I don't think you quite understand what the "sub-prime" market is, subby. That apartment ain't it.

Subprime doesn't mean that paying a mortgage sucks; otherwise, we'd all be victims. It means that banks lent money to people with sub-prime (as in "not exactly the best") risk levels, debt-to-income ratios, and all the other indicators lenders ought to be looking at. As a result, these borrowers received subprime terms on those loans. Often, this involved outright lying on the part of the bankers as to what these terms are. Rather than explain the terms more clearly to someone who may not understand them, many bankers outright lied to get a quick sale. In turn, Wall Street thought it would be a great idea to securitize these mortgages into bond-like instruments to be traded. That just added a whole new layer of horseshiat to run through the fan, when all was discovered (i.e., that most of these mortgages were worthless).

For all we know, there may be some broker or CFO somewhere praying to FSM the SEC doesn't find out about his shenanigans until he gets to Buenos Aires.

Sorry; that was meant for subby, not Pocket Ninja.

I think submitter meant "next housing bubble." It's so hard to keep all the over-hyped financial crises straight. Which piece of the sky is falling this week?

You can get like 70 Star Trek apartments for that much money.

£115m is a lot of hookers and blow.

It's already happening here. http://www.housepricecrash.co.uk/

The current housing crisis is a subprime crisis. The good homes still fetch a fair price. Good mortgage loans are still at about 5.5%, just like 5 years ago.

It's the spec homes built on landfills with 20-mile commutes into town, and bad loans, that are declining in "value". Actually, they are adjusting to their actual worth.

/The definition of a stupid loan: Write an adjustable rate mortgage to a guy who can barely pay his bills as it is. What do you think will happen when it adjusts, that he will somehow get more money to pay it?

The funny thing is, sub prime is just the start. The banks also lent money to people with good credit and income...but just like with the sub primes, they lent way more than the borrower could possibly ever repay.

I'm seeing 750k to 1.5million dollar houses in foreclosure around here. Not very pretty at all.

Its ok though. The government will borrow money to bail everybody out, and then the Deficit Fairy will come and wave her magic wand...

filth: I think submitter meant "next housing bubble." It's so hard to keep all the over-hyped financial crises straight. Which piece of the sky is falling this week?

Sub-prime was hardly over-hyped, in fact the problem with sub-prime lending is that nobody took notice of the problem until they were being smashed on the head by chunks of the heavenly firmament.

House prices are arguably over-hyped, although (optimistically) 50m American families might take issue with that this year, as their houses drop into both arrears and negative equity.

Not that submitter isn't a fool, of course.

With all the money the financiers are losing on the sub-prime defaults, there's less money available for higher quality borrowers, hence, the credit crunch, hence the falling economies around the world.

/that's what I've heard, anyway

Hey subby,

115m? That is a lot of m's

In case you were wondering where the next sub-prime mortgage crisis will take place, it's in London, where an apartment is sold for world record £115m

Subby has clearly never owned a home and thus has no clue what a Sub-Prime Mortgage is.

Oh, and Pocket Ninja you can indeed purchase an apartment and unless you are flush with cash, you will have to finance. It's still called a mortgage but not likely to be a sub-prime mortgage.

Again, subby is the real dumbass here.

FarkinNortherner: filth: I think submitter meant "next housing bubble." It's so hard to keep all the over-hyped financial crises straight. Which piece of the sky is falling this week?

Sub-prime was hardly over-hyped, in fact the problem with sub-prime lending is that nobody took notice of the problem until they were being smashed on the head by chunks of the heavenly firmament.

House prices are arguably over-hyped, although (optimistically) 50m American families might take issue with that this year, as their houses drop into both arrears and negative equity.

Not that submitter isn't a fool, of course.

No, what you mean to say is that the sub-prime market is a real problem, which is very true. And it will ultimately not be as big a problem as it has been made out to be, which is why I say it's over-hyped. Both statements are true.

Pocket Ninja

I apologize, I just re-read what you said. You said " That apartment ", meaning the price. You are correct. Someone trying to by a place at that cost would NEVER be one who would need or even get a sub-prime mortgage.

Still, there are clearly others ( clearly not you ) who don't understand that a person can actually take out a mortgage and purchase an apartment space.

