Collective Stupidity of Lenders; Borrows and the Housing Bill

Starbucks is closing down their coffee shops because no one has the liquidity to buy their product. Is that a liquidity crisis?

Rental rates are rising as all these homeowners move to apartments. Should we put a cap on how much apartments can raise rent? We don’t want people who can’t afford higher payments to lose their homes.

akanska Wrote: ------------------------------------------------------- > spierce Wrote: > -------------------------------------------------- > ----- > > > > Yeah, jobs, the lack of economic hardship, > > reasonable lending rates for responsible > > borrowers, a viable economy, and a decent means > of > > living have no benefit at all. > > > > See above comment about the lack of analysis > and > > facets. > > > Your’s seems to be real deep! Sound grrreat! > > *Jobs? You are complaining about lack of “big > picture analysis”? There are other industries. > > *reasonable lending rates? I’m not loaning you > crap since I have no idea what the real value of > your collateral is. > > *decent means of living? there is no pill thats > gonna save us. We can put on as many bandaids as > congress comes up with, but until we face the > tough issues and resolve them in a responsible > manner, the underlying issues will continue to be > a burden. > > OK, so using your reasoning, why not tackle some > other’s while we’re at it… > > 1. Mom and pop farmer cannot seem to compete with > cheap foreign imports, how sad… so lets > subsidize them and continue to prop up an > inefficient market. > > 2. Detroit seems to be having some issues since > the auto industry is in even greater shambles… > so why not pump money into Ford and GM and support > their great lines of trucks and support the blue > collar unions that allow “decent means of living” > to all!! Ok, so we let the system fail, like we did in 1929, where many historians and economists think we’d have been in the GD until the late 1940s and a recession into the 50’s, or we face some staflation, but keep our economy and country relatively healthy. Other industries than jobs? I am not talking about banking jobs, I am talking about *EVERY* job in this country. Do you think only banks failing in 1929 affected banking jobs? It affected everybody from the shoe shine boy to the hardiest farmer. How could you possibly rip on my analysis when you have a single track mind? Collateral value? Since when do SBA or other non-direct unsecured lending values, or even stable home prices, have to do with collateral value risk? Again, single track mind. When you’re an Okie and can’t find a job, let me know how you’ll feed your kids. I am not talking about plasma TVs, I am talking about housing, food, and clothes. all of which were very difficult during the 1930s. Since when did I ever talk about protecting and subsidizing? Please try a different strawman?!? If you have a third option, please present it. How will letting banks fail affect the following. 1. The job market, especially when nobody can get loans to fund themselves and the equity markets are in the crapper, making borrowing more expensive, cutting margins, and screwing everybody. 2. SBA 3. Consumer spending behaviors, including more essential goods 4. Viability of the US economy in general during a period of rapid credit contraction How will that affect the US population overall and whether or not costs (if any) will be equivalent to those borne during a stagflation environment.

akanska Wrote: ------------------------------------------------------- > spierce Wrote: > -------------------------------------------------- > ----- > > > > Yeah, jobs, the lack of economic hardship, > > reasonable lending rates for responsible > > borrowers, a viable economy, and a decent means > of > > living have no benefit at all. > > > > See above comment about the lack of analysis > and > > facets. > > > Your’s seems to be real deep! Sound grrreat! > > *Jobs? You are complaining about lack of “big > picture analysis”? There are other industries. > > *reasonable lending rates? I’m not loaning you > crap since I have no idea what the real value of > your collateral is. > > *decent means of living? there is no pill thats > gonna save us. We can put on as many bandaids as > congress comes up with, but until we face the > tough issues and resolve them in a responsible > manner, the underlying issues will continue to be > a burden. > > OK, so using your reasoning, why not tackle some > other’s while we’re at it… > > 1. Mom and pop farmer cannot seem to compete with > cheap foreign imports, how sad… so lets > subsidize them and continue to prop up an > inefficient market. > > 2. Detroit seems to be having some issues since > the auto industry is in even greater shambles… > so why not pump money into Ford and GM and support > their great lines of trucks and support the blue > collar unions that allow “decent means of living” > to all!! Ok, so we let the system fail, like we did in 1929, where many historians and economists think we’d have been in the GD until the late 1940s and a recession into the 50’s, or we face some staflation, but keep our economy and country relatively healthy. Other industries than jobs? I am not talking about banking jobs, I am talking about *EVERY* job in this country. Do you think only banks failing in 1929 affected banking jobs? It affected everybody from the shoe shine boy to the hardiest farmer. How could you possibly rip on my analysis when you have a single track mind? Collateral value? Since when do SBA or other non-direct unsecured lending values, or even stable home prices, have to do with collateral value risk? Again, single track mind. When you’re an Okie and can’t find a job, let me know how you’ll feed your kids. I am not talking about plasma TVs, I am talking about housing, food, and clothes. all of which were very difficult during the 1930s. Since when did I ever talk about protecting and subsidizing? Please try a different strawman?!? If you have a third option, please present it. How will letting banks fail affect the following. 1. The job market, especially when nobody can get loans to fund themselves and the equity markets are in the crapper, making borrowing more expensive, cutting margins, and screwing everybody. 2. SBA 3. Consumer spending behaviors, including more essential goods 4. Viability of the US economy in general during a period of rapid credit contraction How will that affect the US population overall and whether or not costs (if any) will be equivalent to those borne during a stagflation environment.

