Biggest Defaulters on Mortgages Are the Rich

[DMX7]

http://www.nytimes.com/2010/07/09/business/economy/09rich.html?src=me&ref=homepage

No surprise really.

[Winehole23]

Rich folks can no longer maintain the lifestyle to which they had become accustomed.

[Winehole23]

(Not a good sign for the rest of us.)

[Wild Cobra]

Rich folks can no longer maintain the lifestyle to which they had become accustomed.
That's one reason why people lose their jobs.

[CosmicCowboy]

I don't think it will hit this area very hard. California was just obscenely overpriced. My son lives in LA and I'm just appalled at how expensive homes are out there (in the good areas) even AFTER the devaluation. Hell, they pay almost $3000 a month rent for a modest little 3/2 built back in the 50's.

[Blake]

Rich folks can no longer maintain the lifestyle to which they had become accustomed.

and/or because property values have dropped, they are simply dumping their "bad" investments

[DarrinS]

I guess business owners and investors are really thriving in the Obama economy.


SpDxlstrpU8

[Wild Cobra]

I don't think it will hit this area very hard. California was just obscenely overpriced. My son lives in LA and I'm just appalled at how expensive homes are out there (in the good areas) even AFTER the devaluation. Hell, they pay almost $3000 a month rent for a modest little 3/2 built back in the 50's.
Sounds about right. I haven't priced house rent for a while, but I'm guessing they start at about $1200 month here in the Portland metro area. That would be for a very modest house also. I'm guessing they are 1/2 to 2/3rds the LA area for an equivalent place.

[Winehole23]

Could be. The article suggests some just can't pay for it, but the trigger for strategic default could be any price in principle.

[EmptyMan]

So they will have to sell off their stuff, flood the market, prices go down, little guy who is busting ass to one day be rich will find deals.

wait wuuuuut../robot voice *rich people are evil...rich people are evil..."

[DarrinS]

There's always the option of "short selling", but don't you get ram-rodded by the IRS when you do that?

[Winehole23]

So they will have to sell off their stuff, flood the market, prices go down, little guy who is busting ass to one day be rich will find deals.In principle, yes.

In practice, (near) historically low interest rates and until very recently, a federal tax credit for new home buyers, have been propping up RE prices.

More correction in RE would almost surely mean more recession. Maybe a lot more. The political and economic price still to be paid for a realistic correction in RE values, would be steep IMO.

[boutons_deux]

You Lie, Darrin,

Obama didn't write the richie's, or anybody's, mortgages, nor did Obama fuck up the economy.

[CosmicCowboy]

In principle, yes.

In practice, (near) historically low interest rates and until very recently, a federal tax credit for new home buyers, have been propping up RE prices.

More correction in RE would almost surely mean more recession. Maybe a lot more. The political and economic price still to be paid for a realistic correction in RE values, would be steep IMO.

They only correct so far...I was in homebuilding during the last big crunch with the RTC. You reach a point where used inventory is substantially cheaper than the cost to build the same unit new. New construction grinds to zero. Demand eventually sucks up existing supply but it takes years. Then the homes jump in price again when the only alternative for growth is new construction.

[Winehole23]

They only correct so far...Says who? This ain't no ordinary recession.

[CosmicCowboy]

Says who? This ain't no ordinary recession.

You are correct. Plus, Obama's anti-business agenda will just make it worse.

But.....we will eventually survive it. We soon will be reaching a point where housing will just be too cheap and a great buying opportunity.

The US is eventually going to have no choice but to inflate our way out of this federal budget mess. When Helicopter Bernanke starts throwing money out the doors those houses will hold their relative value with inflation when a lot of other investments won't.

[Parker2112]

Just because Obama admin has implemented/enforced regs vs big business doesnt mean hes anti business. Sure, big business wants the whole pie, but its not in the voters best interests to let them have it. We already see what they do when they get it (massive CEO salaries, move jobs overseas, create crises that nearly sink the nation, and fill our gulf with oil).

If the economy is a gas pedal:
- business community/republicans want it pegged to the floor, even if the engine will blow
- voters best interests dictate we need to look at things like mpgs, rpms, and what happens if we get a ticket.

So just because Obama is trying to stay around the speed limit means he drives to slow? I think we need to watch our rpms or our kids wont have a car to drive to high school.

[Parker2112]

And if you disagree with me your wrong!

[CosmicCowboy]

Just because Obama admin has implemented/enforced regs vs big business doesnt mean hes anti business. Sure, big business wants the whole pie, but its not in the voters best interests to let them have it. We already see what they do when they get it (massive CEO salaries, move jobs overseas, create crises that nearly sink the nation, and fill our gulf with oil).

