (or whatever it is) of CDOs and sell it as A+ paper? Bring back tar and feathers, the regulatory system is broken.
The US is 25+ years into a policy of converting equity to debt, while the big boys cash out and take the capital to new markets. Knowing this, and being able to do anything about it are two different matters.
What incentive does a resident facing forclosure have to try to stay in a house that has no equity, and that he is straining to pay for? Heck, it is a good business decision to walk on the loan, and sell all of the fixtures first.
Forget sub-prime, I have never attended a real estate closing in my life that didn't hold several suprises. They just know that you are too committed to walk on the deal.
They (the Government) don't care about the borrowers, but they do care about the banks, so that they will be free in the future to continue to bleed capital from the marketplace. They do want to forstall the inevitable so they can unravel the debt mess, and price out the oblications to be resold again.
McCain can't do much more than is being done.
Borrowing from the Fed for
social programs is a
Democrat thing. Borrowing
from the Fed for military
spending and thickening-up
the IRS blue-book is a
Republican thing.
But these are meritime
spending habbits. It's war
time folks! Were on the
debt-plus program!
I am so sick of all you people blaming the borrowers for the housing problems. Borrowers are NOT THE PROBLEM - LENDERS ARE!
Borrowers don't go out and decide to buy a house they cannot afford, they go to the bank and ask how much money they can get for a loan. Since most average Americans, particularly those in the "first-time" classification have no clue about net worth, ability to make payments, percentage of disposable income, and all those nice little financial terms (most people can barely balance their checkbooks!) - they depend on the financial institution to make 'prudent' loans - that is ones that the borrowers can afford to pay back.
It seems to be common sense that the bank would like to get paid back, right? Well in this case apparently not. The banks/mortgage brokers were intent only on making loans and didn't really care whether they were going to get paid back - hence the speedy bundling and sales of the mortgages into the so-called equity markets.
And this then becomes the borrower's problem how? If the bank/mortgage broker had told them they could have $200,000 for a house, that's the house they would have purchased. But since the greedy banks and in some cases fraudulent appraisers were working hand in hand, the naive borrower was told - Oh - you don't need a down payment because we have these new 0% down loans with 100% financing that includes all the closing costs! Just for you because you are a first-time homeowner! Just sign right here.
Oh, the interest will be going up in 5 years to about double what it is right now, but don't worry about that. We'll be happy to refinance that loan for you then and you'll be able to get a better interest rate because you'll have a payment record and some equity in the house. Nice doing business with you. Next!!!
The borrowers COULD afford the houses they bought - at the original interest rate. Most of them were making on-time payments and were doing just fine thank you. But then the market crashed. And now the 're-adjustment' of the interest rates is upon us and guess what? That promise to refinance is so much pie in the sky since the house is now worth less than the amount of the loan and no one is doing any refinancing and the payment just doubled or more....
And this is the borrower's fault how???
I understand that Pres Bush in an unannounced Executive Order early in his first term removed all the financial regulations that would have prevented this whole affair from even getting started.
And yet....it's those stupid, greedy, idiotic borrowers that are at fault.
NOT.
I am not a mc cain fan by no means I do not think he is smart enough to run our country or bush for that matter,all they seem to know about is war, we really need change something this country has not had for many many years, peace is the answer not war.
Obama 08 !!!!
Housing bubble and
Submitted by Jameson Z on Sun May. 3, 2009 8:55 PM PDT.
Housing bubble and construction decline are the new recession threat these days. With the increasing housing bills, unemployment rate, bailouts and foreclosures, it is much difficult these days to survive the housing meltdown. A construction decline of new housing and the housing slump in general have set what was a thriving industry back decades, and the credit market drying up isn't helping matters. Small businesses are also suffering, and installment loans from the bank just aren't as available as they used to be. However, while they wait, land speculators and construction companies still need debt relief as the result of the construction decline.
