On Thursday, President Bush made a huge mistake with regard to sub-prime loans:
WASHINGTON – Faced with a wave of costly home foreclosures, the Bush administration and financial institutions agreed to a five-year freeze on interest rates for certain Americans who face default on their subprime mortgages.
Read the article. This is precisely the opposite of what we need.
We do not need to extricate these people and businesses.
There need to be consequences.
Consequences for stupid decisions on the part of individuals, and stupid decisions on the part of banks, financial institutions and lenders.
The consequences will hurt. Hurt banks, hurt people, hurt families, hurt the American economy. And you know what? I’m ready to suffer that pain because, after all, I’ll have to pay more cash for everyone’s mistakes via the economy.
But if we don’t let people suffer the consequences then there is, considering human nature and history, every reason to expect a situation like this will occur again.
Precisely because there were little or no consequences.
- Let these institutions fail!
- Let the foreclosures occur!
- Let people and businesses go bankrupt!
- Let it affect all their credit scores!
- Let it hurt the economy!
I’m sorry, but on one hand I simply can’t wait for 2008, in order to vacate our President Bush. I never really thought I’d say this, but I am so incredibly disappointed in so many of his decisions, policies, spending, strategies. This begs a post in and of itself; I almost wouldn’t know where to begin. I’ve so tried not to be a “Bush Basher” but, my God, why is it that he cannot understand human nature, the nature of Mexico, the nature of Islam, the nature of a minimalist government? Why is it that our US Congress is so completely poisonous? Why are the GOP and the President so afraid to say what needs to be said? To do what needs to be done?
BZ
Yes, indeed, the US should let those who made and took such loans get what they are due…. why?
I can name another recent event that was much, much, much worse than mere sub-prime loans and even larger.
The economy?
Bounced back right after it.
Looked at that as part of a larger post, but really… if we have forgotten this larger shock to the economy, then how the hell will we *ever* get things into perspective?
You are definitely right about letting these people fall. Ultimately, you and all the other hard working pay for this.
People who made Bad mistakes should have to live with their mistakes.
Somebody Please tell Bush to STFU.
AJ: so WHAT event was much, much worse?
ABF: we’ll ALL pay for this.
Ranando: A-GREED!!
BZ
BZ, sadly Bush has really let the team down in so many ways. Conservatives by nature are predisposed to support the leadership especially if its one of their choosing. No-one could have foreseen how Bush would have let the party faithful down in so many ways. This nanny state action is just one of a number of things.
Let’s hope the next leader will be one that we can respect but right now the electorate is demoralized and the range of candidates unattractive.
Well, I have been called many names by certain folks because I AM a Bush basher, the son of a bitch is as dumb as a box of rocks, and this is another of his goofy schemes…
And if you want to know how much of a buffoon he REALLY is, he gave out the phone number in his address, to the government agency or whatever, well, the dumbass gave out the wrong damned number, he gave the 800 or 888 number of a business here in Dallas, it’s all over the local news, those folks have been inundated with calls, it has damn near shut them down..
Bush gives out wrong mortgage hotline phone number.
I don’t give a fuck WHAT the Queen Fairy Godmother of the Bush Bots thinks, that SOB is damn lucky that breathing is a reflex, if he had to THINK about it, he’d die…
The direct link to the CNN story that a lot of sites are using is dead, apparently CNN pulled their story but one of our stations here in Dallas still has it up…
President Accidentally Gives Out Denton Family’s Number – Videos – KXAS
Bush IS a buffoon… I really don’t care WHO it pisses off when it’s said, BZ is right, we can’t get rid of the ding-a-ling too soon…
I’m not as harsh on these borrowers.
The ones who are eligible are folks who were schmoozed into an arm by a broker on the assumption they could refinance at the end of the teaser rate. I have pity on those folks. But that does not mean I agree with the president or his methods here.
I totally agree that this is the wrong way to handle the situation.
