[clue-talk] The stimulus bill

[Nate Duehr]

On Feb 6, 2009, at 9:28 PM, Sean LeBlanc wrote:

> On 02-06 21:11, Collins Richey wrote:
>> On Fri, Feb 6, 2009 at 7:23 PM, Angelo Bertolli
>> <angelo.bertolli at gmail.com> wrote:
>>
>>> Subsidizing mortgages not withstanding, I think you'd at least  
>>> agree that
>>> the mortgage crisis we're in right now has way more to do with  
>>> banks/loan
>>> officers/whoever not doing their risk assessment "properly."   
>>> Unless you
>>> mean that our attitudes about houses and the culture created by  
>>> our laws
>>> gave the banks the feeling that they could get away with it.
>>>
>>
>> You missed Jed's point entirely. It's not a matter of the banks
>> feeling that they could get away with it. They were actively
>> encouraged (if not required) to ignore the ability to pay back loans
>> by Freddie and Fannie and the Barney Frank types in Congress. The
>> "proper" risk assessment was the desire to get a loan, not the  
>> ability
>> to pay back the loan.
>
> I thought the stuff about Frank and CRA has been debunked long ago?
>
> This is a little older, but Palast seems to have a different take on  
> this.
>
> http://www.gregpalast.com/elliot-spitzer-gets-nailed/
>
> Also note the mention of the double standard for David Vitter.... who
> recently went on a silly tirade in the Senate about ACORN this week.
>
> ---- Begin long quote ------
>
> The press has swallowed Wall Street's line that millions of US  
> families are
> about to lose their homes because they bought homes they couldn't  
> afford or
> took loans too big for their wallets. Ba-LON-ey. That's blaming the  
> victim.
>
> Here's what happened. Since the Bush regime came to power, a new  
> species of
> loan became the norm, the `sub-prime' mortgage and its variants  
> including
> loans with teeny "introductory" interest rates. From out of nowhere, a
> company called `Countrywide' became America's top mortgage lender,
> accounting for one in five home loans, a large chunk of these `sub- 
> prime.'

If you're going to complain about that, why aren't you complaining  
about usury rates already above 20% long before Bush came to power.

Americans WANTED cheap credit, because they can't grow a pair and stop  
spending on frivolous crap, and the politicians gave it to them.

> Here's how it worked: The Grinning Family, with US average household  
> income,
> gets a $200,000 mortgage at 4% for two years. Their $955 monthly  
> payment is
> 25% of their income. No problem. Their banker promises them a new  
> mortgage,
> again at the cheap rate, in two years. But in two years, the promise  
> ain't
> worth a can of spam and the Grinnings are told to scram - because  
> their
> house is now worth less than the mortgage. Now, the mortgage hits 9%  
> or
> $1,609 plus fees to recover the "discount" they had for two years.  
> Suddenly,
> payments equal 42% to 50% of pre-tax income. The Grinnings move into  
> their
> Toyota.

If they can prove they had a promise, you've got a case.  Otherwise,  
they were dolts who didn't ask for promises in writing, and I can't  
think of ANYONE who grows up in this country who doesn't know the  
phrase, "If it's not on paper..."

Blaming banks for offering products slack-asses WANT is stupid.  They  
also offer credit cards, which are heinous, evil, and stupid in the  
hands of most "common" Americans who think credit is a RIGHT.  In some  
small way I actually HOPE that usury rates go to 33% and people  
finally figure out how dumb they are to carry unsecured credit on  
credit cards.

Plastic is not money.  And mortgage "promises" and $5 will get you a  
cup of coffee at Starbucks.  The only "victims" here are those who  
want someone to blame for their inability to READ.

> Now, what kind of American is `sub-prime.' Guess. No peeking. Here's  
> a hint:
> 73% of HIGH INCOME Black and Hispanic borrowers were given sub-prime  
> loans
> versus 17% of similar-income Whites. Dark-skinned borrowers aren't  
> stupid
> they had no choice. They were `steered' as it's called in the mortgage
> sharking business.

They did have a choice -- not to buy!  What's so wrong with that?  As  
we've all pointed out here, even some of us "honkeys" that can qualify  
-- you went there, not me -- find home ownership a BURDEN sometimes.   
Yes, Virginia... owning a house is work and responsibility.  And  
paying the mortgage can be hard.  (And don't tell me it isn't... we  
paid ours for an entire YEAR without my income the last time I was  
laid off from a job.)

