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Phantred
VeteranXV
Old
61 - 09-19-2008, 16:42
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Quote:
Originally Posted by Automatic Jack View Post
The point is that you asserted that buying the Range Rover was some sort of poor judgment. Three years later, I have yet to be convinced of that.

Your larger point is that I am clueless about personal finances. I'm not arguing, but at least I'm not dumb enough to fail to notice BushCo ripping me off.
well no, these weren't the point I was saying you missed...

but... Yes, buying the range rover was a poor financial decision. It's good your happy with it, but it doesn't make it a good decision mr 77 cents.

'bushco' is so 'micro$oft'

I'm not a fan of bush, but blaming him for the housing bubble\burst, oil issues, market issues is retarded.
 
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Chia_Pet
VeteranX
Old
62 - 09-19-2008, 16:42
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Quote:
Originally Posted by trop View Post
this should be mccain and bush's motto
Why its the democrats and liberals that caused this. Blame Clinton and his SEC Chair.
 
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Chia_Pet
VeteranX
Old
63 - 09-19-2008, 16:52
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Quote:
Originally Posted by Automatic Jack View Post
The point is that you asserted that buying the Range Rover was some sort of poor judgment. Three years later, I have yet to be convinced of that.

Your larger point is that I am clueless about personal finances. I'm not arguing, but at least I'm not dumb enough to fail to notice BushCo ripping me off.

youre a ****ing tard.

this ALL stems from people not being able to pay back thier loans. its a halfsies, one half are the people that cant pay the loans, the other is the banks that thought they were getting away with variable percentage rates and giving them to the people that cant afford the loans.

The dems have been pushing this idea where everyone should be able to own a house, thats a fine idea, but then they let the banks actually do it. Those banks went and gave out loans to people who could barely afford them, and they did it by seling alot of these people on loans that have variable rates.

Bam they cranked up some rates and what happens, all these people cant afford thier ****ing himes because the mortgage payment just went from 1900 a month to 5000 a month.

they default, this happens all across the country, soon theres a glut of houses, next those houses all start losing value. not far after many of these houses are now worth LESS then what was paid for them..crash boom bang, HERE WE ARE!!!!

all because liberals wanted to push and push banks to give houses to people who couldnt afford them and the moron bankers who thought they would get some free houses if the poor people defaulted so they could sell them( this was when a house was going UP in value like crazy)

tada!

this is just a reason why entitlment doesnt ****ing work.
 
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Automatic Jack
VeteranX
Old
64 - 09-19-2008, 16:52
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Quote:
Originally Posted by Phantred View Post
but... Yes, buying the range rover was a poor financial decision
How so?
 
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Automatic Jack
VeteranX
Old
65 - 09-19-2008, 16:54
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Quote:
Originally Posted by Chia_Pet View Post
The dems have been pushing this idea where everyone should be able to own a house, thats a fine idea, but then they let the banks actually do it.
Except it was the GOP who actually let them do it, with McCain's current advisors leading the way.
 
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krustyy
VeteranXX
Old
66 - 09-19-2008, 16:57
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On the flip side of range rover money decisions, I'm 28 years old and own two properties in southern california.

One is worth significantly more than when I bought it. The other is worth significantly less. Overall, I'm up about $100k from where I was 5 years ago. In one property, I have renters paying about 95% of the mortgage. In the other property, I rent out two downstairs bedrooms to pay all of the mortgage. I live in one of the 3 upstairs bedrooms.
 
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cogzinofa
VeteranXV
Old
67 - 09-19-2008, 17:05
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Quote:
Originally Posted by Chia_Pet View Post
youre a ****ing tard.

this ALL stems from people not being able to pay back thier loans. its a halfsies, one half are the people that cant pay the loans, the other is the banks that thought they were getting away with variable percentage rates and giving them to the people that cant afford the loans.

The dems have been pushing this idea where everyone should be able to own a house, thats a fine idea, but then they let the banks actually do it. Those banks went and gave out loans to people who could barely afford them, and they did it by seling alot of these people on loans that have variable rates.

