If Obama elected, which way stock market? Opinions please.
whuds...@gmail.com
Walter
Lawyerkill
> Many folks are wondering. Please post your comments.
>
> Walter
What do you mean, "If?"
Blash
> Many folks are wondering. Please post your comments.
>
> Walter
Why don't you many folks chip in and buy a newspaper......there are all
sorts of guesses in them every day........
Christopher Helms
> Many folks are wondering. Please post your comments.
>
> Walter
Dead money until late 2009, then modestly up, assuming nothing new
pops up in this hideous game of financial whack-a-mole that is
currently whip sawing the markets.
Geno4321
"Blash" <bla...@comcast.net> wrote in message
news:C5195A6C.C160D%bla...@comcast.net...
Many people call them lies. And only republicans believes lies.
Uncle_vito
like uncertainty and once the election is over, there is no uncertainty over
who is to be President.
Don't you like that concise answer to your question. Rather than the
bullshit banter of this banal newgroup.
Bunch of retards. And they claim to even have money???
Vito
<whuds...@gmail.com> wrote in message
news:239c4e74-bb0e-4c58...@c60g2000hsf.googlegroups.com...
rayj...@footnote.net
"Uncle_vito" <uncle_v...@yahoo.com> wrote in message
news:TrednfFwE7MOl2nV...@linkline.com...
FrediFizzx
>
> Walter
Generally, markets don't do well right after a first term Democrat is
elected but end up doing OK at the end of the first year. With this
whacky market, who knows? ;-) Everyone is so sick of the shrub
squad's antics, it just might get a good rally goin' if unemployment
doesn't get way out of control.
Fred
VT VirtualTruth
>
> Walter
it would go up, because the world trust the democrats to be more
fiscally
responsible than the Republicans were for the last 8 years!
Stev...@gmail.com
>If Obama elected, which way stock market?
Down into late 2010 no matter who "wins." Politics=politics.
Stocks=stocks.
Sanders Kaufman
news:a84bd8d3-eca2-4d99...@v72g2000hsv.googlegroups.com...
That depends on WHICH stocks you look at.
The LEI's will go down, but some companies will prosper.
Now that the Republican/Libertarian folks are on their way out, the outlook
for Healthcare and Educational professionals will blossom.
Arvind Bhaskar
> "Christopher Helms" <Chrishelms...@yahoo.com> wrote in message
World is hoping the markets will go up.
com...@webtv.net
" BARACK OBAMA IS A DANGEROUS COMMUNIST "
oneword refugee@gmail.com Rita Refugee
I think the market will go down and we will have a new civil war start.
Lawyerkill
wrote:
> <whudson1...@gmail.com> wrote in message
>
> news:239c4e74-bb0e-4c58...@c60g2000hsf.googlegroups.com...
>
> > Many folks are wondering. Please post your comments.
>
> � � I think the market will go down and we will have a new civil war start.
Civil War? Between the holders of PUTS and CALLS?
oneword refugee@gmail.com Rita Refugee
news:ca3ce4bc-7f25-4187...@i20g2000prf.googlegroups.com...
On Oct 14, 5:18?pm, "Rita Refugee" <rita oneword refu...@gmail.com>
wrote:
> <whudson1...@gmail.com> wrote in message
>
> news:239c4e74-bb0e-4c58...@c60g2000hsf.googlegroups.com...
>
> > Many folks are wondering. Please post your comments.
>
> start.
> Civil War? Between the holders of PUTS and CALLS?
Between the haves and the have-nots. Will be nastier this time because
it won't be regional.
Hugh Gibbons
Have y'all noticed how it is the right-wing asshats who are threatening
dire consequences if their preferred candidate does not win?
These people want you to be afraid, because they know that only fear of
the most dire consequences you can imagine would persuade anybody at
this juncture.
Fat chance! Republicans screwed up our country much more than we ever
should have allowed. It is now time to call the Janitor to clean up the
mess. His name is Barack Obama.
Liberal...@xemaps.com
go UP -- just like it did under Clinton.
oneword refugee@gmail.com Rita Refugee
news:Wq-dnb4w--pX7WjV...@comcast.com...
> In article <AH8Jk.46436$XT1....@bignews5.bellsouth.net>,
> "Rita Refugee" <rita oneword ref...@gmail.com> wrote:
>
>> "Lawyerkill" <Lawye...@aol.com> wrote in message
>> news:ca3ce4bc-7f25-4187...@i20g2000prf.googlegroups.com...
>> On Oct 14, 5:18?pm, "Rita Refugee" <rita oneword refu...@gmail.com>
>> wrote:
>> > <whudson1...@gmail.com> wrote in message
>> >
>> > news:239c4e74-bb0e-4c58...@c60g2000hsf.googlegroups.com...
>> >
>> > > Many folks are wondering. Please post your comments.
>> >
>> > ? ? I think the market will go down and we will have a new civil war
>> > start.
>>
>> > Civil War? Between the holders of PUTS and CALLS?
>>
>> Between the haves and the have-nots. Will be nastier this time
>> because
>> it won't be regional.
>
> Have y'all noticed how it is the right-wing asshats who are threatening
> dire consequences if their preferred candidate does not win?
When was the last time that non-hyphenate gangs rioted and caused dire
consequences? Riots are the property of hyphenates and the Democratic
party.
> These people want you to be afraid, because they know that only fear of
> the most dire consequences you can imagine would persuade anybody at
> this juncture.
Exactly who am I trying to persude people to vote for?
> Fat chance! Republicans screwed up our country much more than we ever
> should have allowed. It is now time to call the Janitor to clean up the
> mess. His name is Barack Obama.
I completely agree that Republicans have screwed everything up, but the
Democrats were there doing the most harm they could at the same time. The
economical problems can all be laid at the feet of Democrats who wanted to
by hyphenate voters by letting them purchase homes that they had no way to
pay for.
What do you call a hyphenate test tube baby?
Janitor in a drum!!!!
John Galt
> On Wed, 15 Oct 2008 11:52:20 -0500, "Rita Refugee" <rita oneword
> ref...@gmail.com> wrote:
>
>> I completely agree that Republicans have screwed everything up, but the
>> Democrats were there doing the most harm they could at the same time. The
>> economical problems can all be laid at the feet of Democrats who wanted to
>> by hyphenate voters by letting them purchase homes that they had no way to
>> pay for.
>
>
> your anger.
> (I note your nym - how do you feel about people who say the Rita
> victims deserve it for being stupid enough to live there? That';s what
> you're playing at.)
>
>
> http://bigpicture.typepad.com/comments/2008/10/goal-increase-m.html
>
> Goal: Increase Minority Homeowners by 5.5 Million in a Decade
> Tuesday, October 14, 2008 | 10:00 AM
> in Politics | Taxes and Policy | UnScience
>
> Guess who's goal this was? You might be surprised:
>
> "More and more people own their homes in America today. Two-thirds
> of all Americans own their homes, yet we have a problem here in
> America because few than half of the Hispanics and half the African
> Americans own the home. That's a home ownership gap. It's a -- it's a
> gap that we've got to work together to close for the good of our
> country, for the sake of a more hopeful future. We've got to work to
> knock down the barriers that have created a home ownership gap.