Man up, grow a pair, and be responsible for your own finances -- is my  
admonition to anyone whining that they "had no choice".  Last I  
checked you have to sign at LEAST 20 times on the dotted line at a  
mortgage closing.  Get up, walk away, you may lose earnest money, but  
you ALWAYS have a choice, right up until the last document is signed.   
Hell, even after that... FORECLOSURE or handing over the deed in lieu  
of such, *IS* sometimes the best (or only) financial option left.

One of my friends had to do that, and file for bankruptcy on top of  
that, due to circumstances beyond his control.  He isn't running  
around saying the banks were evil or that he was a "victim".  ARE YOU  
SERIOUS?

(Yes, I know there were predatory lenders who WERE breaking the law.   
Go find them and throw them in jail.  The VAST majority of our problem  
is NOT those lenders.  It's people who signed the dotted line saying  
they'd pay for something -- with no intention to do so when the house  
of cards fell over.)

> `Steering,' sub-prime loans with usurious kickers, fake inducements to
> over-borrow, called `fraudulent conveyance' or `predatory lending'  
> under US
> law, were almost completely forbidden in the olden days (Clinton
> Administration and earlier) by federal regulators and state laws as  
> nothing
> more than fancy loan-sharking.

All of those things WERE legal during Clinton and prior.  There just  
wasn't as much pressure to lend from foreign investments and huge  
pools of investment money "looking" for something to invest in.

> But when the Bush regime took over, Countrywide and its banking  
> brethren
> were told to party hearty  it was OK now to steer'm, fake'm,  
> charge'm and
> take'm.

Umm, I believe if you look at the facts, the Congresscritters who took  
kickbacks from Countrywide were evenly distributed across the Party  
lines, and a number of disgraced politicians were Democratic members  
of the Congressional Black Caucus.  Try a little harder to look beyond  
your Bush-freak-out-mania and see that ALL of Washington was willing  
to be corrupted by Countrywide and bretheren.  Who got money every  
year from Fannie and Freddie, even as they backed all these bad  
loans?  (Obama was the highest paid Senator by Fannie Mae -- EVER.   
Really.  Look it up.)

[snipped Spitzer stuff... Actually fairly true, and Spitzer going down  
from having sex with a prostitute after all the good work he did for  
consumers, is tragic to some extent.  Although I have no respect for a  
man who can't keep his pants zipped.]

> The Fed had to act. Bernanke opened the vault and dumped $200  
> billion on the
> poor little suffering bankers. They got the public treasure  and got  
> to keep
> the Grinning's house. There was no `quid' of a foreclosure  
> moratorium for
> the `pro quo' of public bailout. Not one family was saved  but not one
> banker was left behind.

The Senate passed another one today, and the opposite Party is in  
power.  So this one's a yawner of an argument now... more bankers  
saved, different corrupt politicians this time.  Same old Washington  
D.C.  Aren't you glad fully 40% or more of what you work for is sent  
to them every year?

> Every mortgage sharking operation shot up in value. Mozilo's  
> Countrywide
> stock rose 17% in one day. The Citi sheiks saw their company's stock  
> rise
> $10 billion in an afternoon.
>
> And that very same day the bail-out was decided  what a coinkydink!   
> the man
> called, `The Sheriff of Wall Street' was cuffed. Spitzer was silenced.


It's a stretch to think Spitzer didn't bring that one on himself...  
you try to make him being a man-whore with no self-control sound like  
it was caused by the politicians who were against him.  Yes, they  
threw him onto that prostitute!  (Give us a break.)

> Spitzer wrote, "When history tells the story of the subprime lending  
> crisis
> and recounts its devastating effects on the lives of so many innocent
> homeowners the Bush administration will not be judged favorably."

When the world sees the record inflation after this Administration's  
bailout...

> But now, the Administration can rest assured that this love story   
> of Bush
> and his bankers - will not be told by history at all  now that the  
> Sheriff
> of Wall Street has fallen on his own gun.

Nice choice of words... that little "gun" thing.  Funny.

> Funny thing, this `discretion.' For example, Senator David Vitter,
> Republican of Louisiana, paid Washington DC prostitutes to put him in
> diapers (ewww!), yet the Senator was not exposed by the US prosecutors
> busting the pimp-ring that pampered him.
> Naming and shaming and ruining Spitzer  rarely done in these cases -  
> was
> made at the `discretion' of Bush's Justice Department.

What's your point?  That all sex crimes should go unpublished?  You  
can't argue that Spitzer should get off, if you agree that what the  
Senator did was wrong.  You've painted yourself in a moral corner there.

Nate