As part of the It Gets Better Project, President Obama shares his message of hope and support for LGBT youth who are struggling with being bullied.
Words do matter, as does leadership. Hillary Clinton showed it, and perhaps her video put the pressure on the top dog to get his act together (The President actually gave this speech at the Matthew Shepard dinner earlier). We needed to see the POTUS personally take note of the tragedies that are unfolding because of intolerance, depression, desperation and lack of parental involvement to stop the pain.
Now if only his administration would continue that thought and send a message by to those struggling LGBT youth that he views them as equal to their heterosexual peers through actions, not just words. But the words were sorely needed.
We are a profoundly ignorant. People don’t know anything about their own religions. We know little of our own history, let alone our history in context with the rest of the world. We worship sports heroes who torture dogs, but we point at scientists and laugh. A profoundly messed-up woman like Christine O’Donnell can run on a platform of “See? I can’t manage my finances either. I’m you.” We had eight years of a dry drunk as president because people thought he was the guy they’d want to have a beer with — as if that were ever going to happen. Now there are people who would vote to give the nuclear codes to an aging high school mean girl because they’d like to fuck her — as if that’s ever going to happen. Smart people are regarded with scorn as “elites.” Ignorance is regarded as a virtue.
This is how an empire dies. And we are going to be around to see it.
It’s hard to keep up with the idiocy coming out of this administration, its DOJ and the Pentagon. Look at this development; a memo has been issued as a fig leaf for the uproar created by reinstituting the ban on DADT via the stay of the injunction. (The Wonk Room):
At a briefing this afternoon, officials hinted that they may be pursing a softer approach towards the ban, telling reporters that discharges will now require the approval of the “service branch secretary.” In other words, only four people in the entire Department of Defense will be able to discharge a gay soldier under the policy.
A senior defense department lawyer briefed reporters on Thursday afternoon about the memos, saying, “These two memos are primarily in reaction to … the temporary stay last night. We are clearly in a legally uncertain territory.”
CNN is reporting that even though the Pentagon still wants the ban repealed through Congress, “they are now looking at other possible ways at which it might be repealed.
Perhaps that is the response to the reality check that DADT repeal via the Def Auth bill in the lame duck session is a non-starter. How the Pentagon can do any kind of about face when the geezers who are worried about the soap dropping and want to wait for the Dec. 1 bogus, freeped study to come out is anyone’s guess. Are gays and lesbians a threat to national security, troop readiness and morale or not? Just earlier today we saw an AP article that made an inference that today’s military, populated mostly from the conservative South and West are therefore bigots and require everyone else to accommodate their homophobia. That in itself is rank regional bias to begin with, but it makes “following orders” some sort of magical trait that is hard to find in service members. The whole matter is so childish. It’s embarrassing.
If there are “other possible ways” of non-legislative, non-executive order ways of doing away with DADT, surely they would have copped to them before now, no?
Look, the bottom line is that this is a PR disaster for this White House. The Dan Choi/Valerie Jarrett CNN appearances made it crystal clear who is an honest broker and who has made a deal with the devil. Gates has had Obama by the short ones for some time now, and it’s completely blowing back on all of them.
When Valerie Jarrett had to sit and watch Dan Choi rip her boss’s DADT reasoning to shreds on international television and tell her not to lecture him, it definitely looked like a game changing moment — the emperor had no clothes, they were set ablaze. Dan Choi said “You’ve Lost My Trust, I Won’t Be Voting for Obama,” that was the political gauntlet thrown down. Jarrett has no response to that; how can this administration restore any trust when it has shown that the LGBT community is merely an ATM to it. We’re strung along and told that the threat of President Palin or Majority Boehner is enough to go back to the rear of the bus and pay up some more, thank you very much.
No equality=no money, no vote in 2012 for Obama says Dan Choi. Now the WH has to wonder how many others have seen the betrayal and will do the same. Now the President and his boss Gates are stuck, and have to gamble whether these half-cocked measures are going to repair the damage.
Nope. No. Sale. Not until the discharges stop and gay and lesbian service members have full equality. This policy should have been done away with in the first two years of this administration and yet we’re still talking about showers, bunks and soap dropping. It’s preposterous. The pressure will continue; we’ve had enough of the lies about what can be done, the motives for the actions that have occurred and the unending drive for cash and scare tactics. No, we will vote — but support only those who support us with actions, not promises – the ones who stick their necks out there, like Rep. Patrick Murphy. (more…)
More Questions about Rapacious, Reckless, Righty-Radical, Rat-Face Rubio
I have been watching the campaign for the Florida Senate seat for a while now and believe that Rubio been getting a free ride for much of the campaign. Governor Crist only started negative ads about Rubio in October. Congressman Meek still has not had a television attack ad against Rubio individually (and vice-versa), as far as I know. Meek has attached Crist in a television spot. Now, I really have better things to do but if they are going to shy about it, I am going to speak up. I believe that Rubio and Governor Candidate Scott will complete the financial meltdown in Florida started by the Bush family, if they are elected. Florida would be in better financial condition without Jeb Bush’s tax cuts including the elimination of the Florida Intangibles Tax which mainly targeted the super-wealthy. Rubio has gone negative with gratuitous attacks on Obama and neither Crist nor Meek have responded in kind with attacks on the true culprits — the Bush brothers.
