Obama to Try Better Smoke and Mirrors to Address Housing Market Woes

If I had Onion-level parody skills, I’d treat the latest story in The Hill on Team Obama’s latest housing headfake masquerading as an initiative by riffing on one of its planned new program. Call it HUMP, Homeowners Upward Mobility Program. In true Ministry of Truth style, mortgage borrowers facing foreclosure would be moved, discreetly, into tent cities that would do Potemkin proud, with names like “Country Club Lane” and “Lake Shore Drive” and painted facades in front of their tents and shanties. Local merchants would praise the new subdivision and the inhabitants would say how nice it was to now be living in a McMansion, even if it was only really a couple of inches deep.

But instead you get my normal shtick.

The Administration is so far from having a plan that it is only talking about having a plan: “White House signals more aggressive stance to protect homeowners.” It’s a little late to be talking about doing something in January of an election year, particularly when you’ve spent over a year (starting in November 2010 with the coverup known as the Foreclosure Task Force, which dovetailed nicely with the administration basically taking over the attorney general “settlement” talks, but letting Iowa AG Tom Miller get a lot of media profile so as to disguise who was running the show.

Now the only thing the Administration could conceivably do (well it could in theory do a lot, but that would require being in a parallel universe in which Obama had realized he could go down in history as a great president if he leashed and collared the banks) is a really big refi program by Fannie and Freddie. Oh, but the Administration already has that happening, sort of. We talked about their new scheme last October:

The simple outline is: the government is extending and modifying its disappointing HAMP program, which allowed borrowers underwater up to 125% loan to value to refinance through Fannie and Freddie at lower rates. HARP was expected to help 3 to 4 million borrowers but only 900,000 participated. The LTV cap is now being eliminated and no appraisal will be required. Only borrowers who have never missed a payment will be eligible. Certain fees will be waived for borrowers to refi into short-term mortgages.

Even the Administration conceded this wasn’t much of a program…

This plan is yet more proof that this Administration is not about to inconvenience banks to help homeowners and communities. It has tools in its power than would change the incentives for banks and make them far more willing to do what the overwhelming majority of mortgage investors would prefer, which is provide deep principal mods for viable borrowers. Forcing banks to write down seconds, and taking an aggressive stance on foreclosure fraud would restructuring debt more attractive than it is now. But just as the banks and their captured governments in Europe seem intent on grinding down entire economies to extract their pound of flesh, so are banks in the US continuing to operate a doomsday machine that grind up housing with no regard for the economic and social costs.

Note we’ve been skeptical of refi programs as a form of relief, since mere interest reduction won’t make enough of a difference for borrowers in serious negative equity land.

But having resorted, in typical fashion, to a path of little resistance option, what pray tell can Team Obama do now? The Hill tells us:

The Obama administration has signaled to allies that it will take a more aggressive role this year in protecting homeowners from foreclosure, a posture that fits with Obama’s populist campaign stance….

“There’s an understanding now in the administration that there needs to be a comprehensive strategy to diminish the foreclosure rate and clean up the housing problem,” said Rep. Barney Frank (Mass.)…

“There’s a lot of conversation going on,” Frank said of talks with the administration to find solutions that do not require the expenditure of taxpayer money, a constraint during a time of record budget deficits…

“We need to put more pressure on the banks,” Frank said.

“The four largest servicers are the four largest banks. I don’t believe investors have a right to resist that,” he added.

OMG, there are so many layers of dissimulation in this that it is hard to know where to begin. I guarantee that “There are a lot of conversations going on” is code for “They are flailing around but I am never gonna admit that to you on the record.”

How can Frank talk about “We need to put more pressure on the banks” and then talk about investors, and not bank second liens? He immediately presents investors as the obstacle, when banks don’t want to take the losses. In fact, the New York Fed’s William Dudley said in a stunning argument in the Financial Times that first mortgage investors should take principal writedowns, but really, it was just too hard to do anything about the bank owned second liens. Huh? This the reverse of what is true and what ought to be done, but welcome to the Fed-backed world of cream for the banks, crumbs for the rest of us.

And back to Frank, you may have missed the significance of this remark: “I don’t believe investors have a right to resist that.” Um, what about a contract don’t you understand? Ex bankruptcy or sovereign debt restructurings, investors have to AGREE to a restructuring. The amazing thing about this remark is Frank already lost this fight. There was a servicer safe harbor provision in the initial version of HAMP that was not present in the final version of the program. Why? Because some investors contended that it raised 5th Amendment issues.

But more important, the horse has left the barn and is in the next county as far as being tough on bank is concerned. Obama has already given so much ground to services that it’s inconceivable that he could claw much back. The OCC has already entered into consent orders that are toothless by design. The seemingly neverending mortgage settlement negotiations if they ever get done are intended to be another “get out of jail almost free” card for bank miscreants.

