I am seriously thinking that a large part of the problem with our economy is the media.

Every news channel now has a video package with music to introduce their daily "ECONOMIC CRISIS 2009" reports.

Today in the news there were headlines from major sources saying "its only going to get worse", "the worst has yet to come." To me that is irresponsible journalism. Not saying they should lie or sugar coat things but this type of (imo) sensationlism of the event is scaring people into behaviors that are causeing the economy to get worse.

One example: ABC News is running Obama Outlines Mortgage Plan: Just Enough or Too Little Too Late? (http://abcnews.go.com/Business/Economy/story?id=6899801&page=1) Why are those the only two option they came up with, what about "Good start" or just Obama Outlines Mortgage Plan, why tag on the dramatic language afterwards.

Another example. In our AT&T stores 90% of our phones have a mail in rebate attached to them. (yes we have discussed the reasoning thats not the topic) People aren't buying phones because there is all these reports of MIR companies going belly up and the rebates are no good. We try explaining taht the rebate company we use just manages the paperwork and that AT&T is shelling out the money.

In the end consumers are utterly terrified to spend a dime on anything because the media has them thinking tomorrow anarchy is going to break out and the world is going to plunge into oblivion.

The biggest problem is how do you fix this without enfringing on freedom of press

I am seriously thinking that a large part of the problem with our economy is the media.

You'd be incorrect in context of your post. In the general sense that could be a true statement with clarification -- because our media system has been completely subverted by monetary interests with simultaneously ceasing to be competent, the general population is finding as constant uncontextualized shock things that they should have known for a long, long time.

http://www.amazon.com/Trust-Us-Were-Experts-Manipulates/dp/1585421391/ref=pd_bbs_2?ie=UTF8&s=books&qid=1234987022&sr=8-2

http://www.amazon.com/Manufacturing-Consent-Political-Economy-Media/dp/0375714499/ref=pd_bxgy_b_img_b


are decent starting places.

In any event, it is going to get worse, but the news is never going to tell you why, how, or when, and after it's all said and done will incorrectly tell you what happened and how you should feel about it. Very little you're being told to worry about matters, and very little that matters are you being told about.

Freedom of the press is extremely important. What is not important is the sensationalism or the diversion by the media.

Watch this video, Tommy Chong sums it up pretty accurately.

http://www.youtube.com/watch?v=dYZJVnFP2CY


By the way if ANYONE or SANCHEK would be so kind as to link me to the "how to imbed youtube videos on ayonae.com for dummies" I would appreciate it.

I am inclined to agree the media has played a HUGE role in the crisis. As you said, they should not sugarcoat it, but they play up the doom so much. I can't blame them though, it's more interesting to viewers than "everything is going as planned"

The reason I think the media has caused problems is because it convinced all the retards who know nothing about our economy that we are in a depression. And much like the deflation cycle, it lead these people to spend less, panic more, and making the economy actually get much worse. Especially those who hated Bush and wanted one more thing to blame him for.

When I hear people without high school diplomas talking about why the economy is bad, and how this politician or that politician is to blame, then I know the media has fucked up. And I heard some pretty absurd reasons. My two favorites are "bush fucked up the housing market!" and "The Iraq war did it" which are both extremely false. Though I can't blame the uninformed for thinking so. Democrats played these cards to win the 08 elections.

Even worse is when they talk about stocks. It makes me cringe. As someone who manages his own portfolio and for hobby reads books on economics, I want to cry when I hear things "Yah the stock market is going to hit zero" lol. I loooooove how they hear one analyst say something and take it as fact. For instance "I hear the housing market is going down 35% more over the next 3 years" and when I tell these same people that I am going to buy another house in about 12 months they tell me "why? Are you stupid? Everyone knows the housing market won't hit the lowest until 3 years from now."

The sad thing was how well South Park captured the Obama craze. I have a few black friends who live by Obama. Granted they don't know dick about his political stances, and it is racially motivated (regardless of what they tell me), they believed once he got elected the economy would magically improve. As if Bush was purposely destroying the economy and once his term was over, the spell would be broken. Now that they are all unemployed, I enjoy chuckling at them

The reason I think the media has caused problems is because it convinced all the retards who know nothing about our economy that we are in a depression. And much like the deflation cycle, it lead these people to spend less, panic more, and making the economy actually get much worse. Especially those who hated Bush and wanted one more thing to blame him for.

The same hysteria convinced people that the jobless recovery of 2002 was real and plausible and that the housing bubble was a never ending source of free money.

That was ok though, because it was in your interests?


There are now laws being enacted in some countries that "damaging the economy" through the dissemination of information will be a crime. This is the same insanity as blaming the depression on reporting of it. The bottom fell out because it was rotten, not because someone said it was rotten.

I never said it was ok. Nice try though.

I think it was equally as irresponsible. As I said, you can report the news without blowing it out of proportion.

Yes the economy was rotten, but inducing hysteria does not help. Not at all.

Consumer *perception* has relatively little to do with the drop in spending (with regard to your mention of a specific deal); the combination of Americans being, on average, maximally-leveraged with regard to how much credit they have out for several years now, with the massive credit tightening going on by lending agencies in the wake of the housing collapse, means that people are having a hard time making major (or even relatively minor) purchases *even if they wanted to*. Combine this with the massive drop in value of people's stock/bond/retirement assets and the 500,000 jobs being lost every month currently (underemployed + unemployed rate of the nondisabled under age 65 is now over 13%), and regardless of what the media may or may not be telling us (and they painted an excessively rosy picture even as the house of cards was collapsing), it's no surprise that people aren't beating your doors down to get those phones :).

This is going to be an extremely painful correction, because far from having savings, a large proportion of American households had negative net worth *before* the current crisis started - they have no reserve to draw upon to make it through the lean times, and credit, which is what people have relied upon during the last two recessions (and in the last several years of our supposed recovery) isn't there (nor is that home equity they floated the last eight or so years on) anymore. If the news sounds serious, that's because Americans finally know in their gut that it is; they went through the couch cushions, so to speak, years ago, and are performing obligation triage at this point. Even though your offer might be genuine, in a global sense, Americans *can't* spend their way into saving a lot of companies because we've exhausted all of our reserves to spend *from*, and folks have a legitimate right to be concerned about who is going to be around tomorrow.

AT&T, along with every other for-profit company that's trying to sell a product in this day and age, has the tools of advertising and image management at their disposal to persuade customers of their trustworthiness (and I live in San Antonio, AT&T's corporate headquarters, and am well aware of just how much money and clout that company has). To state that the press has an *obligation* to present the economy in rosy terms in order to try to keep the economy afloat is just hogwash; most of the media outlets are owned by large corporations, and have been doing that for years until it just didn't pass the smell test anymore.

The media is now painting the economy as in trouble not only because it is, but because, of course, it makes ratings; it touches on people's uncertainty and insecurity for its own ends (and for its own agenda, which is decidedly *not* populist). I'd tend to agree with Malse that the diversion around fundmental issues for the benefit of the string-holders is continuing; only being offered in a flavor that is more believable and palatable given that *no-one* believes that things are fabulous anymore.

In short, AT & T should suck it up and market based on its reputation and stability; in that regard, they have it a hell of a lot better than most...

Regards,
Nydia

I think you need to differentiate between which segments of the population you're talking about the media influencing.

A lot of us are in very little danger of being substantially unemployed any time soon and have plenty of liquidity. The seeds of doubt planted by the media certainly have unnecessary effect on my spending, even though there's no legitimate reason for it and that just hurts the economy even more in the long run.

In an economy where consumer spending makes up the majority of our GDP, a crisis of consumer confidence is an economic crisis.

Now, can we feasibly continue this consumption based GDP, regardless of confidence? I don't know. I tend to think not, but there was a time when people thought we'd never be able to move from an agrarian economy to an industrial one...

Gotta give him a break, he's a young inexperienced kid with shockingly superficial knowledge of the economy.

When I hear people without high school diplomas talking about why the economy is bad, and how this politician or that politician is to blame, then I know the media has fucked up.

As opposed to the MBA's on wall street who did what?

Gotta give him a break, he's a young inexperienced kid with shockingly superficial knowledge of the economy.



As opposed to the MBA's on wall street who did what?

Not saying MBA's did not make mistakes, I am merely saying that is is humorous when high school drop outs regurgitate things they heard on TV as factual. When they are merely opinions.

In an economy where consumer spending makes up the majority of our GDP, a crisis of consumer confidence is an economic crisis.



Right. And when people who probably would not know better are being told the world is coming to an end, that causes a crisis in consumer confidence.

Not saying MBA's did not make mistakes, I am merely saying that is is humorous when high school drop outs regurgitate things they heard on TV as factual. When they are merely opinions.

As opposed to the college graduates who regurgitate things they hear on TV as factual? I think one thing can be gleaned from some of this...it is not an educational issue but a greed issue.

On a side note a noted film documentary maker is interviewing my Sister who was in the financial industry. She left a few years back as she at the time felt that the whole thing was corrupt with the way things were sold and compensation was paid out. She basically walked away from millions of dollars in bonuses because she came to the realization that the system was nothing more than legal robbery and felt she couldn't live with herself anymore if she played into it.

Except consumer confidence dropped last year before anyone was circulating the R word, much less the D word.

It's fun and easy to blame media hysteria for specific events, but there's little if any correlation and while the reinforcing effect of talking-point repetition is known, it's only effective in cases where the audience already fundamentally agrees.

2007-2008: People with sub-prime ATMs have to cut their deficit spending because their home values stop artificially inflating.

2008-2009: People secure jobs and money burning a hole in their pockets cut their reasonable spending because the news impresses upon them that they may lose their job and starve any second. Sadly, this very cut in spending could eventually be responsible for what they fear...

Personally, I've been sitting here quibbling over a stupid $800 business trip to Vegas, because I'm worried about spending the money. It's stupid. I can easily afford it, write off most of it, and will probably recoup that and much, much more through networking at the conference.

Yet, here I am wasting time and attention, because those seeds of doubt have been sown so effectively over the past few months.

As opposed to the college graduates who regurgitate things they hear on TV as factual? I think one thing can be gleaned from some of this...it is not an educational issue but a greed issue.

On a side note a noted film documentary maker is interviewing my Sister who was in the financial industry. She left a few years back as she at the time felt that the whole thing was corrupt with the way things were sold and compensation was paid out. She basically walked away from millions of dollars in bonuses because she came to the realization that the system was nothing more than legal robbery and felt she couldn't live with herself anymore if she played into it.

Yes college grads can do the exact same thing. Except they do it far less frequently. Typically the higher education level a person has the more likely they are to verify things they hear, and disseminate between opinion and fact.

And I guess that is cool for your sister? I am going to renounces my US citizenship because I can't live with what we did to the Indians :D

2000: People with secure jobs are cutting excessive spending because real wages have been stagnant for over a decade and they don't act profligate again until the housing bubble provides them with "free" funny money.

2000: People with secure jobs are cutting excessive spending because real wages have been stagnant for over a decade and they don't act profligate again until the housing bubble provides them with "free" funny money.

Relevancy to what we're talking about?

Except consumer confidence dropped last year before anyone was circulating the R word, much less the D word.

It's fun and easy to blame media hysteria for specific events, but there's little if any correlation and while the reinforcing effect of talking-point repetition is known, it's only effective in cases where the audience already fundamentally agrees.

Your ideas are based on the principles that the media can not influence people and events. I just don't agree at all. People in this country seem to inherently believe the vast majority of things they hear on tv.

Just like all the people who thought buying property was guaranteed income in 2001-2005, and caused even a larger housing bubble, all the media doom and gloom did help fuel the crisis.

And as I said before, I don't blame the media for trying to get ratings, I get it. I am once again saying that if they cut out the scary music, didn't put "DEPRESSION?" in big red letters, and were more mellow, it would have helped ease the situation.

Hell even Obama resulted to using these same tactics when trying to pass his stimulus bill. Why? Because it works.

2007-2008: People with sub-prime ATMs have to cut their deficit spending because their home values stop artificially inflating.