I believe we have all heard nicknames for politicians of both parties. Most recently I heard Dave Barry say negative things about the appearance of Governor Crist on NPR. I overheard a woman in a restaurant say similar things about Rick Scott. When I look at Rubio, I see someone who has the facial features similar to a rat; so I call him Rat-Face Rubio. Think of it as joke, if you are offended. Mr. Barry was just joking, wasn’t he? I do not believe that Rubio is literally vermin but I do not believe his is harmless. Unfortunately he has been infected with what I call the GWB/JEB strain of the financial meltdown disease and therefore he is dangerous for Florida and the country. The strain has similar DNA to the Harding/Coolidge/Hoover financial meltdown disease of the 1920s. Republicans for all their talk about free enterprise really know how to run the economy into the ground, while becoming extremely wealthy themselves. The Bush clan, for example, derives much of their wealth from the depression era.
I watched the second Florida Senate debate 14 days or so ago. Rubio talked about Obama being a “disaster.” What does that make George W. Bush? Rubio talks about the debt and spending. Ninety percent of those result from decisions made by George W. Bush. Apparently Rubio does not remember George W. Bush the brother of his patron Jeb Bush. We were on the brink of worldwide financial Armageddon and this petite rat-faced Republican has the temerity to call Obama’s efforts a disaster. Meek did try to counter in the debate but was not clear enough or forceful enough in his response to the disaster comment. Meek did bring up the name of Cheney several times; I suspect because his advisors know that Cheney is not popular. Even Fox News contributor Judge Napolitano thinks Bush/Cheney should have been indicted. Meek needs to do a better job of connecting the Bush clan to the financial meltdown rather than just throw in the name Cheney. Specifically, Meek should eviscerate Rubio if he makes any more Obama is a disaster comments. Crist pointed that many more Floridians would have already lost their jobs already without the stimulus funds. Rubio like many obstructionist Republicans would have preferred more unemployment because that would have made their election job easier. Several studies show that business, in general, has been hoarding cash. Do you think that there may be some businesses out there that could have hired more of the unemployed but held off until after the election? Most businesses are probably waiting for demand to pick up. The employment numbers would be better without the cash hoarding. Where is that Chamber of Commerce campaign to get its members to loosen up?
The main reason that Rubio is on the stage at all is that Jeb Bush is desperate to find that Great Hispanic Hope. First it was Martinez in 2004, where Jeb Bush supported Martinez rather than the more experienced McCollum. When Martinez decided to resign during his term, Jeb betrays Crist to run Rubio. Talk about racial politics. I bet Crist is kicking himself for appointing someone else to the open Senate seat. Never mind that the rapacious Rubio cannot balance his own personal checkbook or that he is connected with all sorts of financial shenanigans. But he will probably be willing to follow orders and has the necessary Hispanic qualification that Jeb was looking for.
Most of Rubio ads so far have been filled with empty-headed platitudes. Even his most recent one where it sounds like he might actually being saying something is just filling air time. He says no more stimulus money. I think everyone is for that, if possible. He fails to mention the possible consequences of that policy; a deeper recession and more unemployment. Rubio is for tax cuts; meaning more tax cuts for billionaires and multi-millionaires. The jobs he talks about creating are going to be mainly overseas for the big transnational entities; his corporate backers. He says he is against increased spending without blaming those mainly responsible, George W. Bush and the Republicans in Congress. Like many Republicans, Rubio is running a campaign based on bullet points. So far his opponents, especially Meek, have not done a very good job of attacking Rubio’s simplistic and reckless campaign.
Heaven help the State of Florida if either Rick Scott as Governor or Rubio get elected. That will make it more difficult for the state to get federal stimulus money, if needed. Thousands more would have lost their jobs already without it. If Scott and Rubio live up to their campaign statements that means many thousands of state workers will get fired in the next year or two; teachers, policemen, firefighters, college faculty, and other state workers. With that many people losing their jobs the multiplier effect means that many other Floridians will also lose their jobs. I hope that Floridians will wake-up and realize the consequences of electing either Rubio or Scott. It will further devastate the State of Florida. Floridians need to think about the consequences of what Rubio is suggesting in his bullet point campaign.
Rubio admits to being a right-wing tea-party candidate. This means that he would not ever support the Dream Act in any substantive form, despite what he might try to indicate in his nuanced position. His base is against it. Despite having many things in common with new arrivals to the United States, it is hard to believe that he would stand very strongly for them. His base is against it. Other Hispanics are starting to notice as evidenced by the article in the La Gaceta newspaper.