If the economy is a gas pedal:
- business community/republicans want it pegged to the floor, even if the engine will blow
- voters best interests dictate we need to look at things like mpgs, rpms, and what happens if we get a ticket.

So just because Obama is trying to stay around the speed limit means he drives to slow? I think we need to watch our rpms or our kids wont have a car to drive to high school.

Oh please...Obama is pro business?...:lmao:lmao:lmao:lmao

Look, wall street and "big" business don't drive the American economy.

Small business is the big job creator and economic engine in the US.

Myself and every other small businessman in the US is looking at this administration and are scared shitless of the damage they are planning to do to our economy. We already know capital gains are going up, regular tax rates are going up, the death tax is coming back...plus they are planning on ramming cap and tax through during the lame duck session before all the defeated congressmen leave Washington.

Those are all business killers and job killers.

This is the most anti-business Presidential administration I can remember in my lifetime.

[DarrinS]

Just because Obama admin has implemented/enforced regs vs big business doesnt mean hes anti business. Sure, big business wants the whole pie, but its not in the voters best interests to let them have it. We already see what they do when they get it (massive CEO salaries, move jobs overseas, create crises that nearly sink the nation, and fill our gulf with oil).

If the economy is a gas pedal:
- business community/republicans want it pegged to the floor, even if the engine will blow
- voters best interests dictate we need to look at things like mpgs, rpms, and what happens if we get a ticket.

So just because Obama is trying to stay around the speed limit means he drives to slow? I think we need to watch our rpms or our kids wont have a car to drive to high school.


What a dumbshit!

[DarrinS]

And if you disagree with me your wrong!


or "you're"

[byrontx]

Oh please...Obama is pro business?...:lmao:lmao:lmao:lmao

Look, wall street and "big" business don't drive the American economy.

Small business is the big job creator and economic engine in the US.

Myself and every other small businessman in the US is looking at this administration and are scared shitless of the damage they are planning to do to our economy. We already know capital gains are going up, regular tax rates are going up, the death tax is coming back...plus they are planning on ramming cap and tax through during the lame duck session before all the defeated congressmen leave Washington.

Those are all business killers and job killers.

This is the most anti-business Presidential administration I can remember in my lifetime.

[byrontx]

My small business is growing. I just hired my first employee. I am not scared of Obama at all. At least the guy is bright which is more than you could say for the last one. The "Death Tax?' You are worried about that shit? It has nothing to do with job creation or the economy as a whole.

If I worry about anything it is the rise of corporate power which works against the little guy struggling to start a business and making it viable. Entrenched economic interests use government to suppress competition. Taxes are going to go up. Having a war and charging it to VISA (Iraq) will have that effect. That wasted money on an unneeded war could have been used to prime the pump and re-charge the economy but I guess blowing money killing people is no crime or issue for you.

[Parker2112]

Oh please...Obama is pro business?...:lmao:lmao:lmao:lmao

Look, wall street and "big" business don't drive the American economy.

Small business is the big job creator and economic engine in the US.

Myself and every other small businessman in the US is looking at this administration and are scared shitless of the damage they are planning to do to our economy. We already know capital gains are going up, regular tax rates are going up, the death tax is coming back...plus they are planning on ramming cap and tax through during the lame duck session before all the defeated congressmen leave Washington.

Those are all business killers and job killers.

This is the most anti-business Presidential administration I can remember in my lifetime.

Your first sentence = cant read any more of your bullshit. Point out where I said Obama=probiz? Your retarded, your better off surrounding yourself with conservatives I suppose.

[Parker2112]

or "you're"

Your rebuttal to a policy discussion is vocabulary correction? Stick it out with the right wing bud

[Bender]

Your rebuttal...
good job

Your retarded, your better off...
bad

[George Gervin's Afro]

Oh please...Obama is pro business?...:lmao:lmao:lmao:lmao

Look, wall street and "big" business don't drive the American economy.

Small business is the big job creator and economic engine in the US.

Myself and every other small businessman in the US is looking at this administration and are scared shitless of the damage they are planning to do to our economy. We already know capital gains are going up, regular tax rates are going up, the death tax is coming back...plus they are planning on ramming cap and tax through during the lame duck session before all the defeated congressmen leave Washington.

Those are all business killers and job killers.

This is the most anti-business Presidential administration I can remember in my lifetime.


so just give up then.. someone else will manage if you don't want to

[Parker2112]

good job

bad

Its sort of like the Al Franken Approach. "Rush Limbaugh is a Big, Fat..."