The article does indicate that the Administration is waking up to the idea that housing could be a contentious election issue. But the article is all grand talk, no new ideas, and most important, no evidence of real will.

But the reality is Obama is relying on looking less awful than the Republican candidate (the risk that disillusioned voters will stay home does not seem to be taken seriously enough by his team). So despite the palaver, fundamentally the Administration does not see the housing issue through the impact on individuals and families, communities, and the broader economy. If he did, you would have seen more aggressive action on jobs and foreclosure fraud some time ago. Instead, the mortgage mess is simply another opportunity to differentiate Candidate Obama from Brand Republican.

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89 comments

  1. ArkansasAngie

    There’s a difference between Obama and Brand Republican? OMG!!!

    There is a lesser of two evils?

    Pull my finger.

    1. Fraud Guy

      One says he will change things and doesn’t, while the other says they will make things worse and does.

      1. Nathan Tankus

        so now we’re playing TINA for electoral battles? Man are Obama apologists scraping the barrel. He promised change and he delivered. You can tell because everything is completely fucked right now. You have to be blind to think otherwise. None of these republican candidates (even if they could get elected, which they won’t) have the kind of free reign of not getting attacked by democrat apologists like Obama has. They will be much more constrained in shoving the “red, white and blue dildo” up our butts (to quote the wonderful George Carlin) then Obama ever has been.

      2. James

        Bingo! Americans are so desperate for the truth they’ll even embrace their own executioner as long as he’s a straight shooter. Witness BillyBob and his selling of NAFTA back when we were all yet babes in the woods. Obama’s little more than a cheap overseas sweat shop made knock off of the original. In retrospect, it’s amazing we ever expected any thing else. Discount goods, discount jobs, discount benefits, discount money, discount politics, discount world.

          1. enouf

            Yep..

            As someone else here mentioned (recently) on another recent article here on NC;

            http://www.democracynow.org/2012/1/17/journalist_chris_hedges_sues_obama_admin

            “Pulitzer Prize-winning journalist Chris Hedges has filed suit against President Obama and Secretary of Defense Leon Panetta to challenge the legality of the National Defense Authorization Act, which includes controversial provisions authorizing the military to jail anyone it considers a terrorism suspect anywhere in the world, without charge or trial. ”

            ..and, i could, as could many of us, rip Mitt (“Corporations are people, my friend”) Romney a new assh*** if we had to respond to his reply about the NDAA in the most recent Clown Show on MSM.

            FWIW; and this pertains to many topics here, i really get a lot out of this show (et al, like Alyona too, and even Thom Hartmann).

            http://rt.com/programs/keiser-report/episode-236-keiser-report/

            ..but this is just blunt enough, so as to actually match reality, and offers glimmers of possible hope that the knowledge/truth is spreading–Globally even.

            That above particular episode has just enough truly-deserved Obama bashing as it has Ron Paul idealogical discussion (2nd half) ..but the 1st half just makes one fall off their chair,..because *nothing* is funnier than reality. ;0

            Thanks again to all whom (as i notice here, and elsewhere) that put in so much effort and work to support the truly original National (and Global) #OWS Movement.

          2. enouf

            ahh… note the reference to this blog at 7:37-7:44 into that keiser-report link i just posted. I think that’s why i picked that episode :-)

            Note[1] Also, the next episode features Nomi Prins – (and i also admire Naomi Klein’s work, and many many others’.

            Note[2] OH, almost forgot; If you have any sort of Pension accruing, etc… watch out!

            http://www.c-spanvideo.org/program/Heist

            Godspeed to all

      3. Up the Ante

        “One says he will change things and doesn’t, while the other says they will make things worse and does.”

        .. and the third assumes “stances”. The three of them are not Chinese, not mystics, and they’re tee-heeing rather than laughing.

    2. ambrit

      Dear AA;
      Then:
      Who’s the lessor of the two Evils?
      One says he will change things, and does. For the worse.
      Can we say Co-Dependant Co-Dominion boys and girls?
      “When I hear the word Justice, I reach for my Homeland Security!”
      Etc. etc.

  2. Benedict@Large

    Since the policy arm is essentially banking industry lobbyists and their administration scribes, the political arm is left with the task of putting a shine on 4 years of complete lack of interest in the plight of crisis-damaged homeowners. It usually takes an institution a while to become captured. The Obama administration is the new model; one in which the institution begins as already bought.

    1. James

      …and proudly trumpets the fact. The new arrogance: loud, proud, and unapologetically corrupt. Can corporate sponsorship decals and banners be far behind?

      1. Jagger

        I like the corporate sponsorship idea. For a couple hundred thousand dollars, we will have the Goldman Sachs White House and the SuperPac Supreme Court. Obama, brought to you by Pfizer… And Boeing, the company that cares, brings you this predential election. We could have logos pasted in the corner of every screen as election results pour in. Think of the dent we could make in the deficit. Not to mention, we might not have to guess as to who owns our politicians.