His media campaign has been a slick one. One item I find offensive is the one dating back to at least August showing the family and home in Cuba. Actually his father had already left Cuba in the 1950s before Castro and the Communist guerillas took over. Did his father go back to Cuba, no more than a couple of hundred away, to fight them? I believe he stayed in Miami tending bar. Since Rubio brought his family’s Cuba history into the campaign, I believe it is fair to inquire why his father stayed in Florida. Was his father fooled by Castro? If so, then he would have that in common with the Eisenhower/Nixon/Dulles administration. That is another fine mess that started with Republicans. Some of us are old enough to remember the 1950s.
It is ironic that Rubio or his older sibling might be considered a so-called anchor baby but for Castro. That term is not my term. You may remember that Senator Lindsey Graham brought up that term a few months ago when he suggested repealing or amending the 14th amendment. Prior to that, I did not know what the term meant. Where was Rubio’s outrage when the term was brought up then? It was subsequently discussed on various blogs, including progressive ones. Since, the term is not defined it is not unreasonable to wonder whether Republicans like Senator Graham may have in mind retroactive changes to the law where those who cannot trace their United States ancestry back for centuries lose their citizenship. Some of the “elites” do view the rest of us as just visitors. If you have a problem with that, I suggest you contact Senator Graham or like-minded Republicans.
I was unable to watch the Florida Senate debate last week. From reading newspaper accounts, it does not sound like much changed from the previous debate. I did watch the televised debate on October 19; I did not see much difference from earlier debates. Meek went after Crist much more than Rubio. I believe that Congressman Meek needs to direct more of his efforts against Rubio. Maybe they are South Florida buddies; I think some folks are starting to wonder. Even some right wing blogs are saying how “nice” Meek is compared to Crist. Perhaps, Meek is having difficulty changing his campaign strategy to run against two individuals rather just one. Like it not Crist, so far, has taken some votes away from him; Meek needs to adjust his campaign. If Meek is to win, he will need to take votes away from both Crist and Rubio. Meek needs to remind voters who Republicans really are and that they work for a narrow slice of the population: the super-wealthy and large corporations.
I posted earlier that I didn’t go to the Tea Partypalooza in San Diego today because, bitter old people, yech. True to form, courtesy of K.C. Alfred, it was like a casting call for dinner theater musical based on Cocoon:
According to a commenter at SignOn SanDiego:
There were almost as many vendors there as attendees probably 15 booths selling buttons, t-shirts and posters, very few books though, wonder why?
I’m guessing business at the Green Bananas booth was less than brisk.
I was accosted by one young woman who wanted to save me from eternal damnation as I marched, so naturally I had to go over and film her. It was hilarious – her schtick was that Obama wasn’t going to save us from the hellfire. I asked her why she wasn’t out there protesting divorce. This got her briefly off message, then the cops told me to move along. Here’s the video of her and the rest of the fundies.
This is a complete record of evidence to support the allegation that the housing boom was a fraudulent plan that begin in 1996. A choreographed disaster.
Some of you know that I have been researching and writing about this for over 2 years. A bit of what I have reported is just surfacing in the news, even though I constantly contacted them and provided information. Others have picked up a lot of the foreclosure information, which is helping. But the A-Z story needs to be told. I have the details.
This is offered to help homeowners fight to keep their homes and the news media to grow some and get the whole story out in the open.
Below are some suggested SOLUTIONS TO FORECLOSURE/INVESTOR problems.
I will begin with a simple analogy:
Please feel free to improve on it.
Pretend if you will, that I have an antique car I want to sell in excess of its real market value. I am willing to finance the sale to the buyer, because I know I am going to sell his debt to someone else. I plan on accepting an offer from a naive buyer only.
What can I do:
Contact and make sure all the appraisers in my area use my inflated value in case the buyer calls around..
Convince someone to buy the loan from me.
Naive buyer shows up, loves the car, and the fact that I will only charge him interest for the first year on the variable interest loan I offer him. He signs and drives off.
I call the "secondary 1" loan buyer, who looks forward to jacking the interest price up to 8% next year, and get all my money back PLUS a $1,000 loan origination fee.
Then "secondary 1" loan buyer decides to do the same and sells the loan to "secondary 2" loan buyer and collects $1,000 loan origination fee.
"Secondary 2" sells to "Secondary 3", to "Secondary 4", "5", "6", and so on as this happens a few times thereafter. Sometimes even a couple of times a week. Why? PONZI !
The fees are added to the total debt.
In the end, the loan is placed in a bundle with a bunch of other loans purchased by a TBTF bank, rated as AAA, and sold to investors.
Not being stupid, the TBTF banks also purchase Credit Default Swaps from RottenEGG, and a PMI policy for extra cushioning just in case the complete stranger they are now financing disappears.
RottenEGG has the protection of the NY FED, Geithner.