2008-2009: People secure jobs and money burning a hole in their pockets cut their reasonable spending because the news impresses upon them that they may lose their job and starve any second.


1981 - present: Millions of people lose their jobs as companies move operations offshore to take advantage of prison labor wages in countries that have no laws or protections for workers.

1981 - present: Millions of people are suckered into believing that Ronald Reagan is a fiscal conservative as he raids social security and other government programs to build up the US weapons systems meanwhile drastically cutting veterans benefits and other necessary social services.

2008 - 2009: People actually lose their jobs as companies layoff hundreds of thousands of people a month.

2008-2009: "[...]Sadly, this very cut in spending could eventually be responsible for what they fear..."

Personally, I've been sitting here quibbling over a stupid $800 business trip to Vegas, because I'm worried about spending the money. It's stupid. I can easily afford it, write off most of it, and will probably recoup that and much, much more through networking at the conference.

Yet, here I am wasting time and attention, because those seeds of doubt have been sown so effectively over the past few months.

Exactly.

Yes college grads can do the exact same thing. Except they do it far less frequently. Typically the higher education level a person has the more likely they are to verify things they hear, and disseminate between opinion and fact.

And I guess that is cool for your sister? I am going to renounces my US citizenship because I can't live with what we did to the Indians :D


Like I said...shockingly superficial knowledge

Relevancy to what we're talking about?

Condition existed before current media reporting. QED.


Your ideas are based on the principles that the media can not influence people and events. I just don't agree at all. People in this country seem to inherently believe the vast majority of things they hear on tv.

You would be wrong, as can be seen by scrolling up. My ideas are based on the operating theory that the media does in fact exert huge influence on people and events, but NOT the specific influence you are talking about.

1981 - present: Millions of people lose their jobs as companies move operations offshore to take advantage of prison labor wages in countries that have no laws or protections for workers.

1981 - present: Millions of people are suckered into believing that Ronald Reagan is a fiscal conservative as he raids social security and other government programs to build up the US weapons systems meanwhile drastically cutting veterans benefits and other necessary social services.

2008 - 2009: People actually lose their jobs as companies layoff hundreds of thousands of people a month.

1923 - the weimar republic hits 4,000,000% inflation causing the 1,000,000,000 old mark to be printed!!!

Condition existed before current media reporting. QED.



You would be wrong, as can be seen by scrolling up. My ideas are based on the operating theory that the media does in fact exert huge influence on people and events, but NOT the specific influence you are talking about.

My mistake, I had to go reread your initial post. Had confused it with another.

So please elaborate on how you feel the media influenced this specific situation. In what way, how they did so, and the effects it caused.

2000: People with secure jobs are cutting excessive spending because real wages have been stagnant for over a decade and they don't act profligate again until the housing bubble provides them with "free" funny money.

During the dotcom bust? You may have missed it, but the news was dire at the time.

The phone sales? People are worried about spending money and finding reasons to talk themselves out of it. The worry about the rebate company is an emergent symptom about that, but they'd be more hesitant to do so regardless. Is it a red herring? Sure. Is it seriously affecting phone sales? No.

The bottom line of the dotcom bust was caused by the sudden realization that it didn't take 500 million dollars of venture capital, 150,000 sq ft of office space and a corporate jet to do the same thing a person sitting at their kitchen table while wearing pajamas and drinking coffee could do.

The bottom line of the dotcom bust was caused by the sudden realization that it didn't take 500 million dollars of venture capital, 150,000 sq ft of office space and a corporate jet to do the same thing a person sitting at their kitchen table while wearing pajamas and drinking coffee could do.

I did it in my mommy's house in my boxers. <3 EQ.

I did it in my mommy's house in my boxers. <3 EQ.


LOL..living proof!

The phone sales? People are worried about spending money and finding reasons to talk themselves out of it. The worry about the rebate company is an emergent symptom about that, but they'd be more hesitant to do so regardless. Is it a red herring? Sure. Is it seriously affecting phone sales? No.

I don't think he's suggesting that it's 100% the rebate issue that's swaying people away from the phones. Of course, even if that particular doubt is just the feather that broke the camel's back, it's still partially responsible for the lost sale.

Looking back at the forest instead of that one tree, all this gloom 'n doom absolutely is deterring sales of items with elastic demand curves, like nice cell phones. That's simply irrefutable if you talk to the people around you. Almost everyone's holding their breath, regardless of their personal financial condition.

I see no rational argument against the media being party to that uncertainty.

The bottom line of the dotcom bust was caused by the sudden realization that it didn't take 500 million dollars of venture capital, 150,000 sq ft of office space and a corporate jet to do the same thing a person sitting at their kitchen table while wearing pajamas and drinking coffee could do.

Sure. What's that have to do with what we're talking about?

I thought you said the dotcom bust was the medias fault...my bad.

Sure. What's that have to do with what we're talking about?

Zimbabwe hyperinflation is estimated to have surpassed post Second World War Hungary's hyperinflation (12.95 quadrillion percent per month, ie. prices doubling every 15.6 hours) by the end of 2008. [/URL]On January 16, 2009, Zimbabwe issued a $100 trillion bill.[URL="http://en.wikipedia.org/wiki/Hyperinflation#cite_note-33"] (http://en.wikipedia.org/wiki/Hyperinflation#cite_note-zwdinf-14)

I thought you said the dotcom bust was the medias fault...my bad.

Nah. I'm just saying that the aftermath was exacerbated by the media then too.

That was probably an even better example of that effect. Far less people were affected by the dotcom fallout and people were losing fake money on the NASDAQ, not their houses. Yet, the hype over it chilled the larger economy into a recession.

Back to a point Sanchek made, even I am afraid of going on basic trips.

It took me a good two weeks to psych myself into realizing it was ok to spend a few hundred bucks to go to Vegas for New Years. Not just myself, but the 6 friends I went with. Who had far more reason to be fearful than I.

Even more confusing is that just 1 1/2 years ago I dropped over 10k going to school in Europe (As well as traveling of course) and since then my net worth has increased overall, and I have a more stable job. Yet I still had the fear. And even now I want to go to Ecuador in the spring, and am having issues with spending the $500 on a plane ticket (I will be going with a friend, and she has a house there so no hotel to pay for, and she also has a farm, so free food). It's madness!

Wow, I got out for an hour to a meeting and this thread reaches 4 pages... in regard to the 'crisis' in consumer confidence being largely the fault of the media:

Losing your job, being upside down in your house, and having all your credit card maximums reduced to what you already have out causes a 'crisis' in consumer confidence too, only people don't need the media to tell them that.

It *is* true that humans are a biologically-programmed social species, being strongly motivated to conform to the prevailing dominant social view (as they were in the face of a contradictory reality over the better part of the last decade with regard to spending), and in that sense herd mentality is a non-trivial issue. Herd mentality, in fact, is what a lot of what got us into this mess, with some fascinating studies on hormone levels in Wall Street traders bearing this out with regard to the 'highs' associated with risk-taking and the strong social pressure to conform. Certainly, the media can have a hand in shaping that, but in this case that is more the tail wagging the dog. The Dot-com crisis was a pale shadow of what we are facing now, and affected mostly the relatively affluent, connected with those industries, while this cuts across all sectors.

On a less 'zinger' note intro, what seems to be happening here in my particular rubber-road-land, as in a lot of places, is that we're trying not to fire anyone, but what my college district is doing to make up the revenue shortfall is consolidating classes and replacing all of the full time temporary positions with adjuncts whom they limit to 75% load and thus don't have to offer any benefits to nor a contract beyond a given semester. At my sister's fly-by-night for profit college they fired half the faculty and tripled class size, and my mother's retail chain gathered up all the managers and told them by what percentage they were going to cut back their work forces *and* 'rewarded' them (that is to say, didn't close any stores) by instituting an across the board 25% pay cut.

So what's happening in practice across large swaths of the working sector is people are suffering the death of a thousand cuts, between reduced job revenue, reduced equity, reduced or nonexistent credit, and reduced investments/retirement, and thus the impetus to reduce spending is real (and sane, as opposed to the previous insupportable insanity) even without the fearful herd mentality which is beginning to take hold and being arguably fanned by the media. While that might have little to do, on its face, with whether or not to accept a 'free' phone (although it's still a mail-in rebate, the customer is having to pay up front), it might have quite a bit to do with being willing to enter the contract that getting that deal entails (most being 2 years).

Regards,
Nydia

That was probably an even better example of that effect. Far less people were affected by the dotcom fallout and people were losing fake money on the NASDAQ, not their houses. Yet, the hype over it chilled the larger economy into a recession.

That's a profound misunderstanding of the bubble pop from someone who nominally recognizes that the cause of the current correction is only circumstantially related to housing.

If anything your anecdotes about media coverage bringing your luxury spending back down to earth is an indictment that no one was looking at the same issues a few years ago despite them being just as relevant. You should have been just as worried about your cost/benefit then -- which goes back to my earliest post.

You can't extrapolate specific event correlations from overall zeitgeist. It's a fallacious prospect and proving or disproving it is virtually impossible. The notion of a media death spiral is attractive but fundamentally missing the point; it is more relevant that the media is providing you NO MEANINGFUL CONTEXT to the "doom and gloom" and they're doing that because of their own financial incentives. You're influenced by apprehension because you have no real information to make a decision with, not because the apprehension exists.

Losing your job, being upside down in your house, and having all your credit card maximums reduced to what you already have out causes a 'crisis' in consumer confidence too, only people don't need the media to tell them that.

Sure, a minority of people are certainly hurting. Though you wouldn't guess it from the news headlines lately, the people in that situation are still a small minority though.

How would you propose that this herd mentality would emerge in the majority of us not facing foreclosure or unemployment, without the media acting as an echo chamber for how bad it supposedly is?

The sad part is that killing consumer confidence in the financially solvent only hurt the insolvent's chances of recovering soon that much more.

That's a profound misunderstanding of the bubble pop from someone who nominally recognizes that the cause of the current correction is only circumstantially related to housing.

The effect of this crash on consumer spending is directly related to the drop in housing values. No more wooden ATM = no more trips to Cancun and new cars every year.


That, of course, is due to deregulation giving incentive to bad loans.

Those bad loans were facilitated by an overly loose monetary policy flooding the system with liquidity.

Less superficially, you do have to question the wisdom of our exporting service and debt in exchange for real goods and money. How long can that last?

I suppose it's also fair to say that we could blame the entire phenomenon of boom/bust business cycles on a monetary policy that is dependent on exponential growth to sustain it. Down with the FED!

Perhaps we should blame the problem on the practice of usury at all? Damn those Jews!


Diving down the endless rabbit hole of causality is an interesting diversion, but not practically relevant to what we're talking about here.

If anything your anecdotes about media coverage bringing your luxury spending back down to earth is an indictment that no one was looking at the same issues a few years ago despite them being just as relevant. You should have been just as worried about your cost/benefit then -- which goes back to my earliest post.

If you look closer at my example (that I'm assuming you're referencing with "you"), that's not luxury spending that I'm worried about. It's spending that will easily bring a 1,000% return on my investment. Not to mention it will support some fraction of the airline, hospitality, and restaurant industry.

Yet, like many other financially solvent people these days, all of this nonsense in the news gave me pause even when it's a no-brainer. That pause only hurts the greater economy and my personal finances in the long term.

(For what it's worth, I booked it anyway, but only after a few days of quibbling over it like a woman)

You can't extrapolate specific event correlations from overall zeitgeist. It's a fallacious prospect and proving or disproving it is virtually impossible. The notion of a media death spiral is attractive but fundamentally missing the point; it is more relevant that the media is providing you NO MEANINGFUL CONTEXT to the "doom and gloom" and they're doing that because of their own financial incentives. You're influenced by apprehension because you have no real information to make a decision with, not because the apprehension exists.

I get the impression that you just haven't been paying attention to the mainstream media much lately (which I wouldn't call a bad thing). You can hardly open a news website or watch TV news these days without seeing them zoom in on a particular family hit by layoffs or a vanished 401k.

