FYI... per HR3962, the directive of the U.S. Preventive Services Task Force on breast cancer screaning, mammographies would have been graded as level "C", and would be the guiding regulation, PERIOD... thus mammographies would NOT covered under proposed house cutting plan... wonder if that would include the Federal Employee Health Benefit Plan too... me thinks not... I ask again, why can't "we the people" have the exact same health plan that "we the people" provide for our employees, aka congress and millions of our other employees... Will the FEHBP be considered a "Cadillac Plan" and taxed too... me thinks not again...
What's the bet that the insurance carriers will come out with a "Gap Policy" in the same manner as is offered to Medicare recipients... hase congress just paid off the insurance lobby yet again...
We need health care reform... but neither the house or senate bills are the answer... instead of reading the sports and comics this week, thy reading thse two horror books... merely 4,000 pages between them of legale/political smoke and mirrors... both written like a labrynth...
Sunday, November 22, 2009
Sunday, August 30, 2009
GM invests $293 Million in China!
From Reuters: "...General Motors said on Sunday it has agreed to set up a light commercial vehicle production venture with major Chinese automaker FAW Group, with total investment of 2 billion yuan ($293 million)...." (http://www.reuters.com/article/newsOne/idUSTRE57T0IV20090830)
Now, I'm not the brightest candle in in the candelabra... but didn't I read recently, that GM had filed for bankruptcy... that in order to survive it required 10's of billions of cash from "we the people"... that this cash infusion was intended to keep it alive... keep thousands of Americans employed... save the industry and revitalize our economy. Make no mistake about it, these comments are not intended as being anti-Chinese... it is a country of very intelligent hard working people. One that over the millennia has contributed much to the knowledge of mankind... it is not us against them... this is a statement of what "we the people" were told... this lead coffin of a debt was required to save OUR economy... it has become more than slightly obvious that we were, yet again, mislead (lied to?) by our elected representatives...
This agreement is yet more evidence that the Chinese are far better traders and bargainers than we… make no mistake about it, these international “deals” are reviewed by or involve numerous government agencies, not the least of which is The State Department…
I have no qualms with the concept of this joint venture... HOWEVER, it takes time and money to build plants; and time and money to hire and train new autoworkers... So please, would someone explain to me why this "joint venture"... is not using the several existing modern, shuttered, assembly plants ... hiring EXPERIENCED auto workers here in the
Hold it.. hold it… the Congressional Budget Office has estimated that the cost of Mr., Obama’s nightmare health reform will cost “we the people” a mere$1.3 Trillion over 10 years… Would not this $293,000,000 be better spent providing health care for “we the people"
And so my fellow Americans... I believe that I will sit back, put my feet up, sip on a marvelous Napa Valley wine, and wait for one of you fans of Nancy, Harry and "B G & O" to provide any really good explanation this latest... sorry folks... fucking over of "We the people"...
For those of us who have any clue, and really care... the next national election is
Saturday, August 22, 2009
Health Care "reform"
In his ongoing effort to "sell" his government take over of health care... calling it reform ... and attempting assuage the middle to right wing segment, the President commented that his plan does not include providing health care for illegal... undocumented... unauthorized... or in legal terms, trespassers... He also states that there the opponents of his reform plan are spreading untruths about the plan...
Mr. President, the simple fact is, the category of "you are here but we don't have any record of your being here" is already receiving the finest health care in the world... in our emergency rooms... through ever increasing over billing and rising premiums, the cost of which is being spread across those members of our society who are here because we belong here and have health care insurance...
I would suggest that there can be no health care reform, without first reforming ICE and providing a temporary entry/work visa's, thereby enabling these hard working people some semblance of legal status... allowing them to stop hiding in the shadows, work in the open, pay taxes into the system that already affords them a far better life. In this manner these fine people would then be able obtain health care coverage, drive legally, carry proper auto insurance and make our roads safer too.
Mr. President, no one wishes to deny health care for those in need... but please, when you promised us "change that we can all believe in", stop playing politics as usual... for that is no change at all...
Mr. President, the simple fact is, the category of "you are here but we don't have any record of your being here" is already receiving the finest health care in the world... in our emergency rooms... through ever increasing over billing and rising premiums, the cost of which is being spread across those members of our society who are here because we belong here and have health care insurance...