All this happened without paperwork ever being updated at the Department of Motor Vehicles Registry, as there is an electronic/internet process in place called MARS (Mortgage Acquisition Repossession Scheme)
The original title on the car still has the original owner’s (the seller/lender) name on it with the purchaser’s name.
Out of no where the car buyer gets notice that his car is about to be repossessed by a Bank/Loan Servicer, let’s call them Spank of America.
At the same time the buyer hears on TV that the Federal Government has a program call RUSE for people who were sold cars whose value was misrepresented, to help any car owner whose car may be repossessed. So the car buyer calls and is told to Stop Making Payments, until things are sorted out and a new agreement can be reached.
A couple of months later MARS comes to repossess the car and a court/hearing date is set.
The buyer calls his lawyer who orders an Audit for the Record of Title from the Registry of Motor Vehicles. No where in the records is the Spank of America or MARS listed as having any standing to repossess the car.
They perform a Car Ownership Audit and find that nothing in the records at the Registry seems to have transpired since the day the buyer signed the Promissory Note with the original car owner for an overstated value.
Now, in the meantime, the original owner has died even though he is shown as the holder of a note on the car.
WHAT’S THE SOLUTION?
Did the buyer’s obligation end upon the death (think no longer in business) of the seller/lender who sold his loan without the buyers permission?
In this mess, how is the buyer guilty of anything. He made all his payments on time before calling RUSE, who told him to hold off on the payments.
Isn’t the true recourse for those at the top of the Hot Potato Loan scheme ladder to get reimbursed from whoever sold them the loan/investment, and so on down the ladder, until the first secondary lender gets to the car’s original owner’s estate for reimbursement?
And, btw, who will stand up and verify receiving the car buyers payments the buyer made for three years? Where did that money go?
THIS is the housing mess.
THIS IS WHY THE RHETORIC THAT "BUYERS ARE DEADBEATS" MUST STOP.
And also, THE REASON WHY WE MUST KEEP LOOKING AT THE WHOLE TRANSACTION, which evidence indicates was mostly fraudulent, especially beginning in 2005, while also staying on top of the foreclosure crimes.
Sometimes I think, because houses are big and the amount of money is huge, and the players are all so rich and powerful, that it tamps down our innate abilities to understand what has happened.
I have come to the collusion where I feel comfortable with the allegation that the Housing Boom/Bust was planned and choreographed. The economy was in a major decline after the DotCoN bubble and only got worse after 911.
I think this plan was in the works as soon as the Gramm-Leach-Bliley Bill passed that deregulated the banks. I don’t find any innocent in this crime other than the unsuspecting home buyers, not including the flippers/crooks.
Both Democrats and Republicans in power for the past listened to the economic advise of the disciples of Milt Friedman.
My opinion of laissez-faire economics? Laissez-faire = Oligarchy Rule
Here’s an analogy to demonstrate laissez-faire economics:
A bee hive: A worker complains one day, so the Queen Bee says "If you work hard and smart enough, someday you can be a Queen Bee, too. Until then, you get to serve me. Unless I really, really favor you or you are descended from a bee I really, really favor" Well any thinking bee knows that you can’t become a Queen Bee. So all the bees become sycophants, turning on each other, all vying for the Queen’s favor.
Laissez-faire is a heartless, cruel, and destined to become oligarchy system.
Another laissez-faire example:
What could be more laissez-faire than the three paragraph Bailout Paulson presentedf for handing the banks $700 billion dollars.
It was a glaring example of his and the Bush Administrations’ lack of concern for homeowners and investors.
Oh, excuse me, that was pure, unadulterated socialism.
AMERICA IS A CRIME SCENE
And if we don’t stop this foreclosure insanity, I fear all hell is going to break loose, literally.
And everyone is guilty.
Where does Paulson live now? Dubai?
Another definition of laissez-faire could be, and you’ve heard this before, privatize the profits, subsidize the losses with the taxpayers money. And how cynical is it to use the tax earnings of the millions who are being tossed to the curb in bogus foreclosure proceedings?
They just took care of the banksters.
The Housing Boom/Bust of 2000-Present was simply a rewrite of the Savings & Loan Crash. And no one in Congress protected the American citizens or the investors, many of whom are foreign Sovereign Wealth Funds (think Saudi Arabia, for one)
Except, today 800,000 families a month are at risk of losing their homes while millions already have. That is an unnecessary and harsh reality.
THE MASTER MIND PLAN TO LAUNCH THE HOUSING BUBBLE:
Step 1. An electronic highway had to be created to enable huge quantities of mortgages to travel quickly enough to satisfy investors. This was designed so that it could feed into the computer models created by quants so bundles could be created for investor trades.
Step 2. The rating agencies had to be co-opted to provide proper ratings to satisfy investors.
Step 3. The FBI Criminal Investigators had to be removed.
Step 4. A Mortgage Fraud reporting system had to be put in place in order to cover the the missteps of the players with proof that the problem was caused by a "few rotten apples".