        1. Jenny

          Obama’s choice of the Bank of America stadium for the Dem Convention is another proof positive that he is absolutely clueless as to what is going on with the 99%. The Democratic National Convention, brought to you by Bank of America.

          Of course. It all follows.

  3. Max424

    Obama wants that money. He could’ve been a weensy bit tougher on the banks and the corpos, and still had a 55/45 money edge over the GOP pretender/challenger come election season.

    But Obama wants that 60/40 edge. Can’t blame him. Why take chances doing something for the people? For the citizens of the –bought and sold– land you lead? As Obama knows (and as all reasonably intelligent politicians intuit, at this stage):

    Money Wins Championships! …and only money*..

    *Unlike the modern NFL, where defense can no longer win championships alone. You now need the Holy Football Troika; a prolific offense, an opportunistic defense, and committed, left-leaning (socialistic!) ownership.

    (Special teams? Propaganda. Fuck em. They’re interchangeable minimum wage turds. My boys –the 90 to 94 Bills– had the best special teams ever, and we lost 4 Super Bowls in a row)

      1. Max424

        Are you referring to Scott Norwood?

        Love Scotty. He was a real, special teams asset. And he did yeoman’s work for us –think it’s easy kicking in cold and blustery Buffalo?

        He could’ve been an immortal; but instead he missed the longest kick he ever attempted on grass, in the most pressurized moment in World History.*

        I forgive him.

        *Was it? The most pressurized moment? I think so. Which would you rather have; a kick to win or lose the World Championship (American hubris, giggle), or the choice to unleash** our entire nuclear stockpile because the Russkies have gone ballistic.

        **Do you have a choice, if you’re the President?

        1. Max424

          World Championship, indeed.

          Talk about pressure. How would you like to have been the Buddhist Roberto Baggio, returning to Catholic Italy, after having sailed the last kick of the competition over the bar and into the crowd to instantaneously lose, a World Cup final? To hated Brazil, ta boot.

          That’s pressure.

  4. skippy

    Better smoke and mirrors..

    Skippy… stronger weed and cleaner lines, illuminated with their own reflection.

    1. Up the Ante

      Jesus, skippy, send me some of your Australian women, would you ?

      I need some refreshment, lol.

      1. James

        Jeez, I’ll settle for the stronger weed! Women come and go. Good weed? Now THERE’S somewhere you can plant your flag!

        1. Up the Ante

          No reply from skippy, he must have face-planted himself on that mirror that so mesmerized him.

          :)

  5. jake chase

    It should be clear by now to even the dimmest observer that BHO cares only about being reelected. His recipe has always been talk bullshit and reward your backers. Chickens come home to roost, but politicians go where the money is.

    As for housing, you cannot fix it without a mass distribution of currency. Selective principal modification is as unfair as it is unworkable. They should call it HUMP, but only because they cannot call it F**K (Frankly Unfair Collective ????.

    1. spacecabooie

      Disagree with your ongoing unfair claims. People (prospective family housing homeowners needing decent housing, rather then investors/speculators or those like prhaps yourself who is ether sitting in a paid off house or renting, either way contributing nothing to the market, perhaps with little to contribute) who bought into the bubble and especially those who stood aside until the collapse was well under way or was perhaps even completed – you’re one who can predict the bottom ? – can without much of a stretch at all claim to be victims who deserve redress. Redress from the banks – and then there are means by which the government (system regulator, enforcer of justice, etc) might gain recompense for any expenditure it initally lays out … it does not have to avoid payign back tax payer money if initially having the banks provide redress places them further in financial jeopardy.

      Actually the government could cancel the $17trillion, return to Glass Steagal, put the investment banks in bankrupcy reorganization letting them settle their own obligations, and invest the citizens’ $17trillion in big development projects, managing them itself rather than having naked capitalism do it.

      In which #$@!ing reality have the have YOU been living ?

      1. JTFaraday

        Okay, I use– unnecessary– dashes all the time, creating awkward hard to read prose in the process, so I shouldn’t talk. But I really couldn’t navigate my way through your first paragraph.

        Thus, I can’t tell if I’m living in your world or not.

        Although I do generally dislike all these efforts to make either the majority of bubble-purchasers or bubble-abstainers (which really doesn’t make sense to me) somehow particularly guilty parties to something that I see as primarily a byproduct of unprofessional, if not criminal, conduct in banking and real estate.

        So, can you say that again?

      2. F. Beard

        those like prhaps yourself who is ether sitting in a paid off house or renting, spacecabooie

        Jake Chase is right. Non-borrowers have been cheated too and deserve restitution. Many renters have been forever priced out of the housing market by the counterfeiting cartel unless:

        1) The Depression deepens and housing prices drop further
        OR
        2) They receive an equal bailout too, along with the debtors.

        1) is clearly unacceptable. Do we want people (like the Austrians) hoping and lobbying for more deflation so they can finally get a real return off their savings?