The only thing the executive branch should be involved in is prosecuting the lying, cheating, good for nothing brokers who sold folks on getting an ARM. The problem with that is there is no reasonable statute.
Brokers don’t schmooze people into ARM’s. People allow brokers to schmooze them into ARM’s.
It’s always easier to blame someone else, Bullshit.
Let these people pay for their dumb decisions and not doing some bookwork before they signed. Next time they just might read the contract.
I see opportunity here, now excuse me while I go buy some property.
BWH: I would have to agreee with Ranando. When a family or individual sits down with a broker or lender to discuss a mortgage, after the requisite applicational paperwork, you and I both know that, somewhere in their heart they KNOW whether or not they can afford to step into a $650,000 house with a combined monthly take-home of $4,500 and a payment of $3,000 or more. It’s everyone’s prerogative to have a meeting of the minds and say “You know, we’ve just run the numbers and though we’d love the house, we just can’t go with that one right now.” Unfortunately, the emotions take over and replace their common sense. But you’re right, it’s not just the borrower, it’s the lender. That’s why I wrote that my opinion is that BOTH sides of the equation need to be free to fail, so they feel sufficient pain to never step through that door again.
BZ
If people don’t live with consequences, we end up with more people in society expecting what most of the kids are learning in school – there are no losers, everyone is a winner.
And when there is no consequence to your bad decision, where is the incentive to avoid the bad decision in the future?
Cary: Exact-a-mundo!
BZ
Don’t worry about what you think of Bush right now, he’s not on the ticket.
Also part of the blame needs to be put on the fast-talkers who got these people into loans they couldn’t afford and they knew they couldn’t afford them when they were offered.
Still people do have to live with consequences.
I was barraged by these people when I bought the house last year. Trust me, they are relentless. The only thing worse than their persistence was their lack of honesty. No joke, at least 9 out of 10 of their “products” were ARMs.
My town has more than its fair share of foreclosures right now. The cost of renting is ridiculous. So folks go shopping prematurely often. Sure some of these are for overpriced houses. For the most part they are for houses that cost under $250K. When refinancing does not happen the way people had planned, they suddenly find out what a bad decision they made.
Look, my impending move has more to do with getting out from under my mortgage than you know. I am in over my head and I’m trying to get out without doing anything that will make me lose sleep.
I know a lot of people who were fooled by dishonest brokers. They had every intention of getting into a good fixed rate mortgage. Then they were convinced that the ARM and the ReFi were the way to go. They are in a real bad spot now.
I don’t like the Government getting involved this way.
Here is the rub. Fixing the interest for people who agreed to adjustable rates is easy not right. Passing laws that require honest business practices is tough but the right thing to do.
Mr. Z – The one day event that took over $1 trillion out of the economy: 9/11. That was the worth of the real estate taken out that single day. The larger impact on businesses, not only across the US but globally, was also large.
We have forgotten 9/11: the day America was attacked.
And the day a huge chunk of the commercial economy evaporated.
The economy recovered and sharply and has continued to do so year on year… and even that one-day hit did not reduce the expansion rate of the economy to zero.
Sub-prime loans spread over a few years in which some housing *value* might decline and a few lenders and some unwise lendees may take the hit?
Bah.
So much for the attention span of America.
Damn it BZ, just when I was starting to like you, you go and bash Bush… Tsk Tsk…. LMAO
I hope people are paying attention, this is what happens when you try to be everything to everybody. PCNess…
Those that are getting Gubmint help love Bush right now, Those of us that can see the trouble down the road because of it, can’t stand the POS….
Just like everything Bush has done in the last couple of years, Dumb as hell.
Bush is just prolonging the inevitable. If these people cant afford the loan now what makes anyone think that more than a handfull are going to be able to afford it in 5 yrs? Oh they can just sell the house they cant afford. Well sorry they cant do that now since most of them are upside down on the thing since in some parts of the country the house value is down 50k to 100k.
I say let the lenders who gave them the loans suffer. Those lenders knew full well those people could not afford the loan.