The Watering Hole

List your reasons for calling it a draw. ;D ;D ;D ;D

I have none. Not one this time. ;D ;D

Didn't watch it which makes it a draw for me.  ;)

My Mom says a poll on Fox gave the win to McCain something like 87% to 11% for Obama with some undecided.

Sounds Fair and Balanced, right?  ::)

CraigBert — Oct 08, 2008Didn't watch it which makes it a draw for me.  ;)

My Mom says a poll on Fox gave the win to McCain something like 87% to 11% for Obama with some undecided.

Sounds Fair and Balanced, right?  ::)

That's not actually a poll.  That was a "who won: text your vote to #".  MSNBC and CBS did the same thing, with, as you might guess, exactly the opposite results.  

It might be that Fox just gave up on doing an actual post-debate poll since the last two times they have been unfavorable to their candidate.  In any event, there were four polls out there last night, and, as before, Obama came off the clear winner in all of them.

This was an interesting debate for me. Here are some of my thoughts on it.

• McCain did not deliver the personal attacks on Obama that his campaign has been delivering.  That, to me, screams "cowardice."  Either that, or he really doesn't have control of what Palin says.  Either way, it's ugly out there in McCain campaign-land.
  
• Depite hearing so often about it, the town hall debate did not give the much-vaunted advantage to McCain.  In fact, he looked much like he did in the first debate.  McCain does a lot of "town hall" appearances, and seems very at ease in those.  However, there is no opponent in those meetings.  I think he misjudged this as being an advantage.
  
• "My friends."  What is up with that?  Is that, like, a verbal tic or something?  I saw it listed as a McCain drinking game before the debate, but had never really heard it... he must have said "my friends" 20 times.  That was weird to me, even weirder than the "that one" comment that, although really weird and awkward, was pretty much par for the course.  
  
• And on that note: "that one"--I think, like in the first debate, McCain still can't believe he's losing to Obama.  Nothing sinister about it.  He's just a cranky old guy who can't believe he's getting smoked.
  
• Can we never have Tom Brokaw moderate another debate, ever?  He spent half his onscreen time interrupting, and grumbling, talking about the fucking time and the agreement not to use too much of it--as if getting in one or two more questions was going to make or break the candidates.  Gimme Gwen Ifil for every debate.
  

Oh, and I forgot one point.  McCain is going to buy your mortgage, readjust the principal to the actual value of your house, and then let you keep paying for it at the reduced price.  

Yet somehow, he calls Obama "too liberal."

Update:

He actually said "my friends" 22 times!  
McCain must have a lot of friends.

http://voices.washingtonpost.com/sleuth/2008/10/my_friends_mccains_tic_is_back.html

Or he's wishing he had friends.  ;)

(Do the voices in your head count??!  ::) )

charger — Oct 08, 2008Oh, and I forgot one point.  McCain is going to buy your mortgage, readjust the principal to the actual value of your house, and then let you keep paying for it at the reduced price.  

Yet somehow, he calls Obama "too liberal."

What do you think of that?
I don't know what the ramifications of that would be,but it sounds like a good idea.

pickmaster60 — Oct 08, 2008[quote author=charger link=1223444221/0#3 date=1223486910]Oh, and I forgot one point.  McCain is going to buy your mortgage, readjust the principal to the actual value of your house, and then let you keep paying for it at the reduced price.  

Yet somehow, he calls Obama "too liberal."

What do you think of that?
I don't know what the ramifications of that would be,but it sounds like a good idea.


I waffle on that.  Again, this is not a new McCain position... this is something that has been floated several times by Democrats and Republicans.  Joe Biden mentioned it in his debate last week, and Obama's been floating the idea since September.

On the face of it, it seems like a good idea.  Keep people in their houses, avoid more foreclosures, save banks money, etc.  I think in certain cases, it should be practiced.  But judiciously and carefully.  All people underwater should not have their homes revalued.  Rich people who bought 3 million dollar mansions that are now worth 2 million should not be revalued.  Second homes, vacation homes--screw those people.  And I don't think everything should be adjusted to current market rates either.  I think a happy medium-- somewhere between the number on the books and the number an evaluator comes up with.  After all, the market went down--that is not the fault of the taxpayers, and that is certainly an outcome anyone with a brain can foresee as a possibility when they buy a house.


So, that said, here's why as a blanket policy it's not a good idea:

A) There are many, many people who bought houses they could afford, and had good credit, and thus earned the right to a good interest rate loan.  If a bunch of people who should have crappy credit are suddenly getting 5-5.25% interest rates, how will that help the credit crisis?  Suddenly there will be no basis on which to judge credit.  People with excellent credit, and enough income to pay off a decent loan, like me, will still be facing 7% or more on a new loan.  Meanwhile, people who fucked up royally and could not afford anywhere near what they bought will be paying interest rates as if they maintained their credit and earned great money.  How the hell are the people now coming into the market going to be able to buy in?  This will only worsen the credit crisis.