>
> I set an ambitious goal. It's one that I believe we can achieve.
> It's a clear goal, that by the end of this decade we'll increase the
> number of minority homeowners by at least 5.5 million families . . .
>
> Home ownership is also an important part of our economic vitality.
> If -- when we meet this project, this goal, according to our Secretary
> of Housing and Urban Development, we will have added an additional
> $256 billion to the economy by encouraging 5.5 million new home owners
> in America; the activity -- the economic activity stimulated with the
> additional purchasers, the additional buyers, the additional demand
> will be upwards of $256 billion. And that's important because it will
> help people find work."
>
> - George W. Bush, U.S. President, October 15, 2002 1:55 P.M.
>
>
> Last week, we mentioned this speech from 2004. Fast forward to today's
> excerpt, from an even earlier, 2002 speech.
>
> Why keep bringing these up? Because it derails the false argument
> brewing amongst those on the right who blame the 1977 CRA or the 1938
> Fannie Mae for the current housing and credit problem. I have zero
> patience for this nonsense, and am unafraid to call people on it.
>
> Nothing in any of these Bush speeches that pushed for more lending to
> minorities and increased lower income home ownership caused the
> problem. Neither did any similar Clinton speeches. Nor did related the
> legislation related to the Bush speeches, nor did the CRA, nor Fannie
> Mae or Freddie Mac. Indeed, none of these actions required the sort of
> reckless lending that we saw from 2002-2007.
>
> Understand this simple fact: In an ultra-low rate environment, where
> prices are appreciating rapidily, and mortgaes are being securitized,
> ALL THAT MATTERS IS THAT THE BORROWER NOT DEFAULT IN 90 days (or 6
> Months). The goal was to make a loan that did not default in that
> period of time, it cannot be put back to the originator.
>
> As a mortgage salesman, you only lose your a fee if a borrower
> defaults within 3 or 6 months. What do you do to maximize your
> returns? The best way to do that -- to put people in houses that would
> not default in 90 days -- was the 2/28 ARM mortgages. Cheap teaser
> rates for 24 months, then the big reset. By then, it was no longer
> your problem.
>
> Can you grasp what a monumental change this was? Instead of making
> sure that borrowers could pay back ALL OF THE 30 YEAR FIXED MORTGAGE,
> you only had to find people who could afford the teaser rate for a a
> few months. THIS WAS AN ENORMOUS AND UNPRECEDENTED SHIFT IN LENDING.
>
> This is the key to the hosuing boom and bust, anbd ultimately
> underlies the entire credit freeze. And, it would not have been
> possible without the Greenspan ultra-low rates, which made the teaser
> portion (the "2" of the 2/28) of these mortgages so attractive.
>
> ~~~
>
> Those who continue to blame the CRA, Fannie Mae, etc. reveal their
> fundamental misunderstanding of how credit operates in general, what
> the financing process was like from 2002-07, and how this situation
> came to pass. Or worse, they understand it, and choose to lie about it
> anyway for partisan political purposes.
>
> You either understand these simple facts, or you don't. If you cannot
> comprehend this, well, then, I am at a loss as to what that says about
> your cognitive functioning. But if you understand this, but spit out
> the nonsense anyway, then you are merely a partisan with no respect
> for the truth.
>
> And that seems to be the main people blaming the CRA and
> Fannie/Freddie for the credit/housing crisis -- those folks who either
> can't think -- or wont.
How about thinking a little deeper?
1) Nobody would have written a teaser rate mortgage if they couldn't
sell it. That would be suicide. Companies that were writing imprudent
mortgages did so only because they didn't have to hold them to maturity,
and thus they didn't have to worry about the toxicity.
2) Before 1999, Fannie and Freddie couldn't touch the stuff. Then regs
were changed and they could. Money got cheap, and the market took off.
I've seen some stats showing that over
30% of what Fannie and Freddie were buying since 2003 were subprimes.
That all leads you inevitably back to the CRA and Fannie/Freddie issue.
In general, I have to say that trying to simplify the cause of the
current distress is rather doomed to failure. A lot of moving parts were
involved to cause a mess of those scope, and unless we properly
understand the cause of it we're doomed to repeat it.
And that requires that we check our partisan hats at the door, as you say.
JG
>
>
Osprey
"John Galt" <kad...@gmail.com> wrote in message
news:DvrJk.196891$4p1....@en-nntp-09.dc1.easynews.com...
Far too often in these newsgroups, we see people trying to pass themselves
off
for being something they are not. The arm-chair doctor, the arm-chair cop,
the arm-chair financial expert, and so on.
I would have to guess about 95% of the users in the newsgroups are nothing
more than people who have little to do.
With that being said, I would like to commend you on your post. You're
probably one of the first ones I've seen in
a long time who has posted like an expert on the issue. You've obviously
done your homework and I like how you ended it.
Good post.
oneword refugee@gmail.com Rita Refugee
news:4g9cf41fdvt2goc5a...@4ax.com...
> On Wed, 15 Oct 2008 11:52:20 -0500, "Rita Refugee" <rita oneword
> ref...@gmail.com> wrote:
>
>>> Have y'all noticed how it is the right-wing asshats who are threatening
>>> dire consequences if their preferred candidate does not win?
>>
>> When was the last time that non-hyphenate gangs rioted and caused dire
>>consequences? Riots are the property of hyphenates and the Democratic
>>party.
>
>
> thugs to do their dirty work. Look at the labor massacres, etc.
If it comes down to bodies in the street, it couldn't happen to a more
thuggish group than labor unionists.
www.freedomtofascism.com
>Far too often in these newsgroups, we see people trying to pass themselves
>off for being something they are not.
Projection noted.
www.freedomtofascism.com
>And that requires that we check our partisan hats at the door, as you say.
There's no way the USA can recover from dumping 1.4 quadrillion in
derivatives on the public.
John Galt
Well, armchair expert or armchair genius, to name two that you see a lot
of, as well.
>
> With that being said, I would like to commend you on your post. You're
> probably one of the first ones I've seen in
> a long time who has posted like an expert on the issue. You've
> obviously done your homework and I like how you ended it.
>
> Good post.
Well, thanks. Every time I dig deeper into the mess, I uncover more
skeletons. With something this complex, the learning never stops.
JG
>
www.freedomtofascism.com
>Many folks are wondering. Please post your comments.
Down. It may go to zero.
All of the Federal Reserve central banks world wide are bankrupt.
They have no money to lend and by getting a loan from already bankrupt
taxpayers exacerbates the problem.
US Treasuries will go into the negative.
John Galt
> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com>
> wrote:
>
>> That all leads you inevitably back to the CRA and Fannie/Freddie issue.
>
>
> melt down both the real estate one and the larger market melt down on
> Fannie and Freddie. Yes they took some of them. But 4 out of 5 of the
> banks that collapsed didn't even deal with the GSEs.
My point is to not "hang" it on any one thing. If your car doesn't run
because it has a flat tire and a missing spark plug and a broken axle,
it doesn't make sense to blame it on the tire.
