The Country Ran Out Of Monies

[r1v3th3ad]

So, Bush is announcing the issue now...

Discuss:


I wanna know if its gonna be another great depression

[Dereksd]

us running out of money is as shocking as clay gayken coming out of the closet.


lets change it by buying lots of hookah stuff even if we cant afford it.

[staygone]

Read about the great depression and tell me that that will happen again.

Just keep being smart with da monies, step it up.

-QM

[TheScotsman]

Actually, GW warned of a problem with freddie and fanny back in April 2001. The report was for the most part ignored. THe Congressional Black Caucus pushed both GSE's to make more loans to minorities, and instituted the NINA loan policy. The GSE's handling mortgage guarantees were nothing more than a government backed ponzi scheme with some good-old book-cooking accountants for added effect.

http://gatewaypundit.blogspot.com/2008/09/...fannie-mae.html

No less than 8 times did GW try to bring attention to the growing mess. It just shows what little a president can do when a democratic congress decides to ignore, suppress, and fail to act in a responsible manner.

GW tried to get the mark-to-market accounting system changed in 2002, but again, congress refused to act, instead taking the day to decide weather to ban MTBE or not. Glad to see they have their priorities.

The lessons are simple, if you make $32,000 a year, and buy a 750,000 house on an ARM, you are screwed, there is no way you can keep it together. Blame what you want, no one held a gun to peoples heads, and made them sign the loan papers. For the love of it all, some of the NINA loans were even done with zero down, and had the costs rolled back into the loan. The buyers started out upside down, but again, who forced them to buy? Zero down, just sign, and get the keys! Who in their right mind would not think that was going to get expensive? All we heard was how interest rates were at all-time lows... hint for the fools that didn't figure that out... that meant interest would go UP! After all, when the prime is .5%, what made people think it was going to go down? Even if you failed remedial math, retaining a real-estate lawyer before you close would have saved them. Another case of trying to save people from their own bad decisions.

It wasn't GW, it was clueless people that wanted to buy something more than they could afford by any stretch of reality, and a congress that promoted/rewarded/encouraged loans that were obviously beyond the borrowers ability to repay. Once those were combined with over-inflated housing prices, and fee-financed banks that were relying on passing out $ from the fed, rather than interest-paid funds from depositors, the die was cast. Now they want to throw $800,000,000,000.00 at the same douche canoes that caused the mess? Isn't that like putting the captain of the Titanic in charge of driving the lifeboat? In what reality does that make any logical sense????? The whole gov't dem, and repub, are trying to impress some sense of urgency on us in an effort to jam this added tax burden down our throat. More government-by-fear, are we going to fall for Barney Frank, and Nancy Pelosi giving away our money to some poorly-run corrupt banking industry? I bet we do, and I bet the sheeple are too brain dead to realize what it's going to cost before it's over.

WAMU hit the ditch today, no loss, they were another fee-financed banking operation. Any bets on weather Wachovia or Citybank is next?

[Johnny_D]

I Fully agree Mr Scotsman.

However in regard to your 'no one put a gun to there head to get the loans' comment that is not, strictly, true.

Very directed marketing campaigns[1]. Social peer pressure. Very bad financial[2]advice from mortgage advisers.
Even celebrities[3] contributed quite heavily to the problem.

All aimed at people and markets where understanding the finer nuances of finance is not a key skill. Even myself has fallen victim to this (Granted, not to a degree that should cause problems, but it happened).

So I'm sorry to say that a lot of the bad debt has been generated by the banks themselves. And there marketing people sure knew how to get people salivating at the prospect of bigger homes and shiny cars.

JD

[1] - During 'soap operas', Back of tabloid papers, using respected celebrities....
[2] - Self-cert mortgages fully knowing the clients income [This happened to me, personally] advising to take interest only
loans with no ability to repay the mortgage at the end of the term with advice like "Take it now, when you get a better job/more money/win the lottery, then re-mortgage, release MORE cash, then pay it back" Again personal experience.
[3] - ... like Carol Vorderman in England. She is a quite famous B List celeb know for her advanced degrees in mathematics and engineering. If Carol thinks it's a good idea to 2nd mortgage up to 125% of the value of your home, then it must ok?


JD

[oolatec]

http://www.youtube.com/watch?v=_MGT_cSi7Rs

Just watch. Why this isn't all over the evening news every day forever is beyond me... ok, well it really isn't beyond me...

