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Way to dodge the question, boutons.
Capitalism or socialism?
Or better still, capitalism or communism?
The lending companies who approved these loans often accepted "stated income" (no do ents and/or $0 down, and/or didn't really qualify the "poor suckers" who couldn't really afford the mortgage, esp after the variable rate increases.
The lenders then pocketed the $$$ and sold the mortgages, subprime and un-subprime, as pkg upstream.
Compare the above "we lend to ty, risky customers. wham bam thank you ma'am" with the current tight-credit situation where to qualify for a mortgage, you will probably have to show 2 years of IRS/W-2 returns, 2 years of bank statements, and all your credit card bills.
The lenders, much more financially sophisticated than the low-end borrowers, knew exactly WTF they were doing, they made 10s of $Bs, and are as complicit in the mortgage crisis as are the borrowers and as are the Repug laissez-faire regulations that permit such shady financial activities. And of course, Greenspan was waving through all this bull saying "there is no bubble", just another top public official outright lying.
Way to dodge the question, boutons.
Capitalism or socialism?
Or better still, capitalism or communism?
croutons prefers the one that comes with the most text to bold.
Who said I was against capitalism? The very same people who said I'm liberal or Democrat. bunch of mother ers.
You, dummy:
What are you, aside from being screwed in the head?The very same people who said I'm liberal or Democrat.
"The whole philosophy of capitalism is to screw the other guy more than he is screwing you"
That's a statement of fact, not my personal opinion, dumb .
The philosophy of capitalism is for two en ies (individual, corporation) to enter into legal economic transactions that that each agree to, without government interference or coercion.
If it is your contention that the less savy ought not to be allowed to participate in commerce unfettered, so that they don't do something stupid, I think you are going to get resistance from ALL sides of the aisle (except Plato, he's right there with you).
Show me a company who screws its customers over repeatedly and I'll show you a company protected in some shape or form by government policy.
Even if I concede that it is a statement of fact, the mere fact you used it to discribe capitalism shows your disdain for that economic system.
"Show me a company who screws its customers over repeatedly"
banks, silently tacking on nickel-and-dime charges, month after month.
toy companies ed over millions of clients (aka repeatedly) by not controlling the quality of toys.
food illnesses sicken and kill 100s of 1000s of people every year because the food companies don't control the quality of their food.
tobacco companies have killed 100s of 1000s of people with their products.
financial companies over clients by insider trading, after-hour-trading, etc, get caught, pay $Bs in fines, the most "respectable", very top banks.
hospitals you over by infecting you with MRSA because they don't control the quality of their staff and their practices.
100K people get killed every year due to medical errors.
A key slogan of the free market is "caveat emptor", aka, buyer should not trust the seller, who is trying to sell you the tiest product for the most money.
Capitalism is an adversarial system, buyer against seller.
And of course sellers will destroy other sellers to create cartels or monopolies, so they can screw the customer with higher prices for the same or tier product (Microsoft).
shall I go on or is that enough "repeatedly"?
So do you or do you not like capitalism?
You, repeatedly.
And people don't change banks, of course. And banks don't compete by doing away with fees or simplifying the fees. I guess banks should provide checking services for free, eh?
That's stupid.toy companies ed over millions of clients (aka repeatedly) by not controlling the quality of toys.
Link? Certainly any firm that sold food which killed consumers repeatedly wouldn't last long. I can think of two instances recently (Taco Bell, spinach). Hardly evidence of repeated misbehavior.
food illnesses sicken and kill 100s of 1000s of people every year because the food companies don't control the quality of their food.
How many did not realize that smoking was bad for you? That knowledge has been around for a long time. Is someone really screwed over when they willingly consume a product?tobacco companies have killed 100s of 1000s of people with their products.
To the extent they are not prosecuted for crimes, you can thank your government. And like it or not investors do take their funds away from such managers.financial companies over clients by insider trading, after-hour-trading, etc, get caught, pay $Bs in fines, the most "respectable", very top banks.
If a doc kills a bunch of his patients word gets around.hospitals you over by infecting you with MRSA because they don't control the quality of their staff and their practices.
100K people get killed every year due to medical errors.
A monopoly doesn't last if its product quality wanes as that opens up the opportunity for others to take business away from it.A key slogan of the free market is "caveat emptor", aka, buyer should not trust the seller, who is trying to sell you the tiest product for the most money.
Capitalism is an adversarial system, buyer against seller.
And of course sellers will destroy other sellers to create cartels or monopolies, so they can screw the customer with higher prices for the same or tier product (Microsoft).
shall I go on or is that enough "repeatedly"?
boutons owned
Meanwhile, back on topic, Greenspan has gone into full denial mode...
