[patientlywaiting]

23109VC, even if you were to refinance and have a recourse mortgage, as I understand it, the lender can only obtain a deficiency judgment though legal foreclosure (and not trustee’s sale).

So lenders who foreclose through trustees’ sales (the normal way of foreclosing in CA) actually give up recourse, regardless of whether the loans were purchase money or not.

Of course, if there are other recourse debts, those lenders could go to court and obtain deficiency judgments. But would they want to spend good money trying to get blood out of a turnip?

[patientlywaiting]

23109VC, even if you were to refinance and have a recourse mortgage, as I understand it, the lender can only obtain a deficiency judgment though legal foreclosure (and not trustee’s sale).

So lenders who foreclose through trustees’ sales (the normal way of foreclosing in CA) actually give up recourse, regardless of whether the loans were purchase money or not.

Of course, if there are other recourse debts, those lenders could go to court and obtain deficiency judgments. But would they want to spend good money trying to get blood out of a turnip?

[patientlywaiting]

23109VC, even if you were to refinance and have a recourse mortgage, as I understand it, the lender can only obtain a deficiency judgment though legal foreclosure (and not trustee’s sale).

So lenders who foreclose through trustees’ sales (the normal way of foreclosing in CA) actually give up recourse, regardless of whether the loans were purchase money or not.

Of course, if there are other recourse debts, those lenders could go to court and obtain deficiency judgments. But would they want to spend good money trying to get blood out of a turnip?

[patientlywaiting]

23109VC, even if you were to refinance and have a recourse mortgage, as I understand it, the lender can only obtain a deficiency judgment though legal foreclosure (and not trustee’s sale).

So lenders who foreclose through trustees’ sales (the normal way of foreclosing in CA) actually give up recourse, regardless of whether the loans were purchase money or not.

Of course, if there are other recourse debts, those lenders could go to court and obtain deficiency judgments. But would they want to spend good money trying to get blood out of a turnip?

[patientlywaiting]

23109VC, even if you were to refinance and have a recourse mortgage, as I understand it, the lender can only obtain a deficiency judgment though legal foreclosure (and not trustee’s sale).

So lenders who foreclose through trustees’ sales (the normal way of foreclosing in CA) actually give up recourse, regardless of whether the loans were purchase money or not.

Of course, if there are other recourse debts, those lenders could go to court and obtain deficiency judgments. But would they want to spend good money trying to get blood out of a turnip?

[patientlywaiting]

Paul Krugman, my favorite economist wins the Nobel.

http://www.latimes.com/news/nationworld/world/la-fg-nobelecon14-2008oct14,0,5347677.story

In an Oct. 12 article on the New York Times’ Web site, Krugman wrote about the global financial meltdown and its reach into Europe, saying that British Prime Minister Gordon Brown and Chancellor Alistair Darling “defined the character of the worldwide rescue effort, with other wealthy nations playing catch-up.”

Whereas U.S. Treasury Secretary Henry Paulson rejected a “sort of temporary part-nationalization” involving governments giving financial institutions more money in return for a share of ownership, the British government “went straight to the heart of the problem … with stunning speed.”

Krugman said the major European economies have “in effect declared themselves ready to follow Britain’s lead, injecting hundreds of billions of dollars into banks while guaranteeing their debts.”

“And whaddya know,” Krugman continued, “Mr. Paulson — after arguably wasting several precious weeks — has also reversed course, and now plans to buy equity stakes rather than bad mortgage securities.”

[patientlywaiting]

Paul Krugman, my favorite economist wins the Nobel.

http://www.latimes.com/news/nationworld/world/la-fg-nobelecon14-2008oct14,0,5347677.story

In an Oct. 12 article on the New York Times’ Web site, Krugman wrote about the global financial meltdown and its reach into Europe, saying that British Prime Minister Gordon Brown and Chancellor Alistair Darling “defined the character of the worldwide rescue effort, with other wealthy nations playing catch-up.”

Whereas U.S. Treasury Secretary Henry Paulson rejected a “sort of temporary part-nationalization” involving governments giving financial institutions more money in return for a share of ownership, the British government “went straight to the heart of the problem … with stunning speed.”

Krugman said the major European economies have “in effect declared themselves ready to follow Britain’s lead, injecting hundreds of billions of dollars into banks while guaranteeing their debts.”