[Apets22]

And the Dow just fell 700+ points.

Awesome.

[freezerburn456]

Yep...$1.2 trillion loss...

Wow...there go a big chunk of my stocks.

This is going to be an interesting week...its only Monday.

[gaia.plateau]

I'm so glad that I'll be living in Cuba next year... one of the very few places that won't be affected by this shite.

[Bulldog_916]

Actually, GW warned of a problem with freddie and fanny back in April 2001. The report was for the most part ignored. THe Congressional Black Caucus pushed both GSE's to make more loans to minorities, and instituted the NINA loan policy. The GSE's handling mortgage guarantees were nothing more than a government backed ponzi scheme with some good-old book-cooking accountants for added effect.

http://gatewaypundit.blogspot.com/2008/09/...fannie-mae.html

No less than 8 times did GW try to bring attention to the growing mess. It just shows what little a president can do when a democratic congress decides to ignore, suppress, and fail to act in a responsible manner.

GW tried to get the mark-to-market accounting system changed in 2002, but again, congress refused to act, instead taking the day to decide weather to ban MTBE or not. Glad to see they have their priorities.

The lessons are simple, if you make $32,000 a year, and buy a 750,000 house on an ARM, you are screwed, there is no way you can keep it together. Blame what you want, no one held a gun to peoples heads, and made them sign the loan papers. For the love of it all, some of the NINA loans were even done with zero down, and had the costs rolled back into the loan. The buyers started out upside down, but again, who forced them to buy? Zero down, just sign, and get the keys! Who in their right mind would not think that was going to get expensive? All we heard was how interest rates were at all-time lows... hint for the fools that didn't figure that out... that meant interest would go UP! After all, when the prime is .5%, what made people think it was going to go down? Even if you failed remedial math, retaining a real-estate lawyer before you close would have saved them. Another case of trying to save people from their own bad decisions.

It wasn't GW, it was clueless people that wanted to buy something more than they could afford by any stretch of reality, and a congress that promoted/rewarded/encouraged loans that were obviously beyond the borrowers ability to repay. Once those were combined with over-inflated housing prices, and fee-financed banks that were relying on passing out $ from the fed, rather than interest-paid funds from depositors, the die was cast. Now they want to throw $800,000,000,000.00 at the same douche canoes that caused the mess? Isn't that like putting the captain of the Titanic in charge of driving the lifeboat? In what reality does that make any logical sense????? The whole gov't dem, and repub, are trying to impress some sense of urgency on us in an effort to jam this added tax burden down our throat. More government-by-fear, are we going to fall for Barney Frank, and Nancy Pelosi giving away our money to some poorly-run corrupt banking industry? I bet we do, and I bet the sheeple are too brain dead to realize what it's going to cost before it's over.

WAMU hit the ditch today, no loss, they were another fee-financed banking operation. Any bets on weather Wachovia or Citybank is next?

I agree with most of your point but the part about the dems being to blame for this. Bush's repuglican congress was in power 6 years, they abolish all regulation and look what happens. We need regulation again and that will stabilize things, hopefully. If there is anything left to stabilize.

[SuburbanSmoker]

I dont see another GREAT depression happening...although the economic situation isnt too good, we eventually will regress back to the mean. Give it some time and smoke up...thats how i deal with my problems

[TheScotsman]

Actually, GW warned of a problem with freddie and fanny back in April 2001. The report was for the most part ignored. THe Congressional Black Caucus pushed both GSE's to make more loans to minorities, and instituted the NINA loan policy. The GSE's handling mortgage guarantees were nothing more than a government backed ponzi scheme with some good-old book-cooking accountants for added effect.

http://gatewaypundit.blogspot.com/2008/09/...fannie-mae.html

No less than 8 times did GW try to bring attention to the growing mess. It just shows what little a president can do when a democratic congress decides to ignore, suppress, and fail to act in a responsible manner.

GW tried to get the mark-to-market accounting system changed in 2002, but again, congress refused to act, instead taking the day to decide weather to ban MTBE or not. Glad to see they have their priorities.

