gut;1114422 wrote:Try looking at what I posted again. Specifically, take a look at Figure 1 on page 2. From about 1962-1995 ownership was remarkably constant around an average of 64% give or take a point or two. Moreover, rates were RISING quickly and steadily in the 60's and 70's (from 6% in 1963 peaking at nearly 15% in 1982). In this same time period, home ownership increased steadily from about 63% to 66%. So you are, simply, wrong.

Lower interest rates lead to higher prices - practically an axiom of bubble formation. It doesn't really change the affordability of a house so it has no real impact on home ownership. What really juiced demand was all the mortgages given with 0-5% down when historically you plunked down 20%. It was the downpayment, particularly in markets like CA, that put home ownership out of reach for so many people. And before people start crying about regulation, realize the first time home buyer loans pushed by the govt STILL require just 3% (or maybe 3.5%) down. And that's a good thing. But it's no one's responsibility but my own to know what my payments can go to in 3-5 years when the ARM resets and whether or not I can make those payments.

Well gosh I looked at figure 1 on page two. We see a chart that covers a relatively short period that you cherry picked but a whole 80 years that reflect my statement.

isadore wrote: What do we see that with relatively low interest rates in a prosperous economy, home ownership increases. Of course through the periods of greatest expansion of home ownership we had strong regulation on the banking institutions. In the 2000s we had the low interest rates but the largely unregulated financial institutions were let loose on families trying to fulfill the American Dream of homeownership.

Low interest rates and government regulation enormous growth in home homeownership from 1940 to 1970s, then beginning again in the 1990s. But as this last growth spurt continues government regulations are cut on financial institutions, leading to the most recent crisis.

isadore;1114593 wrote:
Low interest rates and government regulation enormous growth in home homeownership from 1940 to 1970s

Most of that home ownership was buying moderate sized houses. People who have bought houses that are within their means have have still done fine the past decade. If you make $15/hr, you can't afford to buy a 4,000 sq. ft. home in the best neighborhood. Look at the houses that the average person was buying in the 1940's to 1970's, most of them were around 1,500 sq ft. People lived within their means. I don't want to see to anyone lose money, and the banks have done some stupid things. However people have to be able to manage their money to live within their means.

isadore;1114553 wrote:No maybe we should be considering more government action rather than less. No interest loans and forgiveness of payment in vital economic sectors with a scarcity of trained professionals.

If you go to a no interest loan for a student, someone is paying the price to use the capital. Are you proposing that we increase taxes and use that tax money to pay the interest?

isadore;1114553 wrote:No maybe we should be considering more government action rather than less. No interest loans and forgiveness of payment in vital economic sectors with a scarcity of trained professionals.

I agree that more action should be taken, but not on the government's side, on the side of the individual more action should be taken. Majority of people have found a way to obtain loans responsibly and not default. If the government just forgives people who have defaulted on their loans than what incentive is there for people to go out and achieve? I don't like the lesson that would teach young adults.

isadore;1114547 wrote:And I was taught to feel empathy for people who have been taken advantage.
It is interesting to see your view of them.
You see them as Johns knowingly involved in an illegal activity with the hope for some fleeting satisfaction. Your view of working class people engaged in a legal in fact admireable action of acquiring a home for their family. The illegal or what should be illegal acts are on the part of the lender not the borrower who is the victim. You sound like one of those folks who claim a rape victim got what she deserved for walking into a bar alone. Where others would be want her protected by the police and her attacker punished.

Again, you appear to want to dissolve the homeowner of any accountability in this matter. You are flat wrong, and your strawman attacks on me aren't going to change that. I can be sympathetic for their situation (which I am) while still believing they need to be accountable for their choices. This goes beyond a heightened and fraudulent sense of entitlement. A culture that promotes the victim mentality is absolutely sickening. Teach your children to learn what the fuck they are signing.

You know, smart & rich people both get burned getting involved in stuff they don't understand, either. People don't learn when they aren't accountable, they repeat their mistakes. In your world, you seem to support people repeating their mistakes.

isadore;1114593 wrote:Well gosh I looked at figure 1 on page two. We see a chart that covers a relatively short period that you cherry picked but a whole 80 years that reflect my statement.

