No Limits on the GSEs

[patientrenter]

Spot on, SDR! This just allows the GSEs to wade in deeper. They want to, and they are being told to. They will wade in deeper.

If and when they stumble and are in danger of getting submerged, the federales will arrive. There will be shock, absolute shock, at the discovery that 80-95% non-recourse loans that were made at today’s So Cal prices are going bad. Since no one could have known that, there will be a rescue for the good ol’ Fannie and Freddie brownies/boy scouts, and the homeowners and investors all. It’s so patently obvious what’s happening.

Patient renter in OC

[Deal Hunter]

The government is trying to send out Fannie and Freddie in the same way they were deployed back in the Great Depression – the last time credit siezed up this badly. It won’t work this time.

My usual response to the question, “how will the credit markets go back to normal?” is HIGHLY cyncial (so beware):
Massive, drastic and massively drastic tax reform. Most notable features of the tax reform is eliminiation of capital gains tax, privitazaion of social security, abolishment of the estate tax and limitation of mortgage interest deduction to mortgages under the national median home price (sorry CA, Fl, & NY).

A series of booms (including another housing boom) will follow this degree of tax reform as the tax burden is lifted from business and investments and summarily dumped on the shoulders of wage earners and their descendants. Everyone will rejoice and dance in the fields and quickly forget the stresses of 2007-2008. Everything will be wonderful, until that fateful day when the very first barrel of crude is sold with Euro.

[Deal Hunter]

The government is trying to send out Fannie and Freddie in the same way they were deployed back in the Great Depression – the last time credit siezed up this badly. It won’t work this time.

My usual response to the question, “how will the credit markets go back to normal?” is HIGHLY cyncial (so beware):
Massive, drastic and massively drastic tax reform. Most notable features of the tax reform is eliminiation of capital gains tax, privitazaion of social security, abolishment of the estate tax and limitation of mortgage interest deduction to mortgages under the national median home price (sorry CA, Fl, & NY).

A series of booms (including another housing boom) will follow this degree of tax reform as the tax burden is lifted from business and investments and summarily dumped on the shoulders of wage earners and their descendants. Everyone will rejoice and dance in the fields and quickly forget the stresses of 2007-2008. Everything will be wonderful, until that fateful day when the very first barrel of crude is sold with Euro.

[Deal Hunter]

The government is trying to send out Fannie and Freddie in the same way they were deployed back in the Great Depression – the last time credit siezed up this badly. It won’t work this time.

My usual response to the question, “how will the credit markets go back to normal?” is HIGHLY cyncial (so beware):
Massive, drastic and massively drastic tax reform. Most notable features of the tax reform is eliminiation of capital gains tax, privitazaion of social security, abolishment of the estate tax and limitation of mortgage interest deduction to mortgages under the national median home price (sorry CA, Fl, & NY).

A series of booms (including another housing boom) will follow this degree of tax reform as the tax burden is lifted from business and investments and summarily dumped on the shoulders of wage earners and their descendants. Everyone will rejoice and dance in the fields and quickly forget the stresses of 2007-2008. Everything will be wonderful, until that fateful day when the very first barrel of crude is sold with Euro.

[Deal Hunter]

The government is trying to send out Fannie and Freddie in the same way they were deployed back in the Great Depression – the last time credit siezed up this badly. It won’t work this time.

My usual response to the question, “how will the credit markets go back to normal?” is HIGHLY cyncial (so beware):
Massive, drastic and massively drastic tax reform. Most notable features of the tax reform is eliminiation of capital gains tax, privitazaion of social security, abolishment of the estate tax and limitation of mortgage interest deduction to mortgages under the national median home price (sorry CA, Fl, & NY).

A series of booms (including another housing boom) will follow this degree of tax reform as the tax burden is lifted from business and investments and summarily dumped on the shoulders of wage earners and their descendants. Everyone will rejoice and dance in the fields and quickly forget the stresses of 2007-2008. Everything will be wonderful, until that fateful day when the very first barrel of crude is sold with Euro.

[Deal Hunter]

The government is trying to send out Fannie and Freddie in the same way they were deployed back in the Great Depression – the last time credit siezed up this badly. It won’t work this time.

My usual response to the question, “how will the credit markets go back to normal?” is HIGHLY cyncial (so beware):
Massive, drastic and massively drastic tax reform. Most notable features of the tax reform is eliminiation of capital gains tax, privitazaion of social security, abolishment of the estate tax and limitation of mortgage interest deduction to mortgages under the national median home price (sorry CA, Fl, & NY).

A series of booms (including another housing boom) will follow this degree of tax reform as the tax burden is lifted from business and investments and summarily dumped on the shoulders of wage earners and their descendants. Everyone will rejoice and dance in the fields and quickly forget the stresses of 2007-2008. Everything will be wonderful, until that fateful day when the very first barrel of crude is sold with Euro.

[patientrenter]

Deal Hunter, how did you conclude that the most likely outcome of all this is a massive victory for hard-core Republican political goals? I don’t care about the politics, but I can see that the Republican party’s agenda is near-dead. In November, no one thinks that either the House or Senate will go Republican. The only question is whether the character of the Republican candidate can overcome the political groundswell in favor of the Democrat agenda.

The long-term outcome of this still-emerging massive bail-out will be the same as for every other temporary expansion of government in the last 100 years – a permament expansion. From now on, home prices will be determined directly by the Federal govt’s finger on the money spigots. When next prices go down after this little event, they will have lots of new spigots to open.

