Mortgage Housing Crisis?

[mraynrand]

The mortgatge crisis wasn't caused by Freddie Mac. Sorry, but that has been debunked long ago.

And, i guess subprime loans to unqualified applicants had nothing to do with it.

I live in a blighted area.

[Tyrone Bigguns]

The major banking deregulation act of the last 20 years was Gramm-Leach-Bliley... funny that it was written by McCain's financial advisor Phil Gramm following $300 million of lobbying by the banking industry.

88 Senators voted for it; signed into law by Bill Clinton.

And, that means what? That it didn't contribute.

Signed by Clinton...why that seems terrible. Why didn't our campassionate conservatives immediately go about repealing it.

[Tyrone Bigguns]

The mortgatge crisis wasn't caused by Freddie Mac. Sorry, but that has been debunked long ago.

And, i guess subprime loans to unqualified applicants had nothing to do with it.

I live in a blighted area.

And?

[Partial]

So I was discussing with a friend about how the united states is pretty much fucked. We don't produce any goods that are used world wide and the trade deficit is awful.

The national debt will is too big to ever be paid off.

Is life about to take a major change in the US? My buddy suspects we'll see huge reductions in extra cash/spending money as goods like food, clothing, etc soar in price as the dollar becomes weaker.

[SkinBasket]

So I was discussing with a friend about how the united states is pretty much fucked. We don't produce any goods that are used world wide and the trade deficit is awful.

The national debt will is too big to ever be paid off.

Is life about to take a major change in the US? My buddy suspects we'll see huge reductions in extra cash/spending money as goods like food, clothing, etc soar in price as the dollar becomes weaker.

Is this your buddy?

[texaspackerbacker]

You don't "pay off" the national debt, you extend it and extend it ad infinitum--like corporate leverage only more so.

As for the trade deficit and a lot of production moving overseas, I used to be concerned about that, but less so now. Our GDP is increasing faster than debt; We are not experiencing significant inflation; Therefore, the situation is under control even if more money flows out of the country than in. If this situation was going to do serious harm to America, it would have happened decades ago. The fact that our money is backed by government debt instruments--effectively making the trade deficit just a matter of printing more money--insulates us against any harmful effect. As long as inflation is held in check, that will continue to be the case.

I can just hear the gears grinding when Howard, Bobblehead, aynrand, etc. read this, but I challenge you to dispute it with real facts. If you don't think things are working just fine that way, explain where you see a problem and why.

[Kiwon]

First things first, read what Tex was saying 1.5 year ago. Oh boy...

Second, there is no end in sight in the mortgage crisis / Fannie and Freddie mess. Responsible taxpayers are getting screwed at every turn.

The government created the problem, they created an even worse solution, and now ordinary folks are incentivized to bail on their mortgages because they know that someone else will pick up the tab.

.................................................. ...........................................

Fannie and Freddie tab is $146B and rising

CASA GRANDE, Ariz. — Fannie Mae and Freddie Mac took over a foreclosed home roughly every 90 seconds during the first three months of the year. They owned 163,828 houses at the end of March, a virtual city with more houses than Seattle. The mortgage finance companies, created by Congress to help Americans buy homes, have become two of the nation’s largest landlords.

Bill Bridwell, a real estate agent in the desert south of Phoenix, is among the thousands of agents hired nationwide by the companies to sell those foreclosures, recouping some of the money that borrowers failed to repay. In a good week, he sells 20 homes and Fannie sends another 20 listings his way.

“We’re all working for the government now,” said Bridwell on a recent sun-baked morning, steering a Hummer through subdivisions laid out like circuit boards on the desert floor.

For all the focus on the historic federal rescue of the banking industry, it is the government’s decision to seize Fannie Mae and Freddie Mac in September 2008 that is likely to cost taxpayers the most money. So far the tab stands at $145.9 billion, and it grows with every foreclosure of a three-bedroom home with a two-car garage one hour from Phoenix. The Congressional Budget Office has predicted that the final bill could reach $389 billion.

http://www.stltoday.com/stltoday/news/stories.nsf/nation/story/E744C01438F6DB698625774700815937?OpenDocument

[Scott Campbell]

Well, at least they mean well.