The Chicago Tea Party
February 19, 2009 1:38 PM Subscribe
It's time for a new tea party, and this time derivatives securities are getting the soak. CNBC's Rick Santelli, reporting from the Chicago trading floor, wants to know if you're willing to pay for your neighbour's mortgage. He suggests a national referendum to let Americans vote on the $275 billion dollar foreclosure prevention plan. The markets have already cast their vote.
Markets don't vote.
posted by Nelson at 1:44 PM on February 19, 2009 [1 favorite]
posted by Nelson at 1:44 PM on February 19, 2009 [1 favorite]
I agree with that nut-job completely. I do not want the loser's problems. Which is why all of those banks and brokerage firms should give back the TARP money.
The guy works in an industry that has just received the largest bail out for any failure in any industry in history - and he freaks out that the average joe might get a bail out for fifty grand.
WHERE THE HELL WAS THE FREAK OUT WHEN THE AMERICAN TAX-PAYER BOUGHT UP BILLIONS OF BAD DEBT FROM HIS INSTITUTION.
F*** that guy.
posted by Flood at 1:47 PM on February 19, 2009 [14 favorites]
The guy works in an industry that has just received the largest bail out for any failure in any industry in history - and he freaks out that the average joe might get a bail out for fifty grand.
WHERE THE HELL WAS THE FREAK OUT WHEN THE AMERICAN TAX-PAYER BOUGHT UP BILLIONS OF BAD DEBT FROM HIS INSTITUTION.
F*** that guy.
posted by Flood at 1:47 PM on February 19, 2009 [14 favorites]
The markets have already cast their vote.
The "markets" are going to go negative to any plan that involves doing anything that might remotely benefit the consumer directly.
posted by Thorzdad at 1:47 PM on February 19, 2009 [2 favorites]
The "markets" are going to go negative to any plan that involves doing anything that might remotely benefit the consumer directly.
posted by Thorzdad at 1:47 PM on February 19, 2009 [2 favorites]
Markets don't vote
A piddling oversight which will doubtless be rectified once the present administration has been removed.
posted by aramaic at 1:47 PM on February 19, 2009
A piddling oversight which will doubtless be rectified once the present administration has been removed.
posted by aramaic at 1:47 PM on February 19, 2009
I'm definitely on the side that says, "Hey, I did everything right, I didn't borrow money that I couldn't afford to pay back, where's my bonus and free stuff."
That said, I understand that just letting a bunch of my neighbors get foreclosed upon would be the worst thing possible. The banks aren't loaning, so it's not like I'm gonna get a sweet deal on a recently evacuated condo. Instead, we'd have pocket Detroits popping up all over the nation.
What would have been swell would have been if a bunch of this bailout money went toward the Federal government directly buying out mortgages, fixing the interest rates, and allowing people to get their ducks in a row regarding their primary residences. I could not care less about people speculating on the housing market, but people need a place to live.
Still, this really smacks of "fuck you, got mine" when industry and banking got their bailouts, but they're telling people to neglect their neighbor.
posted by explosion at 1:48 PM on February 19, 2009 [3 favorites]
That said, I understand that just letting a bunch of my neighbors get foreclosed upon would be the worst thing possible. The banks aren't loaning, so it's not like I'm gonna get a sweet deal on a recently evacuated condo. Instead, we'd have pocket Detroits popping up all over the nation.
What would have been swell would have been if a bunch of this bailout money went toward the Federal government directly buying out mortgages, fixing the interest rates, and allowing people to get their ducks in a row regarding their primary residences. I could not care less about people speculating on the housing market, but people need a place to live.
Still, this really smacks of "fuck you, got mine" when industry and banking got their bailouts, but they're telling people to neglect their neighbor.
posted by explosion at 1:48 PM on February 19, 2009 [3 favorites]
Congress helps homeowners who made bad decisions: MORAL HAZARD!!
Congress helps banks who made bad decisions: USA! USA! USA!
These people are ridiculous. It's like when Cramer was screaming "Don't sell Bear! Bear is fine!" and then a week later Bear Stearns was bought out by JP Morgan at 2 in the morning with the government's money at a fire sale. How do these people stay on the air? I really don't get it. They've gotten pretty much everything wrong.
posted by billysumday at 1:50 PM on February 19, 2009 [7 favorites]
Congress helps banks who made bad decisions: USA! USA! USA!
These people are ridiculous. It's like when Cramer was screaming "Don't sell Bear! Bear is fine!" and then a week later Bear Stearns was bought out by JP Morgan at 2 in the morning with the government's money at a fire sale. How do these people stay on the air? I really don't get it. They've gotten pretty much everything wrong.
posted by billysumday at 1:50 PM on February 19, 2009 [7 favorites]
The second link text reminded me of Marilyn Mock, who bought a stranger's back her house. Spookiest thing? The 4th google for her name is her facebook profile.
Voting on the internet makes me think of American Idol. The fact that I fear the voting power of the masses because of a TV show makes sad. Perhaps TV really is ruining my life.
posted by filthy light thief at 1:51 PM on February 19, 2009
Voting on the internet makes me think of American Idol. The fact that I fear the voting power of the masses because of a TV show makes sad. Perhaps TV really is ruining my life.
posted by filthy light thief at 1:51 PM on February 19, 2009
"Today CNBC's Rick Santelli had some strong words about President Obama's new housing plan. Santelli suggested creating a Web site to let Americans vote on the plan"
Rick Santelli is a fucking idiot who has no comprehension of what a representative democracy is. Americans already voted on the plan when we elected our President, Senators and Congressmen.
posted by dersins at 1:52 PM on February 19, 2009 [9 favorites]
Rick Santelli is a fucking idiot who has no comprehension of what a representative democracy is. Americans already voted on the plan when we elected our President, Senators and Congressmen.
posted by dersins at 1:52 PM on February 19, 2009 [9 favorites]
These people are ridiculous. It's like when Cramer was screaming "Don't sell Bear! Bear is fine!" and then a week later Bear Stearns was bought out by JP Morgan at 2 in the morning with the government's money at a fire sale. How do these people stay on the air? I really don't get it. They've gotten pretty much everything wrong.
I'm as much of a Cramer hater as the next guy, but in his defense, Bear was fine.
posted by jckll at 1:53 PM on February 19, 2009
I'm as much of a Cramer hater as the next guy, but in his defense, Bear was fine.
posted by jckll at 1:53 PM on February 19, 2009
The second link text reminded me of Marilyn Mock, who bought a stranger's back her house. Spookiest thing? The 4th google for her name is her facebook profile.
Voting on the internet makes me think of American Idol. The fact that I fear the voting power of the masses because of a TV show makes sad. Perhaps TV really is ruining my life.
whut.
posted by mrnutty at 1:56 PM on February 19, 2009
Dow is down 89? Big whoop, that's just noise on the plot for the past 3 months, when we've seen drops of 700 points, 500 points, etc, quite often. 89 points down I don't buy as meaning what you imply it means. And yea, this just seems mean-spirited at best, encouraging people who haven't yet been clobbered to try and stick it to their less fortunate neighbors.
posted by Mister_A at 1:56 PM on February 19, 2009 [1 favorite]
posted by Mister_A at 1:56 PM on February 19, 2009 [1 favorite]
Yeah let's put every finance bill up for direct vote and run the entire country like California!
posted by GuyZero at 1:56 PM on February 19, 2009 [1 favorite]
posted by GuyZero at 1:56 PM on February 19, 2009 [1 favorite]
I'm as much of a Cramer hater as the next guy, but in his defense, Bear was fine.
Whatever do you mean? They had billions upon billions of dollars in toxic assets. And, pointedly: "On March 14, 2008, JP Morgan Chase, in conjunction with the Federal Reserve Bank of New York, provided a 28-day emergency loan to Bear Stearns in order to prevent the potential market crash that would result from Bear Stearns becoming insolvent.[17] Two days later, Bear Stearns signed a merger agreement with JP Morgan Chase in a stock swap worth $2 a share or less than 10 percent of Bear Stearns' market value.[18] This sale price represented a staggering loss as its stock had once traded at $172 a share as late as January 2007."
So if those people who were watching Cramer's show had sold their stock at $30 or $40 a share or whatever it was, instead of at $2/share, they wouldn't have been any better off? Or...I don't get what you're saying.
posted by billysumday at 1:56 PM on February 19, 2009
Whatever do you mean? They had billions upon billions of dollars in toxic assets. And, pointedly: "On March 14, 2008, JP Morgan Chase, in conjunction with the Federal Reserve Bank of New York, provided a 28-day emergency loan to Bear Stearns in order to prevent the potential market crash that would result from Bear Stearns becoming insolvent.[17] Two days later, Bear Stearns signed a merger agreement with JP Morgan Chase in a stock swap worth $2 a share or less than 10 percent of Bear Stearns' market value.[18] This sale price represented a staggering loss as its stock had once traded at $172 a share as late as January 2007."
So if those people who were watching Cramer's show had sold their stock at $30 or $40 a share or whatever it was, instead of at $2/share, they wouldn't have been any better off? Or...I don't get what you're saying.
posted by billysumday at 1:56 PM on February 19, 2009
the thing about Obama's bailout is that it doesn't reduce the principle on the mortgages all that much... which means it's basically a stealth bank bailout i.e. a way of keeping people making payments so that the foreclosure doesn't show up on balance sheets
posted by geos at 1:56 PM on February 19, 2009
posted by geos at 1:56 PM on February 19, 2009
My favorite part of the clip is when Santelli looks around the floor of the CBOT and declares the (white, middle aged, male, upper-middle class) floor guys are "a pretty good statistical cross-section of America."
Also, YouTube, ad-free link
posted by jckll at 1:57 PM on February 19, 2009 [5 favorites]
Also, YouTube, ad-free link
posted by jckll at 1:57 PM on February 19, 2009 [5 favorites]
I'm definitely on the side that says, "Hey, I did everything right, I didn't borrow money that I couldn't afford to pay back, where's my bonus and free stuff."