Low interest rates and government regulation enormous growth in home homeownership from 1940 to 1970s, then beginning again in the 1990s. But as this last growth spurt continues government regulations are cut on financial institutions, leading to the most recent crisis.

I didn't cherry pick. You made an absolute statement that was wrong. You said lower interest rates lead to a rise in home ownership, and the period I cited proves you wrong (you were the one cherry picking). The expansion of home ownership in the 40's-70's had more to do with tremendous increases in the standard of living (i.e. "means") than anything.

You also clearly don't understand the relationship between interest rates and asset prices. The growth in ownership in the late 90's is almost entirely attributable to relaxed credit standards ON THE BORROWER, with the easy credit boom to juice the higher demand.

JU-ICE;1114164 wrote:According to Lovie Smith, blacks should "have Obamas back" and vote for him, well, because he is black.
http://www.theblaze.com/stories/chicago-bears-head-coach-tells-african-americans-to-have-obamas-back-in-2012/

I suppose Lovie was doing the same for Herman Cain?

Al Bundy;1114625 wrote:Most of that home ownership was buying moderate sized houses. People who have bought houses that are within their means have have still done fine the past decade. If you make $15/hr, you can't afford to buy a 4,000 sq. ft. home in the best neighborhood. Look at the houses that the average person was buying in the 1940's to 1970's, most of them were around 1,500 sq ft. People lived within their means. I don't want to see to anyone lose money, and the banks have done some stupid things. However people have to be able to manage their money to live within their means.

I think you are being easy on the financial institutions by writing “banks have done some stupid things,” rather than “criminal things.” They drew people in with phony offers and promises, that set these people on the road to economic catastrophe. They are at fault, not their victims.

Al Bundy;1114627 wrote:If you go to a no interest loan for a student, someone is paying the price to use the capital. Are you proposing that we increase taxes and use that tax money to pay the interest?

yes

dwccrew;1114774 wrote:I agree that more action should be taken, but not on the government's side, on the side of the individual more action should be taken. Majority of people have found a way to obtain loans responsibly and not default. If the government just forgives people who have defaulted on their loans than what incentive is there for people to go out and achieve? I don't like the lesson that would teach young adults.

I like the lesson that it teaches you adults tht we take serious terms like "promote the general welfare" and "the pursuit of happiness" One of the greatest investments our nation ever made was in the GI Bill that allowed millions of returning veterans a college education. During the 1960s there were national defense loans, loan interest loans available for all college students with forgiveness of part or all of the loan if you entered certain fields, engineers, mathematicans, foreign language, various types of teachers. In 1940 15% of hs graduates went to college, in 1970 it was 40%
http://en.wikipedia.org/wiki/National_Defense_Education_Act
We need professional personnel many sectors of our economy and we need to refurbish the American dream. Upward social mobility is heading down the pipes in this country.

gut;1114808 wrote:Again, you appear to want to dissolve the homeowner of any accountability in this matter. You are flat wrong, and your strawman attacks on me aren't going to change that. I can be sympathetic for their situation (which I am) while still believing they need to be accountable for their choices. This goes beyond a heightened and fraudulent sense of entitlement. A culture that promotes the victim mentality is absolutely sickening. Teach your children to learn what the **** they are signing.

You know, smart & rich people both get burned getting involved in stuff they don't understand, either. People don't learn when they aren't accountable, they repeat their mistakes. In your world, you seem to support people repeating their mistakes.

Really

gut wrote:I can be sympathetic for their situation (which I am)

gut wrote: Sorry, I just struggle to be overly sympathetic for people who chose to ignore the many opportunities to educate themselves on the matter and now claim to be a victim.
141
So, what you're saying is we need the govt to protect people from their own ignorance/stupidity? 116#

people are too lazy or ignorant to be accountable for their actions 141#

aw your cup of goodness and mercy does overflow.
Boy oh boy as they and their children go to sleep tonight in their car with all their possessions in the world in the trunk, it will be a good lesson for all of them.
When financial institutions abuse their customers to the point of economic ruin then government should serve as a protector.

