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Crap like this..

burns me. Today's article in the NYT about possible government bailouts of folks who bought more homes than they could afford, while unsurprising, really pissed me off.

Not one of the folks profiled in this article sounds like anyone who truly needs government assistance in paying their mortgage. They might be losing money on the deals they made but they are not claiming any sort of fraud in their mortgage or home loan...they just don't like the deal they got into. I see no reason why a couple making over 250k, a granny making over 100k, and a couple with 100k in savings should be coming to taxpayers for a handout. It's simply amazing how much our country has bought into the notion of the "privitization of reward but the socialization of risk". You can bet your bottom dollar if the tables were reversed and these folks and made a "killing" on their "investments" in their homes they would have bitched to high heaven about the taxes, if any, they had to pay on that "investment". Yet now that they are over extended on a deal that didn't work in their favor...woe is me. Bleh, articles like this make me ill.

The lawyer couple extensively profiled in the article are one of the true wonders of modern America. Over 250k a year in income and they can't get their financial act together? Oh wait, apparently they've breed like rabbits, gotten divorced, fleaced their cars, ran up credit card debt to all hell and, last but not least, taken a view of their finances that makes one seriously wonder if bailing them out will help at all (“I used to think,” Mr. Breakstone said, “that I would pay the piper later and enjoy life now. I’ve totally reversed that view.”) And I'm supposed to feel sorry for them?

Rant is over...

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Comments

brewergnome
Feb. 23rd, 2008 12:47 am (UTC)
That's what makes me the angriest, that a lot of the peopel who "need bailing out" are the same ones who bitch and moan about socialism and oh my god national health care is so eeevil and communist
boaltie2004
Feb. 23rd, 2008 05:26 pm (UTC)
Yeah, like the folks over in Ohio who consistently vote republican cause they hate fags. I actually do have to say though, the Bush Administration is doing a small part to hold the line on the crazier bailout plans (at least according to this and other NYT articles). While they've been attacked for being too modest, the only way to keep this shit from happening is to give Wall Street a good lesson in how markets work. I'd also say I'm intrigued by the idea of doing the negative amortization certificate talked about in the article. That could allow the mortgage on these house to be brought down to a level the person living in the house could reasonably afford while still giving the bank an opportunity to earn back the money it loaned in the first place. I think the key would be ensuring that, if you set the certificate to be paid on the first sale after it's creation, you'd have to set up a monitoring program so you don't have fraud in that transaction. example - I currently owe 500k on my house, I get a new loan for 200k and a 300k certificate. I go and sell the house to my brother for 210k, 10k goes to the certificate but the other 290k is wiped out. Another good aspect of the certificate is it pulls the losses out over a longer period of time - allowing the banks to get back to some level of normal lending behavior. Of course, one could also argue that it just spreads unknown losses over a longer period making the current instability worse.

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