Thing is, there are a lot of people who, like yourself, did everything right, yet still got burned...either from outright fraud or from a bad combination of falling property values and job loss. I think it's best to look at the plan as a tool for dealing with the coming wave of forclosures due to the latter scenario.
posted by Thorzdad at 1:59 PM on February 19, 2009
Thing is, there are a lot of people who, like yourself, did everything right, yet still got burned...either from outright fraud or from a bad combination of falling property values and job loss. I think it's best to look at the plan as a tool for dealing with the coming wave of forclosures due to the latter scenario.
posted by Thorzdad at 1:59 PM on February 19, 2009
Hey asshole, we take a vote every couple of years on whether we think government should use tax money to help those who need it not just because it is the right thing to do but because it benefits each of us individually when society as a whole benefits or whether we think we should all just do for ourselves and say 'fuck you' to those in trouble. The latter viewpoint has not done too well the last couple of times.
posted by ND¢ at 1:59 PM on February 19, 2009 [1 favorite]
posted by ND¢ at 1:59 PM on February 19, 2009 [1 favorite]
If several of your neighbors gets foreclosed on, you will pay for it. The value of your house will go down, because no one wants to buy a house next a bunch of vacant, un-maintained buildings. And because it will be harder to sell, due to the fact that there are a bunch of cheaper foreclosure sale houses nearby.
posted by delmoi at 2:05 PM on February 19, 2009 [2 favorites]
posted by delmoi at 2:05 PM on February 19, 2009 [2 favorites]
Whatever do you mean? They had billions upon billions of dollars in toxic assets. And, pointedly: "On March 14, 2008, JP Morgan Chase, in conjunction with the Federal Reserve Bank of New York, provided a 28-day emergency loan to Bear Stearns in order to prevent the potential market crash that would result from Bear Stearns becoming insolvent.[17] Two days later, Bear Stearns signed a merger agreement with JP Morgan Chase in a stock swap worth $2 a share or less than 10 percent of Bear Stearns' market value.[18] This sale price represented a staggering loss as its stock had once traded at $172 a share as late as January 2007."
So if those people who were watching Cramer's show had sold their stock at $30 or $40 a share or whatever it was, instead of at $2/share, they wouldn't have been any better off? Or...I don't get what you're saying.
Yes I'm well aware of what happened to Bear. I suggest you do some reading on what precipitated those events. Here would be a good start.
A taste:
The fall of Bear Stearns wasn’t just another financial collapse. There has never been anything on Wall Street to compare to it: a “run” on a major investment bank, caused in large part not by a criminal indictment or some mammoth quarterly loss but by rumor and innuendo that, as best one can tell, had little basis in fact. Bear had endured more than its share of self-inflicted wounds in the previous year, but there was no reason it had to die that week in March.
What happened? Was it death by natural causes, or was it, as some suspect, murder? More than a few veteran Wall Streeters believe an investigation by the Securities and Exchange Commission will uncover evidence that Bear was the victim of a gigantic “bear raid”—that is, a malicious attack brought by so-called short-sellers, the vultures of Wall Street, who make bets that a firm’s stock will go down. It’s a surprisingly difficult theory to prove, and nothing short of government subpoenas is likely to do it. Faced with a thicket of lawsuits and federal investigations, not a soul in Bear’s boardroom will speak for the record, but on background, a few are finally ready to name names.
“I don’t know of any firm, no matter the capital, that could have withstood that kind of bombardment by the shorts,” says a vice-chairman of another major investment bank. “This was not about capital. It was about people losing confidence, spurred on by rumors fueled by people who had an interest in the fall of Bear Stearns.”
posted by jckll at 2:07 PM on February 19, 2009 [1 favorite]
So if those people who were watching Cramer's show had sold their stock at $30 or $40 a share or whatever it was, instead of at $2/share, they wouldn't have been any better off? Or...I don't get what you're saying.
Yes I'm well aware of what happened to Bear. I suggest you do some reading on what precipitated those events. Here would be a good start.
A taste:
The fall of Bear Stearns wasn’t just another financial collapse. There has never been anything on Wall Street to compare to it: a “run” on a major investment bank, caused in large part not by a criminal indictment or some mammoth quarterly loss but by rumor and innuendo that, as best one can tell, had little basis in fact. Bear had endured more than its share of self-inflicted wounds in the previous year, but there was no reason it had to die that week in March.
What happened? Was it death by natural causes, or was it, as some suspect, murder? More than a few veteran Wall Streeters believe an investigation by the Securities and Exchange Commission will uncover evidence that Bear was the victim of a gigantic “bear raid”—that is, a malicious attack brought by so-called short-sellers, the vultures of Wall Street, who make bets that a firm’s stock will go down. It’s a surprisingly difficult theory to prove, and nothing short of government subpoenas is likely to do it. Faced with a thicket of lawsuits and federal investigations, not a soul in Bear’s boardroom will speak for the record, but on background, a few are finally ready to name names.
“I don’t know of any firm, no matter the capital, that could have withstood that kind of bombardment by the shorts,” says a vice-chairman of another major investment bank. “This was not about capital. It was about people losing confidence, spurred on by rumors fueled by people who had an interest in the fall of Bear Stearns.”
posted by jckll at 2:07 PM on February 19, 2009 [1 favorite]
I'm definitely on the side that says, "Hey, I did everything right, I didn't borrow money that I couldn't afford to pay back, where's my bonus and free stuff."
Hey, see that guy stealing your stuff? And that family cadging money from you outside the strip mall? And what about that crackhouse which has just set up across the road from your home?
No? There's your bonus.
posted by Sova at 2:08 PM on February 19, 2009 [6 favorites]
Hey, see that guy stealing your stuff? And that family cadging money from you outside the strip mall? And what about that crackhouse which has just set up across the road from your home?
No? There's your bonus.
posted by Sova at 2:08 PM on February 19, 2009 [6 favorites]
Hey, remember that US Army unit that was stationed stateside, active, in violation of century plus old Federal Law?
Just thought I'd bring that up in this particular thread. Cuz that's the way my brain rolls.
posted by Xoebe at 2:11 PM on February 19, 2009
Just thought I'd bring that up in this particular thread. Cuz that's the way my brain rolls.
posted by Xoebe at 2:11 PM on February 19, 2009
either from outright fraud or from a bad combination of falling property values and job loss.
Fraud and job loss, I feel for. Falling property values? Well shoot, you mean they don't automatically go up all the time? There IS a top to the market (if temporary)? Shocking...
And because it will be harder to sell, due to the fact that there are a bunch of cheaper foreclosure sale houses nearby.
Sounds good to me. I didn't buy when prices were what I considered -- and now many consider -- too high. Now I would like 1 cheap house, please.
And yet, I guess I have to support this if it's the difference between people stuck living on the streets or not. Sigh.
posted by inigo2 at 2:13 PM on February 19, 2009 [2 favorites]
Fraud and job loss, I feel for. Falling property values? Well shoot, you mean they don't automatically go up all the time? There IS a top to the market (if temporary)? Shocking...
And because it will be harder to sell, due to the fact that there are a bunch of cheaper foreclosure sale houses nearby.
Sounds good to me. I didn't buy when prices were what I considered -- and now many consider -- too high. Now I would like 1 cheap house, please.
And yet, I guess I have to support this if it's the difference between people stuck living on the streets or not. Sigh.
posted by inigo2 at 2:13 PM on February 19, 2009 [2 favorites]
The markets have already cast their vote.
This statement is either stupidity or FPP editorializing (or both).
posted by rocket88 at 2:13 PM on February 19, 2009
This statement is either stupidity or FPP editorializing (or both).
posted by rocket88 at 2:13 PM on February 19, 2009
But you're saying that they shorted Bear to death because it was the weakest of the bunch, which suggests it wasn't necessarily a wise investment. Where did the rumors come from? They weren't made up out of whole cloth. Those investment firms had too many toxic assets, all of them, and if people had sold on the day that Cramer was shouting to hold on to Bear, they would have retained a hell of a lot more money. I doubt you could short McDonald's to death, because they're still making money hand over fist and investors would buy those shares up. Bear may have been targeted and taken down by the short-sellers, but they were targeting for a reason: because Bear was weak and full of debt.
posted by billysumday at 2:13 PM on February 19, 2009
posted by billysumday at 2:13 PM on February 19, 2009
Sova, you made me laugh out loud in the Coke spit on monitor way. Well done.
Seriously, though, it's everybody's right to not support the foreclosure prevention plan (though I wouldn't recommend getting any advice from cable news/financial news networks, no matter what their slant) but the very fact that anybody would take a look at all of it and only be able to see support for it as being "willing to pay for your neighbour's mortgage. for your neighbour's mortgage" is proof that the Founding Fathers were right when they did everything they could to make this great land of ours NOT a direct democracy.
.
posted by MCMikeNamara at 2:14 PM on February 19, 2009 [3 favorites]
Seriously, though, it's everybody's right to not support the foreclosure prevention plan (though I wouldn't recommend getting any advice from cable news/financial news networks, no matter what their slant) but the very fact that anybody would take a look at all of it and only be able to see support for it as being "willing to pay for your neighbour's mortgage. for your neighbour's mortgage" is proof that the Founding Fathers were right when they did everything they could to make this great land of ours NOT a direct democracy.
.
posted by MCMikeNamara at 2:14 PM on February 19, 2009 [3 favorites]
Surely unfettered capitalism is the only remedy for this crisis precipitated by unfettered capitalism.
posted by Nahum Tate at 2:18 PM on February 19, 2009 [11 favorites]
posted by Nahum Tate at 2:18 PM on February 19, 2009 [11 favorites]
So, these pricks get rich by shorting stocks and pushing derivatives for a living, and they're telling *US* about how unfair it is that people have to help bail out the mess they helped to create?
posted by markkraft at 2:20 PM on February 19, 2009 [2 favorites]
posted by markkraft at 2:20 PM on February 19, 2009 [2 favorites]
So if those people who were watching Cramer's show had sold their stock at $30 or $40 a share or whatever it was, instead of at $2/share, they wouldn't have been any better off? Or...I don't get what you're saying.
No you don't, because you don't know what Cramer was actually saying. He wasn't saying not to sell Bear stock, which was already around $2 at the time, he was saying that if you had a Bear Stearns brokerage account you shouldn't pull your money out of that.