You can make a list of items that "if this hadn't happened, the entire
problem wouldn't have happened" at least a dozen items long, probably
longer. The chain of events goes back to 1967, and with our armchair
perspective, it's pathetically easy to point to any one of them, say
"J'ACCUSE" and think you've found who or what is to blame. This
minimizes the entire matter, because at MOST (not all) places on the
chain, you find well-meaning people doing well-meaning things without
thought to the long-term consequences of their actions. Further, because
this is a *systemic* problem, it's possible that (for example) item 4 on
the chain wouldn't have caused any problem at all if item 7 hadn't
(unpredictably) occurred several years after.
Let's just solve it, then understand it so we don't fuck it up again.
JG
John Galt
If they're all worthless, of course not.
But they're not all worthless. Not by a long shot.
JG
www.freedomtofascism.com
>Let's just solve it, then understand it so we don't fuck it up again.
You have to get rid of the Federal Reserve banking system. It is not only
bankrupt, but wholly broken.
Read:
www.freedomtofascism.com
>www.freedomtofascism.com wrote:
>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>
>>> And that requires that we check our partisan hats at the door, as you say.
>>
>> There's no way the USA can recover from dumping 1.4 quadrillion in
>> derivatives on the public.
>
>If they're all worthless, of course not.
Unfortunately, yes, all of the derivatives are worthless.
>But they're not all worthless. Not by a long shot.
Yep, they are. If they weren't, all of the central banks wouldn't be
playing the shell game of asking to foot the burden on the public.
Since when have the banks given away assets to the taxpayers?
Never, that's when.
Here's the problem aptly defined.
John Galt
That's "Crisis 101". No new information there, at least not to me.
JG
>
www.freedomtofascism.com
>www.freedomtofascism.com wrote:
>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>
>>> And that requires that we check our partisan hats at the door, as you say.
>>
>> There's no way the USA can recover from dumping 1.4 quadrillion in
>> derivatives on the public.
>
>If they're all worthless, of course not.
Unfortunately, yes, all of the derivatives are worthless.
>But they're not all worthless. Not by a long shot.
Yep, they are. If they weren't, all of the central banks wouldn't be
playing the shell game of asking to foot the burden on the public.
Since when have the banks given away assets to the taxpayers?
The reason banks don't have any money to lend is because they borrowed too
much money to gamble by selling derivatives. It's a house of cards -- the
derivatives themselves aren't backed by anything at all but debt (debt sold
as an asset) and the hope that the debt will be repaid. The entire
underpinning of the derivatives market was US/UK housing. There's no assets
involved in derivatives -- they are purely debt instruments.
www.freedomtofascism.com
Then you should be able to explain to the viewing audience why derivatives
are totally worthless.
They're all debt instruments and don't have any value at all.
www.freedomtofascism.com
>www.freedomtofascism.com wrote:
>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>
>>> And that requires that we check our partisan hats at the door, as you say.
>>
>> There's no way the USA can recover from dumping 1.4 quadrillion in
>> derivatives on the public.
>
>If they're all worthless, of course not.
Unfortunately, yes, all of the derivatives are worthless.
>But they're not all worthless. Not by a long shot.
Yep, they are. If they weren't, all of the central banks wouldn't be
playing the shell game of asking to foot the burden on the public.
Since when have the banks given away assets to the taxpayers?
The reason banks don't have any money to lend is because they borrowed too
much money to gamble by selling derivatives. It's a house of cards -- the
derivatives themselves aren't backed by anything at all but debt (debt sold
as an asset) and the hope that the debt will be repaid. The entire
underpinning of the derivatives market was US/UK housing. There's no assets
involved in derivatives -- they are purely debt instruments.
Here's the problem aptly defined.
http://www.marketoracle.co.uk/Article6797.html
If you can't understand that, then here's a simple explanation:
October 8, 2008, 20:23
Great Depression v2.0?
The real economy is in peril. European governments have put huge chunks of
state cash into their top banks to shore them up and have cut interest rates
to help companies and consumers. How bad are things?
Are we really looking at a repeat of 1929 and the Great Depression that
followed?
First, the differences.
1928 and the year that followed saw a huge stock market boom, much bigger
than anything we've had since. The speed and size of gains sucked investment
from the rest of the U.S. economy.
Nowadays, we have seen a long bull market but higher productivity may
justify share prices. However, we have had other asset booms, notably in
real estate.
Other countries were weakened by the First World War. Many were in debt to
the U.S. The U.S. government's response to the 1929 crash – restricting
imports – was to hammer those debtors and push other exporting nations into
depression.
Nowadays, the U.S. is a debtor nation. It borrows from other countries and
dare not let the value of the dollar fall. It is likely to avoid trade
restrictions.
Now the similarities with 1929. They are bigger than you think.
In late 1920s America, the real economy looked fine. For the first time,
middle class Americans could expect to live a bit like the rich. Consumers
were buying cars and fitting out their homes, not just buying the basic
foodstuffs of survival.
But the asset boom (stock markets in 1928-29, real estate and
mortgage-backed securities today) sucked investment from the rest of the
economy.
Investment banks dreamt up financial products which promised to make the man
in the street rich beyond his dreams – using borrowed money. Companies
bought up their rivals – using borrowed money.
Banks created all these loans by borrowing against securities (shares,
bonds, mortgages). Nothing wrong with that, except that many of these
securities had themselves been purchased on margin, i.e., with borrowed
money.
Sound familiar?
The banks call this leverage – borrowing money to buy shares or other
securities and then re-lending them.
In 1928 Goldman Sachs and the now collapsed Lehman were both launched on the
back of new-fangled investment trusts, using loans to multiply the capital
gain from rising stock prices. Then they created further investment trusts
which invested in the existing investment trusts.
Eighty years later, both Goldman and Lehman were at it again, using the same
basic technique, this time magnifying the gains from securities (shares,
bonds, mortgages).
Unfortunately, this leverage works both ways. In 1929, a small fall in share
prices led to a much bigger fall in the value of the investment trusts. This
soon gathered pace, wiping out first the small investors, then some
stockbrokers and then the banks.
History may show Goldman Sachs to have been more careful in the 1920s. The
promoters of investment trusts took their profits early, leaving the later
investors to bear the losses.
In 2008, the investment banks were among the first to seek government
protection.
But the investment schemes they sold are now dragging down the commercial
banks, the local government treasuries and the insurance companies – as well
as pension funds, the money market funds and mutual funds in which ordinary
people stored their savings.
How will it affect the real economy?
All companies, like individuals, need loans at some time. However,
investment bank lending is not about these kinds of loans.
The investment bank frenzy has led, as in the late twenties, to entire
holding companies being constructed on a mountain of debt. Investment banks
call it mergers and acquisitions.
Thus productive companies are bought up by holding companies, which use the
earnings of the productive companies to pay that debt.
As the leverage goes into reverse, the holding companies cut investment in
machinery and wages because they need to pay back their debt.
When banks and companies de-leverage, it can rapidly stifle economic growth.
There is a saying that economies cause recessions, governments cause
depressions.
Governments cannot stop asset prices falling. What they can do is not make
the situation worse. They must keep taxes low, cut barriers to trade, buy
and sell to other countries, invest in their own infrastructure, help the
unavoidable unemployed.
John Galt
> On Wed, 15 Oct 2008 15:10:13 -0500, John Galt <kad...@gmail.com> wrote:
>
>> www.freedomtofascism.com wrote:
>>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>>
>>>> And that requires that we check our partisan hats at the door, as you say.