It's always crap like: "Timmy the accountant went to college and had a great, secure job, but now he's going to lose his house and his wife left him!" Not only are they providing context that hits home, suggesting this could be you, but they present it as if it were the norm.

You're right that they're playing to people's fears for financial gain, but I don't see how that is relevant at all when discussing the net effect of what they're doing.

In fact, their financial gains are only enhanced by scaring us into thinking every last one of us is in danger of losing our jobs, houses, and families tomorrow. This only causes us to tend more toward stuffing every penny we can under the mattress, which exacerbates the entire ordeal.

I'd submit that 1) it's not a minority of people and 2) it's not the media 'killing' consumer confidence. Nearly one in six adults in this country is now seriously underemployed (less than 50%) or unemployed. I think I linked those stats (on how unemployment is calculated) recently but I'll do so again if I didn't. How many halves of dual income households, or for that matter single income households, does that add up to? *Every* member of my extended middle to upper middle class family has been affected by the downturn, and they are in a variety of fields, from education to public health to the restaurant business to law to AutoCAD. You are also summarily discounting the obvious, namely that this rubber/road moment was a long time coming; people stopped spending long *after* it was unsustainable, not before.

I agree with you that herd mentality and the media are fanning the hysteria because it's what people are craving at the moment, *and* that exacerbates the situation - but I'd submit that the very *real* drop in spending power and real assets of families predates the drop, and has nothing (or very little) to do with the banks' unwillingness to lend at this point.

Regards,
Nydia

In actuality unemployment is probably at more like 14+ percent right now.

In actuality unemployment is probably at more like 14+ percent right now.

It's apples to apples. We calculate employment the same way up as we do down.

I'd submit that 1) it's not a minority of people and 2) it's not the media 'killing' consumer confidence. Nearly one in six adults in this country is now seriously underemployed (less than 50%) or unemployed. I think I linked those stats (on how unemployment is calculated) recently but I'll do so again if I didn't. How many halves of dual income households, or for that matter single income households, does that add up to? *Every* member of my extended middle to upper middle class family has been affected by the downturn, and they are in a variety of fields, from education to public health to the restaurant business to law to AutoCAD. You are also summarily discounting the obvious, namely that this rubber/road moment was a long time coming; people stopped spending long *after* it was unsustainable, not before.

I agree with you that herd mentality and the media are fanning the hysteria because it's what people are craving at the moment, *and* that exacerbates the situation - but I'd submit that the very *real* drop in spending power and real assets of families predates the drop, and has nothing (or very little) to do with the banks' unwillingness to lend at this point.

I do agree that a correction has been in the works for some time. I don't at all dispute that there were real, tangible underpinnings for the initial shock that hit the economy. You may remember that I've been writing about that here for some time now.

What I'm saying is that I agree with Greystone that the media has served to amplify the ripples moving outward from the initial shock, and is only exacerbating the situation.

I agree with you that herd mentality and the media are fanning the hysteria because it's what people are craving at the moment, *and* that exacerbates the situation - but I'd submit that the very *real* drop in spending power and real assets of families predates the drop


Exactly -- the media is a) experiencing the same social forces as everyone else and b) finds traction with what people are already receptive too. This is why there was a drop in consumer confidence followed by substantial journalistic resistance before they got behind the new hysteria. People are parroting talking heads not because they are retards (and I'm not saying they aren't) but because the talking heads articulated what they already felt.

Exactly -- the media is a) experiencing the same social forces as everyone else and b) finds traction with what people are already receptive too. This is why there was a drop in consumer confidence followed by substantial journalistic resistance before they got behind the new hysteria. People are parroting talking heads not because they are retards (and I'm not saying they aren't) but because the talking heads articulated what they already felt.

That doesn't change the fact that this echo chamber only serves to reinforce those fears. 10% of the population hurting and another 75% worried but acting normally won't sink us.

If you convince the other 75% that the should stop acting rationally by playing to their worst fears, then you're shouting "FIRE" in the theater.

The talking heads have so much more influence than you're giving them credit for. Probably because you don't let them influence you as much as the average person does.

Speaking of the phone thing, I want a Blackberry Bold. Normally I'd just go get it. These days, I'm waiting till October when my contract subsidy is available again.

Well, I was giving some thought to purchasing a new Saturn Skye convertible for those days when it might rain and I don't want to ride the motorcycle to work, after seeing a real beauty the last time I went in for an oil change and tire rotation; but, after reading today's paper and seeing that GM is indeed looking at phasing out Saturn, and seeing the TV news where a Saturn person was saying they were only funded through 2011, I am more tempted to stop giving my business to GM altogether.

Sorry for the long sentence. :p

That doesn't change the fact that this echo chamber only serves to reinforce those fears. 10% of the population hurting and another 75% worried but acting normally won't sink us.

If you convince the other 75% that the should stop acting rationally by playing to their worst fears, then you're shouting "FIRE" in the theater.

The talking heads have so much more influence than you're giving them credit for. Probably because you don't let them influence you as much as the average person does.


^^ this is key. The media is guilty of Clear and Present danger.

When I talk to my family back home you would think the sky was falling. Yet when I ask, well are you still employed? Are you still making ends meet? Well then how is it that the sky has fallen? I usually get a frustrated answer or a subject change. Some people really are buying what the media is selling and it's down right scary.

After my experience yesterday of learning how much my house has depreciated I got angsty and worried. And then I was like, WTF is wrong with you? You're still gainfully employed, your company just hired a few new folks and your boss has assured you you'll get your raise at your review. It's very easy to fall into a panic state when everything you read or hear is dire. Hell this is all that people around me talk about anymore.

Well Fild, I guess your family happens to be in the luckier side of things. *shrug*

I think everyone else knows at least one person who was laid off in the past year. Everyone knows a few people who's homes have dropped in value and can't move to find a new job if they needed to. Everyone knows someone who's credit card debt has gotten that much harder to pay off since its no longer 9.95% but 19.95% interest. I have one friend who has been unemployed for nearly 8 months and has run out of their savings - for them the sky IS falling.

If my dad loses his job as a chemist in R&D for GE (which we expect he will sometime soon) he's going to have a very, very difficult time finding a new job at 55 years old that pays a fraction of what he makes now. That is directly related to GE banking taking massive hits due to the mass foreclosures, which is laughable to blame on the media at all.

*edit* To compound on this, all of those people that are unemployed (at least 6% of the country more than "normal") are now unable to buy as much, spend as much, do as much as before. Other countries are doing better, but many are worse off. Now every company in the country is making at least 6% less profits, not to mention that the remaining % of the country realizes they could be next so aren't spending as much. Companies that rely on that 6% to stay afloat now have to lay off people or buy more product, which adds to the problem. Mortgage foreclosures continue to rise, and this isn't going away any time soon. Unemployment in the 20% range isn't an impossibility. Consumer confidence dropping IS something we could attribute to the media as it explains what is going on to the country and the world - but even if we didn't have news organizations we'd be reading it on the blogs of our friends and from the mouth of the President when he addresses Congress tomorrow.

Like Fild, I don't know anyone laid off, losing their house, or in serious trouble either.

My parents do work that's related to the housing industry, and have as much business as ever. Their work is low volume and quality based though, instead of being part of the quantity bubble.

No one at my company has been laid off or had their pay cut (and we sell an AIG product!). Our product/service actually brings value to our customers though, instead of being a bizarre financial instrument.

None of the houses in my neighborhood are being foreclosed that I know of. None are for sale at all (though, that could be because they're impossible to sell right now).

If you're going to turn anecdotes into evidence, it goes both ways.

7.6% of the country is unemployeed right now.
3.2 million homes were foreclosed on in 2008, and 2% of all of the homes in the country are expected to foreclose this year (following the trend in Jan / Feb).
That is the evidence, you not knowing anyone simply means someone else knows 2 people - so stop being so tragically unpopular and go outside now and again ;).

You're making the assumption that those 7.6% are spread evenly across the entire country, therefore if you know 13 people you should know one that's unemployed. Same with the foreclosed homes.

It is not a good assumption.

7.6% of the country is unemployeed right now.
3.2 million homes were foreclosed on in 2008, and 2% of all of the homes in the country are expected to foreclose this year (following the trend in Jan / Feb).
That is the evidence, you not knowing anyone simply means someone else knows 2 people - so stop being so tragically unpopular and go outside now and again ;).

Actually the DC Metro area has some of the lowest foreclosure rates and higher employment rates than the rest of the country. But doing a story on this for what feels like every single day for the past 6 months - I've gotten to know a lot of the people hurt pretty bad by this (not to mention those who are got raked over the coals by ponzi schemes like Madoff and the like).

Of course you're going to get a skewed perspective of it when you're an instrument of the sensationalism...

There have always been lots of people on hard times. It's not as if we're coming from 0% unemployment. It just didn't usually make the news when another kid in the Mid-West starves to death or goes homeless.

I don't know anyone that is out of work at this time. I do live in Utah which hasn't really felt the crunch of the economy atm since the largest employer is the local USAF base * which is still hiring! *

With the economy I'm also being careful but it is not because I have been reading about the doom and gloom, it is from my own experience in the latter part of 2008 and Jan 2009 when new business seemed to all but dry up. Now it is at a fairly normal pace but I do keep looking over my shoulder.

In my family IE Brothers/sisters everyone is doing okay as far as I know.

I have one brother who owns a financing company and he is a bit unique as he looks more at the person than at the credit report but he deals only in commercial financing and it is collateralized lending so right now he is booming as banks cut off financing to business.

My other Brother was fortunate enough to have Equifax buy his business for quite a few million and he has started another company having to do with reading comprehension programs for schools. He did say that alot of his money from the Equifax sale was invested in the stock market so it has deflated a bit but it is like saying I had 20 million and now I have 15 million. A big loss but he won't starve.

I also have a brother in Florida who works for Nordstroms but he rarely keeps in contact so who knows.

My Oldest sister hit the lottery of life, she married her highschool sweetheart who became a doctor and is vastly wealthy so financially she'll never worry.

My other sister was a financial planner worked in Wall Street firms and walked away years ago. She is married to a guy who is in inventory control IE Scanners RFID tags etc...business is slow he said but they always just saved her money and lived on his so unless we have years of depression she should be ok.

Thinking about it...I don't know anyone in foreclosure due to a job loss or over extending themselves.

I can't say its hit me much, although the company we do IT for is rumbling about layoffs. If they cut staff, we cut staff, seems to be the mantra.

My mom owns her home, so there's no big issues there. The 2 credit cards she was using to pay off medical stuff with, will be wiped clean, as they were paying for payment protection. Because my Stepdad died and he was the primary cardholder, the credit card company will pay off the balances. That's $23,000 of debt wiped away. She does have another credit card that she is going through a consumer credit company to get paid off. They are lowering the finance rate, and payment to well below what it was.

I can't say I know anyone who had been laid off, or is losing their home, because of the current "crisis".

I should add that I wasn't being anything than matter of fact in stating I didn't know anyone personally laid off or out of a home. I will say that Leah's business has suffered greatly since around the holidays time frame but that is pretty consistent with previous years. However, it's not rebounding as quickly as it used to but she is still getting some business. My job and company on the other hand are actually doing quite well we just past our budget for this year and we always present three choices for the bean counters: what we'd love to have, what we need with a little of what we'd love to have, and what we need to stay afloat. We were given something between the first and second choices which means we get to implement high cost technologies instead of just operating. We also just hired 2 people in my building company wide I think we're at 25 for the month so far. But then I'm in healthcare and we're fairly stable. Oh and we just spent $14mil on maint. contracts (4 for hardware 10 for software) to give an idea of our budget. We did however delay construction on new projects that hadn't broken ground yet.

My family back home are the chicken littles, trust me. A good measure of things for me is to examine my brother who makes we'll say $200-300k at his job as an FAE/middle mgt/everything else. He still has his job and he's been laid off 3x in 10yrs but he's been at his present company almost 4yrs, that's long for him and his field. When he gets laid off I'll know it's ugly.

There are currently no homes for sale in my neighborhood, but there was last month 1 home that has been on the market for 1yr. Someone bought it at frigging ridiculous price which sunk the rest of us.