It's amazing how many people seem to misunderstand what he was saying.
posted by delmoi at 2:20 PM on February 19, 2009 [3 favorites]
No you don't, because you don't know what Cramer was actually saying. He wasn't saying not to sell Bear stock, which was already around $2 at the time, he was saying that if you had a Bear Stearns brokerage account you shouldn't pull your money out of that.
It's amazing how many people seem to misunderstand what he was saying.
posted by delmoi at 2:20 PM on February 19, 2009 [3 favorites]
But you're saying that they shorted Bear to death because it was the weakest of the bunch, which suggests it wasn't necessarily a wise investment. Where did the rumors come from? They weren't made up out of whole cloth. Those investment firms had too many toxic assets, all of them, and if people had sold on the day that Cramer was shouting to hold on to Bear, they would have retained a hell of a lot more money. I doubt you could short McDonald's to death, because they're still making money hand over fist and investors would buy those shares up. Bear may have been targeted and taken down by the short-sellers, but they were targeting for a reason: because Bear was weak and full of debt.
-Not saying it wasn't weak, or was a wise investment. The point is, it wasn't killed because of toxic assets. It was killed because of a bear raid. C/BAC/JPM/etc all have lots more toxic assets than Bear. But they are still around. This leads one to believe that Bear was taken down in a bear raid.
-Where did the rumors come from? They weren't made up out of whole cloth.
That's just the point. They WERE.
-The only point I was making was that Cramer, on that day, was right. The rumors about Bear that killed it were that it was facing a liquidity crisis, that it had no liquid capital on hand to fund day-to-day operations, and that its trading (repo) partners were abandoning it because of this. This was false. Whole cloth. But it became a self-fulfilling prophecy. Bear was fine.
-Not going to hijack this thread any further but I suggest if you're interested you read up on this a bit. It's a lot more complex than you are making it seem.
posted by jckll at 2:21 PM on February 19, 2009
-Not saying it wasn't weak, or was a wise investment. The point is, it wasn't killed because of toxic assets. It was killed because of a bear raid. C/BAC/JPM/etc all have lots more toxic assets than Bear. But they are still around. This leads one to believe that Bear was taken down in a bear raid.
-Where did the rumors come from? They weren't made up out of whole cloth.
That's just the point. They WERE.
-The only point I was making was that Cramer, on that day, was right. The rumors about Bear that killed it were that it was facing a liquidity crisis, that it had no liquid capital on hand to fund day-to-day operations, and that its trading (repo) partners were abandoning it because of this. This was false. Whole cloth. But it became a self-fulfilling prophecy. Bear was fine.
-Not going to hijack this thread any further but I suggest if you're interested you read up on this a bit. It's a lot more complex than you are making it seem.
posted by jckll at 2:21 PM on February 19, 2009
Okay, I agree that I could probably use some more info on the subject. But when you say that Bear was "fine"... Really? Fine? Hunky dory? Or do you mean fine as in, would have survived had it made it until Congress approved TARP? Because it doesn't seem like any of those places were or are "fine."
posted by billysumday at 2:24 PM on February 19, 2009
posted by billysumday at 2:24 PM on February 19, 2009
So, these pricks get rich by shorting stocks and pushing derivatives for a living, and they're telling *US* about how unfair it is that people have to help bail out the mess they helped to create?
Also, I don't see what the big deal is about short sellers, short sellers only make money when they short companies that are believed to be stronger then they are. Short sellers were the catalyst that brought down Enron, and probably prevented even more money from being soaked up by the tech bubble and the housing bubble.
There is one problem with shorting financial stocks, which is that credit ratings were based in part on share price, because it was thought that these companies could sell shares to pay bondholders, but obviously that's idiotic, because anything that would cause them to default on their bonds would also cause their share price to collapse.
posted by delmoi at 2:26 PM on February 19, 2009
Also, I don't see what the big deal is about short sellers, short sellers only make money when they short companies that are believed to be stronger then they are. Short sellers were the catalyst that brought down Enron, and probably prevented even more money from being soaked up by the tech bubble and the housing bubble.
There is one problem with shorting financial stocks, which is that credit ratings were based in part on share price, because it was thought that these companies could sell shares to pay bondholders, but obviously that's idiotic, because anything that would cause them to default on their bonds would also cause their share price to collapse.
posted by delmoi at 2:26 PM on February 19, 2009
No you don't, because you don't know what Cramer was actually saying. He wasn't saying not to sell Bear stock, which was already around $2 at the time, he was saying that if you had a Bear Stearns brokerage account you shouldn't pull your money out of that.
Actually, on March 11, 2008, when Cramer shouted, "Bear Stearns is fine!" it was selling at $60/share. But I get what you're saying.
posted by billysumday at 2:27 PM on February 19, 2009
Actually, on March 11, 2008, when Cramer shouted, "Bear Stearns is fine!" it was selling at $60/share. But I get what you're saying.
posted by billysumday at 2:27 PM on February 19, 2009
cklennon: “I don’t know of any firm, no matter the capital, that could have withstood that kind of bombardment by the shorts,” says a vice-chairman of another major investment bank. “This was not about capital. It was about people losing confidence, spurred on by rumors fueled by people who had an interest in the fall of Bear Stearns.”
(note he was quoting someone else, to clarify my response is not an attack on cklennon)
But, but... the market's... they're so rational and efficient, and...
So fucking fidgety investors, paranoid and prone to speculation and rumors and innuendo can bring down a firm, "no matter the capital"??? But somehow everything is so logical and works just fine?
I swear, it seems like there's always more exceptions to this "rational market" hypothesis than rules.
Can we bring down a government with this much fidgetiness? It sure would be nice!
posted by symbioid at 2:27 PM on February 19, 2009 [3 favorites]
(note he was quoting someone else, to clarify my response is not an attack on cklennon)
But, but... the market's... they're so rational and efficient, and...
So fucking fidgety investors, paranoid and prone to speculation and rumors and innuendo can bring down a firm, "no matter the capital"??? But somehow everything is so logical and works just fine?
I swear, it seems like there's always more exceptions to this "rational market" hypothesis than rules.
Can we bring down a government with this much fidgetiness? It sure would be nice!
posted by symbioid at 2:27 PM on February 19, 2009 [3 favorites]
I agree with him that the people on trading floor are representative of Americans in general and that lead paint chips are delicious.
posted by I Foody at 2:30 PM on February 19, 2009 [3 favorites]
posted by I Foody at 2:30 PM on February 19, 2009 [3 favorites]
Geez, when did Metafilter get so knee-jerk that people can't read past the first line of a post?
Immediately after I wrote:
I'm definitely on the side that says, "Hey, I did everything right, I didn't borrow money that I couldn't afford to pay back, where's my bonus and free stuff."
I then wrote:
That said, I understand that just letting a bunch of my neighbors get foreclosed upon would be the worst thing possible. The banks aren't loaning, so it's not like I'm gonna get a sweet deal on a recently evacuated condo. Instead, we'd have pocket Detroits popping up all over the nation.
All I meant to imply was that even people who should be poised to enjoy some schadenfreude need to look out for the greater good of the people. So what, in times of weakness, I'm not allowed to wonder why I can't get a little for doing right when so many are getting bailed out for doing wrong? Go go Metafilter thoughtcrime police!
posted by explosion at 2:30 PM on February 19, 2009 [1 favorite]
Immediately after I wrote:
I'm definitely on the side that says, "Hey, I did everything right, I didn't borrow money that I couldn't afford to pay back, where's my bonus and free stuff."
I then wrote:
That said, I understand that just letting a bunch of my neighbors get foreclosed upon would be the worst thing possible. The banks aren't loaning, so it's not like I'm gonna get a sweet deal on a recently evacuated condo. Instead, we'd have pocket Detroits popping up all over the nation.
All I meant to imply was that even people who should be poised to enjoy some schadenfreude need to look out for the greater good of the people. So what, in times of weakness, I'm not allowed to wonder why I can't get a little for doing right when so many are getting bailed out for doing wrong? Go go Metafilter thoughtcrime police!
posted by explosion at 2:30 PM on February 19, 2009 [1 favorite]
-Not saying it wasn't weak, or was a wise investment. The point is, it wasn't killed because of toxic assets. It was killed because of a bear raid. C/BAC/JPM/etc all have lots more toxic assets than Bear. But they are still around. This leads one to believe that Bear was taken down in a bear raid.
The other thing is, just because a bunch of people decide to short something doesn't mean that there was any collusion, stock markets can be irrational.
posted by delmoi at 2:30 PM on February 19, 2009
The other thing is, just because a bunch of people decide to short something doesn't mean that there was any collusion, stock markets can be irrational.
posted by delmoi at 2:30 PM on February 19, 2009
"The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness." - John Kenneth Galbraith
"Fuck you, got mine" is pithier though.
posted by longdaysjourney at 2:31 PM on February 19, 2009 [3 favorites]
"Fuck you, got mine" is pithier though.
posted by longdaysjourney at 2:31 PM on February 19, 2009 [3 favorites]
Can we bring down a government with this much fidgetiness? It sure would be nice!
Ask Iceland, for a while they claimed that everything would have been fine if the U.K. didn't use their fancy new anti-terrorism laws to cease their assets in order to pay back U.K depositors.
posted by delmoi at 2:32 PM on February 19, 2009
Ask Iceland, for a while they claimed that everything would have been fine if the U.K. didn't use their fancy new anti-terrorism laws to cease their assets in order to pay back U.K depositors.
posted by delmoi at 2:32 PM on February 19, 2009
I suggest a national referendum on which financial sector executives should have their heads stuck on the pikes we'll be installing on the White House lawn. Unfortunately I don't think schmucks from CNBC qualify, but maybe in the second wave?
posted by ecurtz at 2:34 PM on February 19, 2009 [2 favorites]
posted by ecurtz at 2:34 PM on February 19, 2009 [2 favorites]
Can we bring down a government with this much fidgetiness? It sure would be nice!