I would suggest that there can be no health care reform, without first reforming ICE and providing a temporary entry/work visa's, thereby enabling these hard working people some semblance of legal status... allowing them to stop hiding in the shadows, work in the open, pay taxes into the system that already affords them a far better life. In this manner these fine people would then be able obtain health care coverage, drive legally, carry proper auto insurance and make our roads safer too.
Mr. President, no one wishes to deny health care for those in need... but please, when you promised us "change that we can all believe in", stop playing politics as usual... for that is no change at all...
Thursday, August 13, 2009
Home Builder Numbers or More Smoke and Mirrors
Toll Brothers reported increased sales, and a lower number of cancellations. Wall Street then proceeded to wet its panties... Now why not do what Wall Street seems incapable of doing... look beyond those statements... I know of one builder with 13 new homes listed in the MLS... all 3,200 to 3,800 sq. ft. in size, 3 to 5 bedrooms... these are homes that would previous have been in the high "7's and "8's"... now being offer at $100-110 per foot!! Great the builder loses $250,000 per home... but not to worry, it makes it up in volume!!! Then we have the cancellation numbers... how many homes in contract were renegotiated in price to keep the sale together?? Could it be that Toll Brothers has a construction loan that required a payment??? Could it be that through tax breaks and accounting smoke and mirrors "we" are able to put a positive spin on things...Gotta be sure that the big boys of Wall Street can turn a fast buck... legalized gambling against a stacked deck...
Tuesday, July 7, 2009
What don't I understand... Hillary Clinton immediately blamed mortgage brokers for the economic free fall... Those sub-prime loans the mortgage brokers created were responsible for the crash... they stole the equity from poor innocent unsuspecting buyers and homeowners... Little or no down payment, interest only loans, less than perfect credit... They made loans to people who should not have been buying homes... Right... So, please explain the following:
- Low down payment and flexible mortgage terms (fixed-rate, adjustable-rate, or interest-only)
- You may qualify even if your credit is less than perfect
- Available to both owner occupiers and investors
- Down payment (at least 3 percent) can be funded by your own savings; a gift; a grant; or a loan from a nonprofit organization, state or local government, or employer
- No mortgage insurance*
- No appraisal fees
- Also eligible for HomePath Renovation Mortgage
- HomePath Mortgage financing is available.
Thursday, July 2, 2009
Let the bloodbath begin!
The vast majority of Toxic Assets, aka Legacy Assets, aka Non-performing Assets, are in fact loans on 1-4 unit residential real estate currently in one stage or another of default and foreclosure.
Read the Housing and Economic Reform (oxymoron) Act and you will find that it authorizes the Secretary of the Treasury to a) acquire these assets and b) dispose of them as he sees fit... As it did when it enabled this crisis years ago, congress has written a law with zero provision for CONGRESSIONAL OVERSIGHT.
Further, without exception, every housing loan modification program in place today is doomed to fail. The very conditions attached to all of them guaranty this fact. i.e. it is now virtually impossible for the tens of millions of self-employed Americans to qualify for ANY real estate loan modification or new purchase loan.
Should these assets be PROPERLY modified... ofttimes the current formula's in place are prescriptions for a second default... they will become performing assets, with no further losses for the lending institutions.
HOWEVER, should they be bundled (as did the RTC) and sold to these private investors at pennies on the dollar, there most like will be a "bloodbath" of new foreclosures. These are delinquent loans, the investor becomes the new note holder, bank if you will, free to accelerate the foreclosure process, and acquire what could amount to over a trillion dollars in residential real estate "on the cheap."
Congress can, and must immediately amend the HERA to prevent this potential debacle.
Residential real estate "lead the way" into this depression (and it is)... it must lead the way back out... I ask you the question, will you set foot in an auto showroom when you don't know if you will own a garage to park it in next week? Ours is a consumer based economy... only a fool would believe that "we the people" will consider spending on anything that isn't a requirement for survival again until the housing crisis has been addressed.
Without loan modification to stem it, we are about to enter another phase of defaults and foreclosures that will last no less than another 18 months to complete... and then an additional 1-2 years, if only that, to clear the inventory... all the while decimating the lives of Americans...
When consumers don't consume store close... the last time that I checked, a vacant retail space pays no rent... enough empty stores in a shopping center and... well why not check in with the bankruptcy courts to see what happens!
As Polonius said to Laertes when he was preparing to leave on a journey, "...to thine own self be true..." Well this is one hell of a journey that congress and Wall Street have taken us on...
it's the foreclosures stupid... it's the foreclosures...
