Rick Reuben wrote:I'm sure you're aware of this, but the triumph of state/corporate synthesis is confirmed when profit is privatized and risk is socialized ( when the markets work, the gravy flows upwards- when the markets tip over, then it's all hands on deck to grab mops and clean up the mess ).

This is an excellent truth about the reality we live in today. What amazes me about the general perception right now is threefold, most people thinking:

1) War for profit has nothing to do with the domestic economy. The media has done an excellent job of separating economic woes from anti-war sentiment with reports on polling, "predatory lending" (whoops, there it is again), and Presidential primary "analysis" (which candidate is preferred by women, blacks, 60-year-olds, etc).

Of course this is when they aren't busy doing hit pieces on pastors. Muddy the waters and the solutions become hard to find.

2) We live in an overly-privatized state which can only be alleviated by the socialization of profit along with risk.

and

3) We must elect a Democrat to do #2. They will magically end a war without changing foreign policy, they will magically fix the economy without changing monetary policy, and they will somehow socialize our economy using privatized structures (re: healthcare & big pharma, energy policy & ethanol, etc) thereby altering a half century trend of corporate subsidy and special interest pandering.

All without any evidence they've ever been successful at the above.

I can't even think of a good analogy of how I feel about this; its like I walk out of the house saying I'm a different human being because I change my haircut. It just doesn't make any sense.

Bellulah is right to complain that his bottom line will suffer, even though he did not participate in the mortgage hustle. Here's an analogy: if you were a passenger on a bus, and one other passenger sold the driver cheap whiskey which the driver used to get drunk and roll the bus off an embankment, would you feel like you should suffer your injuries without complaining about the series of poor judgements that preceded the 'accident'?

thank you reuben- very eloquent analogy to explain my point.

bellulah wrote:
...and what about people like me?


Yes, everyone should be concerned about your situation and your situation only.

and to this, i mean, serious... you didn't even read what i wrote. i didn't say "hey guys pity my sorry ass" but i did quite clearly state that there are people (and i just happen to be one of them) who didn't take plopping over $100k on an investment lightly. in a typical situation, when you do make an investment, you can reasonably expect a return on said investment. i don't care if it's a comic book you bought for $5 you can sell in ten years for $20, or a home where you are building equity.

and, when a market turns to shit after you've owned your house for a couple years and you won't get that return on your investment through no fault of your own, and arguably through other people's greed and ignorance, then yes it is cause for some level of dismay.

so no i'm not pissed i'm not going to make a quick buck. i'm annoyed because one of the great advantages to owning over renting is that you are building equity on your investment, and when you hold your property long enough you, in a reasonable market, will have something to show for it.

bellulah wrote:in a typical situation, when you do make an investment, you can reasonably expect a return on said investment. i don't care if it's a comic book you bought for $5 you can sell in ten years for $20, or a home where you are building equity.

and, when a market turns to shit after you've owned your house for a couple years and you won't get that return on your investment through no fault of your own, and arguably through other people's greed and ignorance, then yes it is cause for some level of dismay.

so no i'm not pissed i'm not going to make a quick buck. i'm annoyed because one of the great advantages to owning over renting is that you are building equity on your investment, and when you hold your property long enough you, in a reasonable market, will have something to show for it.

I think you are confusing the terms "equity" and "return on investment." Equity simply means what a holding is worth less what you owe on it. "Return on investment" means the amount of equity created beyond the initial amount you paid to acquire the equity in the first place. "Building equity" can occur by paying off principal and/or by selling your house for more, inflation and commission adjusted, than what you paid for it. "Building equity" does not equal a positive "return on investment."

Expecting a return on investment from paying off a mortgage on your primary residence is a piss-poor strategy for making money, the last decade in certain parts of the U.S. notwithstanding. You're paying for a roof over your head; might as well enjoy it. If you want to make money, there are countless investments available that actually do so and don't charge a 5% escape fee.

Rick Reuben wrote:

unarmedman wrote:It is not the federal government's responsibility (and therefore everyone's responsibility) to artificially prop up a sour market.

I'm sure you're aware of this, but the triumph of state/corporate synthesis is confirmed when profit is privatized and risk is socialized ( when the markets work, the gravy flows upwards- when the markets tip over, then it's all hands on deck to grab mops and clean up the mess ).