Patient renter in OC

[patientrenter]

Deal Hunter, how did you conclude that the most likely outcome of all this is a massive victory for hard-core Republican political goals? I don’t care about the politics, but I can see that the Republican party’s agenda is near-dead. In November, no one thinks that either the House or Senate will go Republican. The only question is whether the character of the Republican candidate can overcome the political groundswell in favor of the Democrat agenda.

The long-term outcome of this still-emerging massive bail-out will be the same as for every other temporary expansion of government in the last 100 years – a permament expansion. From now on, home prices will be determined directly by the Federal govt’s finger on the money spigots. When next prices go down after this little event, they will have lots of new spigots to open.

Patient renter in OC

[patientrenter]

Deal Hunter, how did you conclude that the most likely outcome of all this is a massive victory for hard-core Republican political goals? I don’t care about the politics, but I can see that the Republican party’s agenda is near-dead. In November, no one thinks that either the House or Senate will go Republican. The only question is whether the character of the Republican candidate can overcome the political groundswell in favor of the Democrat agenda.

The long-term outcome of this still-emerging massive bail-out will be the same as for every other temporary expansion of government in the last 100 years – a permament expansion. From now on, home prices will be determined directly by the Federal govt’s finger on the money spigots. When next prices go down after this little event, they will have lots of new spigots to open.

Patient renter in OC

[patientrenter]

Deal Hunter, how did you conclude that the most likely outcome of all this is a massive victory for hard-core Republican political goals? I don’t care about the politics, but I can see that the Republican party’s agenda is near-dead. In November, no one thinks that either the House or Senate will go Republican. The only question is whether the character of the Republican candidate can overcome the political groundswell in favor of the Democrat agenda.

The long-term outcome of this still-emerging massive bail-out will be the same as for every other temporary expansion of government in the last 100 years – a permament expansion. From now on, home prices will be determined directly by the Federal govt’s finger on the money spigots. When next prices go down after this little event, they will have lots of new spigots to open.

Patient renter in OC

[patientrenter]

Deal Hunter, how did you conclude that the most likely outcome of all this is a massive victory for hard-core Republican political goals? I don’t care about the politics, but I can see that the Republican party’s agenda is near-dead. In November, no one thinks that either the House or Senate will go Republican. The only question is whether the character of the Republican candidate can overcome the political groundswell in favor of the Democrat agenda.

The long-term outcome of this still-emerging massive bail-out will be the same as for every other temporary expansion of government in the last 100 years – a permament expansion. From now on, home prices will be determined directly by the Federal govt’s finger on the money spigots. When next prices go down after this little event, they will have lots of new spigots to open.

Patient renter in OC

[Deal Hunter]

Because when you look closely enough there is NO difference between Republicans and Democrats.

The rhetoric of privitization is hallmark Republican, but the mechanism of privitization can be easily worked into a Democratic agenda. Same goes for elimination or limitation of mortgage interest deduction. Can you see a Democratic congress or president twisting mortgage interest reform as a way to “take from the rich and give to the poor?” Yep, piece of cake.

And other anomalies like, “Wall Street loves Clinton (both Bill and Hill).” Or, why do “free-market, Reagan/Goldwater Republicans” tolerate the existence of the Federal Reserve?

Again, pardon my extreme cynicism, but I did warn you.

[Deal Hunter]

Because when you look closely enough there is NO difference between Republicans and Democrats.

The rhetoric of privitization is hallmark Republican, but the mechanism of privitization can be easily worked into a Democratic agenda. Same goes for elimination or limitation of mortgage interest deduction. Can you see a Democratic congress or president twisting mortgage interest reform as a way to “take from the rich and give to the poor?” Yep, piece of cake.

And other anomalies like, “Wall Street loves Clinton (both Bill and Hill).” Or, why do “free-market, Reagan/Goldwater Republicans” tolerate the existence of the Federal Reserve?

Again, pardon my extreme cynicism, but I did warn you.

[Deal Hunter]

Because when you look closely enough there is NO difference between Republicans and Democrats.

The rhetoric of privitization is hallmark Republican, but the mechanism of privitization can be easily worked into a Democratic agenda. Same goes for elimination or limitation of mortgage interest deduction. Can you see a Democratic congress or president twisting mortgage interest reform as a way to “take from the rich and give to the poor?” Yep, piece of cake.

And other anomalies like, “Wall Street loves Clinton (both Bill and Hill).” Or, why do “free-market, Reagan/Goldwater Republicans” tolerate the existence of the Federal Reserve?

Again, pardon my extreme cynicism, but I did warn you.

[Deal Hunter]

Because when you look closely enough there is NO difference between Republicans and Democrats.

The rhetoric of privitization is hallmark Republican, but the mechanism of privitization can be easily worked into a Democratic agenda. Same goes for elimination or limitation of mortgage interest deduction. Can you see a Democratic congress or president twisting mortgage interest reform as a way to “take from the rich and give to the poor?” Yep, piece of cake.

And other anomalies like, “Wall Street loves Clinton (both Bill and Hill).” Or, why do “free-market, Reagan/Goldwater Republicans” tolerate the existence of the Federal Reserve?

Again, pardon my extreme cynicism, but I did warn you.

[Author]

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