As far as my immediate family's situation goes: My dad has been out of work or semi-employed at best for nearly two years, ever since the real estate crunch hit in Phoenix - 65 is a bad time to lose one's career, and he's been only been able to pick of brief fly by night gigs since then. My sister is adjunct teaching being that her college can't afford to hire her 'full time' (even though she is carrying a full load) - which means the 600.00/mo in medications she needs to keep her on the rails isn't covered by insurance. My mother is working, as I mentioned, for 25% less base salary (not to mention her drop in commission) than she was a year ago - and add to that they they were among the folks who refinanced their home in 2005 in order to get some home improvments done and you have some very tight times indeed for them.

Granted, the Phoenix area is one that has been particularly hurt by the real estate crash as a great many people retire or have second homes there and it was overbuilt by a huge margin, but my point is that the unemployment, foreclosure and funding crisis rates are highly regionalized (although the credit crunch is national), with some areas much more affected than others. My wages have stayed constant, being that I'm a state employee with salary on a fixed schedule - and what I am giving up to adjuncts is about equalled out by what I'm being forced to take on - but this spring, and for the upcoming fall schedule, I've been experiencing pressure to give up some of my load (and thus salary) to favorite adjuncts in the department who 'need the money'.

On the whole perception vs reality thing, being that my friends and family are mostly in Phoenix or Northern California (my best friend has a beautiful house outside of Sacramento whose value has dropped by a third in the past year), the stories I hear are somewhat worse than what you may be experiencing in your individual areas. *Southern* California, where media overwhelmingly gets made, has the highest rates of foreclosure in the nation, and some truly staggering losses in assets - people tend to extrapolate their regional situations and assume that things are the same everywhere, when some areas have been hit much worse than others.

As to the 'why don't folks just move if things are so bad in their area?' issue, this is a viable question/strategy for some folks, but not for others - my cousin Else has recently moved back to Atlanta as funds for her public health project in LA dried up - but for someone like my parents who are nearing the end of their working careers and are tethered to a house they still have (much less) equity in, that's a bit more difficult to do and they're trying their best to cut back and ride it out.

Regards,
Nydia

On the whole perception vs reality thing, being that my friends and family are mostly in Phoenix or Northern California (my best friend has a beautiful house outside of Sacramento whose value has dropped by a third in the past year), the stories I hear are somewhat worse than what you may be experiencing in your individual areas. *Southern* California, where media overwhelmingly gets made, has the highest rates of foreclosure in the nation, and some truly staggering losses in assets - people tend to extrapolate their regional situations and assume that things are the same everywhere, when some areas have been hit much worse than others.

How much did your friend's house appreciate before it dropped? Did she lose any money? Was it real money or artificially inflated fake money?

Notice that you've unconsciously picked the most negative aspect of that investment to talk about? It's all we hear, day in and day out.

It's not just the media out of LA running with this. It's the media everywhere. Who can't go out and find a nice family being foreclosed on after losing jobs, anywhere? That has always been a daily occurrence.

It's interesting that the media is liable for libelous, bad reporting about a single company, yet not for misleading reporting about the state of the entire country's economy. Maybe we need a class action lawsuit against Fox and CNN, to help people pay their mortgages!

Actually, I kind of spoke to soon. In my neighborhood there are actually 3 homes that have been foreclosed on. I did not know the people and the houses are vacant and in need of maintenance.

My son called me last night to tell me my ex's husband was laid off from his job which he has held since the 80's (Andersen Windows). I am not too surprised, knowing the amount of construction going on right now is not doing much for manufacturing of related products.

I am not too worried about Butch and his employment prospects, having known him longer than I knew my ex; he is a skilled painter, having painted one of my custom bikes, and also has built street rods in his pole barn. He will find something.

What does hit home though is that many of his coworkers (of whom I know plenty) have no other skills, and are facing some pretty dire days ahead. The profit sharing program employed at the Andersen company used to offer employees the option of putting their profit-sharing checks toward down payments on homes and receiving a matching amount from the company; this was a great way of ensuring an employee would be more prone to good work habits and remaining with the company. Many homes bought under this policy now may be going on the block, if this economy does not turn around quickly.

In the case of my friend's house, it's more or less a wash - she refinanced when the value went up, taking money out for repairs and debt consolidation, much like my parents did - but she (like my parents) has been in the house for over a decade and so gained and lost. She's certainly not in as bad of shape as many, although she's effectively trapped in her house, but that's somewhat irrelevant to the argument in question, which is why there's so much hysteria about falling housing prices.

The reason you hear so much about foreclosures and the housing bubble bursting is not just for the pathos factor (although that's what brings the ratings in), but because it's extremely important in terms of its ripple effects to the states, and as I've said, some states have been much harder hit than others. Home valuations in the form of tax assessments are a major source of revenue to the states, who have been using that tax revenue over to make up for what they have being systematically and increasingly starved out of over the past eight years due to the Bush federal tax cuts and metric truckloads of unfunded mandates (to give you an example, the state-covered portion of operating costs at Texas colleges has dropped from 86% in 2002 to under 46% now - and we've had to pass on the portion of those expenses that we could not reduce on to our students in the form of increased tuition aka debt). State governments, in turn, employ a huge number of people in the form of teachers, Department of Transportation employees (highway maintenance is done by the states), DPS (state troopers and other law enforcement), Parks and Wildlife, Utility Commissions and of course all of the private contractors they solicit bids for and do business with. No tax revenue? Kiss all those jobs (and the ability of *those* people to make housing payments) and services goodbye.

I understand your hypothesis - that the media is fanning the flames of hysteria about foreclosures, etc, and therefore exacerbating the situation. The fact is that the housing bubble has been masking several ugly and festering sores, namely the loss of necessary operating revenues to states, and a steady drop in the *real* wages, assets, and net worth of families, and even if the bubble itself hadn't burst this year, it was unsupportable because families were so highly leveraged with debt that they couldn't support the confidence Ponzi scheme any more in any case - housing prices in many major markets were 10 times median income and rising.

If we had a 'real' economy, where we actually produced anything and all the profits (and infrastructure) weren't being siphoned out of the system by looters (excuse me, 'investors'), we wouldn't have nearly so far to fall, but unfortunately, that's not the case. The correction is unmasking a lot of fundamental problems with our economy which it served as a band-aid for, but the appropriate question to the media should be not 'why are you spending so much time focusing on poor Ms. Brown', but 'why aren't you talking about why this correction is so devastating in the first place?' And for god's sake, why are we still talking about tax *cuts?*

Sincerely,
Nydia

On the state budget issue, California finally passed their budget today, having to grapple with a 42 billion dollar deficit (10,000 state employees got their pink slips this month). Forty-three out of the 50 states have significant deficits this year, and it's not because they were living high on the hog for the last several years (let's not forget that Grey Davis, Schwarzenegger's predecessor, lost *his* job largely due to Enron sticking it to the state for tens of billions and a resulting 32 bn deficit); the real estate bubble was merely covering increasing shortfalls.

http://www.cnn.com/2009/POLITICS/02/19/state.budgets/index.html?iref=mpstoryview

California is fucked... The tax increases they passed are bullshit!

Maybe we can cut off the illegal immigrants now?

How do you think the states managed to survive just a few years ago, before this bubble in housing values?

Do you think the government bureaucracy must become more bloated every year? As it gets larger, its use of our money is less and less efficient. Maybe a smaller, more efficient government is exactly what we need right now.

I, for one, am thrilled at the prospect of the state governments having to be more fiscally responsible to survive. If only the Federal government would do the same instead of printing money.

Also, I'm not sure where you're getting the idea that property taxes are so significant in the state budgets. For example, in the Georgia state budget (and Georgia is hot on California's heels in this housing bubble debacle):

FY2004, property taxes of $63,677,784 made up, 0.44% of the state's total revenues. Less than one percent.

FY2008, property taxes of $84,961,822 made up a staggering 0.44% of the state's total revenues.

It literally gets lumped into the "Misc" category on the pie chart. Alcohol and tobacco taxes alone accounted for nearly six times more revenue than property taxes.

Wherever you're getting this information, it is grossly exaggerated. No doubt, the original source is a politician who wants a state "bailout" to keep funding his sweetheart deals and pet projects. Just cut a few blue collar jobs, go on TV with a sad face, and wait for the mob to squeeze some money out of Congress for you!

Do you think the government bureaucracy must become more bloated every year?

How could you not want Pelosi, Reid, Frank, and Dodd to be more "in control" ? We all know this is 100% republicans fault and only dems can fix it.

If Bush only let Frank and Dodd implement their brilliant plans these past few years, we would have never been in this mess to begin with.

How could you not want Pelosi, Reid, Frank, and Dodd to be more "in control" ? We all know this is 100% republicans fault and only dems can fix it.

If Bush only let Frank and Dodd implement their brilliant plans these past few years, we would have never been in this mess to begin with.

Heh...maybe...fact is he didn't. It was pretty much a republican congress from the mid 90's to 2006 and for six of those years it was total republican control.

Wait, which of you is being ironical and which is being sarcastic?

I'm being sarcastic. I think the republicans played their role, but dems like Dodd and Frank who thought everyone deserved the right to own a home, played a bigger part.

Even if one of them was getting it backdoor from a certain mortgage company exec.

For the record, I don't think Frank ever said everyone deserved the right to own a home. At most he advocated increased affordable housing (I.E. everyone deserving the right to have a home, not necessarily own it). You may wanna fact check before you post.

Actually it was Bush who said everyone deserved to own a home...the ownership society.

Look, people houses get foreclosed on. It has happened since people borrowed money for homes, sometimes things happen and payments get out of hand. But this current mass of foreclosures happened not so much because greedy people bought homes they knew they couldn't afford and somehow magically could see that if they were foreclosed on the government would save them.

It's pretty obvious why it happened, one thing that lenders suddenly decided to do was ignore that small but important thing called a "debt to income ratio" and they ignored it because they had nothing to lose and everything to gain by writing those mortgages.

Funny thing, I looked back in my original mortgage papers and it was issued by AIG who promptly sold it finally it ended up with Lehman Bros and now it's serviced by a leftover division of Lehman. We actually asked to buy the mortgage out and they couldn't do it because...get this...they don't know where it is.

Actually it was Bush who said everyone deserved to own a home...the ownership society.

Look, people houses get foreclosed on. It has happened since people borrowed money for homes, sometimes things happen and payments get out of hand. But this current mass of foreclosures happened not so much because greedy people bought homes they knew they couldn't afford and somehow magically could see that if they were foreclosed on the government would save them.

It's pretty obvious why it happened, one thing that lenders suddenly decided to do was ignore that small but important thing called a "debt to income ratio" and they ignored it because they had nothing to lose and everything to gain by writing those mortgages.

Funny thing, I looked back in my original mortgage papers and it was issued by AIG who promptly sold it finally it ended up with Lehman Bros and now it's serviced by a leftover division of Lehman. We actually asked to buy the mortgage out and they couldn't do it because...get this...they don't know where it is.

Yes I agree. Bush was a big part of the problem. I still think the dems are trying to blame only him when they themselves also had their hands very deep in this. I think it was a failure of congress and the president. Not just Bush either. Remember, Clinton repealed Glass-Steagall which allowed banks to get into the securities business.

And yes the lenders definitely played their part, just like the retards who signed these mortgages buying into the hype they would make money off buying a house, and the profits could be used to pay the mortgage.

Or Alan Greenspan keeping interest rates so low for so long.

There is no one single person at fault. That is why I think everyone has to pay the price. And by everyone, I mean the borrowers, the lenders (banks included), and the politicians. I don't like the idea of being on the hook when I was responsible.

Cool thing for me is I can dip into the ole' EQ warchest and snap up some cheap property in LA this coming year or two. Put 50-60% down, get an absurdly low interest rate, and have dirt low monthly payments.

It's pretty obvious why it happened, one thing that lenders suddenly decided to do was ignore that small but important thing called a "debt to income ratio" and they ignored it because they had nothing to lose and everything to gain by writing those mortgages.