>>> There's no way the USA can recover from dumping 1.4 quadrillion in
>>> derivatives on the public.
>> If they're all worthless, of course not.
>
> Unfortunately, yes, all of the derivatives are worthless.
No, they're not. Even in Stockton, a foreclosed home still has value.
JG
www.freedomtofascism.com
>www.freedomtofascism.com wrote:
>> On Wed, 15 Oct 2008 15:10:13 -0500, John Galt <kad...@gmail.com> wrote:
>>
>>> www.freedomtofascism.com wrote:
>>>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>>>
>>>>> And that requires that we check our partisan hats at the door, as you say.
>>>> There's no way the USA can recover from dumping 1.4 quadrillion in
>>>> derivatives on the public.
>>> If they're all worthless, of course not.
>>
>> Unfortunately, yes, all of the derivatives are worthless.
>
>No, they're not. Even in Stockton, a foreclosed home still has value.
Derivatives aren't backed by mortgages. Derivatives are only backed by
the hope that mortgage assets will increase. That is all. Once the
mortgage asset decreases the entire value of the derivative is zero.
www.freedomtofascism.com
wrote:
>On Wed, 15 Oct 2008 15:42:23 -0500, John Galt <kad...@gmail.com> wrote:
>
>>www.freedomtofascism.com wrote:
>>> On Wed, 15 Oct 2008 15:10:13 -0500, John Galt <kad...@gmail.com> wrote:
>>>
>>>> www.freedomtofascism.com wrote:
>>>>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>>>>
>>>>>> And that requires that we check our partisan hats at the door, as you say.
>>>>> There's no way the USA can recover from dumping 1.4 quadrillion in
>>>>> derivatives on the public.
>>>> If they're all worthless, of course not.
>>>
>>> Unfortunately, yes, all of the derivatives are worthless.
>>
>>No, they're not. Even in Stockton, a foreclosed home still has value.
>
>Derivatives aren't backed by mortgages. Derivatives are only backed by
>the hope that mortgage assets will increase. That is all. Once the
>mortgage asset decreases the entire value of the derivative is zero.
And here's the kicker -- even if housing prices went back up all of the
derivatives would still be zero value.
There is no way out.
www.freedomtofascism.com
>On Wed, 15 Oct 2008 15:42:23 -0500, John Galt <kad...@gmail.com> wrote:
>
>>www.freedomtofascism.com wrote:
>>> On Wed, 15 Oct 2008 15:10:13 -0500, John Galt <kad...@gmail.com> wrote:
>>>
>>>> www.freedomtofascism.com wrote:
>>>>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>>>>
>>>>>> And that requires that we check our partisan hats at the door, as you say.
>>>>> There's no way the USA can recover from dumping 1.4 quadrillion in
>>>>> derivatives on the public.
>>>> If they're all worthless, of course not.
>>>
>>> Unfortunately, yes, all of the derivatives are worthless.
>>
>>No, they're not. Even in Stockton, a foreclosed home still has value.
>
>Derivatives aren't backed by mortgages. Derivatives are only backed by
>the hope that mortgage assets will increase. That is all. Once the
>mortgage asset decreases the entire value of the derivative is zero.
And here's the kicker -- even if housing prices went back up all of the
John Galt
> On Wed, 15 Oct 2008 15:42:23 -0500, John Galt <kad...@gmail.com> wrote:
>
>> www.freedomtofascism.com wrote:
>>> On Wed, 15 Oct 2008 15:10:13 -0500, John Galt <kad...@gmail.com> wrote:
>>>
>>>> www.freedomtofascism.com wrote:
>>>>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>>>>
>>>>>> And that requires that we check our partisan hats at the door, as you say.
>>>>> There's no way the USA can recover from dumping 1.4 quadrillion in
>>>>> derivatives on the public.
>>>> If they're all worthless, of course not.
>>> Unfortunately, yes, all of the derivatives are worthless.
>> No, they're not. Even in Stockton, a foreclosed home still has value.
>
> Derivatives aren't backed by mortgages. Derivatives are only backed by
> the hope that mortgage assets will increase. That is all. Once the
> mortgage asset decreases the entire value of the derivative is zero.
The instruments are more complex than that:
http://www.portfolio.com/views/columns/wall-street/2008/10/15/Credit-Derivatives-Role-in-Crash#page2
JG
www.freedomtofascism.com
wrote:
This is why everyone is dumping their stocks.
Today the DOW lost 733 points.
http://money.cnn.com/data/us_markets/index.html
It is conceivable that the stock markets will go to zero.
This is the ramification of investment banks buying derivatives on credit
(which they lend to each other) in hopes that the value of something will go
up and repackaging what they purchased on credit to sell for a profit. The
actual 'value' has been multiplied so many times that the dollar amount is
approaching 2 quadrillion dollars -- which is highly over valued.
The debt is real, but the value is not.
At the bottom of this pyramid scheme is John Q public whose income had
dwindled and can no longer support the pyramid -- or buy a house.
V for Vendicar
"www.freedomtofascism.com" <tr...@r.us> wrote\
> Today the DOW lost 733 points.
You stinking Liebreal.. It GAINED 733 points.
Everything is just fine, and if you Stinking Liberals would just stop
lying about the conomy then the economy would not have lost 733 points.
America needs a tax cut for the wealthy.
It worded with Hero Ronald Reagan, and it will work for Hero George Bush.
www.freedomtofascism.com
>www.freedomtofascism.com wrote:
>> On Wed, 15 Oct 2008 15:42:23 -0500, John Galt <kad...@gmail.com> wrote:
>>
>>> www.freedomtofascism.com wrote:
>>>> On Wed, 15 Oct 2008 15:10:13 -0500, John Galt <kad...@gmail.com> wrote:
>>>>
>>>>> www.freedomtofascism.com wrote:
>>>>>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>>>>>
>>>>>>> And that requires that we check our partisan hats at the door, as you say.
>>>>>> There's no way the USA can recover from dumping 1.4 quadrillion in
>>>>>> derivatives on the public.
>>>>> If they're all worthless, of course not.
>>>> Unfortunately, yes, all of the derivatives are worthless.
>>> No, they're not. Even in Stockton, a foreclosed home still has value.
>>
>> Derivatives aren't backed by mortgages. Derivatives are only backed by
>> the hope that mortgage assets will increase. That is all. Once the
>> mortgage asset decreases the entire value of the derivative is zero.
>
>The instruments are more complex than that:
Nah. They all operate under the same principle. Derivatives derive value
from something without actually owning the value.
www.freedomtofascism.com
>www.freedomtofascism.com wrote:
>> On Wed, 15 Oct 2008 15:42:23 -0500, John Galt <kad...@gmail.com> wrote:
>>
>>> www.freedomtofascism.com wrote:
>>>> On Wed, 15 Oct 2008 15:10:13 -0500, John Galt <kad...@gmail.com> wrote:
>>>>
>>>>> www.freedomtofascism.com wrote:
>>>>>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>>>>>
>>>>>>> And that requires that we check our partisan hats at the door, as you say.
