On Wisconsin! (Read 2074 times)


Dave

    Oh I don't disagree with this at all.  I just hate the victim mentality that individual home buyers were not responsible for their part in the mess.

     
    Comes down to culpability.

     

    Is the average home buyer sufficiently informed and capable to understand some of the highly complex loan products that were previously offered during that time period? 

     

    Were mortgage brokers even offering the best products to all borrowers?   This question in particular gets difficult because brokers made larger commissions if they could get less sophisticated borrrowers into products that were more profitable for the banks (higher interest rates) regardless of the systemic risk that went with it.

     

    Surely, borrower and lender share blame.  Unfortunately, the system itself had incentives that encouraged lenders to lend without bearing the risk of default.  Anytime you end up in a system where risk and consequence are decoupled, you're headed for disaster.

    I ran a mile and I liked it, liked it, liked it.

    dgb2n@yahoo.com


    Menace to Sobriety

       Surely, borrower and lender share blame.  Unfortunately, the system itself had incentives that encouraged lenders to lend without bearing the risk of default.  Anytime you end up in a system where risk and consequence are decoupled, you're headed for disaster.

       +1   How many of these loans would have been written if the originator of the loan had to hold the note for say, at least 5 years?

      Janie, today I quit my job. And then I told my boss to go f*** himself, and then I blackmailed him for almost sixty thousand dollars. Pass the asparagus.

        Burnt Toast, you input "projected profit margin" as if this is a bad thing.  We live in a capitalist system, no?  If you allow your profit margin to get slashed, people will no longer invest their money in your company.  Your stock price will plunge and you can no longer sustain growth as you cannot access capital.  There goes your competitiveness, no?

         

        Making a profit is not evil in this country...at least it shouldn't be.  A company is not evil because they don't want to pay you more than what they can get someone else to do the job for.  You are free to leave and pursue greener pastures.

         

        Making a profit is good to a point, after that its greed and yes, that is evil.

         

        An insurance company making billions of dollars, yet cutting their work force is not a good thing. Big corporate farmers bilking the public with governemnt subsidies and gobbling up the small family farms is bad. The mom and pop stores that used to exist that just wanted to service its community, make a decent living and employ some local families that are being driven out of business by the Wal-Marts of the world are bad. US companies moving to third world contries for the for cheap labor to boost its bottom line is bad for everyone except its stock holders I guess. A CEO with stock options that is cutting its workforce while giving themselves multi-million dollar salaries all in the name of increasing its profit margain is bad.

         

        How much profit is enough? For some its never enough, but apparently public employees are getting too much.

         

        The pain that hurts the worse is the imagined pain. One of the most difficult arts of racing is learning to ignore the imagined pain and just live with the present pain (which is always bearable.) - Jeff

         

        2014 Goals:

         

        Stay healthy

        Enjoy life

         

          "Anthropologically speaking, we are living in a money culture. Its cult and rites dominate. ... And if the culture pattern works out so that society is divided into two classes, the working group and the business (including professional) group, with two and a half times as many in the former as in the latter, and with the chief ambition of parents in the former class that their children should climb into the latter, that is doubtless because American life offers such unparalleled opportunities for each individual to prosper according to his virtues. If few workers know what they are making or the meaning of what they do, and still fewer know what becomes of the work in their hands, that is doubtless because we have perfected our system of distribution so that the whole country is one. And if the mass of workers live in constant fear of the loss of their jobs, this is doubtless because the spirit of progress, manifest in the change of the fashions, invention of new machines and power of overproduction, keeps everything on the move. Our reward of industry and thridft is so accurately adjusted to the individual ability that it is natural and proper that the workers should look forward with dread to the age of 60 or 65, when they will be laid on the shelf. 

           

          All this we take for granted; it is treated as an inevitable part of our social system. To dwell on the dark side of it is to blaspheme against our religion of prosperity." 

           

          --John Dewey, "The House Divided Against Itself," 1929


          A Dance with Monkeys

            An insurance company making billions of dollars, yet not paying out valid claims is not a good thing.

             

            FTFY.


            Just sayin, and all.

            xor


              Oh I don't disagree with this at all.  I just hate the victim mentality that individual home buyers were not responsible for their part in the mess.