Bam they cranked up some rates and what happens, all these people cant afford thier ****ing himes because the mortgage payment just went from 1900 a month to 5000 a month.

they default, this happens all across the country, soon theres a glut of houses, next those houses all start losing value. not far after many of these houses are now worth LESS then what was paid for them..crash boom bang, HERE WE ARE!!!!

all because liberals wanted to push and push banks to give houses to people who couldnt afford them and the moron bankers who thought they would get some free houses if the poor people defaulted so they could sell them( this was when a house was going UP in value like crazy)

tada!

this is just a reason why entitlment doesnt ****ing work.
no, it's because the banks have been pushing for less and less regulation, which in turn has allowed them to make stupider and stupider loans because they thought they no longer had to assume the risk of keeping those loans on their books.

it has nothing to do with "liberals" wanting to increase home ownership among minorities and poor people. it has everything to do with a poorly regulated environment in which financial institution no longer had to assume the risk of making stupid loans and investment houses thinking they had math that indicated they were investing in sure things (securitized mortgages).
 
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Chia_Pet
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Old
68 - 09-19-2008, 17:08
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Quote:
Originally Posted by Automatic Jack View Post
Except it was the GOP who actually let them do it, with McCain's current advisors leading the way.

It was clinton dude.
 
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cogzinofa
VeteranXV
Old
69 - 09-19-2008, 17:08
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Quote:
Originally Posted by Phantred View Post
You have to define 'the fault.' A borrower is not exempt from paying his debts because he has a history or not paying them. At the same time, the lendor has an obligation as a prudent businessman not to make stupid loans.
if you knowingly make a loan you know can't be paid back, or if you make a loan without doing your own due diligence to verify the information provided by the borrower, it's your own damn fault when it's not paid back, and it shouldn't be a shock or a surprise.
 
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Automatic Jack
VeteranX
Old
70 - 09-19-2008, 17:09
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Quote:
Originally Posted by krustyy View Post
On the flip side of range rover money decisions, I'm 28 years old and own two properties in southern california.

One is worth significantly more than when I bought it. The other is worth significantly less. Overall, I'm up about $100k from where I was 5 years ago. In one property, I have renters paying about 95% of the mortgage. In the other property, I rent out two downstairs bedrooms to pay all of the mortgage. I live in one of the 3 upstairs bedrooms.
How much did you save to get started?
 
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Chia_Pet
VeteranX
Old
71 - 09-19-2008, 17:09
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Quote:
Originally Posted by cogzinofa View Post
no, it's because the banks have been pushing for less and less regulation, which in turn has allowed them to make stupider and stupider loans because they thought they no longer had to assume the risk of keeping those loans on their books.

it has nothing to do with "liberals" wanting to increase home ownership among minorities and poor people. it has everything to do with a poorly regulated environment in which financial institution no longer had to assume the risk of making stupid loans and investment houses thinking they had math that indicated they were investing in sure things (securitized mortgages).
Bull****,
 
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Stilgar
VeteranXX
Old
72 - 09-19-2008, 17:10
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Quote:
Originally Posted by Phantred View Post
well no, these weren't the point I was saying you missed...

but... Yes, buying the range rover was a poor financial decision. It's good your happy with it, but it doesn't make it a good decision mr 77 cents.

'bushco' is so 'micro$oft'

I'm not a fan of bush, but blaming him for the housing bubble\burst, oil issues, market issues is retarded.
Blaming republicans for rampant deregulation is not retarded.
Keating Five, anyone?
 
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-§trife-
VeteranXX
Old
73 - 09-19-2008, 17:13
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Quote:
Originally Posted by cogzinofa View Post
no, it's because the banks have been pushing for less and less regulation, which in turn has allowed them to make stupider and stupider loans because they thought they no longer had to assume the risk of keeping those loans on their books.

it has nothing to do with "liberals" wanting to increase home ownership among minorities and poor people. it has everything to do with a poorly regulated environment in which financial institution no longer had to assume the risk of making stupid loans and investment houses thinking they had math that indicated they were investing in sure things (securitized mortgages).
Home ownership rates were historically in the ~64-65% range and approaching 70% in the bubble environment. You're delusional if you think political pressure to maximize home ownership had nothing to do with creating the bubble.
 
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cogzinofa
VeteranXV
Old
74 - 09-19-2008, 17:13
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Quote:
Originally Posted by Chia_Pet View Post
Bull****,
that's all you got?
 
