Friday, August 31, 2007

Bush to unveil first steps on mortgage crisis

"President Bush is set to unveil his first detailed steps to intervene in the subprime mortgage crisis that threatens to throw hundreds of thousands of people out of their homes and send financial markets into a tailspin.

He plans to announce a variety of measures in the Rose Garden on Friday morning that are designed to help struggling homeowners with subprime mortgages avoid foreclosure and will declare that lending practices need to be tightened, according to administration aides.

Bush will make clear, as he has in the past, that he does not plan to support a bailout for struggling mortgage lenders. But a senior administration official said aides are studying the possibility of “a broader federal role” in regulating mortgage brokers and originators." ( Politico 8/31/07)

26 comments:

  1. I'm not a republican, but I gotta give Bush credit for not wanting to bail out the lenders. He (i.e., his speech writer) is right in pointing out that "A federal bailout of lenders would only encourage a recurrence of the problem."

    Business Week has a short article about this: http://www.businessweek.com/ap/financialnews/D8RC3IV00.htm

    --SSH Anon

    ReplyDelete
  2. Wasn't it a Republican who wanted to deregulate this industry in the first place?

    ReplyDelete
  3. Uhmmm.....I've changed my mind. Bush is no different than everyone else who wants to bail out the greedy at wall street or the negative-amortization-holding would-be-flipper next door neghbor.

    After reading other analyses at other blogs, seems this yet another attempt to bail out (if only as a symbolic gesture...for now...) the lenders. After all, the up-to-the-eyeballs-in-debt home "owners" are still responsible for making payments on their overpriced properties which are seeing a real decline in value. Bush's move only ensures that the banks get paid...at least by the 80,000 or so people who would qualify for this aid and will still be willing and able to make payments even after this aid is extended to them.

    And so, the housing market collapse continues despite all efforts...as it should!!!

    -SSH Anon

    ReplyDelete
  4. Regulation/deregulation it doesn't matter with respect to Dem or GOP; they all will find something to "do" on the issue so that they look like they are helping people keep their houses. Whatever they (D&R) "do" it will cost the government tax dollars.
    More importantly, is if what they "do" props up the bubble.

    ReplyDelete
  5. Make no mistake, bush is only trying to prop up financial numbers for his place in history. What he announced today will not fix anything. bush encouraged people to buy after sept. 11 and americans overextended themselves (they'd already been doing a good job at that). bush and bernanke are trying to plug all the holes in a weak dam, but they're not going to stop the flood. bush and bernanke don't control the world, the slightest problem somewhere else will send our economy crashing. I am not encouraged by this or bernanke. and this isn't even about subprime - too many people borrowed more than they should have. It's having consequences now and will continue to as people are unable to afford important necessities and unable to afford quality products.

    ReplyDelete
  6. A federal bailout of people who bought homes that they couldn't afford would also encourage a recurrence of the problem.

    ReplyDelete
  7. The proposal was just pap. I agree with a poster elsewhere who thinks the secondary agenda (first being to beat the Dems to a proposed solution and head off a larger bailout) is to prop up stock values on the last day of the quarter. Tuesday could be interesting.
    Chip

    ReplyDelete
  8. I'm not a republican, but I gotta give Bush credit for not wanting to bail out the lenders. He (i.e., his speech writer) is right in pointing out that "A federal bailout of lenders would only encourage a recurrence of the problem."

    Yeah, sure, if it's so. But nobody should ever believe anything the criminal fuckwit says -- watch what he does.
    -- sglover

    ReplyDelete
  9. i stopped bollowing this blog a while back because i had enough of two bloggers silly posts (Lance and VA investor) just wondering if they have ever been back on since NOW IT IS A FACT THAT REAL ESTATE WAS IN A BUBBLE.

    ReplyDelete
  10. Well, his proposal is pretty moderate. It only helps people who are low-income, had good credit before they faced mortgage resets, and have at least 3% equity.

    And it sure as heck beats the Dems, who only want more and bigger bailouts.

    Hey, I'm no Bush fan, but he came through here. He focused on some marginal people who are at least arguable deserving of help, but isn't propping up investors and financiers.

    ReplyDelete
  11. Anything that makes short sales easier is good. I would think that would accelerate the downturn in prices and allow faster adjustment.

    One thing I've always wondered: I had heard that under the new bankruptcy law, if you make less than the median income in your area, you are basically still under the old bankruptcy law. Thus, it would seem to me that if you are a poor waitress or construction worker who got boondoggled, then you can just walk away and declare bankruptcy. It's only the people above the median income who now must be responsible for part of their debt on bad investments, and frankly, maybe they should be.

    I think what we are seeing now is the beginning of the framing of the debate. Bush has just put out a very modest proposal on one edge. Now the Democrats will respond with one also- Hillary already has her $1 billion proposal. So we have a $500 billion problem and competing proposals to "solve" it that both come in under $1 billion. As a renter who doesn't want to bail out the morons who kept this bubble going, the parameters of that debate do not bother me.

    ARF

    ReplyDelete
  12. This is for the Lance's of the world! We were looking at home values and noticing they are getting down to rent comparables, only about 30% more instead of 200% more. So we were considering a low ball offer on some places. However, we just got our lease renewal, our rent is going down!!!!! We live right off the shady grove metro in a prime area.

    So, I think we will wait.

    Bob

    ReplyDelete
  13. Anonymous said...
    "i stopped bollowing this blog a while back because i had enough of two bloggers silly posts (Lance and VA investor) just wondering if they have ever been back on since NOW IT IS A FACT THAT REAL ESTATE WAS IN A BUBBLE."

