The Bailout: Public Anger, Private Talks

[ILAveo]

My take on the Bailout is that it reminds me of how long it took to get water to the Superdome during Katrina. There has been a clear failure of leadership again. The housing market problem at the center of this crisis has been a clear bank crisis issue for at least six months. Why didn't they act to resolve this before it got so far out of hand?

One of the main lessons from the Depression is that when the banking system stops functioning very bad things happen to the real economy. It isn't fair to the taxpayer, but sometimes you should do what works best instead of what's right--I'm holding my nose and supporting some sort of bail out. That said--I do not support the administration's bid for appropriations without substantial oversight and I don't believe it is necessary to provide the whole sum of $700 billion in the first bailout appropriation.

If you're interested, herehttp://www.bankofengland.co.uk/publi.../fsr15art6.pdf is a non/slightly technical Bank of England article reviewing the effectiveness of different policies during recent world banking crises.

[koreberg]

@hobbit
There is probably a law against sending that e-mail to /dev/null since some of it could be threatening, but I doubt the president actually reads it. They probably make some intern do it. Thats how they crush their dreams of changing to world, before they turn them into a washington money grubbing drone.

[Chuck]

Don't know if anyone remembers, but GWB stoped using email just before he took office as a number of other politicians do.

[koreberg]

Well I wouldn't say he stopped, he just shutdown the backup system that clinton had installed under his administration. So any and all e-mail communications that are supposed to be archived, are now regularly deleted. Another prime example of his pseudo oligarchy. His entire administration is above the law. Nixon 2.0. Next he will be giving the I am not a crook speech.

[xcel]

Hi Koreberg:

___The one thing the Bush-II presidency may be remembered for is the same thing Hoover was remembered for. A Great Depression.

___Think of the shanty towns filled with the destitute in the early 30’s. In 2010, it is blocks upon blocks of empty foreclosures with no one maintaining the homes in question. Let us hope this does not happen to a home near any of us…

___Good Luck

___Wayne

[Ophbalance]

Originally Posted by xcel

Let us hope this does not happen to a home near any of us…

This is already happening near me. One of the reasons I didn't take a job in PA this year was the fact that I would have sold my home at a huge loss. I live in a phase II of a subdivision. Phase II has nine empty lots that have been vacant since 2005. It has three empty completed homes, two of which are adjacent to my home, and those two have stood empty since last year when I purchased my house. It's a shame we didn't push for more of a discount on our house, as our builder was in the process of going bankrupt at the time of purchase. He didn't care what the house sold for as the bank was seeing all of the profit. The houses have "LOWER PRICE!" signs on them, but they're still priced too high for this market. I'm surprised the owner/builder doesn't just cut his loses and slash the price on them 10k or so. It doesn't help that it's a 40 mile trip to Raleigh and another 10 to Durham.

[WoodyWoodchuck]

We’re around to the housing market.

I bought a place 4 years ago. As I recall the bank wanted to loan me up to a high percentage of my net salary. The rational I heard was I had a steady job, been there for many years and I would get increases, bonuses and such and my credit was A O K. The realtors kept pointing me to houses that maxed that out and even above that limit. “It is an investment, the price will always go up and be worth more”, “You can get an interest only loan and refinance when the place has increased in value”. Once I let realtors know what *I* wanted, only one ever called me back.

Everyone talked about me walking out of the closing with cash in my pocket. Sound good? Heck yes! If I was the average person I would have jumped all over the deals they were offering me. I’d get the American dream of living well beyond my means, not have to pay for it until years later and everyone would admire me.

Instead I waited and shopped around for what I considered an affordable home. Not more than I needed but something that was as little as I needed. I wanted a place I could afford even if I had to work at McDonalds... as asst. manager of course! So I bought land that had a house on it not a house that sat on a little land. Only thing I could not get was a fixed mortgage for the 20 year term. All anyone offered was the balloon mortgage.

I do not mean to insult anyone whose house has decreased in value as having made a bad decision. I have simply been unemployed before and wanted to make sure keeping a roof over my head was first priority. The lower that mortgage payment is the easier it is to scrape it together doing whatever you can. Be it ever so humble, it’s cheap and it’s mine… at least until the re-fi comes around.

[xcel]

Hi Ophblance:

___I am sorry to hear about the homes in your sub. Let us hope things improve to move those lots and homes soon enough.

___WoodyWoodchuck, thank you for not caving to the temptation. I have to believe that everyone’s home has fallen in value over the last year and a half inlcuding my own that is down about $50K so far. By buying within your means early on, you did exactly the right thing!

___Good Luck

___Wayne

[Ophbalance]

What's sad about it is that the guy who owns them has issues with his kidneys, and isn't likely destined for this world too much longer. He was hoping to leave his wife in a position where she'd never have to work when he passed. He actually hates building homes and prefers building decks, garages, and such. There's more profit margin in that (or so he's said a few times). His builder (the person who built most of the houses in the development) got caught up in the "build! build! build!" frenzy and over extended himself.

Now that being said, the guy can't stand most of us living there. We're all from PA (at least four families... and it's only about 60 homes), NJ, and parts north. We're ruining the south for these southerners . From talking to the folks in the cul de sac, he's fine to deal with up to the day of sale, them after you get quite the cold shoulder (especially us northerners).

[koreberg]

@xcel

Actually my house has gone up in value, there wasn't much of a bubble in my area. Although now houses will sit longer due to the mortgage thing so I could be looking at a decrease soon.