>>>>>> There's no way the USA can recover from dumping 1.4 quadrillion in
>>>>>> derivatives on the public.
>>>>> If they're all worthless, of course not.
>>>> Unfortunately, yes, all of the derivatives are worthless.
>>> No, they're not. Even in Stockton, a foreclosed home still has value.
>>
>> Derivatives aren't backed by mortgages. Derivatives are only backed by
>> the hope that mortgage assets will increase. That is all. Once the
>> mortgage asset decreases the entire value of the derivative is zero.
>
>The instruments are more complex than that:
Nah. They all operate under the same principle. Derivatives derive value
from something without actually owning the value.
The debt is real because money is borrowed to buy the derivative but the
value of the derivative in real assets is non-existent.
John Galt
Uh.....if they derive value from something, then they have value.
Derivatives, currency, stocks, bonds.......they all have value because
people agree that they do. Ergo, the derivative that is in part based on
that mortgage in Stockton does not become valueless; if the mortgage
defaults, the value simply drops to the liquidation value of the property.
If you're suggesting that people will simply decide that all these
things have no value, and thus they become valueless, that's of course
possible, but people generally don't commit suicide; if their financial
future is based on continuing that agreement, then they will continue to
agree on it.
But, now we're talking psychology, not economics.
JG
>
>
>
>
>
Michael Coburn
> "Hugh Gibbons" <hugh_g...@dontsendmeemail.net> wrote in message
> news:Wq-dnb4w--pX7WjV...@comcast.com...
>> In article <AH8Jk.46436$XT1....@bignews5.bellsouth.net>, "Rita
>> Refugee" <rita oneword ref...@gmail.com> wrote:
>>
>>> "Lawyerkill" <Lawye...@aol.com> wrote in message
>>> news:ca3ce4bc-7f25-4187-
bf81-8aa...@i20g2000prf.googlegroups.com...
>>> On Oct 14, 5:18?pm, "Rita Refugee" <rita oneword refu...@gmail.com>
>>> wrote:
>>> > <whudson1...@gmail.com> wrote in message
>>> >
>>> > news:239c4e74-
bb0e-4c58-878...@c60g2000hsf.googlegroups.com...
>>> >
>>> > > Many folks are wondering. Please post your comments.
>>> >
>>> > ? ? I think the market will go down and we will have a new civil war
>>> > start.
>>>
>>> > Civil War? Between the holders of PUTS and CALLS?
>>>
>>> Between the haves and the have-nots. Will be nastier this time
>>> because
>>> it won't be regional.
>>
>> Have y'all noticed how it is the right-wing asshats who are threatening
>> dire consequences if their preferred candidate does not win?
>
> When was the last time that non-hyphenate gangs rioted and caused
> dire
> consequences? Riots are the property of hyphenates and the Democratic
> party.
>
>> These people want you to be afraid, because they know that only fear of
>> the most dire consequences you can imagine would persuade anybody at
>> this juncture.
>
> Exactly who am I trying to persude people to vote for?
>
>> Fat chance! Republicans screwed up our country much more than we ever
>> should have allowed. It is now time to call the Janitor to clean up
>> the mess. His name is Barack Obama.
>
> I completely agree that Republicans have screwed everything up, but
> the
> Democrats were there doing the most harm they could at the same time.
> The economical problems can all be laid at the feet of Democrats who
> wanted to by hyphenate voters by letting them purchase homes that they
> had no way to pay for.
>
> What do you call a hyphenate test tube baby?
>
> Janitor in a drum!!!!
The level of stupidity and and naivety needed to ascribe the world
financial meltdown to ACORN, the "Community Reinvestment Act", and
Democratic resistance to DEregulation of Fannie Mae is more than that
which is needed to accept alien abduction. The deregulating nincompoops
are, however, not going to take responsibility for their larceny and
political opportunism. And they will continue this diversion and
concentration on "nits" so as to feed the religious (ordained without any
scientific or logical underpinning) convictions of the rightarded
community. That religious conviction is that government is evil and so too
are Democrats because they (the Democrats) believe in the concept of good
government. Of course when Republicans are running the government they
are very good at demonstrating how evil and inept it can be.
The primary factor creating the current "crisis" is the deregulation of
the financial sector along with the Republican false economy created in
residential real estate. An economy based on rising prices for
residential real estate is a false economy because it is an economy based
totally on speculation. There is no "production" that arises from
increasing residential real estate prices. Yet these price increases are
what produced the economic numbers used to hide the adverse effects of
Republican war and tax cutting.
The real productivity of America was not enhanced by these price
increases. As a matter of fact the United States is less productive than
it was before the price increases. And that is a "false economy".
A real economy happens when increased productivity results in rising
wages and lower costs of living simultaneously. We see now that the
supposed gains of the last 8 years have been illusory; that we are dead
broke and stripped of the _real_ capital needed to provide a decent
standard of living for the people of the United States (factories,
transportation, electrical grid, and rational markets). We are here
because of Republican lies like what you see above:
http://www.whitehouse.gov/news/releases/2002/01/20020129-11.html ---
Members, you and I will work together in the months ahead on other
issues: productive farm policy -- (applause) -- a cleaner environment --
(applause) -- broader home ownership, especially among minorities --
(applause) -- and ways to encourage the good work of charities and faith-
based groups. (Applause.) I ask you to join me on these important
domestic issues in the same spirit of cooperation we've applied to our
war against terrorism. (Applause.)
--------------------------------------------------------------------
http://www.whitehouse.gov/news/releases/2002/10/20021015-7.html
President Hosts Conference on Minority Homeownership
http://query.nytimes.com/gst/fullpage.html?
res=9E06E3D6123BF932A2575AC0A9659C8B63&sec=&spon=&pagewanted=print
The attempt to move the GSE's under the direct control of Emperor Bush
and the successful attempt by Democrats (using demagoguery) to prevent it.
http://www.whitehouse.gov/news/releases/2003/10/20031015-10.html ---
October 15, 2003
President Calls on Senate to Pass American Dream Downpayment Act
http://www.whitehouse.gov/news/releases/2003/12/20031216-9.html ---
President Bush Signs American Dream Downpayment Act of 2003
http://findarticles.com/p/articles/mi_hb5246/is_200403/ai_n19793121
Mortgage Banking, March, 2004
FANNIE MAE HAS ANNOUNCED A PLEDGE to help 6 million families--including
1.8 million minority families--become first-time homeowners over the next
decade. The pledge boosts the company's commitment to President Bush's
Minority Homeownership Initiative and will help raise the minority
homeownership rate from 50.6 percent currently to 55 percent, with the
ultimate goal of closing the gap between minority homeownership rates and
nonminority homeownership rates.
-----------------------------------------------------------
It is important to note that Frank Raines was being investigated by OFHEO
as these suck ups to Emperor Bush were being made. And by the end of the
year Raines was forced into retirement and replaced with a Republican
crony.
No more lies. If we are to get back on our feet we absolutely must ween
ourselves of oil. We absolutely must conserve OUR available oil and the
oil we can acquire through legitimate trade and deploy that oil to those
functions that cannot currently operate without it (trucks and trains and
areoplanes). The cars will have to pay very high prices for fuel. Sorry.
That China will subsidize its auto market and the fuel used in these cars
will be the downfall of the Chinese.