Thank you for stupiding up my day, failmitter

Clearly the Mortgage industry didn't do a good enough job discriminating against people who are clearly not home owner material.

yes there was indeed predatory lending, but there was just as much fraud, lying and dishonesty from potential home owners who lied about how much money they made, how many assets they had and of course, their work and payment history.

Not every home buyer is a victim here. In fact, I'd say most are just as crooked and therefore responsible for this mess as the lenders and brokers.

JohnnyJones: 115m? That is a lot of m's

But I don't have that kind of letter.

6k pounds ($12k) a square foot? High end apartments in San Francisco top out at $1k a square foot. Wow.

Had a look at 8 St. Jame's Square in Google Earth. Very convenient for Fortnum & Mason, the St. James Club & Hotel, the East India Club, the Reform Club, Piccadilly, The Economist, etc. What this means is that the very high-end carriage trade isn't being affected by the various crises--not even the non-domiciled taxation threat. The entire Greek shipping industry has threatened to move back to Greece rather than pay the taxes but apparently London needn't worry about the loss. Everybody wants to have a place in London.

Carfax Abbey wasn't so expensive. I love London and I'm glad I moved here. I love the taste of the city. Its life, its blood, its death.

libbynomore2: Clearly the Mortgage industry didn't do a good enough job discriminating against people who are clearly not home owner material.

yes there was indeed predatory lending, but there was just as much fraud, lying and dishonesty from potential home owners who lied about how much money they made, how many assets they had and of course, their work and payment history.

Not every home buyer is a victim here. In fact, I'd say most are just as crooked and therefore responsible for this mess as the lenders and brokers.

If you're a lender who doesn't ask for proof of income and assets then you're asking to get lied to. The lenders knew this and expected it. They calculated that if the home owner defaults then they can repossess the house and sell it at a profit.

libbynomore2
"Not every home buyer is a victim here. In fact, I'd say most are just as crooked and therefore responsible for this mess as the lenders and brokers."

Exactly. With the internets there is no excuse for anyone who borrowed more than they could handle at an adjustable rate to claim ignorance. There are literally thousands of sites with homebuying and mortgage information online. When I bought 18 months ago I ran the numbers over and over again at a bunch of different sites.

WTF is "predatory lending"? No one forced anyone to take out those loans.

I know the article isn't about subprime crap, but the thread seems to be. So here's my 2 cents (2 cents more than the foreclosed on peeps have right about now!!!)

Let the market decide how this subprime mess will roll. Keep the gov't out of it. Screw the bailout bullshiat. It can be natural selection at it's finest. Idiots and companies who make poor financial choices will take the fall instead of relying on everybody else to pay for their luxury items.

BlippityBleep: Let the market decide how this subprime mess will roll. Keep the gov't out of it. Screw the bailout bullshiat. It can be natural selection at it's finest. Idiots and companies who make poor financial choices will take the fall instead of relying on everybody else to pay for their luxury items.

In case you haven't noticed this isn't about sub-prime any more. I wonder if your internet libertarianism would be so strong if you lose your job and your savings because of somebody else's poor financial choices.

I rather fancy the Buckinghamshire grand country manor shown in the (pop-up) picture gallery that features:

1. A smarmy git on a mud field
2. A red chair
3. A lovely rusty gate (overlooking the mud field with charming abandoned wire spool)
4. Acres of Pier One furniture
5. Rusty stuff (photo by drunken cameraman)
6. Genuine Japanese scrogging room and bath
7. Authentic lead sheet roof
8. Partial NASCAR track sex sofa
9. The chandelier of DEATH!
10.Alien rectal exam room from smash 1970s sci-fi program "UFO"

Hah! Suck it, Johnny Foreigner! We're considerably richer than you.

Bad_Seed: BlippityBleep: Let the market decide how this subprime mess will roll. Keep the gov't out of it. Screw the bailout bullshiat. It can be natural selection at it's finest. Idiots and companies who make poor financial choices will take the fall instead of relying on everybody else to pay for their luxury items.

In case you haven't noticed this isn't about sub-prime any more. I wonder if your internet libertarianism would be so strong if you lose your job and your savings because of somebody else's poor financial choices.

I'd figure something out. It's better than supporting dumbfarks who are living the good life on my dime.