               

              That's fine for people who have high level math, reading, and analytical  skills, but 50% of people are average and below.  They may not be able to distinguish among mortgages they can handle and those they can't.  Do we just say they don't have the right to own a home, or does the mortgage industry have some responsibility to guide them down fiscally sound pathways?  A whole industry was allowed to grow in the housing and financial markets that preyed preys on people with poor math skills.

              Well at least someone here is making relevance to the subject.

                Am I my brother's keeper?  Well, maybe somewhat. But it doesn't take much math skill to know when you can't afford something.

                 

                (Or to understand risk.)


                Feeling the growl again

                  That's fine for people who have high level math, reading, and analytical  skills, but 50% of people are average and below.  They may not be able to distinguish among mortgages they can handle and those they can't.  Do we just say they don't have the right to own a home, or does the mortgage industry have some responsibility to guide them down fiscally sound pathways?  A whole industry was allowed to grow in the housing and financial markets that preyed preys on people with poor math skills.

                   

                  "Right to own a home"? This was part of the problem right there, the assumption that everyone should own a home. Lots of people are better off renting.  This mentality is part of what drove the system to the point it reached, including gov't incentives to over-ramp home ownership. 

                   

                  Yes, the system was very corrupt and geared itself to take advantage of uneducated, naive, or simply impatient people who were too eager to buy. Shame on them. However, if someone is ready to take on the big financial responsibility of owning a house then they are ready to do like I did and buy a $20 book that will walk them through the basics.  I did not say the buyers were 100% at fault, only that they were part of the problem.  I am not at all swayed by the argument that because someone was below average or lacked certain skills they bear no blame for poor choices.  If they are going to make such big financial decisions it is their responsibility to put due diligence into making them correctly.  If they weren't up to the task, perhaps they should have kept renting.

                   

                  Asking the mortgage industry to be responsible for guiding them?   Trusting the seller to tell you what you should buy is a poor way to make sound decisions in virtually any setting.

                   

                  "If you want to be a bad a$s, then do what a bad a$s does.  There's your pep talk for today.  Go Run." -- Slo_Hand

                   


                  Feeling the growl again

                    Making a profit is good to a point, after that its greed and yes, that is evil.

                     

                    An insurance company making billions of dollars, yet cutting their work force is not a good thing. 

                     

                     The mom and pop stores that used to exist that just wanted to service its community, make a decent living and employ some local families that are being driven out of business by the Wal-Marts of the world are bad.

                     

                    US companies moving to third world contries for the for cheap labor to boost its bottom line is bad for everyone except its stock holders I guess.

                     

                    A CEO with stock options that is cutting its workforce while giving themselves multi-million dollar salaries all in the name of increasing its profit margain is bad.

                     

                    How much profit is enough? For some its never enough, but apparently public employees are getting too much.

                     Who defines at what point it is greed?

                     

                    Like it or not, the purpose of a company is to provide return for its investors -- not to provide jobs to its workers.  By law companies have a fiduciary responsibility to their stockholders -- not to their workers.  Good ones will try to be considerate to their workforce however.

                     

                    Mom and pop stores where I grew up lost out when Wal Mart came in because most of them had terrible selection, service and prices but no competition.  The ones that survive now 15 years post-Wal Mart are the ones who excelled at these things.  It was actually of net benefit for the community (I still hate Wal Mart).

                     

                    Goods in the US today are so affordable to the average person because they are made overseas.  Globalization is not all bad.

                     

                    Some CEOs make selfish moves however cutting workforces can also be done for a number of other reasons, like efficiency, which make a company more competitive.  Again, companies don't exist to create jobs but to create profits for investors.  Good ones are considerate to their workforce however.

                     

                    Yes, some public employee benefits are too much for today's environment.   Oops, that last one was almost on topic....

                    "If you want to be a bad a$s, then do what a bad a$s does.  There's your pep talk for today.  Go Run." -- Slo_Hand

                     

                      "Anthropologically speaking, we are living in a money culture. Its cult and rites dominate. ... And if the culture pattern works out so that society is All this we take for granted; it is treated as an inevitable part of our social system. To dwell on the dark side of it is to blaspheme against our religion of prosperity." 

                       

                      --John Dewey, "The House Divided Against Itself," 1929

                       

                      "I believe that in this way the teacher always is the prophet of the true God and the usherer in of the true kingdom of God."