Triple repost

my most basic disagreement with you is that I don’t think a lack of gov’t bail-outs will lead to a complete system failure. I don’t understand why you continue to analyze this as if it were completely analagous to 1929 and the subsequent depression. OKIES?? You seriously think that allowing ppl to be foreclosed on will lead to mass food shortages? you cannot be serious- thats the kind of fear mongering that doesn’t allow ppl to accept tough corrections that will teach the nation as a whole some important lessons about fiscal responsibility/ flexibility. Look at the generation that came out of the depression and how they were able to build this nation… we could use a little bit of that right now. I’m not proposing we all starve, but I think a more natural unraveling of this mess w/ possibly some more subtly/effective gov’t intervention will be far more successful in the long run.

akanska Wrote: ------------------------------------------------------- > my most basic disagreement with you is that I > don’t think a lack of gov’t bail-outs will lead to > a complete system failure. I don’t understand why > you continue to analyze this as if it were > completely analagous to 1929 and the subsequent > depression. OKIES?? You seriously think that > allowing ppl to be foreclosed on will lead to mass > food shortages? you cannot be serious- thats the > kind of fear mongering that doesn’t allow ppl to > accept tough corrections that will teach the > nation as a whole some important lessons about > fiscal responsibility/ flexibility. > > Look at the generation that came out of the > depression and how they were able to build this > nation… we could use a little bit of that right > now. I’m not proposing we all starve, but I think > a more natural unraveling of this mess w/ possibly > some more subtly/effective gov’t intervention will > be far more successful in the long run. How could it not lead to that situation? BSC was only a taste of what could happen to any financial institution if aid weren’t tossed to it. If BSC went down, then Lehman would have fallen right after, followed by ML and probably MS. After that, the liquidity offered by those banks would then hit others. I guess you didn’t read the vanity fair article. Consider that money center banks are the lynchpin of the economy, letting them fail will affect the economy as a whole, and that will be felt by everybody. This has everything to do with confidence and nothing to do with the mortgage market. The banks can swallow this whole thing, given time and patience. There’s no reason to let things go to shit overnight to teach a “lesson”, because that “lesson” is distributed among all of society. A little bit of “tough love” never did anybody any harm. However, trashing the economy carte blanch to deliver it is a pretty stupid idea. Throwing the baby out with the bathwater never helped anybody.

You can’t scare me Spierce. They’re the lynchpin of your job, not the economy. I will get FILTHY rich if they let those turds fail (as they should!).

spierce Wrote: ------------------------------------------------------- I guess you didn’t read the > vanity fair article. I did not. I guess I should just stop now since clearly I don’t keep up with the most relevant sources of economic news and analysis. I’ll go pinch my nipples now so they’re not too sore when I have to start feeding all those orphaned Okie babies…

akanska Wrote: ------------------------------------------------------- I’m not proposing we all starve, but I think > a more natural unraveling of this mess w/ possibly > some more subtly/effective gov’t intervention will > be far more successful in the long run. If we all starve I’m blaming government subsidizing of the ethanol industry as a result of government mandates that we move towards an unviable fuel source.

If 400000 people who were living beyond their means lost ‘their’ houses, it wouldnt be throwing out the baby with the bathwater. spierce is probably a beneficiary of the largesse, like the other bond buyer -bill gross. gotta love crony capitalism.