BlippityBleep: I'd figure something out. It's better than supporting dumbfarks who are living the good life on my dime.

Yeah, you'd collect your dole cheques until the economy sorts itself out again. By paying a dime to "support dumbfarks" you're protecting yourself from having to pay far more money when things start getting difficult.

Bad_Seed: Yeah, you'd collect your dole cheques until the economy sorts itself out again. By paying a dime to "support dumbfarks" you're protecting yourself from having to pay far more money when things start getting difficult.

I'm sorry. I don't live in the same state of economic fear that you are whining about.

Stupididy is trumping responsibility in this whole mess, and that's no way to run an economy.

Supidity, even.

A whole building doesn't cost that much. Fawk!

BlippityBleep: I'm sorry. I don't live in the same state of economic fear that you are whining about.

Of course you don't. Ignorance is bliss.

lelio
6k pounds ($12k) a square foot? High end apartments in San Francisco top out at $1k a square foot. Wow.

Maybe the housing price in San Francisco would go up a little bit if your neighbor was the White house.

Sudlow


WTF is "predatory lending"? No one forced anyone to take out those loans.

Surprisingly, (or not really) this sounds an awful lot like the same "it serves em right for not checking the box" type of statements after a
guy gets busted for selling bricks wrapped in a DVD player box.

Bad_Seed: Of course you don't. Ignorance is bliss.

You write as if it's inevitable that catastrophe will happen without government support. That view is just as ignorant.

Hell, the way we measure the economy is farked up anyways. If I were to really help out, I would go get in a car wreck and be taken away in an ambulance after a meeting with a divorce attorney. Look at how I've chipped in for my part!

BlippityBleep: Bad_Seed: Of course you don't. Ignorance is bliss.

You write as if it's inevitable that catastrophe will happen without government support. That view is just as ignorant.

It's very likely that at least one bank will collapse. If someone doesn't step in to bail them out ordinary people who didn't do anything stupid will lose their savings. Worse, it could trigger the collapse of more banks as people lose confidence in the financial system. Just hope that it's your government which does the bailing-out and not the Chinese or some oil-rich Arab despot.

Bad_Seed 2008-03-16 04:22:20 PM
libbynomore2: Clearly the Mortgage industry didn't do a good enough job discriminating against people who are clearly not home owner material.

yes there was indeed predatory lending, but there was just as much fraud, lying and dishonesty from potential home owners who lied about how much money they made, how many assets they had and of course, their work and payment history.

Not every home buyer is a victim here. In fact, I'd say most are just as crooked and therefore responsible for this mess as the lenders and brokers.

If you're a lender who doesn't ask for proof of income and assets then you're asking to get lied to. The lenders knew this and expected it. They calculated that if the home owner defaults then they can repossess the house and sell it at a profit.


Sorry, maybe my sarcasm sailed over your head. If mortgage lenders had done the right thing and denied loans to those who coulod only qualify for a sub-prime loan it's true that our economy wouldn't have been so badly harmed, but understanding that most of those who lied and committed fraud on their loan applications were minorities and if the lenders had done the right thin, and rejected them, they would have been accused of discrimination.

Fact.

Bad_Seed: BlippityBleep: Let the market decide how this subprime mess will roll. Keep the gov't out of it. Screw the bailout bullshiat. It can be natural selection at it's finest. Idiots and companies who make poor financial choices will take the fall instead of relying on everybody else to pay for their luxury items.

In case you haven't noticed this isn't about sub-prime any more. I wonder if your internet libertarianism would be so strong if you lose your job and your savings because of somebody else's poor financial choices.

This. I'm actually starting to worry about my retirement investments. If this spirals out of control there might be a lot of us back at square one. Not just the "Idiots and companies who make poor financial choices".

My slaving away during my prime earning years to pay for the excesses and bad decisions of the previous generation looks to be getting closer to a reality...

libbynomore2: Sorry, maybe my sarcasm sailed over your head. If mortgage lenders had done the right thing and denied loans to those who coulod only qualify for a sub-prime loan it's true that our economy wouldn't have been so badly harmed, but understanding that most of those who lied and committed fraud on their loan applications were minorities and if the lenders had done the right thin, and rejected them, they would have been accused of discrimination.

Lol. Yeah. Banks gave out bad loans because they were scared of being accused of discrimination. Now, that must be sarcasm.