Step 5. Real estate appraisers had to be compromised with threats of getting no business and/or even blackballed.
Step 6. Credit Default Swaps had to be an option to hedge the losses most knew would result.
Step 7. President Bush had to announce the plan, and a few rules put in place to enable the Federal Government to back up some funding/risks, and to provide seed money to the developers/home builders.
Step 8. All had to turn their backs, as millions of unqualified buyers were allowed to buy homes, so they could also be blamed for the problems when the bubble of greed burst.
Step 9. The plans for mass foreclosures had to be in place.
Step 10. An economic disaster warning from Paulson, causing the economy to crash so millions would lose their jobs and then be ripe to lose their homes, so the same players could re-run the housing bubble.
Well, oddly, there are no First-Sixth MARI Fraud Reports that I could find. It seems like the The Mortgage Bankers Association (MBA) did a great job accumulating mortgage fraud data beginning with the launch of the housing bubble, unleashed by low interest rates and hired Choice Point (who has ALL of our personal information in their databases) to gather and process the data.
Then the FBI and others use the MBA/MARI report as gospel truth.
What do you make of all this? The MARI report does not include any fraud done by mortgage bankers.
FLORIDA HOMEOWNERS MUST READ AND PRINT THIS. EVIDENCE that the State of Florida new home buyers were at huge risk of fraud.
This also comes up in a search for Seventh Annual Report on Mortgage Fraud. This is an indepth Florida report, written in 2005 by the Florida Department of Law Enforcement that references MARI research from 2001-2004.
Scathing report/example of the full awareness of the State of Florida. And buyers were left unprotected.
Step 5.Lenders demand inflated housing valuations. Compromised Appraisers who were told by mortgage brokers/lenders either give us the appraisal we want or don’t work. Complete with fraud maps, charts, and evidence.
Mortgage Backed Securities (MBS)(Fannie and Freddie issue),
This is in its simplest form a bond. The bond is backed by a pool of mortgages that are being paid by homeowners across the United States. Each month a homeowner makes a payment, that payment basically sent to the holder of this bond.
These securities are issued by Fannie Mae, Freddie Mac and Ginnie Mae – but can also be issued by other institutions.
Backed by our tax dollars, even the tax dollars of those whose homes are being taken, through funding for Fannie, Freddie, and Ginnie. THEY ARE ABOUT TO BE BAILED OUT AGAIN! $400 BILLION.
For all those at FM and FM who were charged with qualifying mortgages? Were they asleep?
They sold the FM/FM MBS TO INVESTORS. As the MARI reports shown above prove, there is absolutely no excuse for not knowing the stuff was riddled with fraud.
To quote MARI: "It is worth noting that value inflation is almost always a direct consequence of incorrect, fabricated or omitted comparables and other information."
In short, fudged appraisals. And 2009 was the worst year yet! See chart in MARI TWELFTH report above
But none did anything to stop this TRAIN WRECK
The investors, people like the Saudi Arabian Sovereign Wealth Fund, bought them because they were AAA rated and backed by the AMERICAN TAXPAYERS, you know, the ones being kicked out of the homes at the rate of 800,000 a month.
Collateralized Debt Obligations or CDO’s (Sachs, BoA, etc),
Pretend that you have a mortgage (okay, most of us aren’t pretending) and you make principal and interest payments each month – these payments are made to your loan servicer and then split up as follows:
Investor A – Gets all of the interest payments from years 1 – 4
Investor B – Gets all of the principal payments from years 1 – 4
Investor C – Gets all of the interest payments from year 5
Investor D – Gets all of the principal payments from year 5
Investor E – Gets the interest and principal payments from years 6 – 10
Investor F – Gets interest payments from years 11- 24
Investor G – Gets principal payments from years 11 – 24
Investor H – Gets the remainder of principal and interest payments, if made from years 25 – 30
A trustee is in charge, which is why there is no chance of a workout, and these go into foreclosure.
Credit Default Swaps or CDS (AIG)
There is nothing wrong (highly debatable these days, mine) with a Credit Default Swap – it is basically an insurance policy against the failure of a specific asset. The reason these have been in the news is because some companies – like AIG, Lehman and Fortis (and many others) found these insurance policies to be very lucrative business.
However, when the reality that the MBS and CDOs were for overvalued houses with predatory loans that wouldn’t be paid, the insurers just didn’t have the money needed to cover everyones losses.
So Geithner bailed out AIG and made investors whole. Well, those that had CDS.
Step 7. Youtube of President Bush’s "We are a Homeowner Society". Listen carefully to his words as he launches programs to give our tax dollars to developers and builders and ease the paperwork burden. Bush specifically targets low income, miniority buyers in this speech.
Step 8. Proof that everyone had a clear picture of the disaster as it was unfolding. See evidence #4 above. The MARI reports regarding mortgage fraud (for all but the brokers and lenders) were widely distributed.