Since we’re comparing this to the great depression: Two UCLA economists say they have figured out why the Great Depression dragged on for almost 15 years, and they blame a suspect previously thought to be beyond reproach: President Franklin D. Roosevelt. After scrutinizing Roosevelt’s record for four years, Harold L. Cole and Lee E. Ohanian conclude in a new study that New Deal policies signed into law 71 years ago thwarted economic recovery for seven long years. “Why the Great Depression lasted so long has always been a great mystery, and because we never really knew the reason, we have always worried whether we would have another 10- to 15-year economic slump,” said Ohanian, vice chair of UCLA’s Department of Economics. “We found that a relapse isn’t likely unless lawmakers gum up a recovery with ill-conceived stimulus policies.”

virginCFAhooker Wrote: ------------------------------------------------------- > You can’t scare me Spierce. They’re the lynchpin > of your job, not the economy. I will get FILTHY > rich if they let those turds fail (as they > should!). Ahh, so you’re actually admittedly conflicted whereas I am accused fo a conflict. Nice.

aldford, read the forgetten man by amity shlaes. hoover and the fed got us into the great depression and fdr kept us there.

akanska Wrote: ------------------------------------------------------- > spierce Wrote: > -------------------------------------------------- > ----- > I guess you didn’t read the > > vanity fair article. > > I did not. I guess I should just stop now since > clearly I don’t keep up with the most relevant > sources of economic news and analysis. I’ll go > pinch my nipples now so they’re not too sore when > I have to start feeding all those orphaned Okie > babies… Yeah, I guess it’s hard to actually…ya know…research what happens in the modern world with regards to a run on banks. It’s far easier to claim to let them fail and say the system, as a whole, will be just peachy and will let economic growth continue after a short amount of non-economic wide pain.

Dsylexic Wrote: ------------------------------------------------------- > If 400000 people who were living beyond their > means lost ‘their’ houses, it wouldnt be throwing > out the baby with the bathwater. > spierce is probably a beneficiary of the largesse, > like the other bond buyer -bill gross. > gotta love crony capitalism. I don’t benefit at all from the bailout. My job isn’t to invest in RMBS, nor companies associated with consumer lending. However, when it comes to keeping the economy going, I guess I do benefit, since I, as well as millions of others, have jobs because of it. But that isn’t a benefit that any of you care about.

It’s just so embarrasing to see Fed taking one after another EMERGENCY measures to save the market, ailing firms and overall economy. Again, “Extended Emergency Loan Program for Wall Street” just now…

aldford Wrote: ------------------------------------------------------- > Since we’re comparing this to the great > depression: > > Two UCLA economists say they have figured out why > the Great Depression dragged on for almost 15 > years, and they blame a suspect previously thought > to be beyond reproach: President Franklin D. > Roosevelt. > > After scrutinizing Roosevelt’s record for four > years, Harold L. Cole and Lee E. Ohanian conclude > in a new study that New Deal policies signed into > law 71 years ago thwarted economic recovery for > seven long years. > > “Why the Great Depression lasted so long has > always been a great mystery, and because we never > really knew the reason, we have always worried > whether we would have another 10- to 15-year > economic slump,” said Ohanian, vice chair of > UCLA’s Department of Economics. “We found that a > relapse isn’t likely unless lawmakers gum up a > recovery with ill-conceived stimulus policies.” I have seen other studies that have shown that the ND policies helped out, especially in easing the actual severity of the downturn. Keep in mind, most other countries didn’t exit the GD any sooner than we did, even those that weren’t touched by the war. Given that single variable it is difficult to guess when/how we would have exited the GD.

Why don’t you look so similar situations in times a little more relevent to today’s economy… More than 1,600 U.S. banks (9 percent ) failed between 1980 and 1994. The s&l mess from the same period claimed more than 1,000 institutions with assets > $500 billion. Housing construction totally dropped off as a result. But guess what? There were no starving babies filling the streets. There was a recession and that was followed by growth. Hopefully the gov’t will allow this same pattern to continue and allow the public to make lessons of the past mistakes to build a stronger tomorrow instead of gumming it up with bureaucrats’ pet policies.

“especially in easing the actual severity of the downturn” if the goal of his policy was to make like easier for those on the bottom, even if it prolonged the downturn, i’d be surpised. i just don’t think that was his intention. maybe it was, though. if so, shame on him. “Keep in mind, most other countries didn’t exit the GD any sooner than we did, even those that weren’t touched by the war.” part of the reason for that were the trade wars that started after the smoot-hawley tariffs were passed under hoover.