wrote:
On Fri, 09 Jan 2009 19:53:08 -0500, BAR wrote:


20% cash down. If you don't have 20% down get a second job. If you have
to wait 15 or 20 years to buy a hose then that is what you have to do.
You do not have a right to buy a house regardless what Barney Frank or
Chris Dodd have to say.

Damn conservatives, always wanting government to regulate everything. ;-)

Government, no government regulation needed just good risk analysis. If
you buy a $200K house are you going to walk away from $40K? Or if you
buy a $500K house are you going to walk away from $100K?

From my seat, it wasn't the CRA or the sub-prime loans that did this
economy in. It was the stupid actions of the banks and investment houses
in their dealings with sub-prime loans. Lehman Brothers was leveraged
somewhere @ 33 to 1. That's just downright dumb.

What gave rise to the sub-prime loan market? Who started underwriting
97% and 100% loans? If I obtained a 100% loan what do I have to lose if
I walk away from it and leave the bank holding the bag?

Remember "redlining"? It was a racist, and illegal, policy of grouping
entire neighborhoods as "out-of-bounds" for loans. That was what the CRA
was intended to alleviate. What a concept, banks doing their jobs
loaning money without regards to race, religion, or gender.

Racist and illegal? It was based upon risk analysis. Why would I want to
lend money to people who were most likely not going to pay it back. And,
if I did have to foreclose just before getting the sheriff to evict them
they would trash the place. Where is my motivation to lend money in
those areas?

What a concept banks lending money to those who they believed would
actually pay the money back.

On Fri, 09 Jan 2009 21:49:11 -0500, Eisboch wrote:


That was the intent, but what it produced was Equal Opportunity Lending,
regardless of the ability to repay, race, religion or gender and it
encompasses everybody.

Nowhere in the CRA were banks ordered to disregard good business
practices. They did that on their own.

You say sub-prime loans didn't do the economy in, but acknowledge it was
the stupid actions of banks and investment houses in their dealings with
sub-prime loans. So, sub-prime loans really are at the heart of the
problem. What if the lending banks had not had the option to sell them
off to the investment houses? The answer, pure and simple, is that the
loans would never have been made to begin with.

Let's see, in normal business practices, if I make a loan, I accept the
risk. In this case, I make the loan, take my money, and pass the risk
off to someone else. What's to keep me honest? "Liar loans"? Come on,
these lenders abrogated their responsibilities. Buffet was right, these
derivatives were "weapons of mutual destruction".

And then to make matters worse, these nitwits leveraged themselves in
derivatives to astronomical proportions. It's my understanding that
money is tight now, because no one knows who owns the bad debts. F'n
geniuses don't even know what they own? No way you can convince me that
some poor slob in Cleveland, trying to buy his dream house, is the cause
of this problem.

It was greed. Financial markets are run on the balance of greed/risk.
There's nothing wrong with that, but greed took over, and here we are. A
few fat cat "financiers" just brought the world's economy to a
standstill.

On Jan 9, 10:28*pm, wrote:
On Fri, 09 Jan 2009 21:49:11 -0500, Eisboch wrote:
That was the intent, but what it produced was Equal Opportunity Lending,
regardless of the ability to repay, *race, religion or gender and it
encompasses everybody.

Nowhere in the CRA were banks ordered to disregard good business
practices. *They did that on their own. *

You say sub-prime loans didn't do the economy in, but acknowledge it was
the stupid actions of banks and investment houses in their dealings with
sub-prime loans. *So, sub-prime loans really are at the heart of the
problem. *What if the lending banks had not had the option to sell them
off to the investment houses? * The answer, pure and simple, is that the
loans would never have been made to begin with.

Let's see, in normal business practices, if I make a loan, I accept the
risk. *In this case, I make the loan, take my money, and pass the risk
off to someone else. *What's to keep me honest? *"Liar loans"? *Come on,
these lenders abrogated their responsibilities. *Buffet was right, these
derivatives were "weapons of mutual destruction".

And then to make matters worse, these nitwits leveraged themselves in
derivatives to astronomical proportions. *It's my understanding that
money is tight now, because no one knows who owns the bad debts. *F'n
geniuses don't even know what they own? *No way you can convince me that
some poor slob in Cleveland, trying to buy his dream house, is the cause
of this problem.

