You are going to bail-out sub-prime lenders.

[Hortlund]

Well, its either this or a recession... I cant say I disagree with the desicion to try to avoid the recession.

[Mickey1992]

''It is not the responsibility of the Federal Reserve -- nor would it be appropriate -- to protect lenders and investors from the consequences of their financial decisions,'' Bernanke said. ``But the developments in financial markets can have broad economic effects felt by many outside the markets, and the Federal Reserve must take those effects into account.''

Bernanke seems to have his head on straight.

"One measure announced by Bush would allow homeowners with a good credit history but cannot afford their current payments to refinance into federally insured mortgages.

He also encouraged lenders to try to work out payment arrangements with financially strapped homeowners and urged Congress to pass additional relief measures."

LePaul is right.  This isn't a handout.  It's just refinancing under the FHA, and that is only for homeowners with good credit.

The other people in foreclosure need to downsize into the house that they should have gotten in the first place.  No need for the government to bail them out of a mortgage they should not have gotten in the first place.

[Stott]

I hope they do this. Uncle Ben is afraid to pull the trigger on his first drop in the Fed Rate and I told my CFA he would do it in June last December and if he had we would not have this problem. My bonds have lost about 25k in value tho most will be payed at the call date so there is no loss if not sold. The credit crunch had forced the value lower and fixing the crunch will put money back in my accounts. My Bond Mutfunds have lost value and they will take quite a while to gain. Usually when Equities get troublesome, bonds will do well. This is not the case now. My mother's portfollio had flucuated 10k a day this month. So, bail em out. Some of us make money:-)

[Mickey1992]

Here is the Edwards/Clinton approach to fixing the foreclosure issue:

Mr. Edwards: I agree with that. But we also need a home rescue fund for all the millions of Americans who are worried about losing their homes.

http://thecaucus.blogs.nytimes.com/2007/08/19/debate-outtakes-the-mortgage-crisis/

==========

Specifically, The Washington Post says, she [Clinton] wants to spend $1 billion in taxpayer money "to help homeowners catch up on mortgage payments, renegotiate their loan terms or pay for financial counseling."

http://www.jacksonville.com/tu-online/stories/082807/opi_195064274.shtml

==========

George Bush on the issue:

"One thing the president promised not do was a direct bailout of homeowners facing foreclosures or of lenders with financial problems traced to portfolios of defaulting subprime loans."

Such bailouts, he said, "would only aggravate the problem."

I actually agree with the Pres on this issue.

[Thrawn]

Originally posted by Mickey1992
LePaul is right.  This isn't a handout.  It's just refinancing under the FHA, and that is only for homeowners with good credit.

A sub-prime borrower doesn't have good credit in the first place...that's why they are sub-prime.

So Bush is offering to your money, to a person with bad credit, that has demonstrated that they can't make payments on the loan the they already have.


Well, its either this or a recession... I cant say I disagree with the desicion to try to avoid the recession.

Madness.  Taking money and resources away from financially wise, successful people to retards that live beyond their means is suppose to stop a recession?     It might look that way but all that is happening is the problem is being made worse.

The US government tried to stop recessions in the early 1900s by the creation of the Federal Reserve Bank and the fractional reserve system.  This lead directly to the Great Depression.   The government can't "fix" economic issues, it can only exacerbate them.  Hell they are the cause of most economic problems in the firs place.

[Mickey1992]

Originally posted by Thrawn
So Bush is offering to your money, to a person with bad credit, that has demonstrated that they can't make payments on the loan the they already have.

No, people with crappy credit who probably should not have gotten the mortgage in the first place would not qualify for the FHA guarantee.  Did you not read the article?

[Hortlund]

Originally posted by Thrawn
Taking money and resources away from financially wise, successful people to retards that live beyond their means is suppose to stop a recession?

Short answer, yes.

Longer answer, exactly.

Im not sure if I should bother with trying to explain to you how the US economy is driving the european economy right now, and how the US economy is driven by domestic consumer spending. If I did, perhaps you would understand why it is vital to keep the US citizens spending their money on consumer goods...but somehow I doubt you are interested in hearing the cold facts here. You seem much more intent on hyperbole and pointless libertarian grandstanding.

[Mickey1992]

Originally posted by Hortlund
...it is vital to keep the US citizens spending their money on consumer goods...

Yes, but people who are living in a house that is sucking up all of their disposable income are not spending money on consumer goods.

[Hortlund]

Originally posted by Mickey1992
Yes, but people who are living in a house that is sucking up all of their disposable income are not spending money on consumer goods.

Sure they are, they are spending money they dont have (credit cards etc) on consumer goods.

[Hortlund]

Originally posted by Thrawn
The government can't "fix" economic issues, it can only exacerbate them.  

Utter BS

[Mickey1992]

Originally posted by Hortlund
Sure they are, they are spending money they dont have (credit cards etc) on consumer goods.

So you think it is a good idea for American homeowners to live beyond their means with a mortgage they should not have been approved for, coupled with maxed-out credit cards?

A very high percentage of the foreclosures are non-owner occupied "flippers".  We definitely should not be bailing out these people who simply made poor investment decisions.

"Defaults in non-owner occupied houses are driving defaults in four of the states with the fastest rising default rates in the nation, according to a report released Thursday by the Mortgage Bankers Association."

http://money.cnn.com/2007/08/30/real_estate/flippers_fuel_foreclosures/index.htm

[Thrawn]

Originally posted by Mickey1992
No, people with crappy credit who probably should not have gotten the mortgage in the first place would not qualify for the FHA guarantee.  Did you not read the article?

Here is the definition of...

"Subprime Loan

What does it Mean?    A type of loan that is offered at a rate above prime to individuals who do not qualify for prime rate loans. Quite often, subprime borrowers are often turned away from traditional lenders because of their low credit ratings or other factors that suggest that they have a reasonable chance of defaulting on the debt repayment."

http://www.investopedia.com/terms/s/subprimeloan.asp

[Thrawn]

Originally posted by Hortlund
You seem much more intent on hyperbole and pointless libertarian grandstanding.

..says the fellow who has so far posted nothing by ridicule, ad hominem in this thread.

[crockett]

Originally posted by Sixpence
There does not have to be a bail out, just rewrite the loans so they are fixed low rates and the handsomehunkes will be able to pay the loan.

The problem is, the idiots bought more house than they could ever afford and the mortgage companies let them do it. You really think the average Joe can afford a $300k house? Nope but that didn't stop them from buying them. So even if you put them in a "real loan" that's low intrest it will still cost more than the intrest only BS.

Everyone is at fault in this, the buyers for being idiots, the banks for being stupid and the govt for not stepping in and setting up more regulations to stop this kind of thing from happening.

[Eagler]

I better find that rosary .. I agree with Thrawn and crockett