See: Iceland
On preview: doh!
posted by jckll at 2:36 PM on February 19, 2009
See: Iceland
On preview: doh!
posted by jckll at 2:36 PM on February 19, 2009
-Not saying it wasn't weak, or was a wise investment. The point is, it wasn't killed because of toxic assets. It was killed because of a bear raid. C/BAC/JPM/etc all have lots more toxic assets than Bear. But they are still around. This leads one to believe that Bear was taken down in a bear raid.
It's fairly well known that Bear Stearns was a particularly heavy investor in subprime mortgage backed securities. While at the time of the JP Morgan deal, Bear Stearns might have been "fine," it's pretty obvious here in 2009 that it would have been just as dead as all the other investment banks.
The five investment banks were Bear Stearns, Merrill Lynch, Lehman Brothers, Morgan Stanley, and Goldman Sachs. They were leveraged at ratios approaching 30:1. They are all gone (MS and GS are now depositor banks, and are subject to more stringent regulation. In essence, they are not the same sort of entities they were before the subprime crisis)
C/BAC/JPM are not investment banks. Furthermore, they are much much bigger entities, whereas the investment banks were never deemed "too big to fail" (see, Lehman Brothers).
Finally, the only reason C/BAC/JPM are even around right now, is because of 1) gov't bailouts ala TARP funds and 2) utter denial that billions of MBS they hold are largely worthless. If they wrote down their assets to market levels, they would be insolvent, as Roubini points out daily.
I'm not saying a bear raid didn't take down Bear Stearns, because it might have. But considering the history of every other entity that dabbled in the same stuff that Bear did is now dead or a shell of its former self, with billions in taxpayer bailout money, I'm skeptical that a massive short selling conspiracy was the primary reason for its demise.
posted by shen1138 at 2:43 PM on February 19, 2009 [1 favorite]
It's fairly well known that Bear Stearns was a particularly heavy investor in subprime mortgage backed securities. While at the time of the JP Morgan deal, Bear Stearns might have been "fine," it's pretty obvious here in 2009 that it would have been just as dead as all the other investment banks.
The five investment banks were Bear Stearns, Merrill Lynch, Lehman Brothers, Morgan Stanley, and Goldman Sachs. They were leveraged at ratios approaching 30:1. They are all gone (MS and GS are now depositor banks, and are subject to more stringent regulation. In essence, they are not the same sort of entities they were before the subprime crisis)
C/BAC/JPM are not investment banks. Furthermore, they are much much bigger entities, whereas the investment banks were never deemed "too big to fail" (see, Lehman Brothers).
Finally, the only reason C/BAC/JPM are even around right now, is because of 1) gov't bailouts ala TARP funds and 2) utter denial that billions of MBS they hold are largely worthless. If they wrote down their assets to market levels, they would be insolvent, as Roubini points out daily.
I'm not saying a bear raid didn't take down Bear Stearns, because it might have. But considering the history of every other entity that dabbled in the same stuff that Bear did is now dead or a shell of its former self, with billions in taxpayer bailout money, I'm skeptical that a massive short selling conspiracy was the primary reason for its demise.
posted by shen1138 at 2:43 PM on February 19, 2009 [1 favorite]
No you don't, because you don't know what Cramer was actually saying. He wasn't saying not to sell Bear stock, which was already around $2 at the time, he was saying that if you had a Bear Stearns brokerage account you shouldn't pull your money out of that.
It's amazing how many people seem to misunderstand what he was saying.
Truly.
posted by billysumday at 2:48 PM on February 19, 2009
It's amazing how many people seem to misunderstand what he was saying.
Truly.
posted by billysumday at 2:48 PM on February 19, 2009
Ha ha! The Chicago Tea Party!
Hey! What will we throw in? How about we toss a few CBOT traders and a CNBC broadcaster or two off the end of Navy Pier?
posted by Reverend John at 2:49 PM on February 19, 2009
Hey! What will we throw in? How about we toss a few CBOT traders and a CNBC broadcaster or two off the end of Navy Pier?
posted by Reverend John at 2:49 PM on February 19, 2009
I'm not allowed to wonder why I can't get a little for doing right when so many are getting bailed out for doing wrong?
I think the problem is that smugness and self-congratulation is often unattractive when it is clear to most of us that there is a large element of randomness in who got stuck. Not that everyone involved acted in good faith, but the majority of those people who will get help here are victims of a failing economy, health problems, or both. Neither of those are really something you or I control. We often feel like we are in a good position solely because we are so careful and smart, but when I look at friends and family and their travails, it becomes clear that the random effects outweigh the stupid moves by a factor of about 2 to 1, IMHO.
YMMV, but that, I suspect, is what is driving the argumentation with your framing of the issue.
posted by Mental Wimp at 2:49 PM on February 19, 2009
I think the problem is that smugness and self-congratulation is often unattractive when it is clear to most of us that there is a large element of randomness in who got stuck. Not that everyone involved acted in good faith, but the majority of those people who will get help here are victims of a failing economy, health problems, or both. Neither of those are really something you or I control. We often feel like we are in a good position solely because we are so careful and smart, but when I look at friends and family and their travails, it becomes clear that the random effects outweigh the stupid moves by a factor of about 2 to 1, IMHO.
YMMV, but that, I suspect, is what is driving the argumentation with your framing of the issue.
posted by Mental Wimp at 2:49 PM on February 19, 2009
“This is now 6:15 on Thursday night, the night before the collapse,” Chanos says. “It was after a meeting with Molinaro”—Bear Stearns C.F.O. Sam Molinaro—“who basically told him at that meeting, ‘We’re done. We’re gone. We need money overnight we don’t have.’ So here he is, calling one of his biggest clients to go on CNBC the next morning to say everything’s fine when clearly it’s not. And he knew it wasn’t.”
Chanos refused to go on CNBC. By 6:30 the next morning, word was out that the Fed was engineering the rescue of Bear Stearns. Chanos realized that he could have been on CNBC while that was announced. “I thought, That fucker was going to throw me under the bus no matter what.”
“So here it is,” Chanos says. “Alan Schwartz takes the position ‘Short-sellers were our problem,’ and who did he try to get to vouch for him on the morning of the collapse? The largest short-seller in the world. You want to talk about ethics and who’s telling the truth on these things? It’s unbelievable.”
(via)
posted by longdaysjourney at 2:49 PM on February 19, 2009 [2 favorites]
All I meant to imply was that even people who should be poised to enjoy some schadenfreude need to look out for the greater good of the people. So what, in times of weakness, I'm not allowed to wonder why I can't get a little for doing right when so many are getting bailed out for doing wrong? Go go Metafilter thoughtcrime police!
I did read your post, sorry if it was worded as a reply to you. It was meant as a reply to the people who say that and mean it without condition. You know the kind, all home and no neighbourhood. I would love to offer them the option of a free house in a favela or an expensive shoebox in Kensington and Chelsea/Upper East Side.
posted by Sova at 2:50 PM on February 19, 2009
I did read your post, sorry if it was worded as a reply to you. It was meant as a reply to the people who say that and mean it without condition. You know the kind, all home and no neighbourhood. I would love to offer them the option of a free house in a favela or an expensive shoebox in Kensington and Chelsea/Upper East Side.
posted by Sova at 2:50 PM on February 19, 2009
We're arguing in circles. Clearly Bear was in dire straits. Clearly it had a ton of sludge on its books. But it did not go from functioning to dead in a week because of toxic assets. Period. I also do not know whether there was a short selling conspiracy, but it's pretty clear that there were rumors all over the place about Bear's liquidity and the alleged flight of its counterparties that led to its demise, both of which were simply, at the time, untrue.
I'm not making any statement about the viability of Bear long-term, whether it would be around today, whether it would have needed TARP funds, etcetera. Just saying that Cramer was right. In the near term, in March/08, Bear had ~$18bn in cash. It was not facing a liquidity crisis. It was fine.
posted by jckll at 2:50 PM on February 19, 2009
I'm not making any statement about the viability of Bear long-term, whether it would be around today, whether it would have needed TARP funds, etcetera. Just saying that Cramer was right. In the near term, in March/08, Bear had ~$18bn in cash. It was not facing a liquidity crisis. It was fine.
posted by jckll at 2:50 PM on February 19, 2009
cklennon, I wonder if you saw the Frontline episode that aired this week, and what you thought of it. You should check it out if you haven't seen it yet.
posted by billysumday at 2:56 PM on February 19, 2009
posted by billysumday at 2:56 PM on February 19, 2009
We're arguing in circles.
I apologize, your position is clearer now. But I was clearly responding to your argument that the existence of C/BAC/JPM was an indicator that Bear Stearns was taken down by short selling. I'm directly addressing that particular point. As you clarify, your definition of "fine" was that in March 08, Bear did not face a liquidity crisis. That is very different than invoking C/BAC/JPM, and I certainly find that a much more plausible position to hold.
posted by shen1138 at 2:58 PM on February 19, 2009
I apologize, your position is clearer now. But I was clearly responding to your argument that the existence of C/BAC/JPM was an indicator that Bear Stearns was taken down by short selling. I'm directly addressing that particular point. As you clarify, your definition of "fine" was that in March 08, Bear did not face a liquidity crisis. That is very different than invoking C/BAC/JPM, and I certainly find that a much more plausible position to hold.
posted by shen1138 at 2:58 PM on February 19, 2009
I'm definitely on the side that says, "Hey, I did everything right, I didn't borrow money that I couldn't afford to pay back, where's my bonus and free stuff."
Hey, I'm on that side, too. But, still, my house has gone down well over 20% in value and I've been laid off. The greedy fucking "capitalists" throwing their holier-than-thou "moral hazard" arguments around have way more culpability in my situation ( and the others in similar straits) than I do. They broke the economy, and they need to just shut the fuck up and do their part to help fix it.
At least we get to see now who really values money over humanity. May they see the error of their ways, or die slow agonizing deaths.
posted by Benny Andajetz at 3:00 PM on February 19, 2009
Hey, I'm on that side, too. But, still, my house has gone down well over 20% in value and I've been laid off. The greedy fucking "capitalists" throwing their holier-than-thou "moral hazard" arguments around have way more culpability in my situation ( and the others in similar straits) than I do. They broke the economy, and they need to just shut the fuck up and do their part to help fix it.