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Fox k
Veteran++
Old
75 - 09-19-2008, 17:14
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Why do we have to raise taxes for the rich to pay for tax cuts for the middle class, cant we drop spending, like say, giving money to the U.N.?

The way I see it, we are getting a socialist in office no matter who wins.
 
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-§trife-
VeteranXX
Old
76 - 09-19-2008, 17:14
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Quote:
Originally Posted by Stilgar View Post
Blaming republicans for rampant deregulation is not retarded.
Keating Five, anyone?
Are you going to have any integrity at all and also point out that Clinton signed the act that repealed Glass-Steagall and was advised by his own economic advisers not to move derivatives off opaque over the counter markets in the late 90s :-)
 
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krustyy
VeteranXX
Old
77 - 09-19-2008, 17:15
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Quote:
Originally Posted by Automatic Jack View Post
How much did you save to get started?
$45k. Bought a 5 bedroom, 2250 sq ft house in Laguna Hills for $450k. The value shot up to a max of about $800k and has since settled around $650k.

I took some equity in that and bought a 2 bedroom condo in Rancho Santa Margarita as an investment property. Unfortunately, that was a very ****ty first investment as I bought if for $320k shortly before market prices peaked. Since it was one of the lowest cost condos in the area, that market specifically got hit really badly with the foreclosures. Similar foreclosures are now selling for as little as $180k.

It would have been smarter if I had chosen to buy now instead of then, but I thought I was making a good decision at the time . As long as I don't sell the place any time soon, this dip in housing prices shouldn't really affect me anyways. I have the place rented out. Within a few years, I'll be making more in rent than I pay in mortgages. 20 years from now, it'll be paid off and making pure income.
 
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cogzinofa
VeteranXV
Old
78 - 09-19-2008, 17:15
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Quote:
Originally Posted by -§trife- View Post
Home ownership rates were historically in the ~64-65% range and approaching 70% in the bubble environment. You're delusional if you think political pressure to maximize home ownership had nothing to do with creating the bubble.
the people lobbying for higher home ownership rate were the people making the loans. of course they wanted increased home ownership rates. that means more loans, increased profits, and increased commissions.
 
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MC Hamster
VeteranXX
Contributor
Old
79 - 09-19-2008, 17:58
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For those who are interested in some of the personalities and attitudes that brought the state of affairs about, I'd highly recommend reading the book "Liar's Poker" by Michael Lewis, a bond salesman with investment banking firm Salomon Brothers (now a part of Citigroup), the company that really brought about trading in mortgages, and were largely responsible for the creation of Fannie Mae and Freddie Mac. It's from 1989, so it doesn't delve into the current state of affairs, but you can certainly see the attitudes that see investment bankers getting massively rich by taking risks with other people's money.

There's even mention in there about how they can take extra risks to make even more money with important companies & industries, because even if the companies did go bad, the government couldn't afford to let them fail and would intervene (as they did with Lockheed in the 70s).

The bankers can happily rely on that, knowing they can invest vital funds in high-risk investments (eg ****ty mortgages they know people won't be able to repay) and if it backfires on them, there's a big taxpayer-funded safety net to bail them out. Not that it's "them" that are taking the risks, that is. It's not their money they're gambling with.

It's yours.
 
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ThisIsNotMyName
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Old
80 - 09-23-2008, 10:02
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thought this was interesting...

How the Democrats Created the Financial Crisis: Kevin Hassett

Quote:
Originally Posted by Kevin Hassett
Sept. 22 (Bloomberg) -- The financial crisis of the past year has provided a number of surprising twists and turns, and from Bear Stearns Cos. to American International Group Inc., ambiguity has been a big part of the story.

Why did Bear Stearns fail, and how does that relate to AIG? It all seems so complex.

But really, it isn't. Enough cards on this table have been turned over that the story is now clear. The economic history books will describe this episode in simple and understandable terms: Fannie Mae and Freddie Mac exploded, and many bystanders were injured in the blast, some fatally.

Fannie and Freddie did this by becoming a key enabler of the mortgage crisis. They fueled Wall Street's efforts to securitize subprime loans by becoming the primary customer of all AAA-rated subprime-mortgage pools. In addition, they held an enormous portfolio of mortgages themselves.