Read the Housing and Economic Reform (oxymoron) Act and you will find that it authorizes the Secretary of the Treasury to a) acquire these assets and b) dispose of them as he sees fit... As it did when it enabled this crisis years ago, congress has written a law with zero provision for CONGRESSIONAL OVERSIGHT.
Further, without exception, every housing loan modification program in place today is doomed to fail. The very conditions attached to all of them guaranty this fact. i.e. it is now virtually impossible for the tens of millions of self-employed Americans to qualify for ANY real estate loan modification or new purchase loan.
Should these assets be PROPERLY modified... ofttimes the current formula's in place are prescriptions for a second default... they will become performing assets, with no further losses for the lending institutions.
HOWEVER, should they be bundled (as did the RTC) and sold to these private investors at pennies on the dollar, there most like will be a "bloodbath" of new foreclosures. These are delinquent loans, the investor becomes the new note holder, bank if you will, free to accelerate the foreclosure process, and acquire what could amount to over a trillion dollars in residential real estate "on the cheap."
Congress can, and must immediately amend the HERA to prevent this potential debacle.
Residential real estate "lead the way" into this depression (and it is)... it must lead the way back out... I ask you the question, will you set foot in an auto showroom when you don't know if you will own a garage to park it in next week? Ours is a consumer based economy... only a fool would believe that "we the people" will consider spending on anything that isn't a requirement for survival again until the housing crisis has been addressed.
Without loan modification to stem it, we are about to enter another phase of defaults and foreclosures that will last no less than another 18 months to complete... and then an additional 1-2 years, if only that, to clear the inventory... all the while decimating the lives of Americans...
When consumers don't consume store close... the last time that I checked, a vacant retail space pays no rent... enough empty stores in a shopping center and... well why not check in with the bankruptcy courts to see what happens!
As Polonius said to Laertes when he was preparing to leave on a journey, "...to thine own self be true..." Well this is one hell of a journey that congress and Wall Street have taken us on...
it's the foreclosures stupid... it's the foreclosures...
Tuesday, June 16, 2009
Go figure!!!
Explain this to me please.... congress and the media blamed the mortgage industry for writing what was called sub-prime financing... to people with feces for credit and little or no cash in the transaction... and then blame mortgage brokers for the entire melt down... and soooooo here we go to the Fannie Mae HomePath web site... seems that they have those REO's to sell off...
http://www.fanniemae.com/homepath/financing/index.jhtml
What am I missing?
http://www.fanniemae.com/
- Low down payment and flexible mortgage terms (fixed-rate, adjustable-rate, or interest-only)
- You may qualify even if your credit is less than perfect
- Available to both owner occupiers and investors
- Down payment (at least 3 percent) can be funded by your own savings; a gift; a grant; or a loan from a nonprofit organization, state or local government, or employer
- No mortgage insurance*
- No appraisal fees
- Also eligible for HomePath Renovation Mortgage
- HomePath Mortgage financing is available from a variety of lenders...
What am I missing?
The Return of TARP!!
Word has it that many of the recipients of the TARP funds want out of the program and wish to return the money... so the $3 trillion question is... what pray tell will the Cacophony of Conceited Condescending Clueless Clowns of Congress do with those funds... dump them into the general fund and go on another spending spree OR, do the the intelligent, prudent, smart, fiscally responsible thing and instruct Secretary Geithner and Chairman Bernanke to turn off the printing presses... and spend every bogus dollar buying back as much of our new found higher interest rate debt as is feasibly possible...
To do so would stabilize the dollar, increase world wide confidence in the credit worthiness of the United States and signal to the world that we are acting like adults. It would lower interest rates, or at least keep them steady, allowing for lower long term mortgage rates to return; thereby providing a boost to the real estate markets... It would show that we have a handle on this situation, and are willing to control spending... if not... go look up the term run-away inflation in your Funk and Wagnalls...
To do so would stabilize the dollar, increase world wide confidence in the credit worthiness of the United States and signal to the world that we are acting like adults. It would lower interest rates, or at least keep them steady, allowing for lower long term mortgage rates to return; thereby providing a boost to the real estate markets... It would show that we have a handle on this situation, and are willing to control spending... if not... go look up the term run-away inflation in your Funk and Wagnalls...