In the UK we had our experience of this with the Northern Rock bank. The Bank of England bailout is explained here:
http://news.bbc.co.uk/1/hi/business/6994099.stm

The Chief Executive of Northern Rock still walks away with more money than I will earn in a lifetime:
http://business.timesonline.co.uk/tol/b ... 656301.ece

But the European Commission isn't happy:
http://business.timesonline.co.uk/tol/b ... 669616.ece

As stated above, privatise the profit, nationalise the risk.

agree with threadstarter.....I know of banks that were lending at 0% down and an 18% interest rate. whatever dumbass who would go for that isn't ready for home ownership....might as well buy the house on a credit card......

fancyjamtime wrote:

bellulah wrote:...and what about people like me?

Yes, everyone should be concerned about your situation and your situation only.

Many people don't have good old dad to give them good financial advice. Not everyone is a lawyer that understands all the wherefores. Not everyone had the good fortune not to lose a job overseas just before their house was refinanced, fucked up their credit through no fault of their own and are hanging on by the skin of their teeth. People besides you are hurting but I am not surprised that you don't see this.

Yes, obviously your situation is the worst. Doubled for unarmedman

this kind of retarded shit is what got us in trouble in the first place! if you don't know what you are signing don't sign! jesus, is it that hard?......when did this country relieve grown adults of personal accountability? If you don't have two or three years in mortgage payments in savings....fucking RENT!
but boo hoo....its not your/their fault......

It wasn't all that long ago that 18% was the going rate for 30-year fixed mortgages....



I'm pretty much in the same boat as bellulah...although I'm not that surprised at the current situation. I don't know when you bought, but there certainly were warning signs. In such a market you do what you can to mitigate your risk by getting into a mortgage you can afford in a desirable location where the property values haven't skyrocketed and not banking on being able to get out of it in the short-term.

ebeam wrote:I'm pretty much in the same boat as bellulah...although I'm not that surprised at the current situation. I don't know when you bought, but there certainly were warning signs. In such a market you do what you can to mitigate your risk by getting into a mortgage you can afford in a desirable location where the property values haven't skyrocketed and not banking on being able to get out of it in the short-term.

Yeah, I had several friends who bought homes in the 2005-2006 year. It was tough to see where the ceiling was back then depending on what market you were in. We were all in Orlando, and I had already been reading reports of rapid decline in new home building.

Truth is that I started seeing a lot of the warning signs coming from articles posted by Rick (then bob) about the housing market. So my wife and I were looking to sell when others were looking to buy. I don't fault folks for wanting to buy, especially folks who understood what they were doing (like bellulah). But there were some pretty bad scenarios...a couple we know bought a condo for $200K (it was the cheapest buy late '05) and by the time we moved (Sept. '06) they were already something like $80K upside-down in it.

To joelb, I agree that in regular markets homes are not good short-term investments. But they can (and should) still be viewed as investments. I think it provides incentives for pride of ownership, property care, etc. In this tanking market, homes have become the new cars! Think of all the insurance fraud that must be going on right now!

110th wrote:...but boo hoo....its not your/their fault......

Sure, let's get rid of usury laws while we're at it. Look, there are a lot of good people out there who were shystered into fucked-up loans. Yeah, it's their fault for not being better informed, but a lot of these people were convinced by people who were thought of as "experts".

I'll bet that not one of those people thought "I think I'll take this loan to irritate some Ayn Rand jackass on some internet forum". I'll further bet that the mindset was more "holy crap...all this working like a slave is finally paying dividends. This mortgage company says that I can finally afford my own home. I can swing this payment and the mortgage guy says that a year or so down the line I can transfer to a fixed rate loan if I can improve my credit score by 10 or so points. I should be able to do that. Thank god I don't have to throw my money down the shitter anymore. I'll have something to leave my children since tuition is so fucking high that I couldn't afford to help them with that". When the grim reality (and $4 gas) hits, it's too late.

It's the same thing with people who get screwed into payday loans. "The kid has to go to the doctor but my work doesn't provide health benefits. I have no gas in the tank. I have no one to rely on for help. Fuck, I have to take out a payday loan and hope to god that I can get in some overtime this weekend." Shit spirals.

Maybe I'm just a pussy but I have empathy for these people, ignorant or no. When exactly did you become so callous?

Well said fancy. Internet forums are full of tough guys who did the "right thing" and can't understand why those god damned idiots couldn't figure it out.