The lessons are simple, if you make $32,000 a year, and buy a 750,000 house on an ARM, you are screwed, there is no way you can keep it together. Blame what you want, no one held a gun to peoples heads, and made them sign the loan papers. For the love of it all, some of the NINA loans were even done with zero down, and had the costs rolled back into the loan. The buyers started out upside down, but again, who forced them to buy? Zero down, just sign, and get the keys! Who in their right mind would not think that was going to get expensive? All we heard was how interest rates were at all-time lows... hint for the fools that didn't figure that out... that meant interest would go UP! After all, when the prime is .5%, what made people think it was going to go down? Even if you failed remedial math, retaining a real-estate lawyer before you close would have saved them. Another case of trying to save people from their own bad decisions.

It wasn't GW, it was clueless people that wanted to buy something more than they could afford by any stretch of reality, and a congress that promoted/rewarded/encouraged loans that were obviously beyond the borrowers ability to repay. Once those were combined with over-inflated housing prices, and fee-financed banks that were relying on passing out $ from the fed, rather than interest-paid funds from depositors, the die was cast. Now they want to throw $800,000,000,000.00 at the same douche canoes that caused the mess? Isn't that like putting the captain of the Titanic in charge of driving the lifeboat? In what reality does that make any logical sense????? The whole gov't dem, and repub, are trying to impress some sense of urgency on us in an effort to jam this added tax burden down our throat. More government-by-fear, are we going to fall for Barney Frank, and Nancy Pelosi giving away our money to some poorly-run corrupt banking industry? I bet we do, and I bet the sheeple are too brain dead to realize what it's going to cost before it's over.

WAMU hit the ditch today, no loss, they were another fee-financed banking operation. Any bets on weather Wachovia or Citybank is next?

I agree with most of your point but the part about the dems being to blame for this. Bush's repuglican congress was in power 6 years, they abolish all regulation and look what happens. We need regulation again and that will stabilize things, hopefully. If there is anything left to stabilize.

You know the president can't pass a law, right? You know the BIGGEST recipient of lobbist & campaign contributions over the past 4 years was Obama, right? I am sure you are still blaming Bush when the Congressional Black Caucus mandated that by 2007 1/4 of the FM/FMC loans went to people making less than 60% of the median for an area, and that they had wanted that to be 1/3 by 2011. That Barney "I wish I didn't sound so stupid" Frank & Co. made matters worse by pushing Fannie Mae and Freddie Mac to take on greater risk. They wanted more loans to people who might not qualify for traditional bank financing. And, as The Wall Street Journal has pointed out, Frank “pressured regulators to ease up on their capital requirements. In 2003 funky-barney said "I do not regard Fannie Mae and Freddie Mac as problems," he said in response to another reform push. And then: "I regard them as great assets." Great or not, we'll give Mr. Frank this: Their assets are now Uncle Sam's assets, even if those come along with $5.5 trillion in debt and other liabilities. You know that ACORN sued FMC for not backing enough loans to people that couldn't pay them back. And you still say Bush did it? I am not seeing how that logic functions, someone's going to have to explain it in really simple terms that I can understand. Agreed (sorta) J.D.... I think we have all bought into the credit trap, For me it was a trip to the Hummer dealer... 3 hours later I had a great new truck, and a 4-year-6-digit loan. That doesn't make it the banks fault I had completely lost my bloody mind that day, does it? What is next, a 7-day cooling off period before they can actually close the deal, and sign the papers? It's the buyers fault for overspending, not the bank's. The national debt clock ran out of digits last month. Is that a rather frightening concept.

[Bulldog_916]

Actually, GW warned of a problem with freddie and fanny back in April 2001. The report was for the most part ignored. THe Congressional Black Caucus pushed both GSE's to make more loans to minorities, and instituted the NINA loan policy. The GSE's handling mortgage guarantees were nothing more than a government backed ponzi scheme with some good-old book-cooking accountants for added effect.

http://gatewaypundit.blogspot.com/2008/09/...fannie-mae.html

No less than 8 times did GW try to bring attention to the growing mess. It just shows what little a president can do when a democratic congress decides to ignore, suppress, and fail to act in a responsible manner.

GW tried to get the mark-to-market accounting system changed in 2002, but again, congress refused to act, instead taking the day to decide weather to ban MTBE or not. Glad to see they have their priorities.

The lessons are simple, if you make $32,000 a year, and buy a 750,000 house on an ARM, you are screwed, there is no way you can keep it together. Blame what you want, no one held a gun to peoples heads, and made them sign the loan papers. For the love of it all, some of the NINA loans were even done with zero down, and had the costs rolled back into the loan. The buyers started out upside down, but again, who forced them to buy? Zero down, just sign, and get the keys! Who in their right mind would not think that was going to get expensive? All we heard was how interest rates were at all-time lows... hint for the fools that didn't figure that out... that meant interest would go UP! After all, when the prime is .5%, what made people think it was going to go down? Even if you failed remedial math, retaining a real-estate lawyer before you close would have saved them. Another case of trying to save people from their own bad decisions.