B) People who now have homes that are underwater would be encouraged to default, and thus get their house prices adjusted to the market rates.  This not only would swell the "home bailout" to unforseeable amounts, but it basically encourages gambling and losing.  It is no secret that investments sometimes lose value.  Sometimes, they lose a lot of value.  In many cases, I think people were fucked over by their loans, with negative amortization, poor rates, rates that adjusted, etc.  And I think that should be fixed.  Wipe the negative amortization off the loan, adjust the rate to a decent FIXED level, and adjust the years to something the person can afford.  In some cases, those people were fucked by their TERMS. However, in no case can you possibly argue that people did not know that housing prices could go down in the future.  Housing prices DO go up or down.  

C) Dropping prices on loans is almost guaranteed to have the effect of reducing the worth of surrounding houses.  This can get to the point where a whole area is devalued even more than it would have been, because too many people are bailed out.


If we allow loan prices to be adjusted to bail people out, what we are doing is paying for other people's mistakes.  Sure, foreclosure sucks.  But when you gamble, sometimes you lose.  I have no problem with adjustments to loan rates and terms, to keep people in their houses.  If they plan to keep their houses for a long time, eventually the real estate will be worth more than it is now.  However, it is a simple issue of fairness that you do not leave the responsible people, who bought in more solid areas, who bought what they could afford--people like me--holding the bag.  That's irresponsible, and what will trickle down from a widespread move like this would be

Not all second houses are "gravy" for people.

If my second house disappears then my 79 year-old Mom will have to find some other place to live.  Since I have too many stairs for her to live in my home comfortably, I'd either have to sell this house as well and find something for both of us or put her somewhere else.  In either of these cases I will have lost $65k to over $120k which makes it next to impossible to find new places for us...

CraigBert — Oct 08, 2008Not all second houses are "gravy" for people.

If my second house disappears then my 79 year-old Mom will have to find some other place to live.  Since I have too many stairs for her to live in my home comfortably, I'd either have to sell this house as well and find something for both of us or put her somewhere else.  In either of these cases I will have lost $65k to over $120k which makes it next to impossible to find new places for us...

That's not my point.  Although you have two houses, one is for your mom.  So that's really more like your mom having a house, and you having a house.

Let me ask you this:

Do you believe you should be bailed out because home prices went down?  If so, what other economic losses or gambles do you believe people should be bailed out on?

I seem to recall you being very fiscally conservative, when the economy was good.  I am finding more and more fiscal conservatives see the economy crashing down and are willing to abandon those principles either in part or in whole.  So many right-wingers attack "The New Deal" incessantly, but they've never seen it as a necessity.  This is an interesting time for American politics and fiscal policy.

Another point:

By buying bad mortgages at face value, and renegotiating with the homeowner, what we are really doing is helping out the mortgage lenders.  They still get face value on the loans (which they would lose if the house foreclosed).  Their hands are washed clean.  The loss comes down to the taxpayer.  Nobody who is actually involved in the original transaction loses anything.

That's how McCain, even while pretending to help you and me, is really trying to help the holders of the mortgage securities.  It's weak.  At least in the rest of the bailout package, we assume some return on our investment.  McCain is willing to cut the mortgage lenders' losses and transfer them to us, without any return.

CraigBert — Oct 08, 2008
Although lower home prices have definitely hurt me, that isn't what put me in this situation.  Having lots of equity that I couldn't get to did and THAT was due to some government intervention.  More of a knee jerk reaction on their part to all of those people who bought houses when they shouldn't have for 0% down with low, teaser rate ARM's.  I'm not asking for any big handout from them, I'd just like some of the penalties I was forced to get to be relaxed.  I'm within $8k of getting that second home to belong to my Mom for the rest of her life (without either her or myself having to make monthly payments).  I will still be losing $65k of equity, but I'd be losing it to my mother so that's acceptable.

EDIT--WHOOPS-GODDAMIT--I EDITED YOUR POST INSTEAD OF MINE--SORRY-
-charger

See, that's the kind of attitude I appreciate.  I think what the government should be doing right now is exactly that.  Wiping out penalties and reducing interest rates.  You should be able to get your penalties wiped clean--and also any reverse-am bullshit appreciation--and then they should just reset... say, give you a 20-40 year loan, whatever works for you financially, and fix your rate at something like 5.5%, and then move on.  

The only way that deal would be rational would be if the government is taking equity in homes.

If they reduced your principal to 80% (for example) they would own 20%.

If house prices recover down the road or even if they don't - when you sell you would get your now 80% equity stake in the sale and the government would get theirs.

It could work - but it is not a painless option - nor should it be.

But it is not "the answer" either - there is no silver bullet.

The reality is that all options are  on the table and McCain was simply shooting his mouth off and claiming this for political reasons.

In the current situation nobody wants to see a flood of foreclosures leading to forced sales and further undermining a weak housing market and feeding back into the credit crunch in a desperate downward spiral.

So McCain is a complete asshole for even trying  make politics about something that is already being considered down the line and it is not helpful when someone with his inept and shyster understanding of economics to blabber it out uncontrolled.

McCain is not fit to be president - he is an asshole.

charger — Oct 08, 2008Another point:

By buying bad mortgages at face value, and renegotiating with the homeowner, what we are really doing is helping out the mortgage lenders.  They still get face value on the loans (which they would lose if the house foreclosed).  Their hands are washed clean.  The loss comes down to the taxpayer.  Nobody who is actually involved in the original transaction loses anything.