                      -John Dewey

                       

                      I'm guessing that Dewey would support the teacher unionsRoll eyes

                      2014 - Get 5k back under 20:00.  Stay healthy!


                      Dave

                        Yes, the system was very corrupt and geared itself to take advantage of uneducated, naive, or simply impatient people who were too eager to buy. Shame on them.

                        ....

                        Asking the mortgage industry to be responsible for guiding them?   Trusting the seller to tell you what you should buy is a poor way to make sound decisions in virtually any setting.

                         

                        Once again, I fundamentally agree with you, Spaniel, but in practice, the uneducated, naive, and impatient people just defaulted on the debt and got foreclosed on when they couldn't pay. 

                         

                        Good in theory but bad in practice. 

                         

                        The borrowers took a hit on their credit but in most states, the banks couldn't sue them for the difference between what they bought the house for and what they sold it for.  If they did get sued, they just went bankrupt.  Bad but not catastrophic.

                         

                        The mortgage brokers had long since sold off the loan to an investment bank so they didn't get bitten.  The investment bank had packaged up and sold the mortgage as a collateralized debt/mortgage obligation (like a bond) so they didn't really get bitten except in the lawsuits that followed.  The CDO/CMO holders thought they were safe since they had bought AAA rated instruments since it was backed up by what amounts to insurance (the credit default swaps). 

                         

                        Then the whole thing came crashing down leaving the taxpayer with the bill. 

                         

                        So yes, I do think the industry needs more regulation.  I do think that mortgage brokers should have to act in the interests of their clients (fiduciary responsibility) just like financial planners are required to do. 

                        I ran a mile and I liked it, liked it, liked it.

                        dgb2n@yahoo.com
                        DoppleBock


                          Then it is our parents fault (I am 42) and they did not have the issue about buying more house than they could afford and on average had a lower level of education - but they did have a much higher level of common sense. 

                           

                          That's fine for people who have high level math, reading, and analytical  skills, but 50% of people are average and below.  They may not be able to distinguish among mortgages they can handle and those they can't.  Do we just say they don't have the right to own a home, or does the mortgage industry have some responsibility to guide them down fiscally sound pathways?  A whole industry was allowed to grow in the housing and financial markets that preyed preys on people with poor math skills.

                          http://a-big-horse.blogspot.com/ 

                          2013 Goals ~ Mar < 3:00, 5M < 29, 10k < 35  

                           


                          Feeling the growl again

                            Once again, I fundamentally agree with you, Spaniel, but in practice, the uneducated, naive, and impatient people just defaulted on the debt and got foreclosed on when they couldn't pay. 

                             

                            Good in theory but bad in practice. 

                             

                             

                            So yes, I do think the industry needs more regulation.  I do think that mortgage brokers should have to act in the interests of their clients (fiduciary responsibility) just like financial planners are required to do. 

                             

                            Yes, they should have acted that way and perverse incentives made them not.  I agree.  The only point I am arguing is that the buyers who screwed up did not bear some responsibility for making poor choices.  Ignorance is not an excuse when the decisions are major and information so accessible.

                             

                            MTA:  There is the issue of who is responsible and the issue of the systems we put in place to cope with the fact that the world does not work as it ideally would.  I'm simply making a point about the former but I agree with you on the latter.

                            "If you want to be a bad a$s, then do what a bad a$s does.  There's your pep talk for today.  Go Run." -- Slo_Hand

                             

                            DoppleBock


                              it is hypocritical to say employees / union or not should try and get all the pay and benefits that they can from a company and then question why a company should seek as much profit for its shareholders as possible. 

                               

                              Reality it is should be (And part of our mission statement) a balance between value provided to

                              1)  The customer

                              2)  The shareholder

                              3)  The employee

                               

                              But in our society all parties involved seem to want to mazimize their part and are not interested in balance.  But the shareholder can drive the final descision because we as consumers only want the lowest cost - The employee is going to take it in the pants ... until the cost to produce where you work is a neutral option to other options.

                               

                              The other choice is we as consumers demand something other thant he lowest price ...

                              http://a-big-horse.blogspot.com/ 

                              2013 Goals ~ Mar < 3:00, 5M < 29, 10k < 35