At least we get to see now who really values money over humanity. May they see the error of their ways, or die slow agonizing deaths.
posted by Benny Andajetz at 3:00 PM on February 19, 2009
Fair enough. My original post was simply arguing that Cramer was right in telling people to NOT flee from Bear because it wasn't facing a liquidty crisis. Because it wasn't.
And I did watch the Frontline show. It was OK. Good if you haven't been following this stuff and wanted a quick overview of the run-up. But pretty light on details if you've been following this for a year...
posted by jckll at 3:02 PM on February 19, 2009
And I did watch the Frontline show. It was OK. Good if you haven't been following this stuff and wanted a quick overview of the run-up. But pretty light on details if you've been following this for a year...
posted by jckll at 3:02 PM on February 19, 2009
Man, where's Terry Tate when we need him most?
That Santelli mouthanus needs to have his mouth filled with sand.
posted by Lipstick Thespian at 3:06 PM on February 19, 2009 [1 favorite]
That Santelli mouthanus needs to have his mouth filled with sand.
posted by Lipstick Thespian at 3:06 PM on February 19, 2009 [1 favorite]
Which would then give him a sandmouthanus, but I digress.
posted by Lipstick Thespian at 3:06 PM on February 19, 2009
posted by Lipstick Thespian at 3:06 PM on February 19, 2009
I wish that the government could tax people who paid off adjustable rate mortgages or who sold a house in the last 20 years or so and use the money to pay off the people did the exact same risky stupid things and lost. They were playing the same game, it isn't like one did the right thing and the other did the wrong thing, they both did the risky thing one group one the other group lost. Doing this would actually improve moral hazard. The ability to retroactively confiscate ill gotten gains would probably be a really useful public policy tool.
posted by I Foody at 3:09 PM on February 19, 2009
posted by I Foody at 3:09 PM on February 19, 2009
The hate for Rick Santelli is utterly unfounded, he's really the only person on CNBC who doesn't make dumbass comments like asking guests "what does this mean for the market, what are you holding?" (or worse, make shit up like Gasparino to the point where the SEC should investigate him).
The backstory for his "emotional attitude" is that he's really the only one of the main CNBC personalities that's been bearish on the economy for the past two years. All the other anchors look for "silver linings" and other garbage. His attitude is from dealing with all the other idiots on CNBC, and yelling has been the only way to get his message across. When he's in the "octobox" with 7 idiots, he has to yell for the idiots to understand that this recession is BIG.
Ultimately, though, I suspect that he's anxious like all the other Chicago traders on the floor that the Fed will start buying up long bonds. The mortgage plan is an indication that the government is getting creative and unconventional, and there's nothing more desperate than buying your own bonds. There is an element of the traders talking their own books, but either way, that's sort of what's really going on. Rick Santelli has always given the attitude that he's talking to a carnival of asshats at CNBC, and today is no different.
posted by amuseDetachment at 3:12 PM on February 19, 2009
The backstory for his "emotional attitude" is that he's really the only one of the main CNBC personalities that's been bearish on the economy for the past two years. All the other anchors look for "silver linings" and other garbage. His attitude is from dealing with all the other idiots on CNBC, and yelling has been the only way to get his message across. When he's in the "octobox" with 7 idiots, he has to yell for the idiots to understand that this recession is BIG.
Ultimately, though, I suspect that he's anxious like all the other Chicago traders on the floor that the Fed will start buying up long bonds. The mortgage plan is an indication that the government is getting creative and unconventional, and there's nothing more desperate than buying your own bonds. There is an element of the traders talking their own books, but either way, that's sort of what's really going on. Rick Santelli has always given the attitude that he's talking to a carnival of asshats at CNBC, and today is no different.
posted by amuseDetachment at 3:12 PM on February 19, 2009
When I say bring down a government, perhaps I should have phrased it differently. Not so much "government" as "total economic system/worldview".
How much lack of faith will it take for us to bring down Capitalism entirely? And can't we stop trying to prop it up so we can vainly limp along until the next inevitable crisis hits.
It bothers me that all our "solutions" are just patches on an unsustainable framework.
posted by symbioid at 3:12 PM on February 19, 2009
How much lack of faith will it take for us to bring down Capitalism entirely? And can't we stop trying to prop it up so we can vainly limp along until the next inevitable crisis hits.
It bothers me that all our "solutions" are just patches on an unsustainable framework.
posted by symbioid at 3:12 PM on February 19, 2009
Yeah, I don't want to bail out all those losers that bought houses they couldn't afford! I did everything right, they could have too, so they can just twist. Wait - Whaddaya mean I can't withdraw money? Why's my bank surrounded by armed guards? Whoah, whoa - I got fired?! What the hell? How am I supposed to make my mortgage? Somebody should do something about this - I'm callin' my representative!
Actually, I'm all for this 'national referendum' on big-ticket congressional expenditures, but only if it's applied to all appropriations bills - 'cause I have no doubt that when the unemployment reaches 20%-35% nationwide, we'll all be more than happy to give millions in pork-barrel funds to greasy fuckers while our children starve, to say nothing of chopping a third right off the top for Pentagon boondoggles.
Seriously, guys, this is not a genie that you want to let out of the bottle.
posted by eclectist at 3:17 PM on February 19, 2009 [1 favorite]
Actually, I'm all for this 'national referendum' on big-ticket congressional expenditures, but only if it's applied to all appropriations bills - 'cause I have no doubt that when the unemployment reaches 20%-35% nationwide, we'll all be more than happy to give millions in pork-barrel funds to greasy fuckers while our children starve, to say nothing of chopping a third right off the top for Pentagon boondoggles.
Seriously, guys, this is not a genie that you want to let out of the bottle.
posted by eclectist at 3:17 PM on February 19, 2009 [1 favorite]
It bothers me that all our "solutions" are just patches on an unsustainable framework.
posted by symbioid at 3:12 PM on February 19 [+] [!]
Yeah, but my body is ultimately going to be un unsustainable framework. Doesn't mean I don't want to put my leg in a cast if it gets broken, though.
posted by Kiablokirk at 3:23 PM on February 19, 2009
posted by symbioid at 3:12 PM on February 19 [+] [!]
Yeah, but my body is ultimately going to be un unsustainable framework. Doesn't mean I don't want to put my leg in a cast if it gets broken, though.
posted by Kiablokirk at 3:23 PM on February 19, 2009
Cramer is a turkey who gets lucky and did what all turkey's eventually do, blow up. It turns out Cramer wasn't the only one. Along with him, all the major banks appear to be in the same state, and consequently all of us as well.
As other people have pointed out earlier, and as Jon Stewart so aptly indicated last week "The rescuee doesn't get to comment on the rescue." But here we go again, another week of the major corporate media going to the turkey's and asking them to play Monday morning quaterbacks, as if their aptly demonstrated ability to assess the situation weren't so abysmally obvious.
CNBC should be shutdown for perpetrating a fraud upon the public, and everyone of those turkeys kicked to the street. Rather than reporting financial news over the last decade, they've been cheerleading as the system headed towards a blow up.
The other thing that bugs me about these stories is the idea that lack of financial discipline by the average person is a causative factor here. Its complete BS. Its the fantasy narrative that vested interests are rolling role out to escape the consequences they should face due to their utter stupidity and foolishness.
posted by herda05 at 3:25 PM on February 19, 2009
As other people have pointed out earlier, and as Jon Stewart so aptly indicated last week "The rescuee doesn't get to comment on the rescue." But here we go again, another week of the major corporate media going to the turkey's and asking them to play Monday morning quaterbacks, as if their aptly demonstrated ability to assess the situation weren't so abysmally obvious.
CNBC should be shutdown for perpetrating a fraud upon the public, and everyone of those turkeys kicked to the street. Rather than reporting financial news over the last decade, they've been cheerleading as the system headed towards a blow up.
The other thing that bugs me about these stories is the idea that lack of financial discipline by the average person is a causative factor here. Its complete BS. Its the fantasy narrative that vested interests are rolling role out to escape the consequences they should face due to their utter stupidity and foolishness.
posted by herda05 at 3:25 PM on February 19, 2009
All of these bailouts put together are just going to soften the blow for us normal folks. It's still going to be bad. We're still falling pretty far economically, but the bailouts will make it so when we do finally find the bottom, it won't snap our necks and kill us. There are limits to how much government can help, and I think Obama's got about the right amount of help in the pipeline. I'd have preferred more infrastructure spending, on stuff we badly need anyway, but I think we'll pull out of this okay. It's just gonna take some time, and it's going to be painful.
The housing bailout only applies to mortgages held by Fannie and Freddie. That means those who took out loans put some significant skin in the game in the form of a downpayment. Those people are not nearly as likely to walk away because then they'd be out the downpayment AND they'd be out of a house too. The bailout also won't help people who are too far underwater (who are also the most likely to walk away from the debt).
All of these bailouts help ALL of us, as a collective. Do We The People gain if we let all of our banks collapse, eradicating monumental amounts of peoples' 401k savings, and throwing millions into poverty right at the time in their lives when they CAN'T work because they're too old? No, that'd be bad for all of us. Do we gain if we let foreclosures run rampant, driving down home values and destroying equity for *everyone* who owns a home? Of course not.
Obama's doing his best to mitigate the horrible situation that 43 left him. I think he's doing fine. He's got people on the far left AND the far right pissed at him, which means he's probably governing in a centrist manner, and that's likely to make the greatest number of people happy. I'm a far leftist myself, so I'd prefer to see some MASSIVE infrastructure spending, but I'm okay with some rational centrist governing.
posted by jamstigator at 3:32 PM on February 19, 2009
The housing bailout only applies to mortgages held by Fannie and Freddie. That means those who took out loans put some significant skin in the game in the form of a downpayment. Those people are not nearly as likely to walk away because then they'd be out the downpayment AND they'd be out of a house too. The bailout also won't help people who are too far underwater (who are also the most likely to walk away from the debt).