I have been amazed over the last few years by some of the loans that got approved in my business. People so buried that I just shuddered as I filled at there credit app. wondering if there hoping for the lucky lottery numbers or a relatives death. But a call and five minutes later approved with room to upsell.

The media has affected my business somewhat as has been mentioned by others here sitting in anticipation of what is coming./chicken little syndrome.
Fortunate for my area of the world which was hard hit by the Dot Com bust and not so much by the housing rapid appreciation. People are just holding onto there homes and continuing to upgrade verse moving.

yeah lots of people have lost in the stock market ect. Its all a matter of perspective in my opinion. You can stare at the computer screen at your portfolio and get depressed or you can take advantage of the current situation to improve your lot.

One thing is certain the cost to finance is about to greatly increase consumer prices. Come march 1st GE who does allot of one year no pay interest gigs is cranking up there cost from 5.5 to 13.5 % which means the consumer will pay allot more. Cash will definitely be king.

Fortunate for my area of the world which was hard hit by the Dot Com bust and not so much by the housing rapid appreciation. People are just holding onto there homes and continuing to upgrade verse moving.

yeah lots of people have lost in the stock market ect. Its all a matter of perspective in my opinion. You can stare at the computer screen at your portfolio and get depressed or you can take advantage of the current situation to improve your lot.

Yah my brother is in Austin for law school, and says property there has been pretty sound. Though it is still relatively cheap compared to back home (los angeles).

I am down close to 6 figures in the stock market (I sold nearly everything I had at the market top 14k, then sat on my cash waiting for it to drop, and when the dow hit 10k I got a little too aggressive), but agree, it is perspective. I really am not bothered. I am 21 and have decades to sit and wait. And since I do index investing, I know eventually markets will recover. Just like I do not get overly joyful when the markets go up huge, I don't get depressed when they go down. I only care what I have when I sell the stock. Until then, I am still holding the same amount of shares.

Plus with income still streaming in, I can invest even more.

On a side note, I read somewhere anti-depressant sales are up 11% annually.

Yes I agree. Bush was a big part of the problem. I still think the dems are trying to blame only him when they themselves also had their hands very deep in this. I think it was a failure of congress and the president. Not just Bush either. Remember, Clinton repealedGlass-Steagall which allowed banks to get into the securities business.

And yes the lenders definitely played their part, just like the retards who signed these mortgages buying into the hype they would make money off buying a house, and the profits could be used to pay the mortgage.

Or Alan Greenspan keeping interest rates so low for so long.

There is no one single person at fault. That is why I think everyone has to pay the price. And by everyone, I mean the borrowers, the lenders (banks included), and the politicians. I don't like the idea of being on the hook when I was responsible.

Cool thing for me is I can dip into the ole' EQ warchest and snap up some cheap property in LA this coming year or two. Put 50-60% down, get an absurdly low interest rate, and have dirt low monthly payments.

The democrats played their part as did Clinton by signing the bill. What concerns me most is that as a nation people didn't fully understand what they were getting into and it was rarely if ever explained to them by mortgage lenders.

Traditionally people will ALWAYS try to pay their mortgage first, it is definitely a first bill to be paid by 99.9% of people.

I am pretty certain that blame for the current situation can be mostly placed on the lenders and the system, much more than the homeowner and I also firmly believe that those who played the speculation game and lost should not be bailed out. However the current bankruptcy laws favor the investor and allow the court to adjust the mortgage to a favorable term for investors but not for the single homeowner...something just wrong about that. I get a kick out of watching the "financial experts" (I say that with much humor) say "We didn't see this coming" That's just bullshit, they saw it far enough back to rewrite laws that protected the individual debtor.

What's being done, and you can see by the CNBC guy ranting on TV is that the banks are actively playing a part in getting a message out that it is the fault of the borrower and that the focus needs to be taken off of the bank. Remember this is an employee, essentially of GE who is bitching and ranting about how much in assistance yet was mum on the much larger and ever growing Wall Street bailout.

If you really believe that massive amounts of people took every penny they had and knowingly purchased homes they could not afford then you are by far the biggest sucker I've seen and you should get a job on Wall Street as I heard they are hiring shills.

People trusted the lenders to write them a mortgage they could afford, no one forced those lenders to write those mortgages. The lenders were selling a bill of goods that they knew full well was wrong and they were less than candid in their sales pitch.

Who forced people to take loans they couldn't afford?

Who forced people to take loans they couldn't afford?


Good...you're a shill.

If you want to say no one forced the banks to make the loans, I'd agree. You can't have it both ways though. No one forced the people to buy things they couldn't afford either.

Ignorance is no excuse.

As an example lets see. I go to buy a house it was actually a house that I had watched for years and had often said "when that house is for sale I want to buy it"

So I fill out my mortgage app and I have my down money, 20%. I get a paper stating that my mortgage is a fixed rate at 5.45%.

Jump ahead one week to closing day. It's 4 PM I walk in there is a stack of papers 6 inches high and the lender says "We changed the terms a bit" I say in a surprised voice..."Oh...what are they" He says that it is an adjustable rate mortgage but for the first 3 years I can save 1/2 a percent in interest. I say...well...I think I should read these changes and he says "We have 15 minutes to get that out in FedEx or you won't get your mortgage.

(Now mind you I'm sure you'll say no one forced you to sign...but in my lame defense I'm a single father with 4 very young children and a business to run and if I don't close that day I am pretty much fucked because all of my shit needs a place to go and living in a hotel is a really shitty thing to have to do)

So the lender says..hey...you can refinance at anytime right into a fixed rate. So ignorant old me who CAN afford his house signs the papers closing the deal. Everyone is happy...my kids are happy and I feel much less stressed out that I am not homeless like I potentially thought we would be.

So I move in..get things squared away and think "Okay...I need to refinance this" So I look at my mortgage papers and what do I see...the lender was correct...I can refinance anytime I want...but the lender wants $50,000 dollars extra if I do it in the first three years.

So there I am stuck for the first 3 years strangely not wanting to pay a penalty of 50k...odd thing is...I couldn't even sue them for the switch...the current laws allowed them to do it thanks to...the republican congress and president.

Now...I am pretty sure that I was not a unique case and from what I see a huge portion of people who purchased a home in the range of 2004-2006 had something we could call similiar done to them.

Call me a sucker...I thought banks had an obligation of truth in lending.

That sucks, no doubt. Sounds basically like the tricks car dealers have been playing on people for decades.

You won't hear me claiming the broker was innocent there.

Saying you had no choice but to barely read it and sign, due to other factors, isn't very convincing. No one forced you to get into a do or die situation with the contract sight unseen.

They may have preyed on your poor planning, but it was your poor planning.

I thought banks had an obligation of truth in lending.

By the same token, don't we have an obligation to hold up our end when we sign a contract?

If you really believe that massive amounts of people took every penny they had and knowingly purchased homes they could not afford then you are by far the biggest sucker I've seen and you should get a job on Wall Street as I heard they are hiring shills.

People trusted the lenders to write them a mortgage they could afford, no one forced those lenders to write those mortgages. The lenders were selling a bill of goods that they knew full well was wrong and they were less than candid in their sales pitch.

You live in lala land. Most these people who took every penny where dumb for thinking their house would rise in value. They thought that real estate was like a fucking rainbow they could ride to a pot of gold. Just smooth sailing.

People are stupid. What kind of asshole doesn't read the paperwork when he is making the most important investment of his life? Sure as hell not me. I am the "shill" who is going to be sweeping up these properties for 50% off with my war chest. You can bet I will be reading every damn line of those papers too.

So I fill out my mortgage app and I have my down money, 20%. I get a paper stating that my mortgage is a fixed rate at 5.45%.

According to my mom (she is a realtor) most these people were putting much less than 20% down, and did not get fixed rates that were magically switched on them at the end. They got ARMs from the get go and didn't bother to figure out wtf was going on.

Saying you had no choice but to barely read it and sign, due to other factors, isn't very convincing.

I read a report where 92% of borrowers had a gun pointed to their head...true story...

Saying you had no choice but to barely read it and sign, due to other factors, isn't very convincing. No one forced you to get into a do or die situation with the contract sight unseen.

They may have preyed on your poor planning, but it was your poor planning.



By the same token, don't we have an obligation to hold up our end when we sign a contract?

Saying I had no choice is exactly the position they placed me in. I understand you have no children, that can and does change the game. If I was sitting there a single person with no obligation to make sure that any other person had a place to sleep at night I would say you're right. I would have told them to shove it and went to a hotel. If you think that I made a poorly planned decision you are way off base.

The position I was in was the equivalent of "Either your signature or your brains are gonna be on the paper" I think that is blatantly obvious.


You live in lala land. Most these people who took every penny where dumb for thinking their house would rise in value.

LOL...so says the person with the most shocking superficial knowledge I've seen post here.

According to my mom (she is a realtor) most these people were putting much less than 20% down, and did not get fixed rates that were magically switched on them at the end. They got ARMs from the get go and didn't bother to figure out wtf was going on.

Here...let me explain. Someone wants money to buy a house, they go to a bank and say "Hey...I want to buy that house" The Bank HAS AN OBLIGATION to say "What is your income" and based on their income and their ability to pay that loan the bank was supposed to make a responsible decision. The banks didn't make a responsible decision in lending that money. remember anyone can ask for a loan the final decision is up to the lender.

I have had numerous people ask me to lend them money...I say "no" alot because I know what their ability to repay is and I am not willing to take the risk because unlike the banks I hold that paper and have a real interest in their ability to repay and I don't even charge interest.

Buyza you do understand that these lenders beared no risk in their lending...you do...no?

Saying I had no choice is exactly the position they placed me in. I understand you have no children, that can and does change the game. If I was sitting there a single person with no obligation to make sure that any other person had a place to sleep at night I would say you're right. I would have told them to shove it and went to a hotel. If you think that I made a poorly planned decision you are way off base.

The position I was in was the equivalent of "Either your signature or your brains are gonna be on the paper" I think that is blatantly obvious.

How did you get in the situation of sign or be homeless? Where were you living before that you couldn't live another week?

How did you get in the situation of sign or be homeless? Where were you living before that you couldn't live another week?


In a house that was sold and gone on the same day I was moving in...it is usually done that way.

How did you get in the situation of sign or be homeless? Where were you living before that you couldn't live another week?

Seriously? It's going to take someone well more than a week to find a new home, get a new loan, and get the property closed.

Not that he should or shouldn't walk away, but kids add something that anyone without kids simply can't understand. People without kids will claim to understand, but until you have children depending on you to provide for them, it's impossible to say how you'd react.

Kids change everything. The thought process behind seeing your children basically homeless for a couple of months because of an unscrupulous lender would cause many men to break the lender's face. The lender knows EXACTLY what he's doing changing the stated terms on a loan and presenting it to the buyer 15 minutes before the closing. The lender KNOWS he has the buyer by the short hairs, and that's exactly the plan.

He's saying he had to sign it without reading because the contract needed to go out that day. One more day would have been enough time to read it and get things sorted out with the broker. A week would have been more than plenty.

I have no sympathy for the "but kids" argument when it comes to this. If "but kids", then don't get yourself into a situation where it's do-or-die for the sake of your kids.

I don't know what's "normal", but it's certainly not required that you put yourself in a do-or-die situation to upgrade your house. People back out of sales all the time (without penalty) because they set the sale up contingent on their purchase and give themselves an ample window between the two.

I've acted as proxy on a few condo transactions that my family did in Florida. Even when it's just rental property, we had those protections and timing. Why in the world wouldn't you for your primary residence that houses your "but kids"?

He's saying he had to sign it without reading because the contract needed to go out that day. One more day would have been enough time to read it and get things sorted out with the broker. A week would have been more than plenty.

I have no sympathy for the "but kids" argument when it comes to this. If "but kids", then don't get yourself into a situation where it's do-or-die for the sake of your kids.

I don't know what's "normal", but it's certainly not required that you put yourself in a do-or-die situation to upgrade your house. People back out of sales all the time (without penalty) because they set the sale up contingent on their purchase and give themselves an ample window between the two.

