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patientrenter
Participant[quote=execute]This is my first post, but i’ve been lurking here along time.
The thing many people seem to forget is that the market is much much larger then the government. The government will fail in propping up home prices. Consider all the things the government has done up to this point: bailouts, stimulus checks, nationalization, and look at the situation the economy is in: market down 55%, unemployment surging, housing values continuing to plummet.I guess my point is that the government is ineffective. They cannot stop this, no matter what they do. Yes, they can make the situation worse and prolong things, but I have zero faith in their ability to “fix” anything.[/quote]
It is easy to forget that government action can be very effective in distorting prices. For example, if the government were to decide tomorrow to give buyers with no downpayment enough money to buy any home at 120% of its appraised value, then I guarantee you that home prices would move up quickly. Yes, inflation would eventually shoot up, but that just transfers wealth from net savers to net borrowers. That makes it a form of confiscation, but it’s a form very much in favor in the US.
patientrenter
Participant[quote=execute]This is my first post, but i’ve been lurking here along time.
The thing many people seem to forget is that the market is much much larger then the government. The government will fail in propping up home prices. Consider all the things the government has done up to this point: bailouts, stimulus checks, nationalization, and look at the situation the economy is in: market down 55%, unemployment surging, housing values continuing to plummet.I guess my point is that the government is ineffective. They cannot stop this, no matter what they do. Yes, they can make the situation worse and prolong things, but I have zero faith in their ability to “fix” anything.[/quote]
It is easy to forget that government action can be very effective in distorting prices. For example, if the government were to decide tomorrow to give buyers with no downpayment enough money to buy any home at 120% of its appraised value, then I guarantee you that home prices would move up quickly. Yes, inflation would eventually shoot up, but that just transfers wealth from net savers to net borrowers. That makes it a form of confiscation, but it’s a form very much in favor in the US.
patientrenter
Participant[quote=execute]This is my first post, but i’ve been lurking here along time.
The thing many people seem to forget is that the market is much much larger then the government. The government will fail in propping up home prices. Consider all the things the government has done up to this point: bailouts, stimulus checks, nationalization, and look at the situation the economy is in: market down 55%, unemployment surging, housing values continuing to plummet.I guess my point is that the government is ineffective. They cannot stop this, no matter what they do. Yes, they can make the situation worse and prolong things, but I have zero faith in their ability to “fix” anything.[/quote]
It is easy to forget that government action can be very effective in distorting prices. For example, if the government were to decide tomorrow to give buyers with no downpayment enough money to buy any home at 120% of its appraised value, then I guarantee you that home prices would move up quickly. Yes, inflation would eventually shoot up, but that just transfers wealth from net savers to net borrowers. That makes it a form of confiscation, but it’s a form very much in favor in the US.
March 8, 2009 at 3:47 PM in reply to: More FHA-Backed Mortgages Go Bad Without a Single Payment #362373patientrenter
ParticipantNo one would lend their own money on the terms that the FHA is using for loans now. That’s the point – this is one of the many schemes to channel trillions of taxpayer money into the hands of homeowners and those who make their living off elevated home prices. The more ridiculous the risks being taken on, and the more money thrown at it, the more effective the program is considered. This article is merely pointing out the obvious, that the FHA program is hitting its mark.
March 8, 2009 at 3:47 PM in reply to: More FHA-Backed Mortgages Go Bad Without a Single Payment #362670patientrenter
ParticipantNo one would lend their own money on the terms that the FHA is using for loans now. That’s the point – this is one of the many schemes to channel trillions of taxpayer money into the hands of homeowners and those who make their living off elevated home prices. The more ridiculous the risks being taken on, and the more money thrown at it, the more effective the program is considered. This article is merely pointing out the obvious, that the FHA program is hitting its mark.
March 8, 2009 at 3:47 PM in reply to: More FHA-Backed Mortgages Go Bad Without a Single Payment #362817patientrenter
ParticipantNo one would lend their own money on the terms that the FHA is using for loans now. That’s the point – this is one of the many schemes to channel trillions of taxpayer money into the hands of homeowners and those who make their living off elevated home prices. The more ridiculous the risks being taken on, and the more money thrown at it, the more effective the program is considered. This article is merely pointing out the obvious, that the FHA program is hitting its mark.
March 8, 2009 at 3:47 PM in reply to: More FHA-Backed Mortgages Go Bad Without a Single Payment #362859patientrenter
ParticipantNo one would lend their own money on the terms that the FHA is using for loans now. That’s the point – this is one of the many schemes to channel trillions of taxpayer money into the hands of homeowners and those who make their living off elevated home prices. The more ridiculous the risks being taken on, and the more money thrown at it, the more effective the program is considered. This article is merely pointing out the obvious, that the FHA program is hitting its mark.
March 8, 2009 at 3:47 PM in reply to: More FHA-Backed Mortgages Go Bad Without a Single Payment #362967patientrenter
ParticipantNo one would lend their own money on the terms that the FHA is using for loans now. That’s the point – this is one of the many schemes to channel trillions of taxpayer money into the hands of homeowners and those who make their living off elevated home prices. The more ridiculous the risks being taken on, and the more money thrown at it, the more effective the program is considered. This article is merely pointing out the obvious, that the FHA program is hitting its mark.