Friday, June 12, 2009
False Hope
There was a spike in pending real estate sales last moth... the markets are all excited... the end of the depression is at hand... a light at the end of the tunnel... wrong...
Pray tell, how many were NOT either an REO or short sales... how many are NOT being financed by the FHA... should they all closes, how many will have an LTV below 95%... how many of these Buyer's have a FICO score that would pass muster at Fannie or Freddie...how many have borrowed down payments and non-occupant co-borrowers... don't get too excited... in failing to properly address the foreclosure issue, that great Cacophony of Conceited Condescending Clueless Clowns of Congress has made certain that "the markets" can stay all a twitter for no less than another 2 years... too bad that Disneyland isn't still selling "E" tickets...
In funding what can only be described as sub-prime loans, isn't the FHA merely laying the ground for the next real estate crash? ONLY a Realtor, Congress, Wall Street, media and the truly naive' believe that a person losing their home is a marvelous business opportunity...
What am I missing....
Pray tell, how many were NOT either an REO or short sales... how many are NOT being financed by the FHA... should they all closes, how many will have an LTV below 95%... how many of these Buyer's have a FICO score that would pass muster at Fannie or Freddie...how many have borrowed down payments and non-occupant co-borrowers... don't get too excited... in failing to properly address the foreclosure issue, that great Cacophony of Conceited Condescending Clueless Clowns of Congress has made certain that "the markets" can stay all a twitter for no less than another 2 years... too bad that Disneyland isn't still selling "E" tickets...
In funding what can only be described as sub-prime loans, isn't the FHA merely laying the ground for the next real estate crash? ONLY a Realtor, Congress, Wall Street, media and the truly naive' believe that a person losing their home is a marvelous business opportunity...
What am I missing....
Tuesday, June 9, 2009
The silence is deafening
Gasoline prices at the pump are on the rise... the policies of the Fed and treasury have now diven oil prices up some 30% in the past few weeks... compounded by their desire to see a weaker dollar...
Ah, but have you noticed that there hasn't been one word of concern from our cash strapped state and local government's??? The now dollar rise in pump prices equates to an approximately 31% increase in sales tax revenue...
Based on a daily consumption of 1.14 billion gallons of gasoline here in California alone, that amounts an increased daily "take" to the state coffers of $70 million dollars, ... plus any add on sales tax to the counties...
The silence emitting from Sacramento, Albany, Springfield, Harrisburg, Boston, Tallahassee, Juneau, Annapolis, Austin, Atlanta and the rest, is deafening...
I'm not sure just how much longer that we can afford these tax cuts...
Ah, but have you noticed that there hasn't been one word of concern from our cash strapped state and local government's??? The now dollar rise in pump prices equates to an approximately 31% increase in sales tax revenue...
Based on a daily consumption of 1.14 billion gallons of gasoline here in California alone, that amounts an increased daily "take" to the state coffers of $70 million dollars, ... plus any add on sales tax to the counties...
The silence emitting from Sacramento, Albany, Springfield, Harrisburg, Boston, Tallahassee, Juneau, Annapolis, Austin, Atlanta and the rest, is deafening...
I'm not sure just how much longer that we can afford these tax cuts...
Wednesday, June 3, 2009
The silence is deafening...
GM, Ford and Chrysler shedding dealers... and the Administration and congress are mum... "we the people" broke up Ma Bell to increase competition and give the public lower prices... "we the people" did away with deregulation of the airlines to increase competition and give the public lower prices... BOTH actions have proven to have been a mistake... the SEC blocked the merger of Dish and DirectTV to keep the competition and give the public lower prices... the rational being... competition keeps prices low.... What am I missing here....
Fewer dealers = less negotiating for price = higher prices= higher sales and personal property taxes... Now I get it....
Have you noticed the deafening silence from government over the higher gas prices??? The sales (7.75%) tax on a gallon of gas at $2.25 = .$. 171/2 ... and at
$3.00 = $23.1/4 ... a 25% tax increase... Now I get it...
Wall Street and Government love the lowered value of the dollar... making EVERYTHING tied to a barrel of oil more expensive to produce... and will cost more at retail... higher prices = higher sales tax... Now I get it...
A real Forest Gump this one!! With big government now in big business... hmmmm big government.... big business... yeah the same thing... life may be a box of chocolates... but each piece now has a bite taken out....
Fewer dealers = less negotiating for price = higher prices= higher sales and personal property taxes... Now I get it....