Personally, I believe very strongly that we are facing one of the biggest threats in the history of this nation....the misinformation movement, coupled with the fear/smear campaigns of the current conservative crop. And I refuse to use civilized tactics vs an uncivilized group. If and when these folks resort to the same tactics that are sinking this nation... whether it be intentional or by way of imitation... they will be demeaned like mangy, neutered dogs.

If they want to engage in debate in a manly fashion, we can go all day.

[spursncowboys]

Its sort of like the Al Franken Approach. "Rush Limbaugh is a Big, Fat..."

Personally, I believe very strongly that we are facing one of the biggest threats in the history of this nation....the misinformation movement, coupled with the fear/smear campaigns of the current conservative crop. And I refuse to use civilized tactics vs an uncivilized group. If and when these folks resort to the same tactics that are sinking this nation... whether it be intentional or by way of imitation... they will be demeaned like mangy, neutered dogs.

If they want to engage in debate in a manly fashion, we can go all day.

Were you alive when Bush was president? This is a very extreme example of tunnel vision. Who is more civilized?
Minute Man group
or
"Pro-(illegal)Immigration

Tea Party
or
Eco-Nazis

[Parker2112]

Were you alive when Bush was president? This is a very extreme example of tunnel vision. Who is more civilized?
Minute Man group
or
"Pro-(illegal)Immigration

Tea Party
or
Eco-Nazis

I'm neither. I'm just an American who stands up to those who would piss on our country and send us to hell.

[Nbadan]

Strategic defaults

M_2sxBOo0Nw

[Wild Cobra]

The "Death Tax?' You are worried about that shit? It has nothing to do with job creation or the economy as a whole.

Let me ask you this. If you had a prosperous business worth a few million, died and left it to your children, how are they going to pay those death taxes without liquidizing or selling the business? What happens to the employees?

[CosmicCowboy]

Let me ask you this. If you had a prosperous business worth a few million, died and left it to your family, how are they going to pay those death taxes without liquidizing or selling the business? What happens to the employees?

X1000

What is a small businessman's incentive to invest in his business when he KNOWS it will have to be dismantled at his death and the Federal Government will get the bulk of the proceeds?

[Wild Cobra]

They only correct so far...I was in homebuilding during the last big crunch with the RTC. You reach a point where used inventory is substantially cheaper than the cost to build the same unit new. New construction grinds to zero. Demand eventually sucks up existing supply but it takes years. Then the homes jump in price again when the only alternative for growth is new construction.
We had a different problem here. This home flipping thing shot the existing house prices up. Contractors however were still willing to build new homes for much less than old homes were selling for. We had a construction boom, which now makes the overage of houses even more than it would have otherwise been.

[boutons_deux]

"prosperous business"

you mean a privately owned business, of course. Someone dying out of an incorporated business shouldn't destroyd the business, which is why owners who are truly worried about the business incorporate it, or at least spread the ownership among several/many private stockholders.

What are the estate taxes on a business owner?

What percentage of the entire populace is affected by estate taxes?

$1M tax-free to dependents isn't enough of a tax exemption?

You of course know that the estate tax misconstrued purposely as a death tax (ie, you get "taxed for dying") is nothing but a ploy by the super-rich and their Repug operatives to CONSERVE inherited wealth and privilege and power through generations. They great success of the Repug message is to get dumbfuck bubbas to believe the death tax has any benefit for any working class, rural, red-state bubba.

[CosmicCowboy]

"prosperous business"

you mean a privately owned business, of course. Someone dying out of an incorporated business shouldn't destroyed the business, which is why owners who are truly worried about the business incorporate it, or at least spread the ownership among several/many private stockholders.

What are the estate taxes on a business owner?

What percentage of the entire populace is affected by estate taxes?

$1M tax-free to dependents isn't enough of a tax exemption?

You of course know that the estate tax misconstrued purposely as a death tax (ie, you get "taxed for dying") is nothing but a ploy by the super-rich and their Repug operatives to CONSERVE inherited wealth and privilege and power through generations. They great success of the Repug message is to get dumbfuck bubbas to believe the death tax has any benefit for any working class, rural, red-state bubba.

You really are confused.

Most small businesses are family businesses. Most over 1 million are also corporations, but privately held. The stock is owned by whoever started the company.

The founder invests in and grows his business all his life.

Lets say this company is worth...5 million.

The founder dies.

Now the heirs (that may even work in the company) owe 55% tax on 4 million.

$2,200,000.

They have to sell/liquidate the company to get enough money to pay the taxes.

[Nbadan]

..your assuming that the business owner had the worst tax attorney in the world...by the time most business owners pass, they have very little in their names..

[Ignignokt]

This thread title would only surprise those who are ignorant of what the Housing Bubble was about.