March 8, 2009 at 3:28 PM in reply to: OT: Ohio – 700 People Have Applied for a Single Job as a Janitor #362358patientrenter
Participant[quote=JohnAlt91941]…..These kinds of stories are common during a recession. Haven’t you ever been through one? ……I graduated from college in the early 90’s and had a tough time finding a steady job. There were anecdotal reports of hundreds of applicants for an accountant job.
But now things are different. Uh huh.
[/quote]John, things are different now. Believe me, the recessions you’ve lived through as an adult are small compared to the early 1980’s, and that’s small compared to the second half of the 1970’s, and that is dwarfed by what happened in the 1930’s.
I don’t know yet how this first recession of the 21st century will rank compared to those of the 20th century, but I will wager with anyone that the early 1990’s will be a blip compared to this.
March 8, 2009 at 3:28 PM in reply to: OT: Ohio – 700 People Have Applied for a Single Job as a Janitor #362655patientrenter
Participant[quote=JohnAlt91941]…..These kinds of stories are common during a recession. Haven’t you ever been through one? ……I graduated from college in the early 90’s and had a tough time finding a steady job. There were anecdotal reports of hundreds of applicants for an accountant job.
But now things are different. Uh huh.
[/quote]John, things are different now. Believe me, the recessions you’ve lived through as an adult are small compared to the early 1980’s, and that’s small compared to the second half of the 1970’s, and that is dwarfed by what happened in the 1930’s.
I don’t know yet how this first recession of the 21st century will rank compared to those of the 20th century, but I will wager with anyone that the early 1990’s will be a blip compared to this.
March 8, 2009 at 3:28 PM in reply to: OT: Ohio – 700 People Have Applied for a Single Job as a Janitor #362802patientrenter
Participant[quote=JohnAlt91941]…..These kinds of stories are common during a recession. Haven’t you ever been through one? ……I graduated from college in the early 90’s and had a tough time finding a steady job. There were anecdotal reports of hundreds of applicants for an accountant job.
But now things are different. Uh huh.
[/quote]John, things are different now. Believe me, the recessions you’ve lived through as an adult are small compared to the early 1980’s, and that’s small compared to the second half of the 1970’s, and that is dwarfed by what happened in the 1930’s.
I don’t know yet how this first recession of the 21st century will rank compared to those of the 20th century, but I will wager with anyone that the early 1990’s will be a blip compared to this.
March 8, 2009 at 3:28 PM in reply to: OT: Ohio – 700 People Have Applied for a Single Job as a Janitor #362843patientrenter
Participant[quote=JohnAlt91941]…..These kinds of stories are common during a recession. Haven’t you ever been through one? ……I graduated from college in the early 90’s and had a tough time finding a steady job. There were anecdotal reports of hundreds of applicants for an accountant job.
But now things are different. Uh huh.
[/quote]John, things are different now. Believe me, the recessions you’ve lived through as an adult are small compared to the early 1980’s, and that’s small compared to the second half of the 1970’s, and that is dwarfed by what happened in the 1930’s.
I don’t know yet how this first recession of the 21st century will rank compared to those of the 20th century, but I will wager with anyone that the early 1990’s will be a blip compared to this.
March 8, 2009 at 3:28 PM in reply to: OT: Ohio – 700 People Have Applied for a Single Job as a Janitor #362952patientrenter
Participant[quote=JohnAlt91941]…..These kinds of stories are common during a recession. Haven’t you ever been through one? ……I graduated from college in the early 90’s and had a tough time finding a steady job. There were anecdotal reports of hundreds of applicants for an accountant job.
But now things are different. Uh huh.
[/quote]John, things are different now. Believe me, the recessions you’ve lived through as an adult are small compared to the early 1980’s, and that’s small compared to the second half of the 1970’s, and that is dwarfed by what happened in the 1930’s.
I don’t know yet how this first recession of the 21st century will rank compared to those of the 20th century, but I will wager with anyone that the early 1990’s will be a blip compared to this.
patientrenter
ParticipantCNBC’s shilling for the investment industry financial was shameless and despicable. So I have no problem with anyone calling them on it.
But all this talk of the unfairness of bailing banks vs homeowners is a case of “never mind the man behind the curtain”. Clearly most people are fooled by it, but where did most of the money go that is being lost today? Trillions are being lost, and maybe worldwide tens of trillions ultimately. Who gained those trillions? Professionals living off the flow of borrowed money into the housing industry benefited – senior private bankers, middle level private bankers, and junior employees of private banks; mortgage brokers, real estate agents, rating agencies; employees of the GSEs, their leadership, their lobbyists, and the politicians who protect the GSEs….
Is that all of the people who benefited? Well, no. The people who benefited the most are those who bought real estate before the boom. These are, by definition, the hundred million or more people who live next door. 90% of the value that is being lost today was gained in the first place by people who bought before the boom, not by the middlemen. How many people do you know who downsized during the bubble, and plan to use the gains to live comfortably in their retirement? Or refinanced above the 1995 value of their home, and used the money to enjoy big plasma TVs, or new cars, or swimming pools? These are the people who walked away with the bulk of the value that is being lost today. If they pissed it away unwisely, that is less reason to give them sympathy or bailouts, not more.
But it’s a lot more popular to preach that homeowners deserve a bailout. Stewart is funny, but his actual message is nothing more than cheap pandering populism.
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