I marvel over those who simply refuse to admit that in the final analysis we are responsible for our own actions. The notion that some Americans have that we need a Great Nanny State to protect us from making our own decisions and choices - be they informed or otherwise - confounds if not scares the crap out of me.

isadore;1115328 wrote: Boy oh boy as they and their children go to sleep tonight in their car with all their possessions in the world in the trunk, it will be a good lesson for all of them.
When financial institutions abuse their customers to the point of economic ruin then government should serve as a protector.

Let me explain a little bit to you how the real world works.

People who knowingly and willingly would commit fraud are not prevented from doing so by any sort of regulations or laws. The fraud laws and prosecution is more about keeping these people accountable than truly protecting you. Rich and supposedly sophisticated (mainly determined by their assets) investors got bilked out of billions by Madoff (and other large frauds). In more than a few cases, these were so-called professional investors (professional marketers/asset raisers is a better description) who got conned. There were plenty of red flags, at least for people who knew what to look for. Some of them knew and chose to ignore it (there's that greed again). Am I sympathetic to these people? Yes. Are they a victim of their own stupidity/laziness/greed? Absolutely.

So it's a fool's game for the govt to have the audacity and arrogance to think they can protect mom & pop from their own ignorance when they walk into a bank, a used car dealer, or a casino. What you don't seem to grasp is all the regulations and safeties are there - in writing. The pages and pages that "nobody reads" is borne out of years of court cases and disclosure laws/regulations. Everything mom & pop need to know is right there in writing. However, the govt unfortunately cannot make mom & pop READ & UNDERSTAND these documents.

Predatory in this case involves fraud - lying ON PAPER. And truthfully the buyer was often complicit. But buyers of the securities were also victims of the fraud, and actually had less transparency and knowledge of the specifics than the buyer would have - yet I don't see you defending the investors here. OOOOOHHHHH, all the sensational terms brandied about like "misleading" and "pressured" and "lying"...yet everything was there in black & white. These buyers - a small % by the way (5%?) - allowed themselves to be a victim. They had the means to NOT be a victim and they chose to disregard the protections afforded them.

The idea that the mom & pop were coerced or forced, or that they were a "helpless victim" is complete and utter bullshit. Yes, the buyers of these securities are more of a helpless victim than mom & pop. Truth.

gut;1114814 wrote:I didn't cherry pick. You made an absolute statement that was wrong. You said lower interest rates lead to a rise in home ownership, and the period I cited proves you wrong (you were the one cherry picking). The expansion of home ownership in the 40's-70's had more to do with tremendous increases in the standard of living (i.e. "means") than anything.

You also clearly don't understand the relationship between interest rates and asset prices. The growth in ownership in the late 90's is almost entirely attributable to relaxed credit standards ON THE BORROWER, with the easy credit boom to juice the higher demand.

I talk about the experience of nearly 80 years and you try to use short period within that time. You are cherry picking. Even within the period you chose my statement remain true but with less precipitous rises and falls.
http://research.stlouisfed.org/publications/review/06/09/Garriga.pdf
http://mortgage-x.com/trends.htm
The low interest rates were a prime attraction that the last 15 years. But also sadly the gutting of regulations allowed financial institutions to trick borrowers into mortgages that were destructive to their interests.

believer;1115339 wrote:I marvel over those who simply refuse to admit that in the final analysis we are responsible for our own actions. The notion that some Americans have that we need a Great Nanny State to protect us from making our own decisions and choices - be they informed or otherwise - confounds if not scares the crap out of me.

You've got a binding contract that spells out everything in black & white. You don't need anything else. All this BS about more regulations is mostly unnecessary fluff and grandstanding, at least in regard to the lender/buyer transaction (the securitization is another issue entirely). But everything the buyer needs is already there in writing - they have to allow themselves to be a victim by choosing not to read and understand.

And the housing bubble was global. Who knew that the local Countrywide dirtbag was also tricking and taking advantage of people in China, Australia, Japan and the UK? That's one busy bastard.