        Banking cheats EVERYONE – borrowers, non-borrowers, State and local governments and ultimately the banks themselves. An equal bailout would fix EVERYONE from the bottom up and reverse much unjust wealth inequality not by make the rich poorer but by making the poor richer.

        It’s only inexpensive fiat that is needed, for Heaven’s sake,. And if further counterfeiting was forbidden (so-called “credit creation”) then the “restitution checks” could be metered to just replace existing credit as it is paid off for NO change in the overall money supply (reserves + credit).

        1. spacecabooie

          Happy with that … for the bystanders, but I want compensation to the extent that I was an actively partcipating victim (don’t like using that already overused word), particularly if the alternative is MY foreclosure or bankrupcy. And I do not want YOU to provide that compensation … why is it that it would HAVE to come from taxpayers (becoming the ultimate strawman).

          Jake is right ? And only Jake ? First sentence, but then this shrill exclamation is then frtittered away. Very rational …

          But sorry for the un-edited entries. Fact of a working life. A life recently working far from home just to pay for said home. The bum that I am, ya know.

          All you want to do, judging by your entries, is pound on the clueless, greedy, or whatever, purchasers (and there aree no non-perjorative categories), whether they waited on the side for the same bubble-cognizant reason other renters did for years until that bubble deflated appreciably but perhaps not completely.

          Obviously, MANY WHO ARE CURRENTLY BOUND BY A MORTGAGE, underwater or not, is a victim, e.g., see MERS, etal.

          To state iat one moment that there ar eno victims among recent home purchasers, and at another that MERS is criminal, defies the logic as I measure it.

          1. F. Beard

            All you want to do, judging by your entries, is pound on the clueless, greedy, or whatever, purchasers (and there aree no non-perjorative categories), spacecabooie

            Say what?! What part of “banking cheats everyone” excludes purchasers?!

            As for taxpayer dollars funding a bailout, that would not be the case. The money would simply be created from “thin-air” and metered out to the population at a rate that precluded either price deflation or price inflation.

            We have a one-time opportunity to combine reform with a universal bailout. Each allows the other in a very serendipitous way.

          2. spacecabooie

            My apology Mr Beard, that was directed more at Jake Chase.

            And yes I understand the money printing solution. And I’d add that the $17T that’s been printed should and can be re-claimed. All of it should be put to use on large development projects, not Yahoo! “technology” projects.

            To suggest or think that today’s “technology” provides middle class wealth effects need only look as far as FISA.

      3. jake chase

        Can’t argue with your second paragraph, don’t have a clue what you mean by your first. Housing market cannot come back unless prices are allowed to fall or unserviceable mortgage debt is eliminated. This government thinks fantasy will do the trick. We’ll see. As for me, I bought my house at the top. So what?

        1. F. Beard

          As for me, I bought my house at the top. jake chase

          The “restitution checks”, since non-debtors would receive an equal amount, would not totally cover mortgage payments IF the bailout was done in a non-inflationary manner. However,the improvement in the economy could be expected to help people make their mortgage payments too. Your “top” might easily become a new “plateau”.

          Btw, just using mortgage debt, I calculated that each American adult could initially receive $304/mo IF further credit creation was forbidden with NO increase in the total money supply (reserves + credit). If one added in the repayment of student debt, credit card, and auto loans, then that figure would of course be higher as it would also be if a small increase in the total money supply was allowed.

          I see no reason why this Depression should continue IF we are willing to abolish credit at least during the bailout period.

          1. jonboinAR

            How would the effects of your bailout be affected if the recipients were required to apply it to their mortgage if they had one? I’m thinking that might go pretty far to removing the mortgage-anchor on the economy and add real wealth to families.

          2. F. Beard

            How would the effects of your bailout be affected if the recipients were required to apply it to their mortgage if they had one?

            I would not make it a requirement since restitution should have no such requirements but certainly many people would apply it to their mortgage payments.

        2. spacecabooie

          The masked expletive was issued due to your persistence in making remarks such as :

          “A large number of these were speculators buying with intent to flip.”

          “… as opposed to cramming down principal modifications in favor of a select class of ‘victims’ all of whom, … knew what they were doing …”

          So, we have a large number of speculators, and a select class of ‘victims’ all of whom knew what they were doing [in purchasing homes as the only housing buyers during the run-up to the housing valuation collapse].

          And, incidentally, as you state, you knew what you were doing (as a speculator, perhaps ?) in purchasing at the top and do not wish to be considered a victim.

          Excuse me but I have a hard time digesting your equating “speculators” and a “select class all of whom knew what they were doing” with family home purchaser ‘victims’ whose only fault was paying what they must for decent housing.

          Providing a check to everyone does not provide the redress deserved by the class of victims who purchased for non-speculatory reasons.

