“I am still confused why anyone needs help? This is the most competitve country in the world. That is the way capitalism works and guess what… it has worked so well over a short 200 years, that the US is the most powerful, wealthiest nation in the world.”

Hag, really?

For whom has capitalism worked?

Is it for the elederly who faces ever increasing prices for medicine they need to stay alive and confusing drug coverage that will probably end up costing them more than they make on their pension fund, which is practically nothing because some Corporate executive cut throat spent it on all on a$$ and alcohol even though they were receiving millions of dollars in salaries?

Please tell me for whom capitalism has worked?

The Wall Street high rollers have raked in a fortune at the expense of the every day American who toils at work all day long only to face foreclosure because the toxic sludge loan that was sold to him is now foaming over and eating away at his just-above minimum wage salary job, the one he HAD to take because the job he worked at for ten years was outsourced to a third world country that if we haven’t invaded we’ll do so eventually if it has any wealth whatsoever that we can fleece.

Is it our children who are obese and uneducated compared to the rest of the world, who face inheriting a world that will be destroyed by Global Warming that our government will not even acknowledge, and has done nothing about because it will eat into the profits of the big Fortune 500 companies who support the American capitalistic society which promotes commericalism at the expense of the public welfare and common good?

Capitalism has divided America into a society of have and have-nots. Polarized, a vast majority of Americans are callous and cold and unfeeling — we don’t care about the elderly couple down the block on a fixed income who eat cat food for dinner; we don’t give two damns about the inner-city child who grows up knowing more about guns and drugs than he does about basic mutiplication; we are certainly capable of driving our gas guzzling SUV, with the Support the Troops bumper sticker in the back, and ignoring the young men who have been killed by the senseless war for profit against the fanthom “evil doers”, and the deprived neighborhoods they come from, because they joined the military hoping to escape into a better life.

God forbid any help be proposed that involves Government intervention, the selfish doing-okay American who doesn’t give a God damn about his neighbors will bitch and moan about his tax dollars which if he doesn’t pay they’ll throw his ass in jail and good riddens.

Capitalism has made a vast majority of Americans into cut throat swindlers, someone who will do anything for the almighty dollar — peddle poison, sell death and promote and encourage sickness, to the uninsured no less.

Capitalism has made us forget that only people-oriented, collective, cooperative, compassionate solutions that benefit all (or atleast the vast majority) truly WORK.

Chavez orders his CITGO petroleum manufacturer to sell cheap oil to Americans who need it and I say, that’s what we need here.

Not dictatorship or socialism but a society where private greed does not prevail while collective need suffers.
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So Hag, you said you were confused why anyone needs help?

Maybe you’re confused because it’s really you that needs the help, help seeing the truth.

Well, Moe has graciously created this blog and you’re here, so you’re well on your way.

I am still confused why anyone needs help? Last I looked, this is a relatively free country with almost free will. After age 18, you make your own decisions and you live with the consequences. Both Lender, Buyer, Investor, and anyone else involed made their own decision. Now live with it. If you foreclose, guess what…bad decision. If you made a bad loan…bad decision. If you purchased those bad loans…bad decision. Like everyhting else in life, learn from it and don’t make the mistake again.

This is the most competitve country in the world. That is the way capitalism works and guess what… it has worked so well over a short 200 years, that the US is the most powerful, wealthiest nation in the world. We came this far because as business dynamics changed, we adapted and changed with it, becoming stronger and more competitive. We don’t live in a Socialist system so therefore the governement should not even be discussing how to “help” anyone. Those people need to take accountability for their actions, help themselves either out of the situation they are in or chalk it up to a bad decision, move on and don’t make it again. I am in agreement with everyone on the this board that says this plan just prolongs the problem to come up again. It is like the Mother who coddles her 17yr old Boy. She still thinks of him as a baby and just wants to a few more years, but sooner or later he needs to make is own decisions and become a Man. So, all I can say to everyone involved in the mess crying for help…”Grow some Sack, live with your deicion and move on!”

Since these Hedge funds funds are not regulated, and don’t have to report their financial holdings like your 401 k does, no one is quite sure just how much wider these mortgage–related losses will be. Though much of the loss has been felt most heavily by the principal actors in this play, the paper they churned eventually flows into the same financial market that hosts 401ks.

You’re right, there is no perfect plan. The current dire economic situation we are in is very vast and complex. Unfortunately, there is no MAGIC BULLET.

There does need to be some strategy (PLAN) to help undo the mess that has been created. No matter what the plan is, it will not be perfect, and not everyone will be happy with it. But to sit back and do nothing while the time bomb keeps ticking, will lead to a bigger and more devastating mess to clean up later.

As I stated the other day, there has been to much focus on subprime mortgages, when the larger problem is all the ARM’s that are resetting over the next 18 months. In 2003 or 2004 Alan Greenspan said ARM loans were better than 30 year fixed loans based on what had occured over the previous 10 years. Even though many people knew that ARM’s carried more risk, if Alan Greenspan said they were a good thing, than that must be the truth.

For whatever reason, many people seem to believe the people who are in trouble with their mortgages are either uneducated, stupid, ignorant or belong to a lower socio economic class and didn’t deserve to own a home in the first place. I would really like to see hard data of who the owners of ARM loans represent across the broad demographics of this Country. I think many people would be quite surprised that those in situations where they are struggling with the adjustments to their loans are people not much different from them.