Bad_Seed 2008-03-16 05:28:55 PM
libbynomore2: Sorry, maybe my sarcasm sailed over your head. If mortgage lenders had done the right thing and denied loans to those who coulod only qualify for a sub-prime loan it's true that our economy wouldn't have been so badly harmed, but understanding that most of those who lied and committed fraud on their loan applications were minorities and if the lenders had done the right thin, and rejected them, they would have been accused of discrimination.

Lol. Yeah. Banks gave out bad loans because they were scared of being accused of discrimination. Now, that must be sarcasm.


Amazing, you don't understand sarcasm OR the point I clearly made.

let's try again......if banks had done the right thing, and denied loans to minorities who couldn't qualify for a conventional loan without lying, and if the banks refused to offer them risky sub-prime mortgages, the banks would have been accussed of discrimmination.

If you cannot understand that, you're clueless and I can't help you.

libbynomore2: Amazing, you don't understand sarcasm OR the point I clearly made.

let's try again......if banks had done the right thing, and denied loans to minorities who couldn't qualify for a conventional loan without lying, and if the banks refused to offer them risky sub-prime mortgages, the banks would have been accussed of discrimmination.

If you cannot understand that, you're clueless and I can't help you.

"Oh please, Mr. Unemployed Black Man, please don't play the race card, just take our money, take as much as you want, but whatever you do, don't accuse us of discrimination."

Yeah, I'm sure that's what happened.

Bad_Seed: Worse, it could trigger the collapse of more banks as people lose confidence in the financial system.

Why would we lose confidence in the system? I mean, they've proven in this issue that they are capable of making right decisions when lending.

I see your point in this issue, but it still pisses me off that the banks and people are going to get away with this shiat. When there is the gov't bailout I only hope that the banks/people involved are held responsible for paying back their free lunch.

Bad_Seed 2008-03-16 05:40:47 PM
libbynomore2: Amazing, you don't understand sarcasm OR the point I clearly made.

let's try again......if banks had done the right thing, and denied loans to minorities who couldn't qualify for a conventional loan without lying, and if the banks refused to offer them risky sub-prime mortgages, the banks would have been accussed of discrimmination.

If you cannot understand that, you're clueless and I can't help you.

"Oh please, Mr. Unemployed Black Man, please don't play the race card, just take our money, take as much as you want, but whatever you do, don't accuse us of discrimination."

Yeah, I'm sure that's what happened.


Again, clueless regarding mortgages and how this all happened.

Thanks for confirming.

BlippityBleep: Why would we lose confidence in the system? I mean, they've proven in this issue that they are capable of making right decisions when lending.

Because if depositors in one bank lose their money then depositors of other banks will get twitchy and ready for a bank run at the slightest hint of bad news.

I see your point in this issue, but it still pisses me off that the banks and people are going to get away with this shiat. When there is the gov't bailout I only hope that the banks/people involved are held responsible for paying back their free lunch.

Nobody is really making money off of this. Banks have lost billions of dollars, their share prices have been plummeting, lots of people will have their mortgages foreclosed. It's not about free lunches, it's about stopping a bad situation from becoming worse.

Personal responsibility is still important.

/Got approved for a $500k loan. Bought for $130k. Watching the credit crisis with amusement. Stupid asses.

libbynomore2: Again, clueless regarding mortgages and how this all happened.

Thanks for confirming.

Any lender who doesn't ask for proof of income knows that people are going to lie to him. That's the whole point of not asking for proof of income, so that people will lie and you can give them bigger loans that they could otherwise get. I'm not the one who's clueless here.

Bad_Seed 2008-03-16 06:00:07 PM

Nobody is really making money off of this. Banks have lost billions of dollars, their share prices have been plummeting, lots of people will have their mortgages foreclosed. It's not about free lunches, it's about stopping a bad situation from becoming worse.


Wow, you really, truly don't understand this thing at all do you? People DID make money, they were the brokers who conspired with dishonest and clearly unqualified borrowers to make loans, then sell them to other investors. The brokers got their commissions, the borrowers got their loans and the banks who bought those loans were left holding the bag because those borrowers just walked away from the promises they made to repay their loans.

You really need to stop talking about this because you know absolutley NOTHING about it.