          It is doubtful that all bubble-time home purchasers were economists or that they even recognized the bubble, or that they were prepared to move out of their house and into a rental before the bubble’s peak was reached, and such characteristics would in any case be irrelevant. Some of us stayed away for years until the peak was past and an apparent (but ultimately false, in my case) plateau had been reached, but that’s also beside the point. While decent housing was not available at a price not goosed by the bubble, people still deserved/needed decent housing and purchased it. The price they paid was goosed, though perhaps indirectly or even unintentionally, through criminal activities. Those who are outside of CA (where the phenomenon has long been the norm) and looked at housing as a volatile market to be speculated on and to profit from, a market to be entered low and exited high, are the speculators. Family homes values’ have been damaged and redress for those families should be available.

          The facts as they have been laid out on this web site are that crimes were committed and that those crimes lead to what can be observed clearly in hindsight as a bubble. And I believe it has also been asserted here, by the most experienced and best trained contributors, that there were victims of these crimes. The victims range from those who were defrauded my mortgage originators to the general public faced with a deflating economy and a deleveraging financial system.

          I would categorize everyone under water as a victim of rank commensurate with the victims of mortgage origination fraud. The lost opportunity in not selling at the peak a paid-off home, not so; their victimhood would rank commensurate to the criminality of those who did sell at the peak.

          The degree of compensation paid directly to those underwater should be on par with the degree to which their purchase price is above the extrapolated pre-bubble trend observed at the time of settlement but in an amount not to exceed the amount by which the current value is below the trend plus any down payment. An early settlement, obtained long before the currently underwater and under-trend value has recaptured the trend, would be larger then a settlement obtained once the value is approaching the trend. And the settlement should be required to go against loan principle.

          To clarify the first paragraph in the previous post, first, I disagree with your claims of unfairness, a disagreement just elaborated upon a bit. Families needed housing during the bubble and some made a purchase, accounting for a greater share of purchases than speculators I would presume. If only speculators had sufficient credit to buy at the bubble’s height (which if true could explain your claim that only speculators were buying) then who was having their credit misrepresented on mortgage applications ?

          Mortgages entered into when prices matched the pre-bubble trend may be victims as are perhaps owners outright of their home and should be compensated using the same formula. In such cases the compensation would not include the amount accounting for an fraudulently inflated price, only for the degree its value is below the extrapolated trend.

          Perhaps even home-buying speculators should be compensated – though since the intent was speculation, it could justifiably be said that the purchaser should have been aware of risks associated with the practice of speculation.

          Finally, redress should be immediate, to allow those families who have to move a fair way to do so. Only the government is in the position to do this. Then the government should take possession of portions of all the MBSs currently in the possession of investors (i.e., exotic-securities-buying speculators) as a guarantee against hits to taxpayers.

          Better yet, as previously stated cancel the $17T in bank bailouts and return the funds to the treasury to be invested in large scale development projects, among which compensation for victimized homeowners would be only a small part.

          1. F. Beard

            Banking precludes honest saving via negative real interest rates. So what else is the population to do for their retirement except speculate?

            Banking cheats EVERYONE. Let’s not be divided into debtors vs non-debtors.

          2. spacecabooie

            “Banking precludes honest saving via negative real interest rates.”

            yadayadayada

            “Banking cheats EVERYONE. … Let’s not be divided into debtors vs non-debtors.”

            Why not ? There are varying degress of “victimization” here and there should be varying degrees of redress.

            While your persistent but focused … neigh, myopic … argument necessarily sounds like policy reform propsositioning, Ron Paul policy reform no less, it does not address the right to immediate redress for the direct victims of fraudulently inflated home prices, much as the obfuscation which is at the heart of the multi state AG settlement does.

          3. F. Beard

            sounds like policy reform propsositioning, Ron Paul policy reform no less, spacecabooie

            How wrong you are here! Ron Paul, as an Austrian, firmly believes in deflation (“to purge the malinvestments”) and hates “money printing”.

            it does not address the right to immediate redress for the direct victims of fraudulently inflated home prices, much as the obfuscation which is at the heart of the multi state AG settlement does. spacecabooie

            A universal bailout would re-inflate deflated home prices.

            As for individual fraud and other crimes, that is a separate issue from restitution for the SYSTEMATIC fraud and crime of banking.

          4. spacecabooie

            Yes, Mr. Beard, Von Hayek, Strauss, Rohatan, Schulz, Pinochet, the Chicago School, and Ron Paul are of the same evil mind (eventhough von Mises made important contributions to supersonic aerodynamics and aeroelsaticity science). I may have mistaken negative real interest rates perefrence (and high-interest-rates risk-aversion) as a consequence of this crowd’s belief in austerity-driven expansion.

            Or is it a msitake to say that Ron Paul is a proponent of both austerity-driven expansion and of defaltion ? It seems to me that what is happenign is something like a reaction on the Fed’s part to deflation that pushes short term rates negative in the interest of promoting growth, as ill conceived an approach as this may be, and so I assumed that your aversion to negative real interest rates (I abhore also its consequntial neutering of honest saving) was synonomous to Ron Paul’s aversion of the Fed.