Have you noticed the deafening silence from government over the higher gas prices??? The sales (7.75%) tax on a gallon of gas at $2.25 = .$. 171/2 ... and at
$3.00 = $23.1/4 ... a 25% tax increase... Now I get it...
Wall Street and Government love the lowered value of the dollar... making EVERYTHING tied to a barrel of oil more expensive to produce... and will cost more at retail... higher prices = higher sales tax... Now I get it...
A real Forest Gump this one!! With big government now in big business... hmmmm big government.... big business... yeah the same thing... life may be a box of chocolates... but each piece now has a bite taken out....
Thursday, April 30, 2009
The slaughter continues
From Reuters: "The U.S. Federal Deposit Insurance Corp (FDIC) may let investors buy bank assets in the Public-Private Investment Program without sharing an equity stake with Treasury, Bloomberg said, citing people familiar with the matter.
Treasury capital likely will not be applied to the FDIC program to buy as much as $1 billion in "legacy loans," both real estate loans and real estate-backed securities, but no final decision has been made, the report said."
As I have warned several times... once this occurs the increased slaughter in foreclosures will commence... $1 billion equates to potentially 5-7,000 in new foreclosures...
Saturday, April 11, 2009
Beware the sale of "Toxic"... "Legacy" assets
The Treasury and FDIC have laid out the plans to acquire bank assets with private investors is fraught with danger for the homeowner's of America. This published plan is set to "encourage" (finance would be a better description) the acquisition of these "legacy"... "toxic"... in reality these are non-performing real estate loans and a far more accurate description, into the purchase of these assets (item of economic value).
The issue here is that virtually 100% of these assets are secured by 1-4 residential real estate. Once these mortgage loans are sold to the investors (Wall Street?) they become the new "bank"; and are free to move rapidly forward with the foreclosure process. Thus, they are "buying" these loans, thanks to the generosity of "we the people", with only 6% down, leveraged with government guarantees ... not a bad deal... buy a $100,000 loan for $6,000... then foreclose on the note... next turn around and resell the underlying asset... the house... for, say $50,000 in a fast sale... now think in terms of hundreds of billions of dollars, several million homes included in this next fiasco... if you think that real estate values have gone down... wait for this blood bath...
I warned of this 18 months ago... that UNLESS these loans are modified prior to any sale to these private investors, the bloodbath of foreclosures will make what has already passed seem like a family picnic in the park... Go back and read the Housing & Economic Reform Act and EESA; that provide the Secretary of the Treasury with unlimited authority to acquire these assets and sell them as he sees fit...
We are sitting on the precipice of a real estate Armageddon... should congress refuse to amend these grossly flawed laws and exercise its responsibilities, it will be complicit in the further rape of the American homeowner...
The issue here is that virtually 100% of these assets are secured by 1-4 residential real estate. Once these mortgage loans are sold to the investors (Wall Street?) they become the new "bank"; and are free to move rapidly forward with the foreclosure process. Thus, they are "buying" these loans, thanks to the generosity of "we the people", with only 6% down, leveraged with government guarantees ... not a bad deal... buy a $100,000 loan for $6,000... then foreclose on the note... next turn around and resell the underlying asset... the house... for, say $50,000 in a fast sale... now think in terms of hundreds of billions of dollars, several million homes included in this next fiasco... if you think that real estate values have gone down... wait for this blood bath...
I warned of this 18 months ago... that UNLESS these loans are modified prior to any sale to these private investors, the bloodbath of foreclosures will make what has already passed seem like a family picnic in the park... Go back and read the Housing & Economic Reform Act and EESA; that provide the Secretary of the Treasury with unlimited authority to acquire these assets and sell them as he sees fit...
We are sitting on the precipice of a real estate Armageddon... should congress refuse to amend these grossly flawed laws and exercise its responsibilities, it will be complicit in the further rape of the American homeowner...
Sunday, March 22, 2009
The Greatest Generation
I watched "A Band of Brother's" again today... as I often due, I reflected on the 16,000,000 men and women who, through their sacrifices, their shedding of blood, the death of almost 500,000 of that number have made our lives possible... These brave souls all now their 80's and 90-s... protected this engine of democracy, this bread basket to the world and built our economy and America into the envy of the planet, the magnet of freedom... who had earned a right to spend the sunset of their lives in rest and retirement... a retirement now ripped from them by the insatiable greed of those thieves of Wall Street... now they have absolutely zero time to recapture anything... just imagine being forced to go back to the work force in your 80's and 90's... many will end their lives in complete destitution... this is the real crime committed by those bastards...