All of these bailouts help ALL of us, as a collective. Do We The People gain if we let all of our banks collapse, eradicating monumental amounts of peoples' 401k savings, and throwing millions into poverty right at the time in their lives when they CAN'T work because they're too old? No, that'd be bad for all of us. Do we gain if we let foreclosures run rampant, driving down home values and destroying equity for *everyone* who owns a home? Of course not.
Obama's doing his best to mitigate the horrible situation that 43 left him. I think he's doing fine. He's got people on the far left AND the far right pissed at him, which means he's probably governing in a centrist manner, and that's likely to make the greatest number of people happy. I'm a far leftist myself, so I'd prefer to see some MASSIVE infrastructure spending, but I'm okay with some rational centrist governing.
posted by jamstigator at 3:32 PM on February 19, 2009
I'm deeply conflicted on this issue. But you have to understand where I'm coming from.
I'm a bear. A pessimist. A Debbie Downer. I'm the guy who posted this question. I don't believe in debt. I don't even like loans. I've never carried a balance on any credit card, ever. I've never taken out a mortgage. I've never bought stocks. Whenever I get a chunk of cash, I immediately use it to pay down my student loans (which happen to be the only debt I've ever had). I keep my nest egg in an FDIC-insured bank account. For years, I've looked forward to the day when I'd have enough saved up to put in a 20% down payment on a condo or co-op. Now I'm thinking not-so-much.
A lot of this comes from watching my dad, who pissed away all his money over the years to the point where he's 60-something and doesn't have shit to show for it - and this is a man who's held high-paying jobs for most of his life. So yeah. Don't be like dad. That's my motto.
Could I have gotten in on the property boom? Of course I could have. I have friends who did. One guy flipped a nondescript flat in a nondescript part of Brooklyn and doubled his money in a few months' time. Others did even better. But I saw the tech crash of the early 2000s, and have always been wary of speculation.
So does it bother me that others will be rewarded for their poor decision making, when I've taken such great pains to live within my means? HELL FUCKING YES. I could have been there with them all along, scooping up property with a devil-may-care attitude, knowing that the government will step in and save me when things get too wacky. Remember, only a fool would get in on the last round of a Ponzi scheme, unless he could be reasonably sure of a bailout.
Instead I'm just another renter, and may never own property within my lifetime. And that's at least partially due to my fellow Americans whose eyes were bigger than their bellies. You know, the same ones who are now asking me for money.
HOWEVER. HOWEVER. I would be okay with this foreclosure bailout IF AND ONLY IF someone could show me that it was actually going to do any good.
Speaking of - does anybody here have any proof that all these bailouts will actually help? Or are we only delaying the inevitable?
We've got TARP. We've got the stimulus package. And now we have this. Do we have any reason at all to think these will do any good? Post your links if you've got them, please. Because if we're gonna fail no matter what, fuck it, we might as well hold onto our money.
I've never been a fan of "trickle-down economics" (voodoo economics for those who remember), or the Regan/Bush doctrine of tax cut tax cut tax cut, but I'm a rational human being, and I know enough to know that it's never a good idea to throw good money after bad.
posted by Afroblanco at 4:13 PM on February 19, 2009 [1 favorite]
I'm a bear. A pessimist. A Debbie Downer. I'm the guy who posted this question. I don't believe in debt. I don't even like loans. I've never carried a balance on any credit card, ever. I've never taken out a mortgage. I've never bought stocks. Whenever I get a chunk of cash, I immediately use it to pay down my student loans (which happen to be the only debt I've ever had). I keep my nest egg in an FDIC-insured bank account. For years, I've looked forward to the day when I'd have enough saved up to put in a 20% down payment on a condo or co-op. Now I'm thinking not-so-much.
A lot of this comes from watching my dad, who pissed away all his money over the years to the point where he's 60-something and doesn't have shit to show for it - and this is a man who's held high-paying jobs for most of his life. So yeah. Don't be like dad. That's my motto.
Could I have gotten in on the property boom? Of course I could have. I have friends who did. One guy flipped a nondescript flat in a nondescript part of Brooklyn and doubled his money in a few months' time. Others did even better. But I saw the tech crash of the early 2000s, and have always been wary of speculation.
So does it bother me that others will be rewarded for their poor decision making, when I've taken such great pains to live within my means? HELL FUCKING YES. I could have been there with them all along, scooping up property with a devil-may-care attitude, knowing that the government will step in and save me when things get too wacky. Remember, only a fool would get in on the last round of a Ponzi scheme, unless he could be reasonably sure of a bailout.
Instead I'm just another renter, and may never own property within my lifetime. And that's at least partially due to my fellow Americans whose eyes were bigger than their bellies. You know, the same ones who are now asking me for money.
HOWEVER. HOWEVER. I would be okay with this foreclosure bailout IF AND ONLY IF someone could show me that it was actually going to do any good.
Speaking of - does anybody here have any proof that all these bailouts will actually help? Or are we only delaying the inevitable?
We've got TARP. We've got the stimulus package. And now we have this. Do we have any reason at all to think these will do any good? Post your links if you've got them, please. Because if we're gonna fail no matter what, fuck it, we might as well hold onto our money.
I've never been a fan of "trickle-down economics" (voodoo economics for those who remember), or the Regan/Bush doctrine of tax cut tax cut tax cut, but I'm a rational human being, and I know enough to know that it's never a good idea to throw good money after bad.
posted by Afroblanco at 4:13 PM on February 19, 2009 [1 favorite]
I'm a rational human being, and I know enough to know that it's never a good idea to throw good money after bad.
Not necessarily true, at least if you buy Keynes.
posted by dersins at 4:47 PM on February 19, 2009
Not necessarily true, at least if you buy Keynes.
posted by dersins at 4:47 PM on February 19, 2009
Me and Afroblanco, though I may be more irritated.
Primary housing should never have been considered an investment any more than food or clothing or health insurance should be considered an investment. It's a cost of living. You budget accordingly. Those who lost sight of this are now in trouble. And speaking as someone who would like to buy the house they could not afford at a reasonable price, hell yes I am narked that my prudently saved money is to be appropriated to keep the grasshoppers in a place they never should have gotten into in the first place.
On a less selfish (that word again! Why are those still in the houses and expecting a bailout not selfish?) note, I believe that the sooner people get out of houses they cannot afford, the sooner the market regains equilibrium, and the sooner things begin getting back to normal. (The past ten years have not been normal.) The bailout simply prolongs this process, and does so at greater long term costs to us, our children, our grandchildren.
How about this? Modified form of bankruptcy that focuses on primary residence only, that lets people walk away from the underwater loans without the same kind of trailing baggage as standard bankruptcy demands. They can start over more quickly, the market clears, things pick up again. (DERAIL- is not the money they DO pay to the banks right now already spoken for, as in, going to pay off bank debt holders (many overseas) rather than fertilizing the economy? I ask the Mutants of the world, for I do not know)
As to those who bought into the game when the dice were hot- well, they can reflect happily on the time they lived places they would not in normal times ever have aspired to. Bad times follow good follow bad. Next time think harder. Don't be like the guys I talked to back in, say, 2005 who said you had to mortgage the house to the hilt and invest either in home improvement or stocks, else you were an idiot.
posted by IndigoJones at 5:18 PM on February 19, 2009 [4 favorites]
Primary housing should never have been considered an investment any more than food or clothing or health insurance should be considered an investment. It's a cost of living. You budget accordingly. Those who lost sight of this are now in trouble. And speaking as someone who would like to buy the house they could not afford at a reasonable price, hell yes I am narked that my prudently saved money is to be appropriated to keep the grasshoppers in a place they never should have gotten into in the first place.
On a less selfish (that word again! Why are those still in the houses and expecting a bailout not selfish?) note, I believe that the sooner people get out of houses they cannot afford, the sooner the market regains equilibrium, and the sooner things begin getting back to normal. (The past ten years have not been normal.) The bailout simply prolongs this process, and does so at greater long term costs to us, our children, our grandchildren.
How about this? Modified form of bankruptcy that focuses on primary residence only, that lets people walk away from the underwater loans without the same kind of trailing baggage as standard bankruptcy demands. They can start over more quickly, the market clears, things pick up again. (DERAIL- is not the money they DO pay to the banks right now already spoken for, as in, going to pay off bank debt holders (many overseas) rather than fertilizing the economy? I ask the Mutants of the world, for I do not know)
As to those who bought into the game when the dice were hot- well, they can reflect happily on the time they lived places they would not in normal times ever have aspired to. Bad times follow good follow bad. Next time think harder. Don't be like the guys I talked to back in, say, 2005 who said you had to mortgage the house to the hilt and invest either in home improvement or stocks, else you were an idiot.
posted by IndigoJones at 5:18 PM on February 19, 2009 [4 favorites]
"Yeah, I don't want to bail out all those losers that bought houses they couldn't afford! I did everything right, they could have too, so they can just twist. Wait - Whaddaya mean I can't withdraw money? Why's my bank surrounded by armed guards? Whoah, whoa - I got fired?! What the hell? How am I supposed to make my mortgage? Somebody should do something about this - I'm callin' my representative!"
So, if/when all of these bailouts fail, what will be left for you and the rest of us who did everything "right"? You know, after the people who either:
1) gamed the system,
2) are completely foolish, or
3) ran the financial system into the ground
(ab)use our lifeline?
To use a sailing metaphor, apparently we are to completely risk losing the use of our lifeboat. The lifeboat that we sacrificed to equip our meager boats with (while they blew their wad on a much bigger yacht, buying/selling yachts, speculating on yacht sales, or financing yacht sales). We wouldn't even have to use our lifeboat if these assholes hadn't blindsided us in this perfect storm they created.
So now, even though our modest boats are sinking alongside theirs (albeit slower) we must give them our lifeboats. We must ensure the rich, the rats and the foolish are saved first. If it works I'm sure they'll circle back for us. If it doesn't we go down (even those of us who prepared).