Greenspan Concedes Mortgage Dilemma
Thursday September 13, 1:26 PM EDT
This was our FED chairman and he could'nt see how cheap credit could lead to a crisis?WASHINGTON (AP) — Former Federal Reserve Chairman Alan Greenspan acknowledges he failed to see early on that an explosion of mortgages to people with questionable credit histories could pose a danger to the economy.
This sounds like Chicken Little, can anybody refute it?
Recession Time! The Housing Bubble Bursts the Economy
By Dean Baker
t r u t h o u t | Perspective
Tuesday 11 September 2007
The downturn in jobs reported last month by the Labor Department provided evidence of an economic downturn that even the economy's greatest cheerleaders could not ignore. Healthy economies do not shed jobs.
During the core periods of the upturns in the eighties and nineties, there were three months in which the economy lost jobs. In two of these, the loss was attributable to major strikes. (The jobs of striking workers are not counted in the survey.) That leaves a grand total of one month in more than twelve years of recovery in which the economy lost jobs. In other words, the August job loss leaves the economic optimists somewhat less credible than the deniers of global warming.
The backdrop for the August job loss is the collapse of the subprime mortgage market. Millions of low- and moderate-income homeowners are now looking at the resetting of interest rates on adjustable rate mortgages to levels that they cannot afford. While the Fed chairman and other leading economists assured the public that the problems would be restricted to the subprime segment of the housing market, this assertion was always ridiculous on its face.
Subprime mortgages accounted for one-fourth of all mortgages issued in 2006. The equally troubled Alt-A mortgage category accounted for another 15 percent. With segments that account for 40 percent of the mortgage market going into convulsion, there was no way that the housing market as a whole would not be affected. Of course, record supplies of unsold new homes and vacant homes also ensured that there would be substantial downward pressure on house prices.
The excess supply and constriction of mortgage credit is now affecting prices. Prices in the cities that had been the hottest bubble markets, such as San Diego, Las Vegas, Phoenix, and Miami, are declining at double-digit rates. Prices in slightly less bubbly markets, such as New York City, Washington, DC, and Boston, are falling at single-digit rates. These declines are likely to continue and quite possibly accelerate as the turmoil in the mortgage market further constrains demand.
This process will set in motion a downward spiral, as declines in house prices lead to more mortgage defaults. This will both place more foreclosed homes on the market and further constrain mortgage credit as the risk of default rises. The weakness in the housing market will be further reinforced by the weakening of the job market.
The job loss will first show up in the housing-related sectors. More than 50,000 layoffs have already been announced in the mortgage banking industry. This job loss has not shown up yet in the jobs data, since these workers were still employed when the August survey was taken. Construction and real estate will also see sharp declines in employment in the months ahead.
However, the direct impact on the housing sector is just the tip of the iceberg. The housing bubble created more than $7 trillion in housing wealth. Homeowners have used this bubble wealth to support a surge in consumption over the last five years, pushing the saving rate to near zero. They borrowed against their home equity to pay for vacations, new cars, or just to meet necessary expenses. As this bubble wealth disappears, consumption of all forms will be cut back, slowing growth and leading to more job losses.
In addition, declining construction-related fees and property tax revenue will constrict state and local budgets. This will lead to pressure for tax increases, just as the economy is going into a downturn, and to cutbacks in government spending and employment. This will further reinforce the downward spiral.
The growth of the housing bubble made this sort of collapse inevitable, just as the crash of the stock bubble was inevitable. The only question was when the bubble would finally burst and the exact form that the collapse would take.
It was incredibly negligent for the Federal Reserve Board and the Bush administration to allow the housing bubble to grow unchecked, and especially to allow the sort of mass fraud perpetrated against moderate-income homebuyers in the subprime market. At this point, there is probably no way to avoid a recession. If those making economic policy show no better judgment going forward than they have in the recent past, it is likely to be a long and painful recession.
===================
Is it really going to be that bad?
Who, what can stop it?
If the economy really tanks going into Nov 08, no Repug candidate will have a chance.
In control of your money supply.It was incredibly negligent for the Federal Reserve Board
So is there no personal responsibility expected in this country? Is everyone a victim? How is this unlike the individual who maxes out their credit cards and struggles to make the minimum payments, let alone actually make any headway on the actual debt?and the Bush administration to allow the housing bubble to grow unchecked, and especially to allow the sort of mass fraud perpetrated against moderate-income homebuyers in the subprime market.