“And whaddya know,” Krugman continued, “Mr. Paulson — after arguably wasting several precious weeks — has also reversed course, and now plans to buy equity stakes rather than bad mortgage securities.”

[patientlywaiting]

Paul Krugman, my favorite economist wins the Nobel.

http://www.latimes.com/news/nationworld/world/la-fg-nobelecon14-2008oct14,0,5347677.story

In an Oct. 12 article on the New York Times’ Web site, Krugman wrote about the global financial meltdown and its reach into Europe, saying that British Prime Minister Gordon Brown and Chancellor Alistair Darling “defined the character of the worldwide rescue effort, with other wealthy nations playing catch-up.”

Whereas U.S. Treasury Secretary Henry Paulson rejected a “sort of temporary part-nationalization” involving governments giving financial institutions more money in return for a share of ownership, the British government “went straight to the heart of the problem … with stunning speed.”

Krugman said the major European economies have “in effect declared themselves ready to follow Britain’s lead, injecting hundreds of billions of dollars into banks while guaranteeing their debts.”

“And whaddya know,” Krugman continued, “Mr. Paulson — after arguably wasting several precious weeks — has also reversed course, and now plans to buy equity stakes rather than bad mortgage securities.”

[patientlywaiting]

Paul Krugman, my favorite economist wins the Nobel.

http://www.latimes.com/news/nationworld/world/la-fg-nobelecon14-2008oct14,0,5347677.story

In an Oct. 12 article on the New York Times’ Web site, Krugman wrote about the global financial meltdown and its reach into Europe, saying that British Prime Minister Gordon Brown and Chancellor Alistair Darling “defined the character of the worldwide rescue effort, with other wealthy nations playing catch-up.”

Whereas U.S. Treasury Secretary Henry Paulson rejected a “sort of temporary part-nationalization” involving governments giving financial institutions more money in return for a share of ownership, the British government “went straight to the heart of the problem … with stunning speed.”

Krugman said the major European economies have “in effect declared themselves ready to follow Britain’s lead, injecting hundreds of billions of dollars into banks while guaranteeing their debts.”

“And whaddya know,” Krugman continued, “Mr. Paulson — after arguably wasting several precious weeks — has also reversed course, and now plans to buy equity stakes rather than bad mortgage securities.”

[patientlywaiting]

Paul Krugman, my favorite economist wins the Nobel.

http://www.latimes.com/news/nationworld/world/la-fg-nobelecon14-2008oct14,0,5347677.story

In an Oct. 12 article on the New York Times’ Web site, Krugman wrote about the global financial meltdown and its reach into Europe, saying that British Prime Minister Gordon Brown and Chancellor Alistair Darling “defined the character of the worldwide rescue effort, with other wealthy nations playing catch-up.”

Whereas U.S. Treasury Secretary Henry Paulson rejected a “sort of temporary part-nationalization” involving governments giving financial institutions more money in return for a share of ownership, the British government “went straight to the heart of the problem … with stunning speed.”

Krugman said the major European economies have “in effect declared themselves ready to follow Britain’s lead, injecting hundreds of billions of dollars into banks while guaranteeing their debts.”

“And whaddya know,” Krugman continued, “Mr. Paulson — after arguably wasting several precious weeks — has also reversed course, and now plans to buy equity stakes rather than bad mortgage securities.”

[patientlywaiting]

George Soros said that equity purchase in banks is a better way of rescuing the financial system. Buying the junk paper was a non-starter.

http://www.pbs.org/moyers/journal/10102008/profile.html

BILL MOYERS:You would put it where?

GEORGE SOROS:Into the capital of the bank so that the capital equity can sustain at least 12 times the amount of lending. So that’s an obvious thing. And every economist agrees with this.

You see, what is needed now the bank examiners know how those banks stand. And they can say how much capital they need. And they could then raise that capital from the private market. Or they could turn to this new organization and get the money from there. That would dilute the shareholders. It would hurt the shareholders.

BILL MOYERS:Of the bank?

GEORGE SOROS:Of the banks. Which I think Paulson wanted to avoid. He didn’t want to go there. But it has to be done. But then, the shareholders could be offered the right to provide the new capital. If they provide the new capital then there’s no dilution. And the rights could be traded. So if they don’t have the money, other people could, the private sector could put in the money. And if the private sector is not willing to do it then the government does it.

