Posted on 10/07/2008 9:04:34 PM PDT by jddqr
I can’t underscore enough what a rotten idea John McCain’s ACORN-like government mortgage buy-up is. I said it during my liveblog. And I’ll say it again: “HE WANTS TO EXPAND THE BAILOUT. He wants to do what ACORN wants to do. We’re Screwed ‘08.”
This was his supposed “game-changer.” This was the very first thing out of his mouth during the debate tonight — his big pitch right off the bat. The McCain campaign immediately sent out this fact sheet on the proposal, which will cost at least $300 billion. The proposal involves directing the Treasury Secretary to “purchase mortgages directly from homeowners and mortgage servicers.” That’s on top of the trillion-dollar crap sandwich, the $85 billion to AIG, the $25 billion to automakers, the $200 billion in capital and credit lines to Fannie and Freddie, and who knows what else we’ll be forking over to California, Massachusetts, etc., etc., etc.
He spent the entire debate assailing massive government spending — while his featured proposal of the night was to heap on more massive government spending to pursue home ownership/retention at all costs. If Obama had proposed this, the Right would be screaming bloody murder about this socialist grab.
(Excerpt) Read more at michellemalkin.com ...
Yes. Yes. Yes. We all know we are paying for it as of the House and Senates votes last week. I am trying to get documented aspects of McCain’s proposals. If you can find that as opposed to your opinions it would be helpful.
Better make that 5. (MSM)
Maybe, I was unclear.
My point is banks should come up with intelligent formulas for appraising houses, rather than relying the temporary whims of speculators in the midst of a bubble. They should only give mortgages on real, sustainable, “unbubbled” values of homes. In the long run, the value of homes will be dependent upon the available income of potential buyers.
Yes, a buyer should be able pay whatever he is willing to pay for a home, but if that buyer wants to overpay, he should do it with his OWN MONEY, in the form of a higher down payment, not with the bank’s money.
If you have a housing market where the average homeowner is spending 60%, 70%, 80% (or 120%) of his income on his mortgage payment, those prices are unsustainable, (unless income dramatically increases in the market) and will inevitably plummet, leaving the loans undercollateralized.
Appraisals based strictly on the latest sale prices of similar homes, can create a self perpetuating bubble. Joe’s house sells for 20% more than it is worth, then Sally’s house down the street goes for 5% more than that (based upon the selling price of Joe’s house), then Bob’s house around the corner is sold for 5% more than that (based upon the selling price of Sally’s house), etc. etc., etc.
You just despise McCain regardless of what he does. You’ve made up your mind a long time ago.
Enjoy voting for some irrelevant Constitution Party no name or something.
Your no longer a factor.
To further clarify, I am not talking about government price controls. I am talking about a RATIONAL market, where lenders come up with more sophisticated, reality based methods of appraising and make loans based upon the true, sustainable value of the collateral (houses), not based upon the fleeting, bubble inflated, current market prices.
I’m just asking banks to be smarter and act in the interest of their shareholders, by ensuring their secured loans are actually secured by sufficient collateral.
“Your no longer a factor.”
????
My what?
Your candidate is no longer a factor. I am not voting for a Socialist idiot.
Isn't this what they were more or less forbidden to do, when the government forced them to be politically correct?
“I am not voting for a Socialist idiot.”
No, you’re not. You’re voting for the Marxist Obama via your fringe 3rdParty vote.
But, that’s fine, enjoy.
“You’re voting for the Marxist Obama via your fringe 3rdParty vote.”
IF and ONLY IF that person lives in a swing state. Otherwise, it’s moot.
“I’m just asking banks to be smarter and act in the interest of their shareholders, by ensuring their secured loans are actually secured by sufficient collateral.”
Suggest you buy a bank. If you do not like what banks do then do what I did and short them.
The value of anything can only be determined by what some body will pay for it. What is a current market price?...Prices change all the time? Your proposed solution is completely about regulated markets. Who does that.
Know what, why don’t we save time? Let me tell you that if you read Thomas Sowell’s Basic Economics or read Walter Williams lectures you will not seem so completely out of it. Economics is not a require subject. Too bad.
“No, you’re not. You’re voting for the Marxist Obama via your fringe 3rdParty vote.”
You PROVE you cannot read. The answer is before your eyes. OPEN THEM.
>>>I’m just asking banks to be smarter and act in the interest of their shareholders, by ensuring their secured loans are actually secured by sufficient collateral.<<<
***Isn’t this what they were more or less forbidden to do, when the government forced them to be politically correct? ***
To a large extent, yes. Banks were coerced by the CRA into making some bad loans.
At the same time, I am almost certain they made WAY more of these bad loans and lent WAY too much money even to people with good credit.
IOW, IMHO, the CRA and the ACORN and the Clinton Admin got the ball rolling on this mess, but when the banks started to realize (or believe) they could make a profit making these garbage loans they ran with it and deluded themselves into thinking that home prices would never stop rising.
So vote for Sara Palin.
BULLCRAP!
Let the BANKS do this! Let the market build their own little poop can, rebuild their securities without the troubled mortgages, resell the bad mortgages on their own and take the hit mutually on a long term WITHOUT governmental involvement. They are big boys. they know how to do this crap.
ZERO governmental involvement except the oversight to allow the securities deconstruction/reconstruction, and ZERO BAILOUT!
She IS attacking the other side.
I am not talking about regulated markets. I am talking about banks not lending money based upon a price that they know cannot be sustained.
For example, if during the height of the dotcom boom, I had a stock that was selling at $400 a share, but even if the company had earnings and growth beyond our wildest dreams they could never possibly support a price over $80 a share, would you lend me $400,000, for 30 years, if I put up 1,000 shares as collateral? Probably not.
In the same way, if homes prices in a particuarly inflated market are rising at 25% per year, while incomes are only rising a 4% a year, a crash in home prices is inevitable. The fact that I gave a loan for the market price in 2005 is not going to help me when in 2009 the price has dropped 40%.
Banks need to evaluate sustainable values of houses when giving mortgages. IMHO, they would be smart to tell borrowers, “You can pay what ever you darn well please for that home, but we are only going to lend you what we think it will definitely be worth 10 years from now.”
I don’t want goverment regulation, I just want smart capitalism to replace the dumb capitalism of the past 10 years or so.
ummm... No, He doesn't... If the whole base was for him, he'd be 10 points ahead right now, and gaining.
All of these fringies protest too much. They have already made their minds up regarding McCain.
Funny stuff this outrage. They are fruitloops.
In the real world it’s McCain or Obama, that’s the damned choices.
Night night, don’t forget the mike in you ‘loops in the am.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.