That's how McCain, even while pretending to help you and me, is really trying to help the holders of the mortgage securities.  It's weak.  At least in the rest of the bailout package, we assume some return on our investment.  McCain is willing to cut the mortgage lenders' losses and transfer them to us, without any return.

The new Fannie Mae program that I'll be in doesn't cut jack shit for me.  All it does is take all of the interest and excessive penalties that I have incurred during this ordeal, wraps it up in a 4+% promisory note amoritized over 15 years and pretends like nothing has happened (I get a six month grace period before I have to start repaying back the note).  Yes, I get to save my house (which has been up for sale for over six months now at a price that would have me losing over $70k of money I've put into it - not even counting lost equity).

While it DOES save me the rest of the equity in my property so I can hopefully sell in a better market sometime in the future, it doesn't bail me out of much since I now have TONS of consumer debt that I didn't have before this issue (I had no choice but to pay the IRS using my credit lines when I couldn't get to my equity then, when my bank fucked up causing me to have late payments to two credit cards, one by two days and the other by three, both cards went from 8.01% and 9.99% to over 31 fucking percent! - Bastards.).  The new interest rates made my minimum payments go up over $1,000 more per month and, since this was all interest that I should never have had to pay, I refused to.  

So, when it's all said and done, I may have one house left, but with shitloads of consumer debt (over $90k) still to pay off and my credit rating is probably trashed (my credit card balances were at zero before all of this and I had a FICO of 811 when I bought this house three years ago).  So far, I'm down over $320k of net worth over the last three years.

Not that I'm bitter or anything...

I watched a bit of the debate via the internet at work, (it was lunch time here). I thought that Obama won hands down. There was one question, about health care and social security, that Obama answered first, which was fairly succint and to the point, when McCain went to answer it, the first part was dribble in which he said a lot of words, but didn't say anything meaningful, the second part was vague, and partly attacked Obama, then he completely washed over the social security part, as far as I could see, as an 'outsider' looking in that was fairly indicitive of the whole thing.
I liked the way Obama bit back, when McCain called him out about telegraphing strikes into Pakistan, then added the "bomb, bomb,bomb,bomb Iran" quote, McCain sounded lame when he said "I was just joking with a veteran"

CraigBert — Oct 08, 2008
While it DOES save me the rest of the equity in my property so I can hopefully sell in a better market sometime in the future, it doesn't bail me out of much since I now have TONS of consumer debt that I didn't have before this issue (I had no choice but to pay the IRS using my credit lines when I couldn't get to my equity then, when my bank fucked up causing me to have late payments to two credit cards, one by two days and the other by three, both cards went from 8.01% and 9.99% to over 31 fucking percent! - Bastards.).  The new interest rates made my minimum payments go up over $1,000 more per month and, since this was all interest that I should never have had to pay, I refused to.  

What I did (and granted, I did not have the amount of debt that you have, and the credit times were much better) was I called up one credit card company, and told them I was cancelling my account.  We then got into a long discussion about my rate, and I managed to get it lowered from somewhere in the 20's to 10%.  I then balance transferred my higher rate cards to that one.  Then I called them, and said "I'm cancelling my card..."  One card, because I had a late payment once, would only lower it to 18% ( I cancelled that one), but the rest got down to the teens.  

Might be worth trying, if you have any other credit cards...

CraigBert — Oct 08, 2008

The scariest part is how you can plan and try to be fiscally responsible and then find out that some entities outside of your control can come in and try to ruin you.  Look at the current financial crisis, all you hear on the news is how your money is secured as long as it's in an FDIC insured institution and is $100,000 or less (actually, I think the newest vote raised this to $200,000 or $250,000...).  Either way it's a false sense of securtity since there's no way the FDIC can cover everyone's money if many more banks fail.

Man - that is the shit I have been trying to explain for weeks now.

All this talk of bailouts for fat cats has obfuscated this in ignorant politics.

The reality is this -  worldwide governments are attempting to  keep the financial system functioning at all costs less than the cost of  it's systemic failure - a cost which is the total capitulation of the capitalism system

The capitalist system won't spring up again over night if it fails and this is completely global.

If say one big mega bank is allowed to fail uncontrolled and unmanaged,  it's failure through it's balance sheet connections would cause a chain reaction of  defaults right across the system up to the ultimate point that sovereign governments would start to default starting a cascade that would require governments to use emergency powers to seize control of economic activity at a command level.

That is the extreme scenario - the  potential "nuclear winter" event that needs to be avoided.

And the politics is about arguing about how much it will cost the tax payer.

Well gee - tax payers will have no money to pay for anything if things really go tits up.

Man this scenario is a survivalist wet dream. :D

People need to understand the seriousness of this situation - it is not like something that happened in the past, it is actually pretty surreal really.

This is kinda like the Cuba crisis - but more drawn out :D

I want to know how much the aftermath of a global nuclear war will cost the tax payer before I sign up to bail things out.

Sorry - Stratman like I know  :)

ELECTRIFIED!