And most of the high price paid for fuel should simply be returned to the
people in the form of a stimulus shaped very much like the most recent
stimulus. http://GreaterVoice.org/gas Such a tax and rebate system will
not be a cost to the working poor who have no choice but to drive that
old pickup to the job site. But it WILL cause the middle people to
conserve and the rich will be subsidizing the rest.
The result of these increased fuel prices will be an increase in 2ond and
3rd generation (NON FOOD CROP) biofuels that will, along with improved
electrical power generation and distribution, eliminate any need for oil
from unfriendly nations, and eventually from any other nations at all.
Such an increase will also convert one room of the McMasion into a fully
equipped video conference room to obviate that drive to the city every
day. This is what should have been the result of what the morons call
the dot.com bubble. That we get in our cars and drive downtown to sit at
a desk is stupidity on steroids. And it exists because of pension funds
owning stock in oil companies and in companies that own downtown real
estate. It is another example of why American style capitalism shots
itself in the foot. We have the INEXPENSIVE technology available to
create a much more efficient and effective and productive society. But
we can't get it done because current assets will lose value and actual
human production (labor) will gain value.
We have the natural resources and the abilities in America to be the most
productive and self sufficient nation on Earth. But we need to stop the
imperialism and the dependency on oil from the middle east. We need to
rely more on multilateral agreements (NATO) and less on our own expensive
military. If we are independent and self sufficient then we do not need
to police the entire planet.
www.freedomtofascism.com
>www.freedomtofascism.com wrote:
>> On Wed, 15 Oct 2008 15:56:08 -0500, John Galt <kad...@gmail.com> wrote:
>>
>>> www.freedomtofascism.com wrote:
>>>> On Wed, 15 Oct 2008 15:42:23 -0500, John Galt <kad...@gmail.com> wrote:
>>>>
>>>>> www.freedomtofascism.com wrote:
>>>>>> On Wed, 15 Oct 2008 15:10:13 -0500, John Galt <kad...@gmail.com> wrote:
>>>>>>
>>>>>>> www.freedomtofascism.com wrote:
>>>>>>>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>>>>>>>
>>>>>>>>> And that requires that we check our partisan hats at the door, as you say.
>>>>>>>> There's no way the USA can recover from dumping 1.4 quadrillion in
>>>>>>>> derivatives on the public.
>>>>>>> If they're all worthless, of course not.
>>>>>> Unfortunately, yes, all of the derivatives are worthless.
>>>>> No, they're not. Even in Stockton, a foreclosed home still has value.
>>>> Derivatives aren't backed by mortgages. Derivatives are only backed by
>>>> the hope that mortgage assets will increase. That is all. Once the
>>>> mortgage asset decreases the entire value of the derivative is zero.
>>> The instruments are more complex than that:
>>
>> Nah. They all operate under the same principle. Derivatives derive value
>> from something without actually owning the value.
>
>Uh.....if they derive value from something, then they have value.
Here's a derivative:
I use my credit card to place a bet that you will pay your mortgage payment.
If you don't pay your mortgage payment, I am stuck owing the credit card
bill and have nothing to show for it.
In the future if you do pay your mortgage payment, I'm still out the money
AND interest and have nothing to show for it.
If I don't have the money to pay the credit card bill, I am bankrupt.
John Galt
> On Wed, 15 Oct 2008 16:42:52 -0500, John Galt <kad...@gmail.com> wrote:
>
>> www.freedomtofascism.com wrote:
>>> On Wed, 15 Oct 2008 15:56:08 -0500, John Galt <kad...@gmail.com> wrote:
>>>
>>>> www.freedomtofascism.com wrote:
>>>>> On Wed, 15 Oct 2008 15:42:23 -0500, John Galt <kad...@gmail.com> wrote:
>>>>>
>>>>>> www.freedomtofascism.com wrote:
>>>>>>> On Wed, 15 Oct 2008 15:10:13 -0500, John Galt <kad...@gmail.com> wrote:
>>>>>>>
>>>>>>>> www.freedomtofascism.com wrote:
>>>>>>>>> On Wed, 15 Oct 2008 14:28:30 -0500, John Galt <kad...@gmail.com> wrote:
>>>>>>>>>
>>>>>>>>>> And that requires that we check our partisan hats at the door, as you say.
>>>>>>>>> There's no way the USA can recover from dumping 1.4 quadrillion in
>>>>>>>>> derivatives on the public.
>>>>>>>> If they're all worthless, of course not.
>>>>>>> Unfortunately, yes, all of the derivatives are worthless.
>>>>>> No, they're not. Even in Stockton, a foreclosed home still has value.
>>>>> Derivatives aren't backed by mortgages. Derivatives are only backed by
>>>>> the hope that mortgage assets will increase. That is all. Once the
>>>>> mortgage asset decreases the entire value of the derivative is zero.
>>>> The instruments are more complex than that:
>>> Nah. They all operate under the same principle. Derivatives derive value
>
> Here's a derivative:
>
> I use my credit card to place a bet that you will pay your mortgage payment.
>
> If you don't pay your mortgage payment, I am stuck owing the credit card
> bill and have nothing to show for it.
>
> In the future if you do pay your mortgage payment, I'm still out the money
> AND interest and have nothing to show for it.
> If I don't have the money to pay the credit card bill, I am bankrupt.
You said it yourself -- derivatives derive value from something else.
Therefore, by your definition, if the "something else" has value, so
does the derivative.
A bet is not a derivative, but an option. An option expires with or
without value, because it's value is NOT based on the underlying
security, but on the *state* of the underlying security.
You've got derivatives and options mixed up. Get them straight in your
mind, you'll sleep better for it.
JG
>
>
www.freedomtofascism.com
wrote:
If I am the Federal Reserve investment banks and made the above
bad bets, in order to not lose face and continue my ponzi scheme of bilking
the rubes, I go strong arm the US Congress and scare the hell out of them to
pass a law to give me tax payer money. Then I can convert two of my
investment banks to commercial banks and continue to lend money to the tax
payers their own money and charge them interest. I'm not concerned that the
American tax payers have no money to give to me, I'll just lend them the
money so they can lend it back to me and then I can lend it back to them and
charge them interest.
I make money, the tax payer is screwed.
John Galt
But they *do* have money to give you.
JG
www.freedomtofascism.com
<Execute_The_Traitor...@hotmail.com> wrote:
>
>"www.freedomtofascism.com" <tr...@r.us> wrote\
>> Today the DOW lost 733 points.
>
> You stinking Liebreal.. It GAINED 733 points.
In a sense it did -- the 9 chosen investment banks will get a larger bail
out check.
And the CIA, er, PPT, will have more money to keep the DOW from dropping to
zero tomorrow.
Mike
that's a great point. and i'd add that too many want to blame only those
items which fit their political agenda and ignore everything else.
Hugh Gibbons
www.freedomtofascism.com <tr...@r.us> wrote:
>
> Nah. They all operate under the same principle. Derivatives derive value
> from something without actually owning the value.
That's why all financial derivatives should be banned.
Clave
Good luck with that.
Jim
Hugh Gibbons
John Galt <kad...@gmail.com> wrote:
No, the value of the MORTGAGE drops to the liquidation value of the
property. Derivatives can be and often are worth exactly zero.
