How Do You Feel About The Government

[rachael]

lame.

[Mercy me]

Back on topic. I don't support the government bailing out the mortgage industry. They need to reap what they have sown. They approved people for more than they could afford. The people bought more house than they could afford. They all need to learn a lesson. The unfortunate part is that it run the price of housing so high.

Off topic, this same problem is also seen in the cost of higher education.

[cmotherofpirl]

If the government is going to do anything, it should ban balloon mortgages and convert them all to fixed rate. That would help the home owner and spank the mortgage lenders who created this mess in the first place.

[Lil Red]

+J.M.J.+
[quote name='Altari' post='1517781' date='May 3 2008, 08:38 PM']I don't like it. Especially this idea that the federal government would "buy" upside-down mortgages to "bail out" homeowners. I don't like the idea of the government owning my home - it smacks of communism.[/quote]


[quote name='cmotherofpirl' post='1518265' date='May 4 2008, 10:53 AM']If the government is going to do anything, it should ban balloon mortgages and convert them all to fixed rate. That would help the home owner and spank the mortgage lenders who created this mess in the first place.[/quote]
agreed.

[kenrockthefirst]

[quote name='Altari' post='1517781' date='May 3 2008, 09:38 PM']I don't like it. Especially this idea that the federal government would "buy" upside-down mortgages to "bail out" homeowners. I don't like the idea of the government owning my home - it smacks of communism.[/quote]
Did you "not like it" when the government bailed out Bear Stearns? Did that smack of communism?

What's good for the goose is good for the gander.

[CatherineM]

It might also help to cap mortgages for single family homes at 30 years. 40 year mortgages or interest only mortgages are just a recipe for disaster when housing goes down. If you can't afford a payment on a 25 year mortgage, you are either buying too large a house, or you just aren't financially up to owning right now.

[kenrockthefirst]

[quote name='CatherineM' post='1522407' date='May 8 2008, 02:41 PM']It might also help to cap mortgages for single family homes at 30 years. 40 year mortgages or interest only mortgages are just a recipe for disaster when housing goes down. If you can't afford a payment on a 25 year mortgage, you are either buying too large a house, or you just aren't financially up to owning right now.[/quote]
Right, but that would mean regulation, which "smacks of communism." Let The Market take care of it. The Market has done such a bang up job up to now.

[Altari]

[quote name='kenrockthefirst' post='1522376' date='May 8 2008, 03:00 PM']Did you "not like it" when the government bailed out Bear Stearns? Did that smack of communism?[/quote]
Yes [I didn't like it]. I despise the idea of government bailouts and subsidies. Let capitalism do its thing. Businesses will rise and fall and, sometimes, fail. C'est la vie. The market is a self-correcting organism.

[Altari]

[quote name='kenrockthefirst' post='1523080' date='May 9 2008, 08:35 AM']Right, but that would mean regulation, which "smacks of communism." Let The Market take care of it. The Market has done such a bang up job up to now.[/quote]
The market has actually done quite well. Part of the current mortgage crisis stems from government subsidies to increase home ownership in the '90s. No, this isn't a "blame Clinton" game. He [and his administration] thought they were doing what was best for the economy. The unforeseen side effect was that lenders would start going after "subprime" candidates to increase home ownership.

The market corrected itself after the Dot Com Bubble. People were crying the end of the blagoblag and ecommerce. Hey look, it's still here.

Nearly all major market problems can be linked to government interventions. The food shortage is a wonderful current example of the problem of government being involved in the economy. Inflation? Bernake is doing his best to keep us out of a depression, despite the fact that dozens of world-renowned economists are screaming for him to keep his hands off.

However, the more important question, that this thread was aimed at, is [i]Are you comfortable with the government holding the deed to your, and everyone else's, home?[/i] I, for one, am not.

