firefly212 Weaver95: None of this makes any sense to me. we've got CEO's who ran their banks into the ground over this mortgage collapse that will walk out of their offices tomorrow morning with something around $20 million dollars in personal compensation. The idiots who bought one (OR MORE!) homes that they knew they couldn't afford are just walking away from the debt without conseqences and absolutely nobody seems at all concerned that we're going to just eat the massive debt load on this mortgage company bailout.

I pay my bills on time, I pay my mortgage on time, I live within my means and I have no credit card debt. But i'm going to see my taxes rise and rise and rise and I don't get any say about it. Didn't we fight a revolution over unfair taxiation or something? I'm pretty sure I read about that somewhere.

If you're advocating some system in which both the banks and the borrowers (bad loans are like dancing, it takes two to tango) lose money when they do stupid things, I'm with ya. But I'd also be for laws that restrict the amount of stupidity banks can have, caps on interest rates, no lending to people who have no jobs, and things like that. When stupid people and stupid banks get together, the harm spreads well beyond the two parties, and we have a great interest in limiting the impact of their idiocy on the rest of us.

Disagree with your statement firefly. This is like imposing sentences for drug users and dealers, and thinking the war on drugs will be won eventually. The supply must be attacked more agressively than the users, but that does not happen because money can be exchanged between enforcers and criminals at larger quantities more discreetly. Same thing here.

Not only am I not surprised, but for people to demonize the idiots (drug users and home evictees) without understanding why they are doing it does not help solve the problems. The root of both these evils are within our society, because at one point or another we failed these people (or like many in Fark, they failed themselves) and changed their defeatist feeling with smugness and made mainstream something that is shameful. So now, everyone is doing it, the ones that are not doing resent how the others are bringing us all down. When that is not the reality.

The system is stacked up against us. Puch the head out and the rest will follow. Leave the limbs alone. Pure simplicity. Because this is not about making excuses for the idiots, but it is about targeting what (who) matters before we get our asses kicked.

Second Try: The best way to troll communist farkers is bringing up the National Socialist German Workers' Party.

They will explode their heads trying to prove Hitler wasn't a socialist, which everybody knows for years to be true. Some will even say the USSR and East Germany were not socialist.

Or they will just call you stupid and blame Bush.

You should read my posts where I did that, or read the post where I said I did that in my other posts.

mizchief: You should read my posts where I did that, or read the post where I said I did that in my other posts.

Or you shouldn't bother, as they were both ignorant rubbish.

^{So it's like a person who doesn't like what their spouse looks or acts like on down the road and picks up and leaves, only to set up a new franchise elsewhere.}

No-fault divorce. Works for the slytted ones.

mizchief: Second Try: The best way to troll communist farkers is bringing up the National Socialist German Workers' Party.

They will explode their heads trying to prove Hitler wasn't a socialist, which everybody knows for years to be true. Some will even say the USSR and East Germany were not socialist.

Or they will just call you stupid and blame Bush.

You should read my posts where I did that, or read the post where I said I did that in my other posts.

Surely you're talking to your own second acccount there?

Don't let the facts cloud your ignorant preconceptions that couldn't be further from the truth. The shear amount of ignorance, self righteousness, and stupidity when it comes to this issue is astounding. Many, many in this thread are just clueless as to how it all works.

madgonad: g0dzilla: The schadenfreude in me wants evil to be visited upon these jumpers, but the economist in me wants a graceful landing that won't suck down the entire economy.

Don't worry. What the article didn't say is that the bank's loss can be legally reclaimed. If the bank could only sell a foreclosed house for $200k what they had $300k invested in you are still legally on the hook for that $100k loss. It is a very simple thing to get a legal judgment, contested or not, against the bailing homeowner. My wife is an attorney and she does these from time to time. The chickenshiat homeowner doesn't have a legal leg to stand on. As this becomes more common the banks will be bundling and selling these valid debts to businesses and attorneys who have useful tools like liens and garnishments to recapture that $100k. The credit hit is the least of your worries. I hope any of you thinking of bailing will reconsider.

um, yeah - well, that's true IF the homeowner isn't under Ch. 7 bankruptcy protection.

/durrrrrr

You act as though bankruptcy isn't a big deal. Obviously, you don't know anyone who has gone through one. Bankruptcy is the end of the line, you can only go that route when there are no other options and it leaves the bankrupt person...wel bankrupt. It is devestating to anyone who goes through it and it literally means they are starting over financially. If you think its an easy way out then you are an ignorant prick. And for those who have those ignorant preconceptions about who is getting bailed out, check out the following:

Link (new window)

Yes, people should only buy what they can actually afford. If they hadn't bought an overpriced mcmansion, they would be able to still make the monthly payments....right.

And the federal reserve didn't have anything at all to do with the payments on these mcmansions nearly doubling over three years. Afterall, what could raising interest rates possibly have to do with the amount that these people needed to pay each month.

Note that these houses were being paid for. These people were able to make their payments in the first few months to a year or so. Then their ARM loans started to go up, and up some more. If you are barely making payments at 4% then raising your rates to 8% will mean that there isn't any possible way to make a payment.

If the federal reserve hadn't raised interest rates, these loans would still be getting paid.