I get it. We gotta trust our Captain. If ever there was one I'd trust it is the O-man. However, if this vortex is too much, and all of us go down you motherfuckers better at least say "Thanks" as I ride your ass to hell.
posted by HyperBlue at 5:56 PM on February 19, 2009
So, if/when all of these bailouts fail, what will be left for you and the rest of us who did everything "right"? You know, after the people who either:
1) gamed the system,
2) are completely foolish, or
3) ran the financial system into the ground
(ab)use our lifeline?
To use a sailing metaphor, apparently we are to completely risk losing the use of our lifeboat. The lifeboat that we sacrificed to equip our meager boats with (while they blew their wad on a much bigger yacht, buying/selling yachts, speculating on yacht sales, or financing yacht sales). We wouldn't even have to use our lifeboat if these assholes hadn't blindsided us in this perfect storm they created.
So now, even though our modest boats are sinking alongside theirs (albeit slower) we must give them our lifeboats. We must ensure the rich, the rats and the foolish are saved first. If it works I'm sure they'll circle back for us. If it doesn't we go down (even those of us who prepared).
I get it. We gotta trust our Captain. If ever there was one I'd trust it is the O-man. However, if this vortex is too much, and all of us go down you motherfuckers better at least say "Thanks" as I ride your ass to hell.
posted by HyperBlue at 5:56 PM on February 19, 2009
IndigoJones has the right idea. The appropriate thing to do is to not "bailout" the three-SUV family with the 4200 sq. ft. McMansion they never had any business being in (and by "bailout," I mean, you're just throwing the money away as they'll be in the same sitituation in a year), but to let them walk away, give the keys to the bank, and take a limited hit on their credit so they can try again.
Ideas might be limiting negative foreclosure information to, say, 2 years on your credit report; not allowing the more open ended "have you ever been involved in a foreclosure" as a basis for approving loans; or making people who allow the banks to foreclose to not be open to any "exotic" future financing, strictly 20% down, 30-year-fixed, no HELOCs or second mortgages, 25% of gross pay. Any number of things which could get the (frankly, kinda dumb) people out of places they have business being and still allow them to try again when they're in better shape.
posted by maxwelton at 5:57 PM on February 19, 2009 [1 favorite]
Ideas might be limiting negative foreclosure information to, say, 2 years on your credit report; not allowing the more open ended "have you ever been involved in a foreclosure" as a basis for approving loans; or making people who allow the banks to foreclose to not be open to any "exotic" future financing, strictly 20% down, 30-year-fixed, no HELOCs or second mortgages, 25% of gross pay. Any number of things which could get the (frankly, kinda dumb) people out of places they have business being and still allow them to try again when they're in better shape.
posted by maxwelton at 5:57 PM on February 19, 2009 [1 favorite]
Ideas might be limiting negative foreclosure information to, say, 2 years on your credit report; not allowing the more open ended "have you ever been involved in a foreclosure" as a basis for approving loans; or making people who allow the banks to foreclose to not be open to any "exotic" future financing, strictly 20% down, 30-year-fixed, no HELOCs or second mortgages, 25% of gross pay. Any number of things which could get the (frankly, kinda dumb) people out of places they have business being and still allow them to try again when they're in better shape.
I understand the frustration, but what do you do about people that did the "right" thing and are getting clobbered anyway? I put 50% down on a 30-yr fixed. The payment was about 27% of my gross. It was the fourth house I've purchased; I've never had more than one at a time and never missed a payment. Then the economy turned south, the company I was with went belly-up and I spent two years underemployed ( making about 60% of what I was making when I bought the house). I couldn't sell the house because the market was saturated and prices had dropped pretty hard. Now the bottom has fallen out of prices, and I am unemployed again because my last company had a 40% (!) RIF.
I still haven't missed a payment, but it's getting real tight. In fact, making sure my mortgage has been paid has negatively impacted my credit rating, as other bills have taken a back seat from time to time. As far as the mortgage company is concerned, I'm gold. What incentive is there for them to renegotiate my deal? With so much of my cash tied up in the house, I'm screwed either way.
I've worked hard. I've played by the rules. And now, I'm pissed.
posted by Benny Andajetz at 6:33 PM on February 19, 2009 [4 favorites]
I understand the frustration, but what do you do about people that did the "right" thing and are getting clobbered anyway? I put 50% down on a 30-yr fixed. The payment was about 27% of my gross. It was the fourth house I've purchased; I've never had more than one at a time and never missed a payment. Then the economy turned south, the company I was with went belly-up and I spent two years underemployed ( making about 60% of what I was making when I bought the house). I couldn't sell the house because the market was saturated and prices had dropped pretty hard. Now the bottom has fallen out of prices, and I am unemployed again because my last company had a 40% (!) RIF.
I still haven't missed a payment, but it's getting real tight. In fact, making sure my mortgage has been paid has negatively impacted my credit rating, as other bills have taken a back seat from time to time. As far as the mortgage company is concerned, I'm gold. What incentive is there for them to renegotiate my deal? With so much of my cash tied up in the house, I'm screwed either way.
I've worked hard. I've played by the rules. And now, I'm pissed.
posted by Benny Andajetz at 6:33 PM on February 19, 2009 [4 favorites]
"As to those who bought into the game when the dice were hot- well, they can reflect happily on the time they lived places they would not in normal times ever have aspired to. Bad times follow good follow bad. Next time think harder. Don't be like the guys I talked to back in, say, 2005 who said you had to mortgage the house to the hilt and invest either in home improvement or stocks, else you were an idiot."
Look, if the banks were not allowed to lever indefinitely starting in 2004, this never would have ballooned like it did. You don't get borrowers without lenders, and you don't get lenders doing incredibly risky things like 30, 40-1 leverage and opaque and overly complex loan securitzation without lax regulatory environments. The failing banks never would have failed if they were required to stick to their previous limits of around 15% and the CDS/CDO market were regulated, and you'd never see the crazy lending. The borrower does not create these conditions. It's like the old baseball cliche. In lending, if you are willing to originate a loan, no matter how crazy or stupid it is, someone will borrow that money. If you want a good investment, you require proof that your borrower is a worthy risk. If you don't, and you allow the loans to be securitized and sold at dishonest valuations, so everyone invests in them, then you get this. The borrower of crazy loans in a crazy housing market is a chump, but they aren't the driving force behind this market, as they are always, always there, waiting to sign on the dotted line if you give them the opportunity. If you are waiting for people to stop being suckers, and you think the economy should depend on it, good luck with that, but I can tell you now that won't work. You're trying to do the impossible.
You have to regulate the market and lending environment and nip these bubbles before they get like this. It's always that sort of environment that brings about these conditions. Not stupid borrowers running wild. They don't, if they never get the chance.
posted by krinklyfig at 7:07 PM on February 19, 2009 [1 favorite]
Look, if the banks were not allowed to lever indefinitely starting in 2004, this never would have ballooned like it did. You don't get borrowers without lenders, and you don't get lenders doing incredibly risky things like 30, 40-1 leverage and opaque and overly complex loan securitzation without lax regulatory environments. The failing banks never would have failed if they were required to stick to their previous limits of around 15% and the CDS/CDO market were regulated, and you'd never see the crazy lending. The borrower does not create these conditions. It's like the old baseball cliche. In lending, if you are willing to originate a loan, no matter how crazy or stupid it is, someone will borrow that money. If you want a good investment, you require proof that your borrower is a worthy risk. If you don't, and you allow the loans to be securitized and sold at dishonest valuations, so everyone invests in them, then you get this. The borrower of crazy loans in a crazy housing market is a chump, but they aren't the driving force behind this market, as they are always, always there, waiting to sign on the dotted line if you give them the opportunity. If you are waiting for people to stop being suckers, and you think the economy should depend on it, good luck with that, but I can tell you now that won't work. You're trying to do the impossible.
You have to regulate the market and lending environment and nip these bubbles before they get like this. It's always that sort of environment that brings about these conditions. Not stupid borrowers running wild. They don't, if they never get the chance.
posted by krinklyfig at 7:07 PM on February 19, 2009 [1 favorite]
And I like Santelli for his knowledge of the market and his conviction to say what's on his mind no matter how much Cashin and Kudlow and the rest of those clowns blather on about mustard seeds and Goldilocks. But his anger is misplaced this time. He wants us all to get a check, if the bad borrowers get theirs. Well, life ain't fair, bud, and we're all getting tax breaks anyway, so there's your check. Plus, the trillion we've thrown at the banks. I wish we weren't at this place, either, but Rick never got on his soapbox like that to rally against the cause of this disaster. He ought to direct his anger at the people who set the stage for this to happen, not the people trying to clean it up and the people who are falling off a cliff.
posted by krinklyfig at 7:22 PM on February 19, 2009 [1 favorite]
posted by krinklyfig at 7:22 PM on February 19, 2009 [1 favorite]
Mortgage stabilization is not about handing out free money. It's about keeping average people in their homes, to glide the housing correction in for a soft landing, rather than gutting every neighborhood in America until it all looks like Detroit.
Why did people get in over their heads? Mostly because they were lied to, up and down the line - Jim Kramer and Suzi Orzman, their banks and mortgage brokers, their realtors, the government its own damn self. They were sold sunshine and lolipops, and it is only now in fucking retrospect we can tell Mr. and Mrs. Middleclass they were fools for believing in any of it. Clearly, they should have been studying economics at a post-graduate level instead of working for a living and listening to the mainstream, everyday advice of paid fucking professionals.
The mortgage rescue plan isn't about giving handouts to the indolent, it's about restitution to the victims of a vicious swindle, and the government keeping you, the live-within-your-means homeowner from having to live on crackhouse corner as your neighbors walk away to move back in with Mom and Dad.
The Chicago School swindlers have a problem with paying their fair share for the debacle they created? Well, cry me a goddamn river. Personal responsibility is a bitch, ain't it?
posted by Slap*Happy at 7:26 PM on February 19, 2009
Why did people get in over their heads? Mostly because they were lied to, up and down the line - Jim Kramer and Suzi Orzman, their banks and mortgage brokers, their realtors, the government its own damn self. They were sold sunshine and lolipops, and it is only now in fucking retrospect we can tell Mr. and Mrs. Middleclass they were fools for believing in any of it. Clearly, they should have been studying economics at a post-graduate level instead of working for a living and listening to the mainstream, everyday advice of paid fucking professionals.