It was greed. *Financial markets are run on the balance of greed/risk. *
There's nothing wrong with that, but greed took over, and here we are. *A
few fat cat "financiers" just brought the world's economy to a
standstill. *

I still remember the bull**** I took here a couple of years back when
I complained about Bank of America openly advertizing to illegals and
anyone else with a pulse that they were handing out free money. They
still have the ads in spanish, "bank of opportunity". They knew what
they were doing, they knew they would get bailed out as they were
paying Dodd, Frank, Obama, Kerry, et al barrels of money...

On Fri, 09 Jan 2009 22:18:18 -0500, BAR wrote:


Racist and illegal? It was based upon risk analysis. Why would I want to
lend money to people who were most likely not going to pay it back. And,
if I did have to foreclose just before getting the sheriff to evict them
they would trash the place. Where is my motivation to lend money in
those areas?

Yup, racist and illegal. When I find the link I'll post it, but those
"redlined" areas have reasonably low default rates. Where most of the
problems have arisen, is the more affluent borrower who over extended
thinking of their home as an investment, not as a home.

wrote in message
t...
On Fri, 09 Jan 2009 21:49:11 -0500, Eisboch wrote:


That was the intent, but what it produced was Equal Opportunity Lending,
regardless of the ability to repay, race, religion or gender and it
encompasses everybody.

Nowhere in the CRA were banks ordered to disregard good business
practices. They did that on their own.

You say sub-prime loans didn't do the economy in, but acknowledge it was
the stupid actions of banks and investment houses in their dealings with
sub-prime loans. So, sub-prime loans really are at the heart of the
problem. What if the lending banks had not had the option to sell them
off to the investment houses? The answer, pure and simple, is that the
loans would never have been made to begin with.

Let's see, in normal business practices, if I make a loan, I accept the
risk. In this case, I make the loan, take my money, and pass the risk
off to someone else. What's to keep me honest? "Liar loans"? Come on,
these lenders abrogated their responsibilities. Buffet was right, these
derivatives were "weapons of mutual destruction".

And then to make matters worse, these nitwits leveraged themselves in
derivatives to astronomical proportions. It's my understanding that
money is tight now, because no one knows who owns the bad debts. F'n
geniuses don't even know what they own? No way you can convince me that
some poor slob in Cleveland, trying to buy his dream house, is the cause
of this problem.

It was greed. Financial markets are run on the balance of greed/risk.
There's nothing wrong with that, but greed took over, and here we are. A
few fat cat "financiers" just brought the world's economy to a
standstill.

Ah, but you left out *why* banks felt safe making the loans. In general,
banks are the
most conservative, no risk lenders in the world. In a normal economy you
basically have
to prove you don't need the money in order to qualify for it.

The problem was the government getting involved via Freddie and Fanny to
take the
risks away and that started in 1995.

Eisboch

wrote:
On Fri, 09 Jan 2009 21:49:11 -0500, Eisboch wrote:


That was the intent, but what it produced was Equal Opportunity Lending,
regardless of the ability to repay, race, religion or gender and it
encompasses everybody.

Nowhere in the CRA were banks ordered to disregard good business
practices. They did that on their own.

You say sub-prime loans didn't do the economy in, but acknowledge it was
the stupid actions of banks and investment houses in their dealings with
sub-prime loans. So, sub-prime loans really are at the heart of the
problem. What if the lending banks had not had the option to sell them
off to the investment houses? The answer, pure and simple, is that the
loans would never have been made to begin with.

Let's see, in normal business practices, if I make a loan, I accept the
risk. In this case, I make the loan, take my money, and pass the risk
off to someone else. What's to keep me honest? "Liar loans"? Come on,
these lenders abrogated their responsibilities. Buffet was right, these
derivatives were "weapons of mutual destruction".

And then to make matters worse, these nitwits leveraged themselves in
derivatives to astronomical proportions. It's my understanding that
money is tight now, because no one knows who owns the bad debts. F'n
geniuses don't even know what they own? No way you can convince me that
some poor slob in Cleveland, trying to buy his dream house, is the cause
of this problem.