[kenrockthefirst]

[quote name='Altari' post='1523120' date='May 9 2008, 08:35 AM']However, the more important question, that this thread was aimed at, is [i]Are you comfortable with the government holding the deed to your, and everyone else's, home?[/i] I, for one, am not.[/quote]
Discussions about macroeconomic theory aside, the government, at least in theory, is accountable to me, whereas slash-n-burn predatory lenders are not. The subprime mortgage crisis is not the government's "fault;" it's due to greedy lenders who thought they saw a way to make a quick buck and it didn't work out. Of course, they were aided and abetted by naive, foolish, or willfully myopic borrowers who bit off more than they could chew, so there's plenty of "blame" to go around. However, unless you want to do away with Fannie Mae and Freddie Mac, I'm not sure that there's anything inherently wrong with the government securing someone's mortgage.

[Justin86]

[quote name='kenrockthefirst' post='1523144' date='May 10 2008, 12:17 AM']Discussions about macroeconomic theory aside, the government, at least in theory, is accountable to me, whereas slash-n-burn predatory lenders are not. The subprime mortgage crisis is not the government's "fault;" it's due to greedy lenders who thought they saw a way to make a quick buck and it didn't work out. Of course, they were aided and abetted by naive, foolish, or willfully myopic borrowers who bit off more than they could chew, so there's plenty of "blame" to go around. However, unless you want to do away with Fannie Mae and Freddie Mac, I'm not sure that there's anything inherently wrong with the government securing someone's mortgage.[/quote]
In our world of over spending I fail to see why the government needs to be spending more money on helping out people who don't understand that if you want a house you have to be able to make the minimum monthly payment on it's mortgage. They were the one's that signed the contract. It is their responsibility to pay up and no one else's.

It is not as if these people are poor. Actually, other than the one's who apparently can't read a contract, a lot of them are real estate developers who when they bought these houses expected property values to rise which they haven't. Again, this is no one's problem but theirs. I'm not interested in paying my tax dollars just so someone else can make a buck or two. What's happening to them is called business. You failed. Get over it. So your credit is shot, so what? Donald Trump has declared bankruptcy three times, and got himself out of it three times. It is perfectly do-able for these individuals to do the same.

[kenrockthefirst]

[quote name='Justin86' post='1523168' date='May 9 2008, 09:46 AM']In our world of over spending I fail to see why the government needs to be spending more money on helping out people who don't understand that if you want a house you have to be able to make the minimum monthly payment on it's mortgage. They were the one's that signed the contract. It is their responsibility to pay up and no one else's.

It is not as if these people are poor. Actually, other than the one's who apparently can't read a contract, a lot of them are real estate developers who when they bought these houses expected property values to rise which they haven't. Again, this is no one's problem but theirs. I'm not interested in paying my tax dollars just so someone else can make a buck or two. What's happening to them is called business. You failed. Get over it. So your credit is shot, so what? Donald Trump has declared bankruptcy three times, and got himself out of it three times. It is perfectly do-able for these individuals to do the same.[/quote]
That's fine, as long as we're all playing by the same rules. If Bear Stearns gets a bail out, so should John Doe. If John Doe's told, "smell of elderberries it up," Bear Stearns should be told the same thing.

As I stated above, what's good for the goose is good for the gander.

[Justin86]

Bear Stearns should have been told to smell of elderberries it up too, just to confirm that's what I think.

[Altari]

"What's good for the goose is good for the gander."

Can, in this case, be paraphrased as

"Two wrongs make a right."

The government was planning on bailing out homeowners. What did that turn into? A bill to bail our investors, prospectors and corporations. The government needs to keep its nose out of the economy. If Freddie Mac and Fannie Mae disappeared, I wouldn't be heartbroken - in fact, I'd be glad. If the government stopped cutting taxes on "Big Oil", I'd be happy. If the FDA were to be nullified, I'd be happy.

Myself, and like-minded individuals, don't mind paying more in money and time to get quality products and services we want or need, as long as it means the government is not involved in our economy. I'm not an "eco-nazi" or a conspiracy theorist, just to jump the gun on that. I simply prefer the evil I can see, touch and judge, rather than the evil that sits in a large assembly hall in D.C. and decides what's best for me.

Edited May 9, 2008 by Altari

[kenrockthefirst]

[quote name='Justin86' post='1523199' date='May 9 2008, 10:11 AM']Bear Stearns should have been told to smell of elderberries it up too, just to confirm that's what I think.[/quote]
Good deal, my thoughts, too.

[quote name='Altari' post='1523224' date='May 9 2008, 11:04 AM']"What's good for the goose is good for the gander."