SUGGESTED SOLUTIONS: For Home Buyers/Owners and Investors
STOP THE MUSICAL HOME GAME NOW!!!
I have a solution.
It will keep people in homes. Hell, there are homes empty or about to be empties and people/families/babies and children/grandmas and grandpas who need a home.
Will make investors whole
And will make those who bent the law and fudged the numbers pay the difference to the investors
PROPOSED SOLUTION TO THE MESS:
First the Investors: Investors stand to lose a lot. Pension Funds and foreign sovereign funds as well as many, many others.
I believe a polygram test will prove that absolutely everyone involved in rating, buying and selling the MBS and CDS knew in 2005, the height of the frenzy, that something wasn’t quite right.
That said, contracts were made. However, because the foundation product for the investment was worth much less than everyone said they believed they were worth, the investors have losses.
There is no way the banks have enough to make up for the contractual losses. We are certainly not going to bail them out again, not after how poorly they have treated the majority of citizens in the US for the past 2-3 years. They can go hang.
And, in a laissez-faire model, it’s really not anyone’s problem other than the investment fund Trustees and the institutions/people that sold them the MBS, CDOs.
Who bails us out if we are snookered? Um, no one.
So, there is no way, in the short run, to resolve the losses.
However, the two most commodities in the deal still exist: The House and the Home Owner/Buyer
The market still exists. No one took the houses off the board and the people are still needing homes.
So………….to minimize the losses to the investors and to minimize the failure of the TBTFs, it’s time for a do over.
New contracts need to be written BETWEEN the investors’ Trustees and those who sold MBS and CDOs if, and only if, the investor hasn’t been made whole via Credit Default Swaps for a property/properties. I believe the NY FED under Geithner gave the money to AIG to take care of the investors so we could avoid World War III.
There is also a possiblity that the bank/lender could have been made whole, as well, via a PMI policy.
And, if the BANK/Mortgage had PMI insurance, and the bank was made whole via PMI for a home/homes, than those homes have no outstanding debt owed. Period.
To avoid moral hazard, as most of the homes have been or will be foreclosed EVEN IF investors and banks/lenders were made whole, and to save entire neighborhoods from blight and violent crime/crack houses, there is absolutely every reason to reunite the homeowner/buyer with their home and play LET’S MAKE A DEAL.
NO ONE HAS TO ADMIT TO APPRAISAL FRAUD or fraudulent behavior. We will let the FBI work that all out if they ever get enough funding.
Most of the foreclosed homes end up auctioned off for peanuts to wealthy flippers, the very people most guilty of inflating home valuations to begin with. This just doens’t make sense.
The market today, if we don’t stop and correct this mess will just get more and more corrupt, as proven by the most recent MARI Report:
Mortgage fraud is a relatively low-risk, high-yield criminal activity that tempts many. However, according a May 2006 Financial Crimes Enforcement Network (FinCEN) report,
finance-related occupations, including accountants, mortgage brokers, and lenders, were the most common suspect occupations associated with reported mortgage fraud2. Perpetrators in these occupations are familiar with the mortgage loan process and therefore know how to exploit vulnerabilities in the system.
What is a reasonable price for the homeowners to pay to be able to either stay in or return to their home?
Does it really take a Rocket Scientist (I revere them) to understand that there absolutely HAS TO BE a relationship between the cost of housing and household wage?
Are we to believe that entire industries hadn’t caught on to this basic of rules for financing? No. Which if all would be honest, all would admit that we got to play pretend monopoly with real homes and real people, and their childrens’ lives. Shame.
Those who are the haves, who want to bring up moral hazard for helping desperate people get on with their lives, simply shut up. Where was your moral hazard squawking when the billions were flowing like a chocolate fountain at a mid-sized wedding?
Both homeowners and investors need a reasonable solution that isn’t fraught with risk.
America (and other countries) that suffered from exploding house-price bubbles, had no excuse, the tools were there, just they chose not to use them.
The reason was mainly because there was no agreement on what is the correct or fundamental value of a house; even though some people were warning about potential problems with housing in USA and also in UK in 2003, there was no consensus. Alan Greenspan spoke of a “bit of froth” in 2005, but he had no courage in his convictions, and even as late as early 2008, just before the slump really started in UK, Gordon Brown was saying that housing in UK was “affordable”, and so there was no risk of catching the American disease.
Even now, after a cataclysmic wake-up call, there is no consensus about what is the “right” price for housing.
What is the right price?
At it’s simplest level (it gets more complicated), the “right” price for housing is that which allows the population to spend a fixed proportion of their income on “shelter”, that proportion is broadly well-known, it works out somewhere between 20% and 30% (and I’m not going to argue-the-toss about exactly where it is, although there is a broad consensus in that the calculation of the weighting of “shelter” in the CPI analysis provides good base-line).
Homeowners deserve their homes at true value (costing no more than 30% of their income total for mortgage, taxes, and insurance) and those who issued the MBS and CDOs owe the investors the rest.