I've acted as proxy on a few condo transactions that my family did in Florida. Even when it's just rental property, we had those protections and timing. Why in the world wouldn't you for your primary residence that houses your "but kids"?

So when the lender said "If we don't get this out the door in 15 minutes you don't get your mortgage" I shouldn't have believed him? No it's not required that one place themselves in a do or die situation...unfortunately I didn't see it as that because it wasn't presented as that until I walked into the lenders office to close.

You don't buy the "I have kids" because you don't have kids and you have no idea of the change in the thought process until you have one.

Your argument borders on shear batshit craziness.

You see, I run a web design and Internet marketing business, I don't buy real estate for profit. I buy it to put a roof over the heads of my family.

You are saying that everyone should be an expert...nice utopia...but truly unrealistic. Even the worst versed in law in this country would tell you that I had a reasonable expectation to be dealt with honestly and truthfully by the lender.

LOL...so says the person with the most shocking superficial knowledge I've seen post here.



Here...let me explain. Someone wants money to buy a house, they go to a bank and say "Hey...I want to buy that house" The Bank HAS AN OBLIGATION to say "What is your income" and based on their income and their ability to pay that loan the bank was supposed to make a responsible decision. The banks didn't make a responsible decision in lending that money. remember anyone can ask for a loan the final decision is up to the lender.

I have had numerous people ask me to lend them money...I say "no" alot because I know what their ability to repay is and I am not willing to take the risk because unlike the banks I hold that paper and have a real interest in their ability to repay and I don't even charge interest.

Buyza you do understand that these lenders beared no risk in their lending...you do...no?

Yes I have heard you make that claim before. It is quite amusing. We all know attempts to insult are the best way to prove you are right :D

I know how loans work. I also know that I have friends who want loans even though they can't afford them. Much like the people who wanted these houses.

Once again, I am not dismissing the lenders for their actions. I just feel the borrowers are at fault as well. If you are too irresponsible to read all the terms and truly calculate what you can and can't afford, then you might have to pay the price.

I also still believe that many people knew they couldn't afford the houses at the time and were banking on future price hikes in housing to offset that.

BTW, can you help me with my car? I got a real bad deal from the dealer :( I had to sign the papers that night though cause he said the deal would be gone if I didn't so I did it without reading it. It's so unfair!

You don't buy the "I have kids" because you don't have kids and you have no idea of the change in the thought process until you have one.

Your argument borders on shear batshit craziness.

You see, I run a web design and Internet marketing business, I don't buy real estate for profit. I buy it to put a roof over the heads of my family.

You are saying that everyone should be an expert...nice utopia...but truly unrealistic. Even the worst versed in law in this country would tell you that I had a reasonable expectation to be dealt with honestly and truthfully by the lender.

Those are awful excuses.

You need the house for a roof over your head, so you pay less attention to the transaction than you imagine someone would a rental property?

It doesn't take an expert to know that you should read every word of a contract relating to any transaction that large.

Like I said several times, that's obviously slimy on the part of the broker, but you can't seriously claim that you have no personal responsibility. Seems like you're in a hurry to blame everyone except the guy that actually signed the contract.

So when the lender said "If we don't get this out the door in 15 minutes you don't get your mortgage" I shouldn't have believed him?

You are saying that everyone should be an expert...nice utopia...but truly unrealistic. Even the worst versed in law in this country would tell you that I had a reasonable expectation to be dealt with honestly and truthfully by the lender.

Ummm no? For someone as paranoid as you in regards to banks and wall st, I would think you would know better.

I nearly bought a condo for myself back in 2005. You know what stopped me? I read the mortgage agreement. It was an ARM with a massive penalty to get out. You see, I was responsible. I did some research before I went for a loan, and took the time to read it.

What was I told when I took the time to read it? Something like "You really should hurry up, this property could go any second" and "loan offers like this don't always come around" what was my response? "That's ok, I'll take my chances"

Not everyone should be an expert. I'm not. I wasn't at 18 when I was going to buy a condo. I did have enough commonsense to read up on the basics, and ask the important questions.

You are the shill if you think you can trust anyone who is suppose to profit off you.

I understand you never bought a house...I guess you'll do it better than I did...good for you!

Ummm no? For someone as paranoid as you in regards to banks and wall st, I would think you would know better.

I nearly bought a condo for myself back in 2005. You know what stopped me? I read the mortgage agreement. It was an ARM with a massive penalty to get out. You see, I was responsible. I did some research before I went for a loan, and took the time to read it.

What was I told when I took the time to read it? Something like "You really should hurry up, this property could go any second" and "loan offers like this don't always come around" what was my response? "That's ok, I'll take my chances"

Not everyone should be an expert. I'm not. I wasn't at 18 when I was going to buy a condo. I did have enough commonsense to read up on the basics, and ask the important questions.

You are the shill if you think you can trust anyone who is suppose to profit off you.

So you didn't get your mortgage agreement until closing day? You see I got mine about a week or two before the closing I read it and it was fine the problem is they changed it at closing...I being a dumb twit wasn't in the realization that laws favored lenders and allowed them to do that.

They gave me a "summary" a week or two before. Though I still read it through on closing day.

Its impossible to read all the papers they throw at you on closing day, if you think otherwise you haven't bought a house. That's why you pay 3% of the cost to your Realtor and pay your broker and settlement company. I had a great broker, a great settlement company (and a loser of a Realtor but he was a family friend) and didn't have any problems - but I can easily see how someone would. I literally signed 90 documents while having my moving truck parked outside with all of my worldly belongings in it that day, and without really reading anything over settlement still took 2 hours.

Thanks Kelraz...Squish was just about to post that. People who have never bought a house really have no understanding...unless of course your Mom is a realestate Agent and you have become a multi-millionaire stock investor able to absorb huge losses all because you sold EQ Toons on Ayonae Ro.

I do understand. Regardless of if I pulled the trigger or not. I didn't have to read the entire thing. I just had to read about the penalties involved from switching to a fixed, and how the ARM worked. I then backed out and was going to get a fixed. But the property sold before I could do so thankfully.

Don't hate just cause I made a couple bucks selling EQ toons. Business is business.

I find it very hard to believe that either of your home loans would have more paperwork than these seven figure condos with multiple purchase partners. They threw huge mountains of paperwork at me each time.

Maybe I care more about representing my family's interests than you care about providing shelter for your kids? Dunno.

The last time, it was nearly 5pm on New Year's Eve when we started and they were trying to pull a fast one on us, while pressuring me to hurry up and sign before 5pm. Needless to say, I didn't capitulate.

I kept them and their counterpart(s) at the bank there until 10pm, and we got it worked out. I'd rate the ordeal as a top-5 miserable experience in my life not including doctors or dentists, but it sure beat being a sucker.

Good for you...I must say you are certainly, in this situation, woefully ignorant.

Of what? The apparent lure of taking no personal responsibility for my actions?

Of what? The apparent lure of taking no personal responsibility for my actions?

Personal responsibility is so last year.

No you are woefully ignorant of the fact that during the times that lenders were pushing mortgages many of them broke the law but there was no recourse to go after them. You are also woefully ignorant of how a parent thinks and the situation that I was placed in and the thought process that one goes through knowing that his potential is to see his children becoming possibly homeless, even for 24 hours, or to sign a document that can be litigated and settled in his favor.

Let me give you a little background to who I am. In 1998 my wife suddenly died, I was left a single father who ran a very successful business and suddenly had to raise 4 children ranging in age from 2 - 10 with the oldest one being the biological child of another, I'm sorry I can't call him man as he is far from that.

My wife was a stay at home Mom, she took on the almost sole responsibility of raising our children I was far from prepared to take on the role of everything with my children but I did. From what I can see I did a pretty good job, three out of four are honor roll students and one, my oldest daughter has won national newspaper awards and photography awards, my youngest daughter is the lead flutist in her school band and my youngest son has an uncanny ability to discuss history and politics far beyond his 15 years.

I am very sure that in raising my kids their stability was my number one concern after seeing their fright and unsure reactions to things after mommy didn't come home. I am certain that having a home, their own bedroom, their own yard and no interruption of that was key in raising kids who could get over a very traumatic experience. Now I understand you won't and will never possibly see it from my perspective and honestly I hope you never have to.

But that is why I signed those papers. Now I make alot of money, far more than it takes to pay my mortgage so being able to pay it is not an issue with me. My issue is this, the lenders knew exactly what they were doing, they preyed on people, to think otherwise is foolish and just simply idiotic.

I will give kudos to you as being someone who has perfect business judgement and just never makes a mistake. You could probably write a book and make millions of dollars dispensing advice on perfection.

And Buyza...you are a God..do yourself a favor...don't mistake your ability to make money as being a wise person. You probably think that you could take a guy like me and walk all over him in a business deal...I assure you..in business that is right where I want you and you'd probably be quite surprised on how fast I could buy and sell you to the highest bidder after I took every penny you have. Just be careful man...don't be so boastful..remember business is 90% being in the right place at the right time and 9% bullshit...the other 1% can be divided up between who you know, knowledge and skill.

becoming possibly homeless, even for 24 hours, or to sign a document that can be litigated and settled in his favor.

And Buyza...you are a God..do yourself a favor...don't mistake your ability to make money as being a wise person. You probably think that you could take a guy like me and walk all over him in a business deal...I assure you..in business that is right where I want you and you'd probably be quite surprised on how fast I could buy and sell you to the highest bidder after I took every penny you have. Just be careful man...don't be so boastful..remember business is 90% being in the right place at the right time and 9% bullshit...the other 1% can be divided up between who you know, knowledge and skill.

Your posts have given me an excellent business idea. I should start a business where I let people who have no where to go for a night can stay with me and they pay me. I can call it a HOTEL.

I'm sure the kids would have survived 1 night at the Hilton. I spent a month living in a hotel while in limbo after the massive northridge earthquake leveled my house. It really wasn't that difficult. And before you say how small your children were, I was only 6.

Don't pat yourself too hard on your back, buddy. I never said I could "take" a guy like you. I don't think that's how business work. Though you apparently think you can "take" a guy like me. Oddly enough you then go on to contradict yourself saying how it is 90% being in the right place. Only 1% being skill.

Plus I don't think you could buy and sell me to the highest bidder. There is something calling the thirteenth amendment...DUH!!!!

I think you are just bitter because I profited off your hard work in everquest :( I would be too if some load mouth kid who I envisioned as an idiot was far more successful at his age than I was at twice his age.

I love how liberal ideologues get super angry and use insults when they are confronted with opposing views.

God you are such a fucking loser haha.

Freedom of the press is extremely important. What is not important is the sensationalism or the diversion by the media.

Watch this video, Tommy Chong sums it up pretty accurately.

http://www.youtube.com/watch?v=dYZJVnFP2CY


By the way if ANYONE or SANCHEK would be so kind as to link me to the "how to imbed youtube videos on ayonae.com for dummies" I would appreciate it.

Without the X's [Xyoutube]code on the end of the url after the v=[X/youtube]

So for that video it'd be [Xyoutube]dYZJVnFP2CY[X/youtube]

Well no...I never sold my toon so I really could care less. I assure you you are very much so stunningly ignorant and woefully lacking of any wisdom.

You're a braggart, that is all you are and all you will ever be. I really get a kick out of reading your wisdom lacking posts and your utterly moronic views on things.

I am comforted by the knowledge that you will ultimately fail you will most certainly pass as a morally bankrupt and financially lacking individual. The writing is on the wall.

load mouth kid who I envisioned as an idiot

I envision you as an idiot only from reading your posts...it appears I am correct.

Well no...I never sold my toon so I really could care less. I assure you you are very much so stunningly ignorant and woefully lacking of any wisdom.

You're a braggart, that is all you are and all you will ever be. I really get a kick out of reading your wisdom lacking posts and your utterly moronic views on things.

I am comforted by the knowledge that you will ultimately fail you will most certainly pass as a morally bankrupt and financially lacking individual. The writing is on the wall.



I envision you as an idiot only from reading your posts...it appears I am correct.