            The “banking cheats everyone” statement also seems to be resonant with my takeaway impression of Ron Paul’ anti-fed positions.

            But, yes, I take it that Ron Paul would deflate and would certainly not print money.

            Obviously I have not actually worked through the IS-LM models, something that would help me pull together and clarify the conecpts.

            And I am very grateful to you for taking what seems to be a genuine interest in my education of these concepts. You have pretty consistently been a voice of reason, but I took exception to your support for Jake Chase; largely due to what I consider falsehoods in statements he made as I referenced above.

            I agree with the “universal bailout” concept but in addition to the individual bailout.

  6. Eugene Villarreal

    No, No, No….The next new Obama FIXIT will be called PIMP (Principal Interest Modification Plan). Since Obama has already been pimping for the banksters, this will be a fitting title.

    1. James

      Add “meltdown of own accord.” The next REAL revolution will be a tsunami of discontent from the bottom up brought about by the 1%’s own ignorance. No added fuel or fire needed. They’ll do it to themselves. Same as they historically always have. Humans. Stupid animals who’ve lost their way.

      1. enouf

        However;

        “Stupidity” defined means one who is ‘unable to learn’ (in short);
        whereas,
        “Ignorance” defined means ‘lack of knowledge’ (in short),

        From my perspective; those whom are ‘stupid’ are the result of their environmental upbringing (mostly). Those whom are ignorant just do not have either a) enough “true” information at their hands, or b) are purposefully ignorant, as in cognitive dissonance, or c) …a plethera of many other issues, like Life Sustinence to even have the energy to edu’ma’cate themselves

        I personally believe all people are born into Original Sin; so the se7en deadly sin concept and The Ten Commandents applies to all humankind.

        just my 2 cents;
        thanks

        1. enouf

          wow, what a typo, eh?
          “The Ten Commandments” ;0

          Note[1] oh yeah… the (c) option above also has very much to do with employment, income, ability to afford Cable/Internet access, even Bus/Train fare to make it to a public kiosk as in their local library to access Public Computers … don’t get me started on the 1996 Telecommunications Act debacle/charade!

          Thanks

  7. Crazy Horse

    OCCUPY YOUR NEIGHBORHOOD

    Are all those vacant houses boarded up by the banksters driving the value of your house down? Do 50% of your remaining neighbors have zero or negative equity in their homes? Do you believe that the first purpose of a house is to provide shelter, rather than serve as a playing card in bankster Ponzi schemes?

    United you have a chance of survival, alone you will be ground down and forced to join the dispossessed living under freeway overpasses.

    – Organize 100 like minded neighbors into a defensible neighborhood unit.
    – Advertise, interview, and recruit families who have been rendered homeless to occupy the vacant houses in the neighborhood.
    – Sponsor neighborhood work parties to help paint and upgrade abandoned houses and others in need of immediate repair.
    – Piggy back utility services barrio-style if the utilities refuse connections.
    – Occupy and tear down houses that are beyond salvage and convert the lots to community garden plots.
    – Recruit a militarily trained homeless head of family to occupy one of your neighborhood vacant homes and serve as Sheriff to deter crime in the neighborhood. By now you know that the Police only serve their masters, and that is not you.
    – Install an air raid siren system to alert the entire neighborhood in the event of attempts of eviction or police invasion.
    – Place your bodies immediately on the line when attacked by eviction attempts. Non-violent methods are most effective until the point where they are met with overwhelming violence and media silence.
    – Or if all else fails, organize an armed neighborhood militia to defend your neighborhood. Recruit like-minded members of the police force to neutralize police power.
    – Form a united front with other similar neighborhood units to multiply your strength and rapid response capabilities.

    El Pueblo Unido Jamás Será Vencido

  8. Susan the other

    For the last few weeks the media has been trying to insert the idea that the Fed wants to take all the government owned REOs and rent them out. Because this will get them off the market so the rest of the market will get healthy again. One small problem: The OCC and the Fed have now announced that their review of harmful foreclosures is going to take much longer than they thought. Hopefully, not only will government owned REOs be contested due to everything from original false securitizations and inducements, to fraudulent and forged paperwork. So they probably can’t rent them or sell them. Looks like Karma to me.

    1. enouf

      Have you entertained the thought?;

      “This is how the rich get richer”

      If i wanted to steal from others a Global Treasonous Financial Terrorist Corp; I would wait until prices bottomed, swoop up all assets (Houses/Homes/RE) with all my surplus $$ i obtained from

      a) the Fed Discount Window
      b) Overseas profits (to be re-patriated <–HA! ((what a gullible propagandist term!) … at a 5% or so rate))

      Thankfully i am not one of those
      Godspeed my friends

  9. Praedor

    It is a thing that people, in their core, understand or “know” but that never gets spoken aloud in mixed company:

    The only proper thing to do with an underwater house bound to a mortgage higher than it is worth, is to WALK AWAY. DUMP IT.