And here is where we can get creative.
Today, many are un, under or low wage employed because, as Evidence #10 above clearly lays out, cash rich companies/banks are refusing to hire or loan money to small businesses and, instead, are using their trillions to buy more stock, pay higher bonuses, and reward shareholders with higher dividends. On top of the past decade of shipping manufacturing jobs, and the tax revenues as well, America is at a cross roads, perhaps a solid stand still.
The corporations and the TBTFs will do just fine. They can move to tax-free Dubai. Hope that works out well for them.
But we have to glue this mess together again, NOW, stop the bleeding and heartache.
And there are millions of families that have been displaced, tens of millions of children. This will destroy our country’s social fabric if it is resolved instantly. And it can be. Unless we are just heartless enough to watch the house burn rather than help tens of millions of people whose only sin was being laid off and/or lied to, or both.
Which is why I believe we need a new mortgage model. For lack of a better name, I will call it a Sliding Scale Mortgage. Whatever wages are made in a home, no more than 20% will be used to pay off the mortgage.
There will be no transfer of funds for the homes other than payments from the homeowners to the investors/lenders IF they can prove a stake in the house. Money already paid the builder, developer, and the real estate professionals at least once for the homes which stand ready to occupy.
It can be called The Cost of Housing Payment. Buyers could pay off faster if they wanted to with no penalities, because we are not going to use this life sustaining commodity, a roof over the heads of a family, for speculation again. Overtime, this can make the investor whole again and, in the interim provide a stream of returns.
20% of income is all people can afford because of all the ways and means money is taken from them at every turn in this country. Health care insurance/costs being one of the worst financial assaults on the American family.
For instance, people in flood zones surely can’t afford Flood Insurance anymore. My quote jumped from $350/year to $2,100/year this year. Thank FEMA. Guess I just rot if a rain cloud hangs around for too long. Who, at FEMA, thinks middle class families can pay $2,100/yr on top of a mortgage, taxes, and insurance. Flood insurance is now comparable real estate taxes. It’s ridiculous. Why pretend there is a national flood insurance program, when no one can afford it. Just another example of how every penny we make is being squeezed from us.
Also, there is a need for some clawback in lieu of prosecutions.
Have you ever wondered where all that money collected by the FBI, Justice, the IRS goes? I believe the American people deserve a transparent, easy to navigate open window to this process for resolving The Housing Disaster.
Have you ever read the Federal Budget? I have. Good Grief, it’s a poorly written fairy tale, quite frankly. Besides which, I want to see, on a weekly basis, where every penny is going. It’s our money!!!
The clawback money could be bundled and put into a Housing Restoration Fund, divided by states, and monitored by volunteer citizens groups within each county. I think we have learned we can’t trust money making people to always do the right thing when it comes to housing. A portion could also be distributed to a Disaster Fund to help in future disasters.
We can let Justice, the IRS (maybe deduct the clawed back monies from income in a kind gesture), and the FBI work that out.
The citizenry deserves to see that crime does not pay, and certainly children need to see that there are consequences for bending the rules and fudging the numbers.
Of course, some did much worse and may have to pay a higher price than clawback.
I would rather see the guilty white collar criminal be sentenced to working for minimum wage AND HAVING TO LIVE AT THAT RATE of income (taken from his hoard of cash and paid to him every two weeks like the majority of Americans), with the wage he earns paid directly to fund programs for the needy: needy children, the elderly, infirm, etc., quite frankly, than jail.
Enough with prison industries profiting privately run, corporate prisons whose stocks are traded on Wall Street! HAVE WE COMPLETELY LOST OUR MORAL COMPASS IN THIS COUNTRY?
Perhaps we could boost our compassion commodity, which is sorely undervalued at this time.
These suggestions would STOP THE FORECLOSURE INSANITY and
keep people in their homes and/or
fill the empty homes,
punish those who cheated the investors, and the payments made by homeowners
would fulfill the investors’ contracts over time which, I suppose, could be leveraged when necessary by the very banks that sold the MBS.
We have to put aside the moral hazard issues. No one was ringing that alarm while millions became millionaires playing with people’s homes.
And, no way in hell should the enriched by The Housing Disaster be allowed to buy foreclosed properties at auction, to start the whole corrupt process all over again with the very same players who bent the rules and fudged the numbers.
We have the homes that need to be filled.
We have people in need of homes.
Fill the damn homes.
STOP THE MUSIC. Stay in the home you landed on. Agree to pay 20% of your income for the home.
Republican U.S. Senate incumbent Richard Burr and Democratic challenger Elaine Marshall faced off in a debate on PBS broadcast from UNC-TV studios in Research Triangle Park.
Democratic challenger Elaine Marshall accused Republican incumbent Richard Burr in their last television debate Thursday night of having views on homosexuality that are “wrongheaded and discriminatory.” But Burr said she wasn’t listening to him and that she was trying to inject race into a discussion of gay rights.