What guild where you in? Because if you were in EW with Squish, then I profited on your game play :D

I am really not a braggart. Most my antics on the board where for publicity purposes. It worked pretty well. I also enjoyed getting a rise out of people who didn't sell to me and thought I was breaking the EULA. Boohoohoo.

Why are my views moronic? Cause I am not an ideologue like you? Because I believe in personal responsibility?

Haha morally bankrupt? Says the guy who doesn't believe in personal responsibility, calls people names over the internet because they disagree with his views, tells people he can buy and sell them, and how he can "take" them in business. Not sure if that is gay innuendo or not.

I am morally bankrupt solely on the fact that I believe in personal responsibility, and profiting on video games. You caught me.

As for financially lacking, not likely. I am a Jew :D

No you are woefully ignorant of the fact that during the times that lenders were pushing mortgages many of them broke the law but there was no recourse to go after them. You are also woefully ignorant of how a parent thinks and the situation that I was placed in and the thought process that one goes through knowing that his potential is to see his children becoming possibly homeless, even for 24 hours, or to sign a document that can be litigated and settled in his favor.

<snip paragraphs pleading to emotion>

But that is why I signed those papers. Now I make alot of money, far more than it takes to pay my mortgage so being able to pay it is not an issue with me. My issue is this, the lenders knew exactly what they were doing, they preyed on people, to think otherwise is foolish and just simply idiotic.

More excuses. There's a shocker...

No one "placed" you in the position of having to sign or be homeless except for you. From all you've written on the topic, it sounds more like you were too caught up in that particular house and let emotion win over your better judgment. You backed yourself into a corner and don't want to take responsibility for it.

Ignoring all your excuses, your central premise here doesn't wash anyway. You say that what happened to you probably happened to most people (so it's not their fault they signed either!), but how is that possible?

You say you were trying to get a fixed rate mortgage, but most of the people caught in the subprime debacle couldn't have paid the fixed rate payment to start with. That's the whole point. If everyone were in your situation, we wouldn't have a subprime crisis.

All these falsified income statements and rushed loan apps were specifically to get an adjustable rate interest-only loan that almost anyone could afford for a couple years. It's almost diametrically opposed to what you're talking about.

These people were stupid, greedy, or some combination of the two. The mortgage brokers certainly preyed on this, but neither party is innocent in those deals.

I will give kudos to you as being someone who has perfect business judgement and just never makes a mistake. You could probably write a book and make millions of dollars dispensing advice on perfection.

Perfect judgment? No.

I've made plenty of mistakes in business. However, what I didn't do is insist on blaming everyone but myself when I did make a mistake. All that does is waste a learning opportunity (like fucking read shit before you sign it!).

Irrelevant, but I couldn't help but notice this:

Just be careful man...don't be so boastful

Now I make alot of money, far more than it takes to pay my mortgage so being able to pay it is not an issue with me.

WHAT A BIG MAN YOU ARE! Sigh.

Maybe braggart is not the correct word...I'll go with ostentatious, pretentious, woefully ignorant and stunningly superficial with an exceptional lack of basic social skills.

What I gave you is advice...apparently from your obviously tasteless posts you seem to be indirectly screaming for it. I have no real interest in buying anything you have and I'm certain you wouldn't sell for much..... I know who you were on Ayonae Ro you were the resident Y a n t i s wannabe and I know that many EW didn't sell their characters through you. Honestly I don't give a shit about who sold or didn't sell.

Your ignorance shows most brightly with statements like this:

Says the guy who doesn't believe in personal responsibility

I'll also make a note to the Jewish half of my family that there are others out there...but the others aren't much like them.

Wow Sanchek..I honestly didn't think you were that gullible..I'm kind of shocked.

More excuses...you know...karma is a funny thing...


Oh and BTW did I mention I have them in court and the attorney is working on contingency...funny thing huh...

Wow Sanchek..I honestly didn't think you were that gullible..I'm kind of shocked.

More excuses...you know...karma is a funny thing...


Oh and BTW did I mention I have them in court and the attorney is working on contingency...funny thing huh...

Excuses? Gullible? You just precisely described your last several posts about how you rushed to sign a six figure deal without bothering to read the document...

No...what I described is that the lenders were allowed to violate laws, break rules, and change terms with what they thought were houses they were going to get back in a foreclosure thereby adding to the asset portfolios of the Wall St firms that were buying the mortgages and planned to eventually own their homes.

That's what I described. Anyone with half of a brain and basic transaction knowledge knows full well that they have a reasonable expectation of truth from the lender. I think you said your girlfriend is an attorney, she should be able to tell you that in any contract there are reasonable expectation and in this case they were not met.

Why you think I feel no personal responsibility is ridiculous I most certainly wanted to read the mortgage terms but was so obviously told that I would not have the time to and that if that mortgage was not on the Fedex truck that day I would not get a mortgage and would be required to go through the whole approval process again is why I made the choice to just sign and keep a roof over my kids heads.

I'm really getting tired of explaining the obvious intent of the lender, you see, they had a financial incentive to place people in ARMs over fixed rates. They were salesman that talked circles and were expert in keeping people off balance. Did I learn anything..yep, probably more than you know and I am most certain I will never be taken down that road again.

Again, please don't fail to realize...the lender has the say on who gets the loan...funny your outrage is on the people and not the lenders...that is why you are gullible.

funny your outrage is on the people and not the lenders...that is why you are gullible.

Have you not read a word I've posted here?

Have you not read a word I've posted here?


Yep..every word

If you ask me to borrow money...and I tell you I don't care what you make or if you even have a job and then I lend you money and you default on the loan...whose fault is it that I'm not getting paid back?

Both. About equally there. We'd both be morons.

If I signed a document very clearly delineating what I was to pay you and when, it would be more my fault than yours.

Yep..every word

You're just not paying any attention at all then, if you think I'm excusing the brokers in this. Just a few posts back, look at the BOLD TEXT specifically stating that I think neither party is innocent.

Now if you're looking for me to blame only the brokers/lenders, I won't do that. That's not what you've been asking (though it seems to be all you're personally willing to do).

You're going to be hard pressed finding many people who will join you on that ship, outside the stupid and greedy (not you) who thought it made sense that they could buy starter mansions while making $50k/year.

You're going to be hard pressed finding many people who will join you on that ship, outside the stupid and greedy (not you) who thought it made sense that they could buy starter mansions while making $50k/year.

I am not for bailing out speculators, or those who bought 500k houses on 50k salaries. Just to show you my transparency on this...the year I bought my home I earned in excess of 200k...I payed 245,000 for ny home...I was most definately NOT over extended in any way shape or form....I can play you some great recording of me attempting to pay my mortgage and of Lehman Brothers refusing to accept the payments. That is how I am most certain they had all intentions of selling to then foreclosing on the homes they financed.

It is purely incorrect to say that these lenders were forced by the government to write these mortgages (I'm not saying you think that) they wrote them because they could sell them and make an instant profit...I think what I find hard to believe is that none of them have been arrested. You look at Richard Fuld of Lehman, he made over 500 million dollars on sub-prime loans and he gets to keep the money and those who he wrote the loans to lose everything. The mans company KNOWINGLY wrote loans they KNEW would be defaulted on. Why is that not criminal? Why are these firms rewarded for bad behavior? Why will my kids and their kids pay for their reward?

Why does Wall St (figurative) get rescued and when it comes time for Main street we see this sudden outrage of "Why should I help my neighbor?"

The fucking homeowner assistance, it is assistance because in order to get the assistance you MUST pay your mortgage on time, is 75 Billion dollars...compared to what? That is just about six monrth of funding the Iraqi government by us...why is that OK and not helping fellow citizens keep their homes? The end result would hopefully be a stabilization of the foreclosure run.

I guess I don't get American anymore...somewhere along the line we lost our souls.

Getting back to the point:

http://www.cnn.com/2009/POLITICS/02/23/poll.obama.media/index.html

# Nearly eight in 10 say things are going badly in the country
# Three of four Americans are angry about the way things are going in the country
# But three out of four questioned say that things are going well for them personally

Keeping that 75% paralyzed with fear is going to kill us.

CNN on why people have lost confidence?

http://money.cnn.com/galleries/2009/news/0902/gallery.five_measures_new/index.html

Does them reporting that people are looking at more then their own paycheck make more people look at more than their own paycheck? Oh the humanity.

Like Fild, I don't know anyone laid off, losing their house, or in serious trouble either.

My parents do work that's related to the housing industry, and have as much business as ever. Their work is low volume and quality based though, instead of being part of the quantity bubble.

No one at my company has been laid off or had their pay cut (and we sell an AIG product!). Our product/service actually brings value to our customers though, instead of being a bizarre financial instrument.

None of the houses in my neighborhood are being foreclosed that I know of. None are for sale at all (though, that could be because they're impossible to sell right now).

If you're going to turn anecdotes into evidence, it goes both ways.

Five months have passed since we discussed this and I'd love to know how anything has changed. There is potentially an unreported rate of 17% unemployment in this country (after a year of unemployment people can't continue to collect benefits, and this recession is much longer than that). In June Atlanta supposedly had the highest foreclosure rates in the nation, do you still not know anyone who lost a job or had a home foreclosed on.

Personally, my step-dad's sister's husband lost his job in Colorado where he used to do home remodeling. No real surprises there that this industry is hurting. However, the real surprise was that the Baltimore Opera closed its doors and just a few months later the Washington Opera canceled all of their contract employees. My girlfriend, their publications editor, is now jobless along with their entire costume department and hundreds of others. Will an Opera will get along without edited playbills? Probably. Without costumes and props? Probably not. So DC may lose its Opera presence entirely very shortly.

Gannett (publisher of the USA Today and others) has had 3 rounds of week-long furloughs (forced week vacation without pay) and now finished its third round of layoffs which cut a few of my friends from their local paper jobs. Additionally all of our local television stations have pooled their resources together and created a DC bureau which feeds the exact same video of press events to all of the local stations so they could cut a bunch of camera operators and producers. Much like Opera, this may be the end of local news.

Its not all doom and gloom though for us. While my girlfriend is collecting unemployment I get unpaid labor to help get my show off the ground. Beer sales are at record highs and the show will be pretty cheap to the networth that buys its, best time ever to launch something like this. But how is it for everyone else who just 5 months prior were unaffected.

I only know directly of one person who has lost his/her job. My best friend lost his programming job with an insurance company. Though, he did find another job with a different insurance company programming for them in just about a month albeit for about $2000 less per year.

My parents are struggling hardcore. My father is a factory sales rep. for a few furniture companies, and sales are obviously horrid right now. His income is literally 1/4th what it was 10-15 years ago. My Mom works at a furniture store part time. They live in Kokomo, IN which counts Chrysler and Delphi (GM) as it's major non-retail/food service employers, so finding other lines of work is about impossible. Their house is worth substantially less now than five years ago(and worth about what it was 15 years ago), and they owe just about what it's worth now after refinancing to pay some major medical bills a few years back. This leaves them unable to sell the house that they've lived in for 23 years to move to attempt to find better work. My Dad is considered self employed for benefits and tax purposes, and health care insurance expenses are eating them alive.

My wife's company laid off some employees last year, but her job seems pretty secure. There was a pay freeze at her company though this year. I however received approximately a 30% pay increase this year because a former employer called me and offered me a job making 30% more than I was making where I am now. It was not until after I accepted the other job that my current employer ponied up to keep me, but that did eventually happen. So, my wife and I are actually better off financially this year than we ever have been in our adult lives.

The house that was next to ours that was foreclosed has been purchased and is in the process of some renovations. It should no longer be vacant within the next 30-60 days according to the people that bought the house. There appear to be no more new foreclosed houses in my immediate vicinity, but I do know the people two houses down were in some major problems and have put their house on the market.

Unemployment in Columbus isn't representative of the rest of Ohio though, we have the most stable economy of any of the large cities in the state due to relative lack of manufacturing jobs and an economy that's more based upon the tech sector, Ohio State University, and the state/city Governments.

Me and my immediate family are no worse off than before...However, we live in Louisiana, .... how far could we possibly drop?