[patientlywaiting]

George Soros said that equity purchase in banks is a better way of rescuing the financial system. Buying the junk paper was a non-starter.

http://www.pbs.org/moyers/journal/10102008/profile.html

BILL MOYERS:You would put it where?

GEORGE SOROS:Into the capital of the bank so that the capital equity can sustain at least 12 times the amount of lending. So that’s an obvious thing. And every economist agrees with this.

You see, what is needed now the bank examiners know how those banks stand. And they can say how much capital they need. And they could then raise that capital from the private market. Or they could turn to this new organization and get the money from there. That would dilute the shareholders. It would hurt the shareholders.

BILL MOYERS:Of the bank?

GEORGE SOROS:Of the banks. Which I think Paulson wanted to avoid. He didn’t want to go there. But it has to be done. But then, the shareholders could be offered the right to provide the new capital. If they provide the new capital then there’s no dilution. And the rights could be traded. So if they don’t have the money, other people could, the private sector could put in the money. And if the private sector is not willing to do it then the government does it.

[patientlywaiting]

George Soros said that equity purchase in banks is a better way of rescuing the financial system. Buying the junk paper was a non-starter.

http://www.pbs.org/moyers/journal/10102008/profile.html

BILL MOYERS:You would put it where?

GEORGE SOROS:Into the capital of the bank so that the capital equity can sustain at least 12 times the amount of lending. So that’s an obvious thing. And every economist agrees with this.

You see, what is needed now the bank examiners know how those banks stand. And they can say how much capital they need. And they could then raise that capital from the private market. Or they could turn to this new organization and get the money from there. That would dilute the shareholders. It would hurt the shareholders.

BILL MOYERS:Of the bank?

GEORGE SOROS:Of the banks. Which I think Paulson wanted to avoid. He didn’t want to go there. But it has to be done. But then, the shareholders could be offered the right to provide the new capital. If they provide the new capital then there’s no dilution. And the rights could be traded. So if they don’t have the money, other people could, the private sector could put in the money. And if the private sector is not willing to do it then the government does it.

[patientlywaiting]

George Soros said that equity purchase in banks is a better way of rescuing the financial system. Buying the junk paper was a non-starter.

http://www.pbs.org/moyers/journal/10102008/profile.html

BILL MOYERS:You would put it where?

GEORGE SOROS:Into the capital of the bank so that the capital equity can sustain at least 12 times the amount of lending. So that’s an obvious thing. And every economist agrees with this.

You see, what is needed now the bank examiners know how those banks stand. And they can say how much capital they need. And they could then raise that capital from the private market. Or they could turn to this new organization and get the money from there. That would dilute the shareholders. It would hurt the shareholders.

BILL MOYERS:Of the bank?

GEORGE SOROS:Of the banks. Which I think Paulson wanted to avoid. He didn’t want to go there. But it has to be done. But then, the shareholders could be offered the right to provide the new capital. If they provide the new capital then there’s no dilution. And the rights could be traded. So if they don’t have the money, other people could, the private sector could put in the money. And if the private sector is not willing to do it then the government does it.

[patientlywaiting]

George Soros said that equity purchase in banks is a better way of rescuing the financial system. Buying the junk paper was a non-starter.

http://www.pbs.org/moyers/journal/10102008/profile.html

BILL MOYERS:You would put it where?

GEORGE SOROS:Into the capital of the bank so that the capital equity can sustain at least 12 times the amount of lending. So that’s an obvious thing. And every economist agrees with this.

You see, what is needed now the bank examiners know how those banks stand. And they can say how much capital they need. And they could then raise that capital from the private market. Or they could turn to this new organization and get the money from there. That would dilute the shareholders. It would hurt the shareholders.

BILL MOYERS:Of the bank?

GEORGE SOROS:Of the banks. Which I think Paulson wanted to avoid. He didn’t want to go there. But it has to be done. But then, the shareholders could be offered the right to provide the new capital. If they provide the new capital then there’s no dilution. And the rights could be traded. So if they don’t have the money, other people could, the private sector could put in the money. And if the private sector is not willing to do it then the government does it.

[Author]

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