History over many years has shown that there is a certain percentage of defaults on standard mortgages annually. I believe off the top of my head it has been around 2-3%. With all the new creative financing that has come about the last five years or so, there is no history to what type of default rates existed for these more riskier loans. What Has happened, is that the defaults and foreclosures are running about twice as high as history had shown on other convential loans.

When these newly created mortgages were packaged and sold to investors on Wall Street, they were told that they carried relatively low risk and were actually given higher ratings then they should have been given from the likes of S & P, Moodys and others.

We talk in terms of the homeowner who signed an ARM loan that is now resetting and will be forced into foreclosure, as the person who needs to be saved. Some talk in terms of screw the homeowner, they should of known what they were getting into. The ones who need protecting are the investors.

I’d like to throw out a thought I’ve been having for discussion. To date, I do not know who the investors who own the CDO’s and SIV’s are. These packaged investments have been off the books of firms such as Bank of America, Citigroup, Chase, Wells Fargo and other investment banks and over the last few months have slowly been revealed that they exist.

From what I have read, the investors of these funds may be pension funds, 401K investment money, Life Insurance Investments, Mutual Funds as well as other holdings that were seeking higher rates of returns.

What if the homeowners that are in trouble with their mortgages, are also invested into the pension funds, 401K’s, Life Insurance Policies and Mutual Funds they may own that bought these packaged mortgages. If this is truly the case, than the owner and the investor are connected at both ends of the problem and are one in the same person.

Does that make any sense? Maybe I need a touch of reality and that this really isn’t the case.

If this is true, than the investor money that we have created through our contributions for investing/retirement has fueled the housing/mortgae boom/bust. To me, that says that through the choices we have made, we have created our own reality. Everything is going in a circle and we need to get off this marry go round.

Please tell me I’m wrong.

Option arms qualified at teaser rate, over inflated stated income or no ratio loans DO NOT deserve to be frozen. Investors in those as well as borrowers that took out those WILL HAVE to face the music and take the losses. If anyone can rationally explain why borrower that took out these loans shall have their rates frozen I’m all ears. That will also teach a lesson to note holders too.

For LENDERS: DO NOT LEND MONEY ON STUPID TERMS
For BORROWERS: DO NOT BUY STUFF YOU CAN NOT AFFORD

In regard to the “victims”: Congratulations! You have now been victimized again! You are free to continue making payments on a house which you have negative equity in. As the price of your house continues to decline over the next few years, take heart, as you will be back to square one in 10 or 15 years.

Eat your heart out evil “investors.” Who are they anyhow?

http://www.bloomberg.com/apps/news?pid=20601208&sid=a3r_IRjU20O0&refer=finance

http://www.bloomberg.com/apps/news?pid=20601208&sid=a5PJ56devNt8&refer=finance

Orange County? Florida Schools? That can’t be right. They will have to be made whole! Bring on the lawyers!

The truly criminal perpetrators of this subprime mess whom Hans is railing against are the fly-by-night Mortgage Brokers who are already long gone. The remaining firms were just criminally stupid. You aren’t supposed to drink your own kool-aid fellas. CFC, WaMu, Wells Fargo will all be punished severely and will be lucky to survive as going concerns. Next we will be organizing a bail-out of their laid-off employees’ prime loans. The Wall-Street Firms are in the same boat, choking on the mortgages they were in the process of Securitizing when this mess seemingly came out of nowhere. It didn’t come out of nowhere, but those involved in the mania had simply lost all perspective of reality.

Sorry to say folks, but we are not out of the first inning of this disaster. Next will be securitized auto loans, credit cards, and commercial real estate (the business in which I am in). The government would be best served in letting the process play out and then attempting to pick up the pieces. Government intervention now will at best prolong the inevitable agony.

Best of luck to everyone and their families,

Brian

Have the responsible mortgage holders walk down the street to the deadbeat’s house and write the deadbeat a cheque to cover the shortfall. Repeat monthly, for the next 30 years.

Any bailout is the same thing in disguise.

1. There WILL be NO perfect plan for this enormous mortagage mess
2. There WILL be some kind of plan, like it or not
3. Just freeze all ARM’s for a period of time. ALL of them
4. And if after that freeze, homeowners continue to be delinquent, then let them go into foreclosure
5. That way EVERYONE get’s a freeze and the borrowers that cannot truly afford the payment, will weed themselves out and the ones that can and deserve a freeze, will keep their homes and live happily ever after
6. You can fight this all you want and say NO BAIL OUT, but it WILL happen, so instead of just saying screw that or this, how about some ideas on how this should be done because, again, it will be done and your government is working on this RIGHT now.

I still can’t seeem to understand why investors are crying wolf, when these investments are already and obvioulsy going way south and appaer to be worthless. So, it wasn’t as if they were going to see the glorious returns that they had hoped for when they gambled on these subprime loans, just like borrowers.

You know what investors are making BIG MONEY? Not the the investors of MBS’s, oh NO! It’s the guys you took out derivative contracts and bet AGAINST these MBS’S, those investors are the ones making a killing. They are hoping for more write downs.

One may think this is a bail out. I disagree, it’s a temporary “fix” to an out of control problem with no perfect solution.

Someone will lose here, no matter what.