    LOL ... It sounds like you don't know what a bubble is. Go out and try actually buying your dream home ... then you'll find out if a bubble has bursted and you can really get what you want for "pennies on the dollar." Sorry, there's never been a bubble out there ... it's just wishful thinking by people who want something for nothing.

    ReplyDelete
  14. "However, we just got our lease renewal, our rent is going down!!!!! "

    Must be a real palace. Rent is hyperinflationary - yours is going down. LOL.

    ReplyDelete
  15. Hello David,
    I am not sure how else to reach you but would you be interested in a link exchange? http://portlandhousing.blogspot.com/

    ReplyDelete
  16. Lance said...
    “LOL ... It sounds like you don't know what a bubble is. Go out and try actually buying your dream home ... then you'll find out if a bubble has bursted and you can really get what you want for "pennies on the dollar." Sorry, there's never been a bubble out there ... it's just wishful thinking by people who want something for nothing.”

    Psssst. Hey “Lance”, even the MSM is using the “B” word. It’s OK, you’re allowed to say it now.

    ReplyDelete
  17. Hey, "Robert", since you're moderating comments, would you please just filter out Lance's rhetoric?

    He's going to be paying interest alone for the next ten years on a place that's worth less than he owes. He lost, game over. Enough toying with him, enough humoring him. Let's get this blog back up to par with being an honest source of analysis for the local market, okay?

    ReplyDelete
  18. A Unique Alias said...
    “Hey, "Robert", since you're moderating comments, would you please just filter out Lance's rhetoric?"

    You my friend are absolutely, 100% correct. I have poked, prodded and begged for anything resembling meaningful data from this guy. I did this so that any new readers would quickly realize that, just like the REI, his spiel is full of holes and wishful thinking. If you can sit through one of his tirades, you can easily navigate through any misguided rant your local realtor may dribble. For this, I must say, “Lance”, you have been indispensable……………

    As for “analysis for the local market”, I am looking for some specific data that is elusive. What are the percentages of ARMs/IO/No-doc/NMD loans for a given zip code? Yes, some data are readily available for the metro markets/geographic areas, but can it be found/narrowed down for local zip codes? I have gone as far as asking local lenders and professional data miners for this. The lenders aren’t giving it out (for obvious reasons), and the data miners are not geared for the consumer.

    ReplyDelete
  19. anon said
    "Must be a real palace. Rent is hyperinflationary - yours is going down. LOL. "

    Are you serious? Rents aren't hyperinflationary. They are based purely on supply and demand. If a place is vacant they offer incentives to get you in. Free months, etc. If they are full, they drop the incentives and raise the rates. I live in one of the nicest places in Montgomery county, for renters that is.

    ReplyDelete
  20. "He's going to be paying interest alone for the next ten years on a place that's worth less than he owes. He lost, game over. Enough toying with him, enough humoring him. Let's get this blog back up to par with being an honest source of analysis for the local market, okay? "


    is that what it was? lol. I thought it was a place for angst-ridden poors to blow off steam about the "Housing-Industrial Complex"!!

    ReplyDelete
  21. Anonymous@5:47am: I denno . . . I'm not up to my eyeballs in debt. Hell, I actually have positive net worth. So, hm, who's poor again?

    Jesus, the last generation of kids in this country grew up f*cked when it comes to money management.

    ReplyDelete
  22. Oh, and Robert -- to a certain extent, I suppose I can agree with you. Realtors sound exactly like Lance, because they are just as convinced that basic principles of economics don't apply to houses.

    ReplyDelete
  23. "anon said
    "Must be a real palace. Rent is hyperinflationary - yours is going down. LOL. "

    Are you serious? Rents aren't hyperinflationary. They are based purely on supply and demand. If a place is vacant they offer incentives to get you in. Free months, etc. If they are full, they drop the incentives and raise the rates. I live in one of the nicest places in Montgomery county, for renters that is."


    What is this responsive to? Rents have been skyrocketing in the DC area for a number of years. The trend has picked up lately. The fact that your building is going down leads me to believe it's not a desirable home. Big surprise, you seem so smart. I can't believe you don't make big dollars.

    ReplyDelete
  24. anon said "Rents have been skyrocketing in the DC area for a number of years."

    This is a complete lie. Rents have been pretty flat. 2001- 2006 rents went up a litte. 2006 - 2007 rents were flat or down for most people. 2007, it looks like rents are falling. As a renter, this is what I have noticed. What data do you have shows rents climbing? Other than data from a realtor.

    anon said "Big surprise, you seem so smart. I can't believe you don't make big dollars"

    You must be one frightened homeowner. Its funny how when someone lacks any logical argument they result to personal attacks. Rents are going down, well, you live in a crappy area,... no, you are poor and stupid. Do you see how uneducated your arguments are? By the way, for full disclosure... I am 33 and grade 15 goverment employee. So, I make about 130k a year.. This is more then double what the family income is in MD. I guess if I include my wifes 100k from her grade 13 we are making over 3 times the average family income.. So, we are not poor. WE are just not dumb enough to give someone 800k for a crappy house in Bethesda.

    ReplyDelete
  25. "Anonymous@5:47am: I denno . . . I'm not up to my eyeballs in debt. Hell, I actually have positive net worth. So, hm, who's poor again?

    Jesus, the last generation of kids in this country grew up f*cked when it comes to money management."


    I know, I know. You're all extremely wealthy. It's misleading to point out that you're frozen out of the homebuyers market.

    ReplyDelete
  26. not sure about this one but if thats what it takes

    ReplyDelete