How much would you pay for the option to buy a house at $400,000 if the
property value had declined to $350,000? I'm betting zero. In fact, I
would have to pay you $50,000 right now just to take it off my hands.
But I wouldn't do that, because I'd rather have the zero. See?
> If you're suggesting that people will simply decide that all these
> things have no value, and thus they become valueless, that's of course
> possible, but people generally don't commit suicide; if their financial
> future is based on continuing that agreement, then they will continue to
> agree on it.
Their financial future is based on *not* fulfilling any agreement in
which they lose money.
b.jeswine
Hugh Gibbons <hugh_g...@dontsendmeemail.net> typed:
> How much would you pay for the option to buy a house at $400,000 if
> the property value had declined to $350,000? I'm betting zero. In
> fact, I would have to pay you $50,000 right now just to take it off
> my hands.
>
> But I wouldn't do that, because I'd rather have the zero. See?
You's rather have the zero than the $350K ... yes, we see your inscrutable
logic.
Michael Coburn
> retro...@comcast.net wrote:
>> On Wed, 15 Oct 2008 11:52:20 -0500, "Rita Refugee" <rita oneword
>> ref...@gmail.com> wrote:
>>
>>> I completely agree that Republicans have screwed everything up, but
>>> the
>>> Democrats were there doing the most harm they could at the same time.
>>> The economical problems can all be laid at the feet of Democrats who
>>> wanted to by hyphenate voters by letting them purchase homes that they
>>> had no way to pay for.
>>
>>
>> You've been sold a bill of goods and bought it because it appeals to
>> your anger.
>> (I note your nym - how do you feel about people who say the Rita
>> victims deserve it for being stupid enough to live there? That';s what
>> you're playing at.)
>>
>>
>> http://bigpicture.typepad.com/comments/2008/10/goal-increase-m.html
>>
>> Goal: Increase Minority Homeowners by 5.5 Million in a Decade Tuesday,
>> October 14, 2008 | 10:00 AM
>> in Politics | Taxes and Policy | UnScience
>>
>> Guess who's goal this was? You might be surprised:
>>
>> "More and more people own their homes in America today. Two-thirds
>> of all Americans own their homes, yet we have a problem here in America
>> because few than half of the Hispanics and half the African Americans
>> own the home. That's a home ownership gap. It's a -- it's a gap that
>> we've got to work together to close for the good of our country, for
>> the sake of a more hopeful future. We've got to work to knock down the
>> barriers that have created a home ownership gap.
>>
>> I set an ambitious goal. It's one that I believe we can achieve.
>> It's a clear goal, that by the end of this decade we'll increase the
>> number of minority homeowners by at least 5.5 million families . . .
>>
>> Home ownership is also an important part of our economic vitality.
>> If -- when we meet this project, this goal, according to our Secretary
>> of Housing and Urban Development, we will have added an additional $256
>> billion to the economy by encouraging 5.5 million new home owners in
>> America; the activity -- the economic activity stimulated with the
>> additional purchasers, the additional buyers, the additional demand
>> will be upwards of $256 billion. And that's important because it will
>> help people find work."
>>
>> - George W. Bush, U.S. President, October 15, 2002 1:55 P.M.
>>
>>
>> Last week, we mentioned this speech from 2004. Fast forward to today's
>> excerpt, from an even earlier, 2002 speech.
>>
>> Why keep bringing these up? Because it derails the false argument
>> brewing amongst those on the right who blame the 1977 CRA or the 1938
>> Fannie Mae for the current housing and credit problem. I have zero
>> patience for this nonsense, and am unafraid to call people on it.
>>
>> Nothing in any of these Bush speeches that pushed for more lending to
>> minorities and increased lower income home ownership caused the
>> problem. Neither did any similar Clinton speeches. Nor did related the
>> legislation related to the Bush speeches, nor did the CRA, nor Fannie
>> Mae or Freddie Mac. Indeed, none of these actions required the sort of
>> reckless lending that we saw from 2002-2007.
>>
>> Understand this simple fact: In an ultra-low rate environment, where
>> prices are appreciating rapidily, and mortgaes are being securitized,
>> ALL THAT MATTERS IS THAT THE BORROWER NOT DEFAULT IN 90 days (or 6
>> Months). The goal was to make a loan that did not default in that
>> period of time, it cannot be put back to the originator.
>>
>> As a mortgage salesman, you only lose your a fee if a borrower defaults
>> within 3 or 6 months. What do you do to maximize your returns? The best
>> way to do that -- to put people in houses that would not default in 90
>> days -- was the 2/28 ARM mortgages. Cheap teaser rates for 24 months,
>> then the big reset. By then, it was no longer your problem.
>>
>> Can you grasp what a monumental change this was? Instead of making sure
>> that borrowers could pay back ALL OF THE 30 YEAR FIXED MORTGAGE, you
>> only had to find people who could afford the teaser rate for a a few
>> months. THIS WAS AN ENORMOUS AND UNPRECEDENTED SHIFT IN LENDING.
>>
>> This is the key to the hosuing boom and bust, anbd ultimately underlies
>> the entire credit freeze. And, it would not have been possible without
>> the Greenspan ultra-low rates, which made the teaser portion (the "2"
>> of the 2/28) of these mortgages so attractive.
>>
>> ~~~
>>
>> Those who continue to blame the CRA, Fannie Mae, etc. reveal their
>> fundamental misunderstanding of how credit operates in general, what
>> the financing process was like from 2002-07, and how this situation
>> came to pass. Or worse, they understand it, and choose to lie about it
>> anyway for partisan political purposes.
>>
>> You either understand these simple facts, or you don't. If you cannot
>> comprehend this, well, then, I am at a loss as to what that says about
>> your cognitive functioning. But if you understand this, but spit out
>> the nonsense anyway, then you are merely a partisan with no respect for
>> the truth.
>>
>> And that seems to be the main people blaming the CRA and Fannie/Freddie
>> for the credit/housing crisis -- those folks who either can't think --
>> or wont.
>
> How about thinking a little deeper?
>
> 1) Nobody would have written a teaser rate mortgage if they couldn't
> sell it. That would be suicide. Companies that were writing imprudent
> mortgages did so only because they didn't have to hold them to maturity,
> and thus they didn't have to worry about the toxicity.
>
> 2) Before 1999, Fannie and Freddie couldn't touch the stuff. Then regs
> were changed and they could. Money got cheap, and the market took off.
> I've seen some stats showing that over
>
> 30% of what Fannie and Freddie were buying since 2003 were subprimes.
> That all leads you inevitably back to the CRA and Fannie/Freddie issue.
NO. It doesn't.
You will do well to actually LOOK at these numbers and recognize your
own stuff from above:
http://www.washingtonpost.com/wp-dyn/content/article/2008/06/09/
AR2008060902626_2.html
In 2000, as HUD revisited its affordable-housing goals, the housing
market had shifted. With escalating home prices, subprime loans were more
popular. Consumer advocates warned that lenders were trapping borrowers
with low "teaser" interest rates and ignoring borrowers' qualifications.
