So what if “we’re watching the unraveling of a global real estate financing bubble,” or that said worldwide unraveling risks “what could become [Germany's] worst financial crisis since the 1930s,” or that SEC regulators are “checking the books at top Wall Street brokerage firms and banks to make sure they aren’t hiding losses” even greater than we know about?
What, us worry?
Credit-card companies target people fresh out of bankruptcy with credit offers, according to a study that found that nearly 100 percent of more than 300 families surveyed had been offered new credit cards within a year after completing Chapter 7 bankruptcy proceedings.
The findings show “how the credit industry seeks to profit from financial distress,” said the study’s author.
Hedge funds? ‘Aren’t Worried About Possible Tax Increases‘ Blackstone spends big on lobbyists, as Democrats waver on investment-fund taxes.
Meanwhile, ‘Mortgage-Market meltdown leaves Bush, Democrats sparring over response‘. Markets are liquid enough to handle the subprime fallout, [President Bush] says. “He doesn’t know what he’s talking about,” says [House Financial Services Committee Chairman Barney] Frank.
The enemy is us?
SFGate reader Carl Schwab (no relation) e-mailed me this morning with an observation about many of the comments posted yesterday relating to the subprime stories:
I was surprised and more than a little disheartened at the pent up venom that was directed to the “idiots” who took out these loans. I’m afraid if the economy goes south our country’s “I’m an individual and screw the rest of you” mentality will prove a huge barrier to dealing with our problems. It will be interesting.
Views from elsewhere
‘The Crunch‘ (The Economist) Even cuts in interest rates, which financial markets are pricing in increasingly aggressively, would not necessarily address the underlying problem. Restoring faith in American mortgage markets, and the cornucopia of investments derived from them, is the bigger challenge.To do that, many had hoped this week that Fannie Mae and Freddie Mac, America’s two governCment-sponsored mortgage giants, could step in and mop up some of the subprime loans that the private sector is too fearful to buy. But President George Bush appeared to dismiss such a response on August 8th, which may be another reason why the markets so suddenly lost their nerves once again.
“I was surprised and more than a little disheartened at the pent up venom that was directed to the “idiots” who took out these loans.”
While it is the Mortgage Companies and Banks fault for giving those loans, the blame also does lay with the people who bought homes knowing that they couldn’t afford them. I know a single mother, who at the time was making about $45,000/year. She bought a home in El Cerrito for $500,000. I aksed her how she could afford it and she said she got a zero downpayment and a great adjustable rate loan. Even at that time, 2 years ago, she had to take in renters to help her make the mortgage payments! I havent talked to her in about a year, but I can imagine that she has either had to sell that house or is in foreclosure. People have to know their own limits and not rely on someone else or the government to bail them out of their bad decisions.
“I was surprised and more than a little disheartened at the pent up venom that was directed to the “idiots” who took out these loans. I’m afraid if the economy goes south our country’s “I’m an individual and screw the rest of you” mentality will prove a huge barrier to dealing with our problems. It will be interesting.”
Mr. Ross - Your reader has it wrong. The responses are largely not due to pent up venom but folks who are tired of others irresponsibility being made their problem. Bailing out hedge funds, investment banks, and folks who took out loans they could not afford to finance a lifestyle they never should have lead is simply not my responsibility as a citizen of this country. I’ve seen very few comments that would lead me to believe the author had a “screw you mentality”. Rather, the authors were rightfully putting forth comments based on common sense finanical wisdom. If that is now considered venomus…so be it.
Venom doesn’t stop lenders from being unethical and shady. Address the original problem. A smooth tongue will try to give a person wanting a home the belief that they can truly manage the burden. It is NOT fair if they don’t truly understand the burden.
Especially when the seller, mortgage company, lenders, etc are smiling, nodding, and lying through their teeth through the entire process. When I bought my home(Paid for thank God) I changed “people” three times due to lies told to me about a variety of issues. They all had smiles on their faces and “guarantees” when they did. Trust isn’t to be mocked. These people just didn’t understand the magnitude of the lengths shady people will go to to make a buck.
Hope everyone who still has a mortgage is still smiling and mocking others when THEIR mortgage company or lender goes under and somebody new takes over “changing” the terms of their loans: legally or illegally. It’s already happening. Get that lawsuit money ready. This isn’t just going to affect the “stupid” ones.
investment property
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