On the other hand, if the idiots had taken out fixed rate loans, they wouldn't have had a problem anyway.

Mortimer14: If the federal reserve hadn't raised interest rates, these loans would still be getting paid.

On the other hand, if the idiots had taken out fixed rate loans, they wouldn't have had a problem anyway.

Problem was that in too many places (like southern california) houses cost so much (and still do) that you either had to get the ARM, I/O or other voodoo loan, or be prepared to sell an organ for the down payment - even if your salary otherwise was "middle class". In just the last 5 or 6 years prices went from 'absurd' to 'you gotta be f*cking kidding me' and beyond...

Maybe if these people chose not to buy these overpriced pieces of stuccoed shiat, (perceived) supply and (real) demand wouldn't have been so screwed up...

First off, I put the blame for this whole thing as follows: about 75-85% on the banks and the rest on the buyers. Most of the blame lies with the banks, who know- or SHOULD know- all the details about the buyer's finances and credit history, and yet they STILL went ahead and issued loans that carried a high potential for default. The buyer's portion of the risk is that they should also have understood that the terms of their ARM or whatever meant that their payments would go up. On the other hand, many of these banks downplayed that issue to the buyer, in order to simply make the sale. Now, we COULD just let all these banks fail completely, and let the chips fall where they will... but that would be an absolute disaster for our economy and our people. Unfortunately, the only solution is to bail out the banks, let the people pay for it gently over time with taxes, and allow the economy to stabilize. Either way, it's all of us that will have to pay for it. And this would happen even in a truly laissez- faire, capitalist state, too. Well, the disaster part, anyway. Hell, it would be worse- banks wouldn't have been regulated at all, and could have done even more damage to the nation, and our government wouldn't have been able to step in and prevent this from bringing the whole nation and its citizens to financial ruin overnight.

Now, about the whole "Socialism" thing. The Soviet Union, East Germany, etc, etc. were NOT "Socialist" countries. They were communist countries. Communism includes facets of socialism in its framework, to be sure, but true socialism requires democracy, which didn't exist in the eastern bloc, and still doesn't exist in remaining communist nations like Cuba and China. The true socialist nations, such as Sweden, Norway, and Finland, enjoy very high standards of living, strong (comparatively) economies, extensive freedom, excellent education, and long life expectancies. Now, their form of government wouldn't be quite ideal for the US. Our culture is different. But a little but of socialism is absolutely necessary in this day and age.

Oh, and don't point out the fact that the official name of the Soviet Union was "The Union of Soviet Socialist Republics," as a way of saying they were socialist. East Germany was officially called the "German Democratic Republic." They were neither democratic, nor a republic. The names of every communist state to this date were a lie.

Greek:
Now, about the whole "Socialism" thing. The Soviet Union, East Germany, etc, etc. were NOT "Socialist" countries. They were communist countries. Communism includes facets of socialism in its framework, to be sure, but true socialism requires democracy, which didn't exist in the eastern bloc, and still doesn't exist in remaining communist nations like Cuba and China. The true socialist nations, such as Sweden, Norway, and Finland, enjoy very high standards of living, strong (comparatively) economies, extensive freedom, excellent education, and long life expectancies. Now, their form of government wouldn't be quite ideal for the US. Our culture is different. But a little but of socialism is absolutely necessary in this day and age.

Oh, and don't point out the fact that the official name of the Soviet Union was "The Union of Soviet Socialist Republics," as a way of saying they were socialist. East Germany was officially called the "German Democratic Republic." They were neither democratic, nor a republic. The names of every communist state to this date were a lie.

Yup.

I grew up in the Eastern Bloc. These arguments always amuse me.

Eastern Bloc communism actually had a lot more in common with fascism than with socialism. It was a form of absolute state capitalism, not socialism. Socialism implies community ownership and/or management of resources, which implies that all citizens, theoretically, have some say in how things are run. This is only possible with a democratic framework of government in place.

Eastern Bloc "socialism" was in name only. A small elite of party chiefs and their goons had the final say on everything. The vast majority of people were little better than a modern version of landless serfs. The only reason it stuck as long as it did was the fact that in a lot of places (China, Russia, some parts of Eastern Europe) it immediately replaced primitive feudalism - so there was at least some sense of social progression for many people initially.

More cluelessness. ARM's are not the problem. The prime rate has not gone up, and most ARM's that have adjusted have either not gone up or gone up very, very little.

The problem is that they bought an asset that has went down dramatically in value and they owe much, much more than its worth. Much like if someone has all their money invested in the stock market and the stock market crashes and wipes out the value of their life savings. In the case of real estate, its worse because much of it is borrowed money. In the stock market it is called buying on margin which is considered risky. In real estate however, it wasn't considered nearly as risky because historically, real estate has never had such a dramatic downturn. Also, unlike a stock, you can't just unload a piece of property when the market goes bad. Instead of just selling at a loss and recouping what you can, you are stuck with a depreciating asset that you can't give away and you still have payments.

It ain't just the property flippers who got burned, its pretty much anybody who bought property 2003-2005. When you are sitting there in your house and the prospects of ever breaking even are bleak, its a bad situation.

And the homeowners aren't the ones getting bailed out and if you think they are and don't suffer consequenses for walking away, you are an ignorant douche.