Marshall said that being gay or lesbian is a genetic matter and not a matter of choice. Burr said he didn’t believe the science was conclusive on the issue.
Well one thing is clear — Burr’s another one hung up on the soap dropping in the shower as you will see below. The DADT question starts at 36:43. Judy Woodruff starts off with a side question of whether being gay is a choice. Watch it —
Moderator: We’ve talked about the military. Right now there’s a battle underway in the courts of this country, the federal courts, and in Washington, over what to do about the military’s “Don’t Ask, Don’t Tell” policy against gays in the military. I’d like you to comment on that but I also have a very straightforward question, and that is: do you believe that being gay is–or lesbian–is it a matter of genetics, of biology or is it a matter of choice?
Marshall: Well Judy, it’s a… your last question is the most important. I don’t believe it is a matter of choice. I believe that it is a biological occurrence, specifically beyond that I don’t have the scientific knowledge to say, but I don’t really believe its choice. I do think that if there are people that want to stand up for me and stand up for every American and defend us around the world they should be able to do that. I believe the government policy on Don’t Ask Don’t Tell needs to be repealed. As to the judge and the courts – this is a law that Congress made, it is something that Congress needs to fix. The president has recommended it, the highest of brass has recommended it, and it is time that that takes place. It should have taken place but it hasn’t taken place, and now we’ve gotten judges from the Ninth Circuit who, a judge, who has jumped in on this, probably because Congress didn’t act, but it really needs to be decided by Congress and not the judiciary.
Moderator: And Mr. Burr, respond on the Don’t Ask Don’t Tell, and also the question on whether being gay and lesbian is a matter of genetics, biology or a matter of choice.
Burr: Well, Judy, let me just say I’m not sure that any of us know whether its genetic or by choice, and I’m not sure that’s even relevant. If somebody chooses that lifestyle and how it might then impact our policies. Don’t Ask Don’t Tell has worked. Now personally I don’t see a reason to reverse it. But that’s a personal opinion. I think the country should have a debate. And what we should do is we should wait until the Department of Defense has gotten back the survey of those individuals who serve. That survey’s back in December. This is not too far off. I agree with Secretary Marshall. This is not an issue for the courts to decide. This is a law of the country and only Congress can in fact address it. But I’m confident of this – that this is the wrong time to change this policy. We’ve got hundreds of thousands of troops deployed. We don’t yet know what we might have to do, from a standpoint of changing the accommodations for troops if the policy changed. Now I’m not scared to have the debate, I welcome the debate, but I’m also very confident that we should time this in a way that makes as little impact on those troops that are deployed as we possibly can.
Moderator: And so the research that has shown, that indicates that gay/lesbian is a matter of biology, you would say…
Burr: I would only say that I’m not sure there has been conclusive evidence of what the result is.
Moderator: A rebuttal.
Marshall: I would respond to that by saying there is ample evidence that it is biological and Senator Burr obviously believes its by choice. That is wrong headed and discriminatory. We shouldn’t be judging people by the color of their hair, the color of their eyes, the color of their skin, or other factors that they have no control over. That’s wrong in America, and what you’re talking about is governmental discrimination for something that’s outside of somebody’s control
Burr: Secretary Marahall, I’m not sure that I referred to anybody’s skin color, or to their hair color. This is a very specific group of individuals, and I made it very clear what my position was. But don’t bring race into this.
Marshall: It is because of who they are by factors that they have no control over. Gender is another one of those. This country has been replete with discrimination based upon things that folks have no control over, and its time in 2010, this century, that we end that.
Let’s just say it goes downhill from there — it’s hard to recover after Sen. Burr says our ‘founders’ wrote the 14th amendment. That comes after the above statements about DADT. FAIL-O-RAMA.
During tonight’s North Carolina senate debate, Sen. Richard Burr (R-NC) said he was against changing the 14th amendment to eliminate birth right citizenship, but said “it is important for the courts to determine” if the “founders” intended to allow for the practice:
BURR ON THE 14th: But I think when you have a debate in the country and that issue is raised, then it’s important for us to have that arbitrator, the courts to come in and tell us did our founders, when they wrote the 14th, did they have something else envisioned?
Thursday Prop 19 got endorsements from Danny Glover, Melissa Etheridge and Hal Sparks joined by LAPD Deputy Chief Steve Downing, former New Mexico Gov. Gary Johnson and activist Sarah Lovering at a news conference to show support for Prop 19 which would legalize marijuana possession for those over 21.
Currently marijuana use for 18 and older is decriminalized, and medical marijuana use is legal statewide.
If Prop 19 passes, the Feds have said they will crack down on pot in CA, making for an interesting series of legal challenges and states’ rights arguments.
Melissa Etheridge said that she had used pot to help nausea during her breast cancer chemo and says she favors legalization and while she uses marijuana medicinally she said
I don’t want to look like a criminal to my children anymore. I want them to know this is a choice that you make as a responsible adult.