It wasn't GW, it was clueless people that wanted to buy something more than they could afford by any stretch of reality, and a congress that promoted/rewarded/encouraged loans that were obviously beyond the borrowers ability to repay. Once those were combined with over-inflated housing prices, and fee-financed banks that were relying on passing out $ from the fed, rather than interest-paid funds from depositors, the die was cast. Now they want to throw $800,000,000,000.00 at the same douche canoes that caused the mess? Isn't that like putting the captain of the Titanic in charge of driving the lifeboat? In what reality does that make any logical sense????? The whole gov't dem, and repub, are trying to impress some sense of urgency on us in an effort to jam this added tax burden down our throat. More government-by-fear, are we going to fall for Barney Frank, and Nancy Pelosi giving away our money to some poorly-run corrupt banking industry? I bet we do, and I bet the sheeple are too brain dead to realize what it's going to cost before it's over.

WAMU hit the ditch today, no loss, they were another fee-financed banking operation. Any bets on weather Wachovia or Citybank is next?

I agree with most of your point but the part about the dems being to blame for this. Bush's repuglican congress was in power 6 years, they abolish all regulation and look what happens. We need regulation again and that will stabilize things, hopefully. If there is anything left to stabilize.

You know the president can't pass a law, right? You know the BIGGEST recipient of lobbist & campaign contributions over the past 4 years was Obama, right? I am sure you are still blaming Bush when the Congressional Black Caucus mandated that by 2007 1/4 of the FM/FMC loans went to people making less than 60% of the median for an area, and that they had wanted that to be 1/3 by 2011. That Barney "I wish I didn't sound so stupid" Frank & Co. made matters worse by pushing Fannie Mae and Freddie Mac to take on greater risk. They wanted more loans to people who might not qualify for traditional bank financing. And, as The Wall Street Journal has pointed out, Frank "pressured regulators to ease up on their capital requirements. In 2003 funky-barney said "I do not regard Fannie Mae and Freddie Mac as problems," he said in response to another reform push. And then: "I regard them as great assets." Great or not, we'll give Mr. Frank this: Their assets are now Uncle Sam's assets, even if those come along with $5.5 trillion in debt and other liabilities. You know that ACORN sued FMC for not backing enough loans to people that couldn't pay them back. And you still say Bush did it? I am not seeing how that logic functions, someone's going to have to explain it in really simple terms that I can understand. Agreed (sorta) J.D.... I think we have all bought into the credit trap, For me it was a trip to the Hummer dealer... 3 hours later I had a great new truck, and a 4-year-6-digit loan. That doesn't make it the banks fault I had completely lost my bloody mind that day, does it? What is next, a 7-day cooling off period before they can actually close the deal, and sign the papers? It's the buyers fault for overspending, not the bank's. The national debt clock ran out of digits last month. Is that a rather frightening concept.

On the Barney Frank question:

He said his quote about FM and FMC that AT THE TIME, nothing was wrong that he could see. But he didnt take over responsibility in the House Committee on Financial Services until early 2007. The housing crisis was already beginning at that point.

Do I think he would have fully privatized FM and FMC in 2003? No. A fully privatized, but publicly traded, Fannie and Freddie would have sent the stockmarket down to 9000 three months ago. We would be looking at 1980s levels of the stockmarket instead of adjusted 2002 levels today.

http://www.cato.org/pubs/handbook/hb108/hb108-21.pdf

This book talks about how the CATO institute wanted the financial markets deregulated further than they were at that point in time. While it sounds good in theory, it doesnt look good if you really dig into it.

[Giant Ninja Robot]

enough smart talk, we're fucked.

but at least gas is below 3 bucks again

[Bulldog_916]

enough smart talk, we're fucked.

but at least gas is below 3 bucks again

Without lube and with a fat hemorrhoid, I agree.

I dont think gas will stay that way. The only reason gas is going down is because the economy is tanking. Once we start to see a comeback in stocks, oil is gonna shoot right back up. If oil keeps going down, OPEC is gonna cut production until the price drop ends. They wanna position themselves for a huge rally in prices if the economy comes back.