    Actually, the proper and human thing to do if Obama were human would be to force CRAM DOWN on the banks. Period. End of story. But Obama is not human, he is a member of the species Homo financefellator.

    Walk away from the underwater home. Do it now, do it en masse…but totally wreck the place on the interior before you go. Leave the outside untouched, even pristine, but utterly annihilate the interior. BIG frickin’ holes in EVERY wall, insulation pulled from exterior walls and sprinkled about the urine and feces impregnated carpets. Deeply gouged and ruined hardwood floors. Broken/shattered toilets, countertops, tiling. Wreck it and walk away.

    F*ck the banks and f*ck Obama and his buttbuddies in banking/finance.

    1. F. Beard

      Heavens no! Stay rent free instead if you can get away with it.

      The bankers would probably LOVE a large scale destruction of housing just like they love wars.

      1. TK421

        They might like houses to be destroyed, but gutting them of valuable materials isn’t destruction. And anyway, people have been scavenging from their foreclosed homes then walking away for years now, and banks haven’t been happy about it.

    2. publius

      Good point, whatever happened to the mortgage cramdown legislation Obama promised? Talked out of it by Geithner, no doubt.

      1. enouf

        someone please remind me what “cram down” means?

        I loathe and love many of these seemingly apropos terms, however; we live in a world of acronym soup, and even though this is not an instance of such, it clouds the real meaning; please define/explain for us less informed.

        Thank you kindly

  10. brian

    well i’m not staying home on election day
    just leaving the first box blank
    for the first time since 1972
    have never voted for a republican
    and since they give me no reason
    come what may

    1. Praedor

      My plan as well. My intent is to abstain from he Pres election and stick with locals only. I MAY waver and write in a candidate for Prez (perhaps Buddy Roemer or…even Guy Fawkes).

    2. James

      Same as it ever was. VOTE for what you mean, and MEAN for what you vote. If you don’t actually MEAN the vote you are casting, then WHY in the fuck are you casting it? I.E.; don’t vote for some shithead A, as an I’m NOT voting for shithead B, as some sort of convoluted idiotic “statement.” Just DON’T VOTE!

      In the end, it’s as simple as this: if you don’t GRANT consent to the current bullshit, then don’t EXTEND it by voting for the status quo in the first place! To borrow a line, it’s so damn simple even a conservative Repube could understand it (and they have, evidently). REFUSE TO LOSE! DON’T VOTE! FUCK THE STATUS QUO!

      1. enouf

        Sorry James .. but Apathy never has and never will be a cohesive bonding agent, no matter how loud any of us may proclaim it might be…

        To quote someone infamous;
        “All good men need to do to let evil thrive is to do nothing”
        (or something very similar; but you get the point ;-))

        Thanks

  11. ron

    Currently buying a house that is a Short Sale. Bank of America is the servicing the loan with Wells 50K 2nd and an investor owned 1st. Yesterday Bank of America sent the 1st lien investor and 2nd lien holder final closing cost information for there sign off. In Calif the major banks are primary servicing agents rather then large holders of 1st liens but they do have significant number of 2nd loans. Total losses for the investors and bank will exceed 320K. This is a rather ordinary home in the East Bay the losses for the high end foreclosures must be mind bending!

  12. Wake Up America!

    When it comes to the housing market and foreclosure crisis we have HAMP – Have A Major Problem. The government knows this but their programs to “help” homeowners are nothing but a facade to help the banks. As I try to explain the crisis to friends – some without mortgages – in the end we are all CHUMPs – Consumers Hurt by Unfair Mortgage Practices.

    1. Woodrow Wilson

      I think what it means is, Americans are still screwed, and the banks get a liability waiver included in this settlement (should it come to fruition).

      A lot of Americans, thanks to savvy propaganda, still believe this crisis is due to deadbeats who can’t/won’t pay. They don’t want to hear anything to do with banking fraud. Coakley, while on the surface is championing mortgage fraud, time will tell if her politics are as important as the Rule of Law, and truly punishing those for destroying it.

      Rope & Lampposts would be a great start for all involved.

  13. LillithMc

    Long ago I remember FHA and VA were willing to adjust a mortgage to the lower interest rate free of charge if the borrower requested it. If the borrower was in trouble, they worked with them before a foreclosure. Especially in underwater areas like mine that is down over 50%, if the bank did a mortgage modification that was similar to a refinance, they would lower the interest rate to market, perhaps extend the loan length, take away the built-in rise in interest rate.
    They could keep the homeowner in the home instead of taking back a home that can not be sold in this market. All this requires employees and that may be an essential fault in this new world of banking.