Funny thing is, you think predatory lending you think Payday and mafia loan sharking - 3 & 4 digit APR's. But the "victims" of "predatory" mortgage lending saw their payments double...in other words rates going from like 3% to 6%, in most cases probably still below historical prime averages. There was a mountain more fraud than what we might traditionally consider "predatory" lending. Predatory lending didn't cause the bubble or the financial meltdown.

isadore;1115365 wrote:I talk about the experience of nearly 80 years and you try to use short period within that time. You are cherry picking. Even within the period you chose my statement remain true but with less precipitous rises and falls.
http://research.stlouisfed.org/publications/review/06/09/Garriga.pdf
http://mortgage-x.com/trends.htm
The low interest rates were a prime attraction that the last 15 years. But also sadly the gutting of regulations allowed financial institutions to trick borrowers into mortgages that were destructive to their interests.

No, you cherry picked. You focused on 15 years to make your claim and ignored the prior 65 years that contradicts you when interest rates did not track with an increase in home ownership. And I already explained the driving factor behind the increase the past 15 years. You can't even read your own charts - home ownership rose steadily from @ 1992-2007, but interest rates did not start declining significantly until 2000.

You don't understand the relationship between asset prices and interest rates - lower interest rates means higher prices so it does not mean a home is more affordable. In other words, you pay less in interest, but the price of the same home is now higher, offsetting most if not all the advantage from the lower interest rate. So quite simply your theory is wrong because it can't be true and isn't true.

gut;1115359 wrote:Let me explain a little bit to you how the real world works.

People who knowingly and willingly would commit fraud are not prevented from doing so by any sort of regulations or laws. The fraud laws and prosecution is more about keeping these people accountable than truly protecting you. Rich and supposedly sophisticated (mainly determined by their assets) investors got bilked out of billions by Madoff (and other large frauds). In more than a few cases, these were so-called professional investors (professional marketers/asset raisers is a better description) who got conned. There were plenty of red flags, at least for people who knew what to look for. Some of them knew and chose to ignore it (there's that greed again). Am I sympathetic to these people? Yes. Are they a victim of their own stupidity/laziness/greed? Absolutely.

So it's a fool's game for the govt to have the audacity and arrogance to think they can protect mom & pop from their own ignorance when they walk into a bank, a used car dealer, or a casino. What you don't seem to grasp is all the regulations and safeties are there - in writing. The pages and pages that "nobody reads" is borne out of years of court cases and disclosure laws/regulations. Everything mom & pop need to know is right there in writing. However, the govt unfortunately cannot make mom & pop READ & UNDERSTAND these documents.

Predatory in this case involves fraud - lying ON PAPER. And truthfully the buyer was often complicit. But buyers of the securities were also victims of the fraud, and actually had less transparency and knowledge of the specifics than the buyer would have - yet I don't see you defending the investors here. OOOOOHHHHH, all the sensational terms brandied about like "misleading" and "pressured" and "lying"...yet everything was there in black & white. These buyers - a small % by the way (5%?) - allowed themselves to be a victim. They had the means to NOT be a victim and they chose to disregard the protections afforded them.

The idea that the mom & pop were coerced or forced, or that they were a "helpless victim" is complete and utter bull****. Yes, the buyers of these securities are more of a helpless victim than mom & pop. Truth.

So "truth in lending" laws are all horse$hit. Gotcha. caveat emptor...and all that. What is it about 49 Attorney Generals winning 20 billion in lawsuits against companies like Ameriquest do you not effin understand?

Whether it be class action or personal civil suits, American law allows for legal repercussion through our courts when fraud assault occur. Your responses here show a microcosm of why so many people all across America can't stand Wall Street. Make a profit ethically? No way. Fukk someone in the a$$? Good business man. If you don't like ourcourt system and buyer protection laws...move to Siberia. Most Americans enjoy our legal system the way it's drawn up. Apparently, you don't.

gut;1115359 wrote:Let me explain a little bit to you how the real world works.

People who knowingly and willingly would commit fraud are not prevented from doing so by any sort of regulations or laws. The fraud laws and prosecution is more about keeping these people accountable than truly protecting you. Rich and supposedly sophisticated (mainly determined by their assets) investors got bilked out of billions by Madoff (and other large frauds). In more than a few cases, these were so-called professional investors (professional marketers/asset raisers is a better description) who got conned. There were plenty of red flags, at least for people who knew what to look for. Some of them knew and chose to ignore it (there's that greed again). Am I sympathetic to these people? Yes. Are they a victim of their own stupidity/laziness/greed? Absolutely.