It was greed. Financial markets are run on the balance of greed/risk.
There's nothing wrong with that, but greed took over, and here we are. A
few fat cat "financiers" just brought the world's economy to a
standstill.

When you "invite" all the CEOs of the major US based banks in front of a
Congressional committee and tell them that you believe that the practice
of red-lining is not in their, the banks, best interest and that they
should re-evaluate their lending practices otherwise they may find
themselves facing the committee again testifying under oath. The threat
is understood by any moderately intelligent person.

wrote:
On Fri, 09 Jan 2009 22:18:18 -0500, BAR wrote:


Racist and illegal? It was based upon risk analysis. Why would I want to
lend money to people who were most likely not going to pay it back. And,
if I did have to foreclose just before getting the sheriff to evict them
they would trash the place. Where is my motivation to lend money in
those areas?

Yup, racist and illegal. When I find the link I'll post it, but those
"redlined" areas have reasonably low default rates. Where most of the
problems have arisen, is the more affluent borrower who over extended
thinking of their home as an investment, not as a home.

Seek and seek well.

Let me ask you another question. What is the cost of making a $40K loan?
What is the cost of making a $200K loan? What is the profit on a $40K
loan? What is the profit on a $200K loan? Which loan would you rather
put your efforts into?

"Eisboch" wrote in message
...

"hk" wrote in message
m...
BAR wrote:
hk wrote:
BAR wrote:

20% cash down. If you don't have 20% down get a second job. If you
have to wait 15 or 20 years to buy a hose then that is what you have
to do. You do not have a right to buy a house regardless what Barney
Frank or Chris Dodd have to say.


Ahh, but you don't make the rules for this or anything else.

Sadly no. But, Carter, Clinton, Frank and Dodd all had a hand in
loosening the rules which contributed to the problem we find ourselves
in today. McCain and Bush saw the problem coming and tried to arrest and
turn it around but, they were thwarted by Frank and Dodd. The public and
Congressional record supports me.


You're hilarious. Really.


He's also correct.
Not quite that straightforward, but the point is that it was basically
another "giveaway" program that backfired. Now, according to Obama, the
solution is more giveaway programs.

Handing out money will not solve the mess we are in just as creating
artificial jobs won't. (FDR's programs didn't work either ... it took a
war to escape the Depression).

There are two basic solution options.
The first will take time and most Democrats, especially those on the far
left won't like it.
The second is to throw in the towel and become another European style
socialist republic.

Eisboch



Obama quote on how many jobs will be created vs. money spent comes out to
about $313k per job. Not very fiscally effective.

On Fri, 09 Jan 2009 21:28:33 -0600, wrote:

It was greed. Financial markets are run on the balance of greed/risk.
There's nothing wrong with that, but greed took over, and here we are. A
few fat cat "financiers" just brought the world's economy to a
standstill.

Um...it takes two to tango you know. The old saw "if it's too good to
be true, it probably is" had a big part in this.

In my view, politics besides the point, folks who purchased $300,000
homes with no documenation of their $100,000 income when they were
actually on welfare are just as guilty as those who wrote the
mortgages.

And believe it or not, that's pretty much what happened. The dynamic
of buying a $300,000 home one year and selling it the next for
$400,000 was too good to be true. I saw it happen right here in
Woodstock right down the street from me.

There is a lot of blame to go around on this - it wasn't strictly a
case of financiers being greedy.

Also, I would posit that the base reason the economy tanked wasn't the
mortgage crisis - it was the rampant speculation on the crude oil
market that tanked the world's economy.

And I think I can prove it.

--

If we aren't supposed to eat animals,
why are they made of meat?

"Tom Francis - SWSports" wrote in
message ...


And believe it or not, that's pretty much what happened. The dynamic
of buying a $300,000 home one year and selling it the next for
$400,000 was too good to be true. I saw it happen right here in
Woodstock right down the street from me.

There is a lot of blame to go around on this - it wasn't strictly a
case of financiers being greedy.


Gee. We bought a house in Florida for $485K. Sold it 3 years later for
$1M.

I feel so guilty.

Eisboch