    1. enouf

      Thank you; but *please* refrain from using the term ‘us … lefties’ since our battle isn’t a political one, but a more humanitarian one …and a boxless issue, wouldn’t you agree? thanks

      Also, I appreciate the update notice
      Godspeed

  14. Doug Terpstra

    Money quote from the banksters madam, Barney, in The Hill article link:

    “The other thing to remember, the main reason is not to help individuals, it’s to help the economy [cough, banks]”

    Well, DUH!

    1. F. Beard

      Heck, screwing individuals (by stealing their purchasing power) for the “good of the economy” is the ESSENCE of banking.

    1. James

      Voting for Obama (guilty) reminds me of nothing more than the classic story of the coyote/bear/whatever caught in the trap of his own making who must now gnaw off his own leg to escape his ultimate fate. That said, time to move on and do what must be done. Time to cut our losses and admit that we’ve – yet again – been penetrated most extremely in our hind parts. Get used to it, I’ve learned to say. It’s not the first time, and it certainly won’t be the last. “We’ve been fucked” as the young ones say, although what in the fuck do they know anyway? Their penetrations are yet to be experienced in ways they have yet to imagine. Why spare them the drama here? And in the end, aren’t the extreme unwelcomed penetrations what we’re all living for anyway?

  15. Francois T

    To show how much I am sick and tired of Obama’s sucking up to Big Finance, consider that I have never voted Republican, and that I had high hopes for O in 2008.

    Now the question that must be asked:

    Would the country really be that much worse off under a Romney presidency?

    I truly wonder.

    1. enouf

      OMGoodness, you *cannot* be serious.. please!

      Why do you think so many of us were SO THE F*** upset when the SCOTUS handed Dubbya the win over Gore in Y2K?! We KNEW what we were in for (in the following 4yrs atleast).. and Yes, dare i say.. even a possible 9/11 type incident, but definitely knew a fake/phony bubble econ was to be propped up through rising DOW, etc.. not any *real* “living-wage” being created–only service-me-sector ones. Hurray!

      Look at what it hath wrought .. don’t even get me started on the 2004 Election either! .. I’m still laughing at how all the gas-guzzlin’ soccer-moms couldn’t see the rapacious increases in the price of Oil/Gas/Petrol that was to follow–Fools, ..sadly.

      Love

  16. ScottS

    Is now a bad time to suggest abolishing the mortgage interest tax deduction? ‘Cos as a renter, I think it’s unfair and it drives up home prices.

    1. different clue

      Yes, its a bad time. Why not suggest capping the mortgage interest deduction at some working-class upperbound limit like stopping at the first $100,000 of the house price? And also limit the deduction to one principal live-in house per family only? No such deduction for a house owned to rent-out to others. No such deduction for a second, third, or beyond home.

  17. publius

    First off, we don’t have a “housing” problem, we have a mortgage problem. Millions of underwater mortgages, to be exact (first and second lien). Houses are selling every day, at prices that are approaching normalcy.

    Second, the problem is these debts were lent against assets which declined in value, and now portions of those debts have no more security than an unsecured line of credit (in some cases huge, underpriced unsecured lines).

    The question becomes, who is going to take the loss? Because a loss will be taken, eventually, not many borrowers are going to pay off those large, unsecured debts.

    Options are:
    a)The borrower through paying off an underwater mortgage or being pursued for a deficiency
    b)The investor/guarantor of the loan
    c)The taxpayer
    d)The loan originator

    Of course sometimes b is the same as c as in the case of FHA and GSE loans.

    That’s the game that is being played now – try to stick the loss to someone other than yourself.

    1. F. Beard

      Because a loss will be taken, eventually, publius

      Not necessarily. We have a one-time opportunity to combine reform (putting banks out of the counterfeiting business) with a universal bailout of the entire population from ALL credit debt.

      No one would suffer, even in real terms, except sadists and bankers who would gnash their teeth in frustration at only being able to lend honestly.

  18. different clue

    A few days ago Praedor just upthread said that hopelessly underwater homeowers should all just walk away and trash out their home-interiors as they leave. Until a few days ago I would have totally agreed with “trash out as they go”.

    But I have had a change of heart, or realization. It isn’t the house’s fault that the homeower is underwater on the house. The house is just an inanimate object with no will of its own. And trashing out the house would accomplish the goal which a Wall Street Opinionator named Holman Jenkins once called for: namely the mass-destruction and removal of houses to make houses more scarce and force the prices up. If the Wall Street Journal is for it, maybe I should re-think it. “Trash-out as you leave” just helps the banks and etc. by solving their shadow inventory problem for them.

    So I now support F. Beard’s advice to stay in the home rent-free till somebody throws you out. I also support the
    concept described above about forming neighborhood defense squads to find and settle high-quality homeless people into those empty houses . . . and defend those Occupied Houses against outside aggression. They could even link up with the Occupy Movements and so forth to make it a viral concept
    spreading everywhere.

    Occupy This Old House!

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