But only the abject gross negligence of Congress could have made it all possible…
But only the abject gross negligence of Congress could have made it all possible…
Saturday, March 21, 2009
The A.I.G. Bonuses ..Get Over It...
I note with great interest that the people screaming for the most blood are the very same members of congress who could not take the time to read and understand just what they were voting for... They admitted that they were surprised that this issue of executive compensation and bonuses was not covered in the bill that they just voted for! I note too, that the silence from Speaker Pelosi and Senator Reid is quite deafening... could it be that they know that in forcing the vote on what is most probably the single most important piece of economic legislation in our history, in less than the promised five days, they are directly responsible for yet another screw up...
Get over it, the damage has been done, the bonuses, that is if they are in fact bonuses and not commissions, have been legally paid; and, if enacted, this latest waste of our time and money by congress will most likely be proven unconstitutional... Hopefully the president will have the will power to use his veto powers, saving us the cost of taking it to the Supreme Court... Let's see now, "you" work for XYZ Widget Company, have done a great job, "you" have an employment contract calling for incentive pay whenever you meet or exceed your quotas and the company paid you a handsome bonus... but then the company files for bankruptcy... the creditor's ask the bankruptcy judge to invalidate your contract and order that you return the bonus... do you believe that you ought to be compelled to return it?... I didn't think so, you have a valid contract, right...
I note too that the public, which in 60% of the case is too damned lazy... too taken up with American Idol and Survivor... too busy Twittering and “Facebooking” to put down the remote or cell phone and vote... even too damned lazy and disengaged to pick up a pencil and fill in an absentee ballot... to damned lazy to write to their members of congress (it's OK folks, Word has spell check)... and then, when the media tells them too, they wake up and start screaming... please, either start paying attention... get involved... see to it that this sort of gross negligence on the part of congress doesn't happen again... or else do as YOUR member of congress fully expects you to do... sit down, shut up, go back to your reality television programs and enjoy this "E Ticket" ride that they have placed us on...
A dolt is a person who consistently screws things up... now, think of congress... but in continually returning these mostly inept people to their seats in the capitol, without any real scrutiny on our part, are we not doing the same thing, screwing up!... In failing to participate in the electoral process... in failing to do our jobs as citizens and provide oversight of our elected officials (at every level) we are getting just what “we the people” asked for... the finest government that the Sierra Club, NRA, Oil, Farm, Wall Street, Banking, Insurance, Union, "Widget" or any other special interest lobby can buy… even a three year old learns not to put its hand in the fire twice...
Get over it, the damage has been done, the bonuses, that is if they are in fact bonuses and not commissions, have been legally paid; and, if enacted, this latest waste of our time and money by congress will most likely be proven unconstitutional... Hopefully the president will have the will power to use his veto powers, saving us the cost of taking it to the Supreme Court... Let's see now, "you" work for XYZ Widget Company, have done a great job, "you" have an employment contract calling for incentive pay whenever you meet or exceed your quotas and the company paid you a handsome bonus... but then the company files for bankruptcy... the creditor's ask the bankruptcy judge to invalidate your contract and order that you return the bonus... do you believe that you ought to be compelled to return it?... I didn't think so, you have a valid contract, right...
I note too that the public, which in 60% of the case is too damned lazy... too taken up with American Idol and Survivor... too busy Twittering and “Facebooking” to put down the remote or cell phone and vote... even too damned lazy and disengaged to pick up a pencil and fill in an absentee ballot... to damned lazy to write to their members of congress (it's OK folks, Word has spell check)... and then, when the media tells them too, they wake up and start screaming... please, either start paying attention... get involved... see to it that this sort of gross negligence on the part of congress doesn't happen again... or else do as YOUR member of congress fully expects you to do... sit down, shut up, go back to your reality television programs and enjoy this "E Ticket" ride that they have placed us on...
A dolt is a person who consistently screws things up... now, think of congress... but in continually returning these mostly inept people to their seats in the capitol, without any real scrutiny on our part, are we not doing the same thing, screwing up!... In failing to participate in the electoral process... in failing to do our jobs as citizens and provide oversight of our elected officials (at every level) we are getting just what “we the people” asked for... the finest government that the Sierra Club, NRA, Oil, Farm, Wall Street, Banking, Insurance, Union, "Widget" or any other special interest lobby can buy… even a three year old learns not to put its hand in the fire twice...