Can, in this case, be paraphrased as

"Two wrongs make a right."[/quote]
No. Be consistent.

[quote name='Altari' post='1523224' date='May 9 2008, 11:04 AM']The government was planning on bailing out homeowners. What did that turn into? A bill to bail our investors, prospectors and corporations. The government needs to keep its nose out of the economy. If Freddie Mac and Fannie Mae disappeared, I wouldn't be heartbroken - in fact, I'd be glad. If the government stopped cutting taxes on "Big Oil", I'd be happy. If the FDA were to be nullified, I'd be happy.

Myself, and like-minded individuals, don't mind paying more in money and time to get quality products and services we want or need, as long as it means the government is not involved in our economy. I'm not an "eco-nazi" or a conspiracy theorist, just to jump the gun on that. I simply prefer the evil I can see, touch and judge, rather than the evil that sits in a large assembly hall in D.C. and decides what's best for me.[/quote]
The difference is, the "government" is us. Again, theoretically speaking, at least, the "government" is accountable to us. The Market is accountable only insofar as we can take our dollars elsewhere, which does work, but not always. In the case of the subprime mortgage lenders, as soon as they identified a mark and closed the deal, they made their money and went on their way a la snakeoil salesmen of yore. What's to a) prevent that from happening in future and b) provide remedy now for people who got screwed?

[Altari]

[quote name='kenrockthefirst' post='1523295' date='May 9 2008, 02:09 PM']Good deal, my thoughts, too.
No. Be consistent.[/quote]
That's one way of slanting it, but not quite accurate.

"We spent $1,000,000 on a special interest project that resulted in failure."

"Since they spent $1,000,000 on a SIP, I should get $1,500,000 because I have a larger constituency base!"

It might be "consistent", but it's also justifying one wrong with another.

[quote name='kenrockthefirst' post='1523295' date='May 9 2008, 02:09 PM']The difference is, the "government" is us. Again, [b]theoretically[/b] speaking, at least, the "government" is accountable to us. The Market is accountable only insofar as we can take our dollars elsewhere, which does work, but not always. In the case of the subprime mortgage lenders, as soon as they identified a mark and closed the deal, they made their money and went on their way a la snakeoil salesmen of yore. What's to a) prevent that from happening in future and b) provide remedy now for people who got screwed?[/quote]
The important word in your statement is "theoretically". All else hinges upon that single word. In reality, the government is accountable to no one. Our tax dollars are traded on a daily basis as favors to other Congressmen in order to get bills passed (in order to ensure a solid next election). Our elected officials have absolutely no loyalty to us, or our needs, or our causes. They can take as much of our money as they want, and we can't do a blessed thing about it.

The market, on the other hand, will eventually be held accountable. Wal-mart had some of the worst employment practices in the country. The market rebelled and protested. People sent angry letters, quit, refused to shop there. They voted with their dollar, and now Wal-mart has better employee benefits than many of the large-scale competitors. They told their investors where to shove it, and reminded them that the customer had to come first. Their profit margin went down, but customer satisfaction went up. The market corrected itself, without the government. And it's more common than just Wally World.

What happens when we demand something of Washington? They snicker and give us lip service. They start a bill (such as the mortgage bail-out bill), but then ultimately pander to whoever will give them the most money. We can't stop them. In the end, they can send the IRS after us and take our money whether we want them to or not. At least in the free market, people can walk away.

Edited : Sorry, I forget to specifically address this last part
[quote]provide remedy now for people who got screwed?[/quote]
Who got "screwed"? My husband and I bought our house under the "sub-prime" class. We didn't get screwed. We pay our mortgage. Our mortgage company is happy, we're happy.

Why didn't we (and about 90% of homeowners) get screwed? [b]Because we bought a house we could afford.[/b] Amazing, isn't it? You purchase something that is within your means, and then you pay for it, and you keep it. I have zero sympathy for people who claim that they "didn't know" their mortgage was going up. Closing on our home took well over two hours, since we read through each and every page. Everyone else got those documents, and if they didn't read the paper they were signing, well...they got what they deserved, and society shouldn't be "bailing them out".

Edited May 9, 2008 by Altari