HUD restricted Freddie and Fannie, saying it would not credit them for
loans they purchased that had abusively high costs or that were granted
without regard to the borrower's ability to repay. Freddie and Fannie
adopted policies not to buy some high-cost loans.
That year, Freddie bought $18.6 billion in subprime loans; Fannie did not
disclose its number.
In 2001, HUD researchers warned of high foreclosure rates among subprime
loans.
"Given the very high concentration of these loans in low-income and
African American neighborhoods, the growth in subprime lending and
resulting very high levels of foreclosure is a real cause for concern,"
an agency report said.
--------------------------------------------------------------
http://findarticles.com/p/articles/mi_m0EIN/is_/ai_92843512 ----
WASHINGTON--(BUSINESS WIRE)--Oct. 15, 2002
The National Association of Realtors(R) announced today that it has made
a pledge to the White House to help meet the President's challenge to
increase the number of minority homeowners in America by 5.5 million
before the end of the decade.
----------------------------------------------------------------
The (P)resident made this commitment to increase home ownership at a time
when home ownership was already rising very fast. The initial housing
bubble actually started in 1999/2000 after the 1997 zero capital gains
taxes on residences used for only 2 years, and the slashing of capital
gains taxes from 28% to 20%.
***********************************************************
http://www.whitehouse.gov/news/releases/2003/10/20031015-10.html ---
October 15, 2003
President Calls on Senate to Pass American Dream Downpayment Act
Remarks by the President on Housing and the Economy
Ruiz Foods
Dinuba, California
(...)
THE PRESIDENT: Como esta? (Applause.) Me, too. (Laughter.)
(...)
But here are some of the things that we intend to do and we discussed
today earlier. Sometimes people have trouble finding the down payment for
a home. It makes them nervous when they hear the down payment. We need to
have a down payment fund to help people with down payments if they
qualify. The Congress -- the House passed my request for $200 million a
year. It's stuck in the Senate. The Senate needs to act. If they're
interested in closing the minority home ownership gap, they need to act
on the down payment fund.
-----------------------------------------------------------------
This actually turned out to be a way to induce people who could not
afford the home into buying the home. Yet the Republicans want to blame
Freddie.
http://astuteblogger.blogspot.com/2008/09/nytimes-in-2003-bush-
proposed.html ------------------------------
September 11, 2003
New Agency Proposed to Oversee Freddie Mac and Fannie Mae
By STEPHEN LABATON
The Bush administration today recommended the most significant regulatory
overhaul in the housing finance industry since the savings and loan
crisis a decade ago.
Under the plan, disclosed at a Congressional hearing today, a new agency
would be created within the Treasury Department to assume supervision of
Fannie Mae and Freddie Mac, the government-sponsored companies that are
the two largest players in the mortgage lending industry.
The new agency would have the authority, which now rests with Congress,
to set one of the two capital-reserve requirements for the companies. It
would exercise authority over any new lines of business. And it would
determine whether the two are adequately managing the risks of their
ballooning portfolios.
-------------------------------------------------------------------
**********************************************************
http://www.whitehouse.gov/news/releases/2003/12/20031216-9.html ---
For Immediate Release
Office of the Press Secretary
December 16, 2003
President Bush Signs American Dream Downpayment Act of 2003
(...)
This administration will constantly strive to promote an ownership
society in America. We want more people owning their own home. It is in
our national interest that more people own their own home. After all, if
you own your own home, you have a vital stake in the future of our
country. And this is a good time for the American homeowner. Today we
received a report that showed that new home construction last month
reached its highest level in nearly 20 years. (Applause.)
------------------------------------------------------------
This is actually the American Dream _NO_ Downpayment Act and it was
part of the Bush and Republican dream of currency destruction as a way of
destroying the US government and replacing it with a fascist Republican
state.
And here we have the wraparound and the whole enchilada. We have no
downpayment and no taxation on home speculation. This doesn't even count
the mortgage deductability. That interest is 99.9% of the payment on the
home and it is deductible. The untaxed appreciation of the home and the
government subsidy as a break on the interest was actually a way to live
in the house essentially for free. Just sell it at the end of 2 years or
refinance it and you were the smartest kid on the block. You be in the
fast lane.
*********************************************************************
http://findarticles.com/p/articles/mi_hb5246/is_200403/ai_n19793121 ---
Mortgage Banking, March, 2004
FANNIE MAE HAS ANNOUNCED A PLEDGE to help 6 million families--including
1.8 million minority families--become first-time homeowners over the next
decade. The pledge boosts the company's commitment to President Bush's
Minority Homeownership Initiative and will help raise the minority
homeownership rate from 50.6 percent currently to 55 percent, with the
ultimate goal of closing the gap between minority homeownership rates and
nonminority homeownership rates.
--------------------------------------------------------------------
Now back to
http://www.washingtonpost.com/wp-dyn/content/article/2008/06/09/
AR2008060902626_2.html -------------------------------------
But by 2004, when HUD next revised the goals, Freddie and Fannie's
purchases of subprime-backed securities had risen tenfold. Foreclosure
rates also were rising.
That year, President Bush's HUD ratcheted up the main affordable-housing
goal over the next four years, from 50 percent to 56 percent. John C.
Weicher, then an assistant HUD secretary, said the institutions lagged
behind even the private market and "must do more."
For Wall Street, high profits could be made from securities backed by
subprime loans. Fannie and Freddie targeted the least-risky loans. Still,
their purchases provided more cash for a larger subprime market.
"That was a huge, huge mistake," said Patricia McCoy, who teaches
securities law at the University of Connecticut. "That just pumped more
capital into a very unregulated market that has turned out to be a
disaster."
In 2003, the two bought $81 billion in subprime securities. In 2004, they
purchased $175 billion -- 44 percent of the market. In 2005, they bought
$169 billion, or 33 percent. In 2006, they cut back to $90 billion, or 20
percent. Generally, Freddie purchased more than Fannie and relied more
heavily on the securities to meet goals.
"The market knew we needed those loans," said Sharon McHale, a
spokeswoman for Freddie Mac. The higher goals "forced us to go into that
market to serve the targeted populations that HUD wanted us to serve,"
she said.
---------------------------------------------------------------
Then came Johny Fish Story McCain and his white horse on the heels of the
Raines Scandal attempting to Privatize the oversight. If Bush couldn't
get it into the executive branch, then he could do just as well placing
it into the "private Sector" where Allen Greenjeans could do his typical
job of regulating.
The McCain initiative was to move the oversight out of the Congress so
that the GSE's would make even more bad purchases. It is just
destruction of government. That is what Republicans are about.
I've seen it too many times. If you want to destroy something you
discredit it. That is how it is done in business as well as government.
You feed it until it pops.
rko...@gmail.com
> Many folks are wondering. Please post your comments.
>
Not sure. but here is a article that talks about which is better at
this time. Offensive or defensive.
http://indiastockmarketviews.blogspot.com/2008/09/can-defence-be-best-offence.html
Rich Uncle
or so been taking into account the likely impact of the successful
candidate and presumably will arrive at a decision by Election
Day.
===============================================
Hugh Gibbons
<200c66c8-0cf3-49bc...@s9g2000prm.googlegroups.com>,
rko...@gmail.com wrote:
The market will go up regardless of by how much Obama wins the election.