So it's a fool's game for the govt to have the audacity and arrogance to think they can protect mom & pop from their own ignorance when they walk into a bank, a used car dealer, or a casino. What you don't seem to grasp is all the regulations and safeties are there - in writing. The pages and pages that "nobody reads" is borne out of years of court cases and disclosure laws/regulations. Everything mom & pop need to know is right there in writing. However, the govt unfortunately cannot make mom & pop READ & UNDERSTAND these documents.

Predatory in this case involves fraud - lying ON PAPER. And truthfully the buyer was often complicit. But buyers of the securities were also victims of the fraud, and actually had less transparency and knowledge of the specifics than the buyer would have - yet I don't see you defending the investors here. OOOOOHHHHH, all the sensational terms brandied about like "misleading" and "pressured" and "lying"...yet everything was there in black & white. These buyers - a small % by the way (5%?) - allowed themselves to be a victim. They had the means to NOT be a victim and they chose to disregard the protections afforded them.

The idea that the mom & pop were coerced or forced, or that they were a "helpless victim" is complete and utter bull****. Yes, the buyers of these securities are more of a helpless victim than mom & pop. Truth.

If the laws are not preventing agents of financial institutions from committing these fraudulent practices then the punishments should be more extensive and draconian. One thing that was obvious in the economic collapse was not many of these folks suffered any real punishments. Real pain, real deterrent.
Gosh it is interesting you have greater sympathy for the victims of Bernie Madoff than for average working class Americans. These folks usually have advanced educations and easy access to lawyers and accountants. Mom and Pa got what they deserve. The rich and powerful get taken. But mom and pa get screwed. Your own words
“Read and Understand” Because of course the documents are prepared to fool them. But you have no sympathy. That is why we need the government there to protect them from these scams. Gosh who gets your sympathy not the average working people screwed over by large corporate entity. But the rich investor with the accountants, lawyers and advisers.
I know for you Christmas Carol and How the Grinch Stole Christmas were tragedies.

believer;1115339 wrote:I marvel over those who simply refuse to admit that in the final analysis we are responsible for our own actions. The notion that some Americans have that we need a Great Nanny State to protect us from making our own decisions and choices - be they informed or otherwise - confounds if not scares the crap out of me.

Yes indeed...we are responsible for our own actions. That's the way it should be. In the case of Bernie Madoff and a whole bunch of sub prime lending institutions, investment banking firms, and the like....when you act irresponsibly in violating American laws, then you pay the consequences.

Footwedge;1115423 wrote:Yes indeed...we are responsible for our own actions. That's the way it should be. In the case of Bernie Madoff and a whole bunch of sub prime lending institutions, investment banking firms, and the like....when you act irresponsibly in violating American laws, then you pay the consequences.

yessir

gut;1115379 wrote:Funny thing is, you think predatory lending you think Payday and mafia loan sharking - 3 & 4 digit APR's. But the "victims" of "predatory" mortgage lending saw their payments double...in other words rates going from like 3% to 6%, in most cases probably still below historical prime averages. There was a mountain more fraud than what we might traditionally consider "predatory" lending. Predatory lending didn't cause the bubble or the financial meltdown.

yessir

gut;1115387 wrote:No, you cherry picked. You focused on 15 years to make your claim and ignored the prior 65 years that contradicts you when interest rates did not track with an increase in home ownership. And I already explained the driving factor behind the increase the past 15 years. You can't even read your own charts - home ownership rose steadily from @ 1992-2007, but interest rates did not start declining significantly until 2000.

You don't understand the relationship between asset prices and interest rates - lower interest rates means higher prices so it does not mean a home is more affordable. In other words, you pay less in interest, but the price of the same home is now higher, offsetting most if not all the advantage from the lower interest rate. So quite simply your theory is wrong because it can't be true and isn't true.

Yes they do, low interest rates track with rising home ownership. Try reading your chart from 1993 as you write there is no appreciable change in interest rates until 1998 and as other chart shows there is no appreciable rise in homeownership with home ownership, in1998 at the level is as it was in 1990. Then a cut in rates that year marks the beginning of a rise that would go on for the next nine years. Sadly also a time of decreasing regulation which would lead to disaster.