Thursday, March 5, 2009
Ex-Leaders of Countrywide Profit From Bad Loans
I wrote on February 18, 2008... warning that this would occur...from the NY Times...
"Ex-Leaders of Countrywide Profit From Bad Loans"
http://www.nytimes.com/2009/03/04/business/04penny.html?_r=1&emc=eta1
The Housing and Economic Reform Act as well as EESA gave the Treasury
Secretary UNLIMITED, UNFETTERED authority to do with as he saw fit with the asset being purchase by the government... didn't anyone in congress read and, heaven forbid remotely understand what they were voting for... what they were giving away... this can and ought to be, but so long as there are lobbyist and campaign contributions will never be corrected...
Without proper loan modification, prior to any sale of the assets,... there will be a surge of foreclosures that may just make what we have already gone through seem like a day at the beach...
Many government official, and all of their "experts" have stated that real estate prices are still over valued and need to come down even further... but for whose benefit? I wonder which members of congress and government officials are invested in partnerships and blind funds, following in the footsteps of Stanford L. Kurland... this reeks of the RTC all over again...
"Ex-Leaders of Countrywide Profit From Bad Loans"
http://www.nytimes.com/2009/03/04/business/04penny.html?_r=1&emc=eta1
The Housing and Economic Reform Act as well as EESA gave the Treasury
Secretary UNLIMITED, UNFETTERED authority to do with as he saw fit with the asset being purchase by the government... didn't anyone in congress read and, heaven forbid remotely understand what they were voting for... what they were giving away... this can and ought to be, but so long as there are lobbyist and campaign contributions will never be corrected...
Without proper loan modification, prior to any sale of the assets,... there will be a surge of foreclosures that may just make what we have already gone through seem like a day at the beach...
Many government official, and all of their "experts" have stated that real estate prices are still over valued and need to come down even further... but for whose benefit? I wonder which members of congress and government officials are invested in partnerships and blind funds, following in the footsteps of Stanford L. Kurland... this reeks of the RTC all over again...
The real number of problem loans is...
The Case Shiller and First American Core Logic are understated by several million... They both draw their data from the recorded deed information and then use a general "guestimate" (thank you Paul Harvey) as to the current value in a manner that is very similar to what one might glean at www.zillow.com. And that one has no relationship to reality! Zillow reports only history… does not provide an accurate estimate of current value.
Problem... they have zero way of determining the current balance due on an Option ARM, with negative amortization. The ONLY number recorded is the original amount recorded. In order to accomplish this feat, one would need to know not just the opening balance, but also: 1) the entry rate, 2) date of recordation, 3)original minimum payment, 4) the payment history, 5) the term, 6) index, 7) margin 8) the historical data for the index from that date of funding, and 9) and then go about running the numbers for each of the millions of loans in the portfolio’s for every lender or thrift that made these loans… Once this is completed, a Broker Price Opinion (BPO) of the estimated value would be required...not happening…
There never was a secondary market for these loan products... none in MBS pools. Further, very few of these loans have are in default. As the ENTIRE loan portfolio's of Downey, WaMu and Wachovia, plus any other thrift that offered Option ARM's IS COMPRISED SOLEY OF THIS PRODUCT, you may wish to research the dollar amount their respective portfolio's... and you will be closer to the true number of problem loans...
Further... as, with the exception of Wachovia, all of those loans carry a maximum 10-15% negative accrual, you will then get a better handle of the number of additional (not previously included in the default data) loans that may go into default... AND the dollar amount of additional TARP funding that may be required to cover these losses... You will find that the Treasury indemnified US Bank, Chase and Wells Fargo from any loan losses as part of the (forced?) purchase of those banks...
My research indicates that the true number of problem and potentially problem loans to be closer to 25 million...
Another reason to offer immediate modification of the CURRENT LOAN BALANCE, every ARM loan; and every fixed loan more than 3% over the 10 tear Treasury bond into: a 50 year amortized. 5 year reset loan at 4%. With NO QUALIFYING. Loans already in default carry a forbearance agreement as part of the modification...