In the times that Fannie and Freddie couldn't make the market, they became the market. Over the years, it added up to an enormous obligation. As of last June, Fannie alone owned or guaranteed more than $388 billion in high-risk mortgage investments. Their large presence created an environment within which even mortgage-backed securities assembled by others could find a ready home.

The problem was that the trillions of dollars in play were only low-risk investments if real estate prices continued to rise. Once they began to fall, the entire house of cards came down with them.

Turning Point

Take away Fannie and Freddie, or regulate them more wisely, and it's hard to imagine how these highly liquid markets would ever have emerged. This whole mess would never have happened.

It is easy to identify the historical turning point that marked the beginning of the end.

Back in 2005, Fannie and Freddie were, after years of dominating Washington, on the ropes. They were enmeshed in accounting scandals that led to turnover at the top. At one telling moment in late 2004, captured in an article by my American Enterprise Institute colleague Peter Wallison, the Securities and Exchange Comiission's chief accountant told disgraced Fannie Mae chief Franklin Raines that Fannie's position on the relevant accounting issue was not even ``on the page'' of allowable interpretations.

Then legislative momentum emerged for an attempt to create a ``world-class regulator'' that would oversee the pair more like banks, imposing strict requirements on their ability to take excessive risks. Politicians who previously had associated themselves proudly with the two accounting miscreants were less eager to be associated with them. The time was ripe.

Greenspan's Warning

The clear gravity of the situation pushed the legislation forward. Some might say the current mess couldn't be foreseen, yet in 2005 Alan Greenspan told Congress how urgent it was for it to act in the clearest possible terms: If Fannie and Freddie ``continue to grow, continue to have the low capital that they have, continue to engage in the dynamic hedging of their portfolios, which they need to do for interest rate risk aversion, they potentially create ever-growing potential systemic risk down the road,'' he said. ``We are placing the total financial system of the future at a substantial risk.''

What happened next was extraordinary. For the first time in history, a serious Fannie and Freddie reform bill was passed by the Senate Banking Committee. The bill gave a regulator power to crack down, and would have required the companies to eliminate their investments in risky assets.

Different World

If that bill had become law, then the world today would be different. In 2005, 2006 and 2007, a blizzard of terrible mortgage paper fluttered out of the Fannie and Freddie clouds, burying many of our oldest and most venerable institutions. Without their checkbooks keeping the market liquid and buying up excess supply, the market would likely have not existed.

But the bill didn't become law, for a simple reason: Democrats opposed it on a party-line vote in the committee, signaling that this would be a partisan issue. Republicans, tied in knots by the tight Democratic opposition, couldn't even get the Senate to vote on the matter.

That such a reckless political stand could have been taken by the Democrats was obscene even then. Wallison wrote at the time: ``It is a classic case of socializing the risk while privatizing the profit. The Democrats and the few Republicans who oppose portfolio limitations could not possibly do so if their constituents understood what they were doing.''

Mounds of Materials

Now that the collapse has occurred, the roadblock built by Senate Democrats in 2005 is unforgivable. Many who opposed the bill doubtlessly did so for honorable reasons. Fannie and Freddie provided mounds of materials defending their practices. Perhaps some found their propaganda convincing.

But we now know that many of the senators who protected Fannie and Freddie, including Barack Obama, Hillary Clinton and Christopher Dodd, have received mind-boggling levels of financial support from them over the years.

Throughout his political career, Obama has gotten more than $125,000 in campaign contributions from employees and political action committees of Fannie Mae and Freddie Mac, second only to Dodd, the Senate Banking Committee chairman, who received more than $165,000.

Clinton, the 12th-ranked recipient of Fannie and Freddie PAC and employee contributions, has received more than $75,000 from the two enterprises and their employees. The private profit found its way back to the senators who killed the fix.

There has been a lot of talk about who is to blame for this crisis. A look back at the story of 2005 makes the answer pretty clear.

Oh, and there is one little footnote to the story that's worth keeping in mind while Democrats point fingers between now and Nov. 4: Senator John McCain was one of the three cosponsors of S.190, the bill that would have averted this mess.

(Kevin Hassett, director of economic-policy studies at the American Enterprise Institute, is a Bloomberg News columnist. He is an adviser to Republican Senator John McCain of Arizona in the 2008 presidential election. The opinions expressed are his own.)

To contact the writer of this column: Kevin Hassett at [email protected]
 
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