My employer who hasnt had a layoff in almost 40 years of its existance had two rounds of layoffs for a total of 1500 people out of 10,000. Sales are down 25 percent from last year that was down about the same. No raises, no hiring, no OT for production workers. Instead of closing 1 entire plant, the decided to simply shut down 1 plants worth of equipment and spread it out around the 5 Wisconsin plants. Printing took a hit, but hopefully we'll come out the tunnel still floating. One thing is for sure, too many companies chasing too little volume, had to take out the excess capcity and go from there.

'But how is it for everyone else who just 5 months prior were unaffected.'

- Funny enough, I was one of those who, five months ago, felt the effects of the recession to be overplayed, and was thinking myself relatively uninvolved. Now, however, my father's business is folding, I'm defending him against a bankrupt petition, my brother-in-law's job (he's a building site foreman!) is hanging on by a thread, and many of my friends who have recently graduated from university are finding job hunting a depressing and gloomy prospect.

A lot has certainly changed, including my own perspective of it all.

I know a few people who have lost their jobs in just the last two months, let alone five months. My own income is down significantly while my bills have only gotten higher. IMO we have pretty much hit the bottom though and I'm anticipating business to pick up some this fall.

I find myself to be relatively unchanged, but I am seeing many customers on my mail route (doctors, Ph.D's, financial workers, attorneys, construction workers, and many small business owners) receiving state unemployment mail and much more mortgage related mailings. Keep in mind I deliver to a relatively upscale area, where the homes average 500K to 800k, with a few in excess of 1 mill, and the lots averaging 3-5 acres.

I am seeing more remodeling and repairs being done than I recall from the past few summers, and homes are starting to turn over faster when put up for sale, compared to those that sat for 1-2 years with for sale signs the last couple years. But, some of those that were listed for sale 2 years ago still have not sold, so it is an issue of the home and location and lot and not so much the economy.

Still good here.

Atlanta sucks. North Atlanta does not.

I know 5 people who have been laid off, another 4 or 5 who have taken salary cuts, and 10 more who despite having masters or betters educations can not find a job period. Real estate sale prices continue to slide downwards towards the expected value post correction (just now halfway down!) and numerous firms have been doing mass layoffs here, including the two largest law firms in Oregon. The commute from Yuppie Ville to my side of town has dropped from 45 minutes to 30 by my boss' account due to traffic reduction. Despite being in a recession-proof industry we're probably not getting bonuses this year regardless of how our department does, which is about a 10% effective paycut.

Interestingly, I saw a truly despicable ad on TV at the diner near work, which has been inundates with 20 times the applicants they can use for waitstaff, which featured a clip of the President talking about debt issues while barely disguised advertisements for "debt-relief" services scrolled in a CNN-style ticker across the bottom. I about threw up in my mouth a little.

Yeah I've been seeing those too. I get mailers a lot that look like government programs to refinance my house at a new "government" rate, which are pretty believable besides the lack of .gov on the end of their address.

I am almost completely insulated on this whole thing, other than I lost some money on investments. Technically, I have made more money during this downturn then before it, since I got an increase in pay grade beginning of last year. As for China, well, there are 10,000 major construction projects going on in Beijing. The traffic gets worse every day with lots of shiny new expensive cars and hardly anyone knows how to drive them. Its hustle, bustle and prosperity everywhere you look. Plus, the Chinese don't expect much.

My parents are retired. They rode the upswing of the housing bubble by selling their home in Redondo Beach for 4 times what they paid and their rental back in New York. They bought their current home with cash and have a managed fund to pay taxes, bills etc. They still bitch about money lost in other investments but they are content just to let the troubles of the world pass them by.

Most of my friends are in the military. Many more work in government or in education/academia, which tends to be well insulated from downturns. A few more of my friends also work in engineering and architecture, where the life cycle of major projects can carry them through with enough work to keep them busy through most down turns, especially if they are large civic/municipal projects that are paid for with municipal bonds. Still, everyone I know has scaled back/downsized/belt tightened and focused on saving and frugality. You can thank the media for that as there is always that overly present issue of fear and uncertainty. The sky could after all fall at any minute.

I also have one friend who is an artist. Him and his wife both. I guess technically, they never had jobs to lose nor did they ever have much money to boast about losing. They are doing just fine.

AT&T wise, we're doing pretty good. The iphone is keeping my paycheck happy without that we'd probably be in trouble. Though i had to reduce my 401k contributions by more than half, no matter how i had it setup it was a blackhole of money that i couldnt afford to lose.

Polk County, FL has one of the highest unemployment rates in the state.

A good friend of mine. father had 15 employees in a drywall buisness and 5 trucks a year ago, now he has just him and his son and sold off the trucks

My grilfriend is a marketing manager for a tea house chain, and they are ONLY alive because they are near tourist traps and euros come to her shops for a little taste of back home.

My school district, along with plenty of others, is going through major cuts. We all took pay cuts for this year, and no increase in pay for poor suckers like me who completed our master's degree and were expecting a raise. Supplemental contracts for sports and academic clubs are gone, health insurance was slashed, and we layed off over 100 teachers.

I live in a pretty low income housing area. Lots of empty houses lately, and a few empty strip malls that never gained renters. Housing market is still going down, our house is down to about a quarter of what we paid for it.

My job is very secure as I work for the state. NO pay/cost of living increase though this year. My health coverage contribution went down though so thats cool. Wife is a dept store manager with small uptick in sales because no one wants to drive into town to Wal-mart anymore so they stay local. So, so far so good for us. I know that will make Rover happy knowing his long lost brother is doing well.

I forgot to mention, my neighbor is a real estate agent. If you listen to the FUD from the local news, you'd think she'd be turning tricks on the corner to buy bread, but even she is doing well. Closed on ~10 houses last month and took a two week vacation to Mexico.

I still say it's all too easy to completely underestimate the massive indirect power that the media has in these things. Remember that AIG went down due to a credit rating provision on less than 200 of their swap contracts, not even due to the underlying obligations or their capitalization (or lack thereof). Companies like Bear and Lehman were sunk far more by panic-driven naked shorts than by rational movements in the market.

Panic the masses and tremendous amounts of capital goes from funding jobs to jumping on naked shorting bubbles overnight. Blame the underlying instability of these huge institutions, sure, but also blame people who yell "Fire" in the movie theater.

My job is very secure as I work for the state. NO pay/cost of living increase though this year. My health coverage contribution went down though so thats cool.


As sad as it may be, the simple fact is that correctional staff at state institutions are in one of the most secure jobs during times like these, as the liklihood of a reduction in crime coinciding with a recession/depression is remote, at best. And, if the state does need to pinch pennies with the prison system it will be the programs that go before the line staff, which will piss off the inmates which in turn can provide impetus for more hiring of line staff.

My sister is a real estate agent in FL. She hasn't sold a house since September. Her husband is a handyman and they're living off what he makes while drawing down her retirement savings.

Well...one can blame the media...I blame the politicians and their corporate backers. We have an economy based on banks that give shitty loans rated as AAA by bullshit ratings companies an economy whos other big industries are prisons and health care admin...not one single ounce of substance...hell...the tech sector has even been sold to offshore interests.

Damien: Do you think the mainstream media will ever get in the weeds and report the gritty information?

Matt: Not in real time. They get around to it eventually. But far after the fact. At some point there’s always a magical moment in time when the tide turns and the major media will criticize a powerful person or organization. It’s a form of herd behavior. There’s a theory that if there’s 50 deer in a herd, the instant 26 decide to run away, they all run away. But until that moment, they all stand still. The same goes for journalism. Everybody backed Bush in the Iraqi War and through the 2004 election, then all of a sudden everyone realized he was wrong about almost everything and the entire press turned on him. I think that’s going to happen with this Wall Street story too. For a while, there will be a reluctance to go after the key players. But once the floodgates open, the mainstream press will take up the slack and do the job they’re supposed to be doing.
Source (http://seekingalpha.com/article/147559-interview-journalist-matt-taibbi)

In fact, before the article went to print I was extremely nervous we had gotten something wrong and Goldman would come out with a whole list of things they’d say we made mistakes about. But the fact that they didn’t come up with a single thing greatly emboldens me to think we got it right.
Matt Taibbi has become recently noticed for his takedown on Goldman Sachs (http://www.rollingstone.com/politics/story/26793903/the_big_takeover).

It gets so little notice...even here (http://ayonae.com/goldman-sachs-scams-t12389.html).

And the media can't be totally blamed for the financial crisis when we have banks so stupid that they sue themselves:You can't expect a bank that is dumb enough to sue itself to know why it is suing itself.

{snip}

In this particular case, Wells Fargo holds the first and second mortgages on a condominium, according to Sarasota, Fla., attorney Dan McKillop, who represents the condo owner.

As holder of the first, Wells Fargo is suing all other lien holders, including the holder of the second, which is itself.

"The primary reason is to clear title and ownership interest in a property to prepare it for sale," Waetke said in an email exchange. "So it really is not Wells Fargo vs. Wells Fargo."

Yet court documents clearly label "Wells Fargo Bank NA" as the plaintiff and "Wells Fargo Bank NA" as a defendant.

Wells Fargo hired Florida Default Law Group., P.L., of Tampa, Fla., to file the lawsuit against itself.

And then Wells Fargo hired another Tampa law firm -- Kass, Shuler, Solomon, Spector, Foyle & Singer P.A. -- to defend itself against its own lawsuit, according to court documents.

Wells Fargo's defense lawyers even filed an answer to their client's own complaint.

"Defendant admits that it is the owner and holder of a mortgage encumbering the subject real property," the answer reads. "All other allegations of the complaint are denied."
Source (http://www.foxbusiness.com/story/markets/al-lewis-wells-fargo-bank-sues/)

Rodney Lass figured his days as a homeowner were over when he was hit with a foreclosure judgment more than a year ago.

He stopped rehabbing his two-story Bay View home and moved on.
But what Lass didn't realize until recently is that the house remains in his name today.

He's still responsible for the taxes, upkeep of the property and the mortgage, leaving Lass perplexed.

"Why would I pay for something that I don't own anymore?" Lass said.
The foreclosure, however, failed to go through after the California-based lender decided it didn't want the gutted house. Lass said he found out for certain that he still owned it from the Journal Sentinel.

Today, the house at 703 E. Lincoln Ave. sits condemned, holes in its roof, a blight on the working-class neighborhood.

The home represents a growing phenomenon known as walkaways - properties for which lenders sue for foreclosure but never take the title.

For years, lenders complained about debtors who left the keys on the kitchen table and skipped town, leaving it to the bank to file for foreclosure and eventually take title by buying it at a sheriff's sale.
The latest twist: Now it's the lenders who are doing the walking, often without telling the borrowers, who may believe erroneously they have already lost title. Source (http://www.jsonline.com/watchdog/watchdogreports/50548282.html)

And even banks are walking away - so why blame the media for reporting the dumb stuff that the finance industry is doing? That's like blaming Toto for pulling the curtain away from where the Wizard of Oz was hiding.

The most retarded part is that the foreclosure issue was actually one that could have been remedied in an almost win/win for banks and homeowners. Thanks to the Rick Santelli's of the world there became a massive uninformed/misinformed backlash that ends up doing a huge amount of damage to all involved including local governments.

And the media can't be totally blamed for the financial crisis when we have banks so stupid that they sue themselves:


In other news, Wells Fargo financial prospects reported a drop in expected returns due to litigation costs ...

Well...one can blame the media...I blame the politicians and their corporate backers. We have an economy based on banks that give shitty loans rated as AAA by bullshit ratings companies an economy whos other big industries are prisons and health care admin...not one single ounce of substance...hell...the tech sector has even been sold to offshore interests.

Did you write in to the Daily Show recently (http://blog.indecisionforever.com/2009/05/29/the-daily-show-correspondents-attempt-to-unravel-question-even-more-confusing-than-economy/)?

Did you write in to the Daily Show recently (http://blog.indecisionforever.com/2009/05/29/the-daily-show-correspondents-attempt-to-unravel-question-even-more-confusing-than-economy/)?


No...I write ads...


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