The mortgage rescue plan isn't about giving handouts to the indolent, it's about restitution to the victims of a vicious swindle, and the government keeping you, the live-within-your-means homeowner from having to live on crackhouse corner as your neighbors walk away to move back in with Mom and Dad.
The Chicago School swindlers have a problem with paying their fair share for the debacle they created? Well, cry me a goddamn river. Personal responsibility is a bitch, ain't it?
posted by Slap*Happy at 7:26 PM on February 19, 2009
The mortgage rescue plan isn't about giving handouts to the indolent, it's about restitution to the victims of a vicious swindle, and the government keeping you, the live-within-your-means homeowner from having to live on crackhouse corner as your neighbors walk away to move back in with Mom and Dad.
What about us renters? I, for one, would be glad if rents went down.
Also, because of the bubble, the idea of owning property in my city is pretty much impossible for someone of my means. By propping up unreasonably high prices, you're basically insuring that it will continue to be unlikely for me to ever own property.
So, see it from my point of view :
My tax dollars are going to help keep real estate prices unreasonably high, so people who fucked up can stay in their apartments. The same people who played a very important role in fucking up the economy (I don't buy the helpless victim angle, sorry.) The same fucked-up economy that will make it difficult for people of my generation to earn a decent living right as we're entering our prime. The same fucked-up economy that will make it difficult for us to save up enough money to pay the egregiously high real estate prices that you're suggesting we help to prop up.
All for a bailout that we have no reason to believe will actually improve things in the long term.
The more I think about it, the more I'm against it.
posted by Afroblanco at 9:09 PM on February 19, 2009 [2 favorites]
What about us renters? I, for one, would be glad if rents went down.
Also, because of the bubble, the idea of owning property in my city is pretty much impossible for someone of my means. By propping up unreasonably high prices, you're basically insuring that it will continue to be unlikely for me to ever own property.
So, see it from my point of view :
My tax dollars are going to help keep real estate prices unreasonably high, so people who fucked up can stay in their apartments. The same people who played a very important role in fucking up the economy (I don't buy the helpless victim angle, sorry.) The same fucked-up economy that will make it difficult for people of my generation to earn a decent living right as we're entering our prime. The same fucked-up economy that will make it difficult for us to save up enough money to pay the egregiously high real estate prices that you're suggesting we help to prop up.
All for a bailout that we have no reason to believe will actually improve things in the long term.
The more I think about it, the more I'm against it.
posted by Afroblanco at 9:09 PM on February 19, 2009 [2 favorites]
I'm just glad that someone's finally speaking up for the silent majority -- stock exchange floor traders.
posted by mazola at 10:15 PM on February 19, 2009 [1 favorite]
posted by mazola at 10:15 PM on February 19, 2009 [1 favorite]
bear raid
The very thought of a "bear raid" terrifies me. When did berries and fish stop working bears? Why? Leave our economy alone please.
posted by thsmchnekllsfascists at 11:51 PM on February 19, 2009
The very thought of a "bear raid" terrifies me. When did berries and fish stop working bears? Why? Leave our economy alone please.
posted by thsmchnekllsfascists at 11:51 PM on February 19, 2009
You have to regulate the market and lending environment and nip these bubbles before they get like this.
Absolutely no argument. My only point is that since that didn't happen, it's a bit much to expect the non-stupid non-borrowers to pony up for the stupids.
Who I really blame are the public highschools which do not have three years required courses in basic practical home economy. I want propaganda films on personal fiscal irresponsibility on a scare level equal to the VD films once put on by the War Department. (Do they still screen those things?)
posted by IndigoJones at 5:59 AM on February 20, 2009 [1 favorite]
Absolutely no argument. My only point is that since that didn't happen, it's a bit much to expect the non-stupid non-borrowers to pony up for the stupids.
Who I really blame are the public highschools which do not have three years required courses in basic practical home economy. I want propaganda films on personal fiscal irresponsibility on a scare level equal to the VD films once put on by the War Department. (Do they still screen those things?)
posted by IndigoJones at 5:59 AM on February 20, 2009 [1 favorite]
What about us renters? I, for one, would be glad if rents went down.
It's not just prices going down, it's the painful decline of neighborhoods and cities. You might want your rent to decline in the same place you live right now, but what you're missing is that if rents decline across the board your place turns into Detroit. You want that?
The very thought of a "bear raid" terrifies me. When did berries and fish stop working bears? Why? Leave our economy alone please.
Yuk yuk yuk
posted by jckll at 6:06 AM on February 20, 2009
It's not just prices going down, it's the painful decline of neighborhoods and cities. You might want your rent to decline in the same place you live right now, but what you're missing is that if rents decline across the board your place turns into Detroit. You want that?
The very thought of a "bear raid" terrifies me. When did berries and fish stop working bears? Why? Leave our economy alone please.
Yuk yuk yuk
posted by jckll at 6:06 AM on February 20, 2009
It's not just prices going down, it's the painful decline of neighborhoods and cities. You might want your rent to decline in the same place you live right now, but what you're missing is that if rents decline across the board your place turns into Detroit. You want that?
I dunno. For years, I've had to listen to New Yorkers bitch endlessly about how great their city was before the people like me showed up. I'm almost anxious to see how great their impoverished bohemian city turns out to be, and how many of them stick around through the crash.
Here's to hoping that, by the time the economy bottoms out, the cost of living in this city will have sunk to a reasonable level.
posted by Afroblanco at 7:07 AM on February 20, 2009
I dunno. For years, I've had to listen to New Yorkers bitch endlessly about how great their city was before the people like me showed up. I'm almost anxious to see how great their impoverished bohemian city turns out to be, and how many of them stick around through the crash.
Here's to hoping that, by the time the economy bottoms out, the cost of living in this city will have sunk to a reasonable level.
posted by Afroblanco at 7:07 AM on February 20, 2009
CNBC’s Rick Santelli: Aiding and Abetting the Criminal Element of Wall Street?
posted by homunculus at 1:13 PM on February 20, 2009
posted by homunculus at 1:13 PM on February 20, 2009
So does it bother me that others will be rewarded for their poor decision making, when I've taken such great pains to live within my means? HELL FUCKING YES. I could have been there with them all along, scooping up property with a devil-may-care attitude, knowing that the government will step in and save me when things get too wacky.
Well, congratulations for never taking any risks, I guess. You realize that every venture is a risk, don't you? Whatever pays you your living requires someone to take a risk with their money, to buy something, to purchase a service, to attempt to entertain themselves. Let's say you save up your nest egg to the point that you get a downpayment together and buy that condo with a $2000/month mortgage. Then let's say, oh, an uninsured motorist runs you over crossing the street in front of that condo. And now you can't make the payments. You see, risk. It is life itself. Congratulating yourself for having avoided fiasco is all well and good, but we are all at risk. It's somewhat mitigated by making wise choices, but mostly we are at the mercy of chance. And just because that chance has been small over the last few decades doesn't make us particularly smart for having avoided failure. There are some pretty big dummies who have struck it big, and some pretty smart cookies who have been driven into the ground. Life has a way of breaking us all, sooner or later, to paraphrase Pat Conroy. It's just a matter of time. Going your way with humility is the best way to pad the fall.
posted by Mental Wimp at 2:28 PM on February 20, 2009
Well, congratulations for never taking any risks, I guess. You realize that every venture is a risk, don't you? Whatever pays you your living requires someone to take a risk with their money, to buy something, to purchase a service, to attempt to entertain themselves. Let's say you save up your nest egg to the point that you get a downpayment together and buy that condo with a $2000/month mortgage. Then let's say, oh, an uninsured motorist runs you over crossing the street in front of that condo. And now you can't make the payments. You see, risk. It is life itself. Congratulating yourself for having avoided fiasco is all well and good, but we are all at risk. It's somewhat mitigated by making wise choices, but mostly we are at the mercy of chance. And just because that chance has been small over the last few decades doesn't make us particularly smart for having avoided failure. There are some pretty big dummies who have struck it big, and some pretty smart cookies who have been driven into the ground. Life has a way of breaking us all, sooner or later, to paraphrase Pat Conroy. It's just a matter of time. Going your way with humility is the best way to pad the fall.
posted by Mental Wimp at 2:28 PM on February 20, 2009
What about us renters? I, for one, would be glad if rents went down.
I would be glad if I don't get evicted because my landlord went bankrupt.
posted by dirigibleman at 2:57 PM on February 20, 2009
I would be glad if I don't get evicted because my landlord went bankrupt.
posted by dirigibleman at 2:57 PM on February 20, 2009
I'm a renter and I've been fortunate the last couple of years and have been in a pretty high tax bracket. While I get where you're coming from if you've played it straight and aren't in trouble when you say you feel like you don't owe a bailout to anyone who didn't, but I have to say, when Katrina hit, I didn't begrudge anyone their FEMA assistance (inadequate as it was -- I hope this time we learned our lesson) nor do I begrudge the funding of national parks I've never visited or highways I've never driven on or any number of things. We're talking about people's houses here.
I totally agree to the stipulation that this needs to be limited to primary residences only. That kind of bailout is not what I think most people are arguing for, nor do I think it's what's being proposed, but since there's no bill yet, I'm not too interested in arguing what-ifs.
posted by feloniousmonk at 7:04 PM on February 20, 2009
I totally agree to the stipulation that this needs to be limited to primary residences only. That kind of bailout is not what I think most people are arguing for, nor do I think it's what's being proposed, but since there's no bill yet, I'm not too interested in arguing what-ifs.
posted by feloniousmonk at 7:04 PM on February 20, 2009
Fox News "war games" the coming civil war
posted by homunculus at 7:07 PM on February 24, 2009 [1 favorite]
posted by homunculus at 7:07 PM on February 24, 2009 [1 favorite]
Another Battle on the Housing Front: Stimulus Aid Set Aside to Help Military Families Avoid Foreclosure
posted by homunculus at 12:27 PM on February 25, 2009
posted by homunculus at 12:27 PM on February 25, 2009
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posted by billysumday at 1:40 PM on February 19, 2009 [3 favorites]