"no personal responsibility expected in this country?"
who said that?
The lending companies were doing mortgages for people whom they knew were very probably getting in over their heads.
Both sides screwed up, the lenders are the much more sophisticated side, they bear more responsibility, not all responsibility.
The lenders extended credit to those who are likely to have a harder time accessing credit. How is it their problem (other than having to foreclose on a house or deal with slow pays if they still hold the loan) if someone cannot manage their own financial affairs or understand the terms of the deal? Everyone loves to pass the buck in America. Of course, when it's not a "repug", "shrub", or "darth cheney" it's cool to shirk responsibility and look to someone else to bail your dumb ass out.
Boutons hates the ARM he has.
Maybe he should cut it off. Might reduce his rediculous posts.
I have no ARM, you assholes have to make up.
Boutons, if you want to get on some ones case about bad, high
interest rate loans, pick on the payday loan companies that charge
rates that are out of sight. But you more than likely think they
are doing a service to their customers.
I still maintain, the buyer of these homes may have lost some
money, equity and maybe not, if it was a negative mortage and
they paid only a portion of the interest, like Calif. But they
would in many cases been paying more in rent than they did
in the house they bought, that is one advantage in buying a
house, in many cases it is cheaper than rent. And they
got a good education on home buying.
Many people have no business buying a house. They have no
idea how to maintain it or the problems of home ownership.
I witnessed this in the seventies, when the govt had many
surplus homes and put many people in them on a lease buy
program. All these folks did was destroy the homes and then
walk off and do it all over again and again. Until, I know in
Abilene, Texas, that they just took bulldozers in and leveled
blocks of empty govt owned homes.
Mortgage study notes racial gap
Web Posted: 09/05/2007 07:57 PM CDT
Rachel Stone
Express-News Business Writer
Poor people, blacks and Hispanics get subprime mortgages at higher rates than wealthier people and whites, according to a social justice group's examination of lending data in 172 cities. The annual study released Wednesday from the Association of Community Organizations for Reform Now, known as ACORN, found that in the San Antonio area, more than 28 percent of all home loans had subprime rates.
Black and Hispanic home buyers across all income levels in the San Antonio area were twice as likely as whites to get high-cost home loans, according to the analysis.
The group looked at lending data from the San Antonio metropolitan statistical area, which covers Atascosa, Bandera, Bexar, Comal, Guadalupe, Kendall, Medina and Wilson counties.
The study's authors defined "subprime mortgages" as those with interest rates at least 3 points higher than the comparable rate on U.S. Treasury securities. Such mortgages typically are issued to those with weak credit histories. Adjustable-rate mortgages — home loans with low introductory interest rates that reset to higher rates over time — weren't necessarily included in the analysis.
At higher income levels, the racial and ethnic disparity persisted. Black and Hispanic borrowers earning more than $63,189 were 1.6 times more likely than whites earning that much to get high-cost loans.
In refinance loans, the gap widened. Almost 57 percent of refinance loans made to blacks and 61 percent made to Hispanics were high-cost loans. Fewer than 40 percent of refinance loans made to whites had subprime rates.
People with lower income levels also got more subprime mortgages. The study found that 45 percent of San Antonio-area borrowers earning less than $26,550 a year got subprime mortgages in 2006.
Fewer than 23 percent of San Antonio-area borrowers earning more than $63,189 got subprime mortgages.
Lenders have come under fire recently for issuing too many subprime mortgages to high-risk borrowers during the past few heady years of the housing bubble.
Now subprime mortgage holders are defaulting in higher numbers than in years past. As a result, several lenders have cut back on the number of subprime loans issued after tightening the qualification requirements for mortgages.
( why didn't the lenders always insist on tight qualifications? because the lenders new they could very probably get a year or two of interest-only payback at least before the borrower dried up. Then the lender can short-sell or foreclos/sell. )
"We have seen a sharp increase in foreclosures in some of the urban and minority communities that most need to build wealth through homeownership," Maude Hurd, ACORN national president, said in a media release.
ACORN is an advocacy group that looks at housing issues for minorities and lower-income consumers. The group has programs to help people learn about credit and how to negotiate with their creditors.
[email protected]
Online at: http://www.mysanantonio.com/business...y.291758a.html
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The lenders knew exactly what they were doing. To say the borrowers are the only guility party is stupid.
Gotta love it.
Dems complain lower-income families can't get homes. The dumb s get into arm subprime garbage because they are so uneducated when it comes to financial matters (after all, why use your brain when the govt will take care of you).... hits the fan....insert race card....wank fest
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