Not Again... Americans who can't afford their mortgage up 145%

twostrokenut

twostrokenut

Well-Known Member
Lucky Luke said:
People have been speaking of this massive housing bubble for years and years. Property goes up. land is a resource. Sure there are corrections in the market like any other resource but it always bouncers back to more than it was.

We can either reverse the citys population growth or make more land- otherwise its only going to go up. (on avg housing prices double every 10 years) Its a pretty safe investment if you can hold on till the growth.
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land is no different than any other commodity. more money chasing the same land drives prices up. Australia is not somehow magically immune.
 
twostrokenut

twostrokenut

Well-Known Member
rkymtnman said:
you think 1%ers have maxed out credit cards, take out car loans for 7 years, 40 year mortgages?
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no not personally. 1%ers are incorporated. and all those expenses are on credit. you think the family dollar truck driver gets his diesel fuel from the company's capital draft account? smarten up.
 
twostrokenut

twostrokenut

Well-Known Member
whitebb2727 said:
Fuck the banks. Car manufacturers also. Should have let them all fail.
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very interesting proposition youre putting forth here. in 1933 the banks did fail and we enacted an emergency.....little known fact is that we are still operating under that emergency to this day....

so I'm like fuck em too....car manufacturers are banks too dude. the reprocussions are going to be big but nothing a society of Freeman and women can't handle.
 
twostrokenut

twostrokenut

Well-Known Member
jonsnow399 said:
1 percenters OWN businesses for the most part. Even if they inherited piles of cash its still stupid to buy a house for cash and lose the tax deduction and with great credit you can get low and even 0 percent financing, you'd be crazy not to take advantage of that.
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exactly. 0% loans are reserved for those surrounding the creation of new currency at the bond level....sometimes extended to the populace in a crisis.
 
twostrokenut

twostrokenut

Well-Known Member
TacoMac said:
That is spot on.

When you buy something for cash, not only are you out your cash reserves which increases the amount you're leveraged and lowers your net worth, you wind up constantly paying taxes and you get no deduction on interest of any kind to help offset upkeep costs and taxes.

You lose coming and going.

What's more, you really can't be sure what property values and tax assessments are going to do, so it's very, very, very foolish to buy outright.
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now that depends on the state. "posession is 9/10ths of the law".
 
Fogdog

Fogdog

Well-Known Member
twostrokenut said:
the hundred airs way is find some nice person to gift you a property then pay them on the side.
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Yes, a lot of people are helped out by their parents to buy a home. I think it's the only way in some places. Nothing wrong with that.

twostrokenut said:
your loaded term "home ownership" is just so subjective....to hedge with that would require tapping equity or outright ownership.....nlt sure where you're going with that.
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Home ownership means somebody has title to the land and property that they call home. Home + ownership. Knit your brows together and think hard you might understand. and don't get mad, I just couldn't help mocking just a little bit.

You are right in that home ownership isn't a hedge in any sense used by the financial industry. A mortgage can be paid off with inflation adjusted wages. It's not the mortgage that is the hedge. The wages are. There are investment strategies using home equity as leverage to buy inflation adjusted securities as a hedge too. Not that I'm claiming to be an expert about that. Not saying zero risk either.
 
twostrokenut

twostrokenut

Well-Known Member
ttystikk said:
True, but you're still looking at the rose in the frosting of the rotten cake...

The big Institutions are the ones that will destroy our economy again, not the little guy.

ALL the little guys put together aren't as much of a factor in the economy as just one of the 'too big to fail' banks.

THAT'S WHY THEY'RE 'TOO BIG TO FAIL', GET IT?

They need to be broken up so they can't wreck our economy!
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dude "too big to fail" was every bit as much of a bunch of "little guys" defaulting as it was banks pushing government insured sub prime "predatory" loans.
 
twostrokenut

twostrokenut

Well-Known Member
Fogdog said:
Yes, a lot of people are helped out by their parents to buy a home. I think it's the only way in some places. Nothing wrong with that.


Home ownership means somebody has title to the land and property that they call home. Home + ownership. Knit your brows together and think hard you might understand. and don't get mad, I just couldn't help mocking just a little bit.

You are right in that home ownership isn't a hedge in any sense used by the financial industry. A mortgage can be paid off with inflation adjusted wages. It's not the mortgage that is the hedge. The wages are. There are investment strategies using home equity as leverage to buy inflation adjusted securities as a hedge too. Not that I'm claiming to be an expert about that. Not saying zero risk either.
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lol I like how low key you are keeping this. sometimes it's someone who doesn't want to show an income rather than a "parent".
 
twostrokenut

twostrokenut

Well-Known Member
TacoMac said:
You obviously don't know what a credit default swap is.

Remember all those 10's of millions of loans carried by 10's of thousands of banks? Those were all bundled into 10's of millions of 401k's and other investment portfolios. Then, they actually began betting against those very loans because they knew nobody would be able to pay it all off.

That is the definition of what happened. They bet against themselves. They all knew full well nobody would ever pay off all those 10's of millions of bad loans. The credit default swop was just one more way for them to make money before the bottom fell out.
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you have a flair for the obvious. credit default swaps are for credits that are already defaulted.
 
twostrokenut

twostrokenut

Well-Known Member
TacoMac said:
You're preaching to the choir, but you're looking at it all wrong.

Yes, ultimately it was the big banks that caused it all. But the point is that it was a product of the lower 98% of people, mostly lower middle class and poor, that took out all that ridiculous credit on ridiculous terms to begin with.

I'm just telling you where the money all came from. You're acting like it was all the banks money from the outset. It wasn't. Until the second the loan was made to all those people one by one, the money didn't exist.
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yet somehow you think it's the banks fault instead of Americans who happened not to read title12.
 
Fogdog

Fogdog

Well-Known Member
twostrokenut said:
you have a flair for the obvious. credit default swaps are for credits that are already defaulted.
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Dangit two stroke. Bad twostroke, bad. You are soooo wrong about this.


cred·it de·fault swap
noun
FINANCE
plural noun: credit default swaps
  1. a financial contract whereby a buyer of corporate or sovereign debt in the form of bonds attempts to eliminate possible loss arising from default by the issuer of the bonds. This is achieved by the issuer of the bonds insuring the buyer’s potential losses as part of the agreement.
CDS theory was that a security could yield more than the low interest bonds available at the time by taking a pile of higher interest/higer risk loans and insuring them. The cost of the insurance would be paid for by the higher interest and on balance the security would pay back at a higher than prime rate with the same risk.

Of course, turned out, the tools used to estimate risk were bogus and so the whole thing unraveled very quickly, ultimately putting AIG, the big boy in the insurance room at risk. If AIG went under, world wide panic would ensue. We can thank Bush and his administration for letting banking industry self regulate these securities which is how the whole thing went down.

I'm sure somebody will dig up nefarious actions by Hillary and Obama but the root of this problem was the Bush administrations ruling to let banks regulate the CDS market free of government oversight.
 
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