Further, in order to correct the lack of oversight from all of the previous laws...HERA, EESA and the new ARRA (love those acronym's) and any future act; require every lender, thrift, loan servicier, brokerage, insurance company or any other entity that owns any beneficial interest, either directly or indirectly, in any loan secured by 104 unite residential real estate, and has received any federal funds, either directly or indirectly be required to make the above offer of loan modification.
These loan modifications are to made without... without... any qualifying... my proposal will reduce the average mortgage payment by about 55% for these 25 million homeowners... we all gain by keeping them in the home; and thereby stabilizing the real estate market... the mortgage payment savings will, no doubt, go back into the economy through the purchase of good and services... my proposal will inject some $150 million (compounded)... for no less than the first 5 years of the loan modification or about $2.4 trillion... at "tad better" than what Mr. Obama is proposing... and $100 in true hard costs per loan, my proposal is as close to cost free as we will ever get!
Problem... they have zero way of determining the current balance due on an Option ARM, with negative amortization. The ONLY number recorded is the original amount recorded. In order to accomplish this feat, one would need to know not just the opening balance, but also: 1) the entry rate, 2) date of recordation, 3)original minimum payment, 4) the payment history, 5) the term, 6) index, 7) margin 8) the historical data for the index from that date of funding, and 9) and then go about running the numbers for each of the millions of loans in the portfolio’s for every lender or thrift that made these loans… Once this is completed, a Broker Price Opinion (BPO) of the estimated value would be required...not happening…
There never was a secondary market for these loan products... none in MBS pools. Further, very few of these loans have are in default. As the ENTIRE loan portfolio's of Downey, WaMu and Wachovia, plus any other thrift that offered Option ARM's IS COMPRISED SOLEY OF THIS PRODUCT, you may wish to research the dollar amount their respective portfolio's... and you will be closer to the true number of problem loans...
Further... as, with the exception of Wachovia, all of those loans carry a maximum 10-15% negative accrual, you will then get a better handle of the number of additional (not previously included in the default data) loans that may go into default... AND the dollar amount of additional TARP funding that may be required to cover these losses... You will find that the Treasury indemnified US Bank, Chase and Wells Fargo from any loan losses as part of the (forced?) purchase of those banks...
My research indicates that the true number of problem and potentially problem loans to be closer to 25 million...
Another reason to offer immediate modification of the CURRENT LOAN BALANCE, every ARM loan; and every fixed loan more than 3% over the 10 tear Treasury bond into: a 50 year amortized. 5 year reset loan at 4%. With NO QUALIFYING. Loans already in default carry a forbearance agreement as part of the modification...
Further, in order to correct the lack of oversight from all of the previous laws...HERA, EESA and the new ARRA (love those acronym's) and any future act; require every lender, thrift, loan servicier, brokerage, insurance company or any other entity that owns any beneficial interest, either directly or indirectly, in any loan secured by 104 unite residential real estate, and has received any federal funds, either directly or indirectly be required to make the above offer of loan modification.
These loan modifications are to made without... without... any qualifying... my proposal will reduce the average mortgage payment by about 55% for these 25 million homeowners... we all gain by keeping them in the home; and thereby stabilizing the real estate market... the mortgage payment savings will, no doubt, go back into the economy through the purchase of good and services... my proposal will inject some $150 million (compounded)... for no less than the first 5 years of the loan modification or about $2.4 trillion... at "tad better" than what Mr. Obama is proposing... and $100 in true hard costs per loan, my proposal is as close to cost free as we will ever get!
Wednesday, March 4, 2009
This too shall fail...
And from the latest soon to fail government "program" on loan modification...
"They must also fully document income and prove occupancy..."
In my more than 28 years in the mortgage business I don't believe that
I have seen more than a couple of dozen self employed 1040's that would
qualify the client for anything more than food stamps! The tax code is
about to bite these people in the ass... If you want a real estate loan
you must not take legitimate business deductions... thereby paying far
higher income tax... but we aren't raising your taxes!! If we keep or somewhat
lower the tax rates... severely limit or reduce deductions, resulting
in a higher tax bill, have we raised your taxes??!!
If, as the president states there are millions of small business owners...
most of whom files as "Sole Proprietor's... or S-Chapter Corporations (in
effect self employed)... then he has determined that these millions of
Americans are not worthy of any assistance...
"They must also fully document income and prove occupancy..."
In my more than 28 years in the mortgage business I don't believe that
I have seen more than a couple of dozen self employed 1040's that would
qualify the client for anything more than food stamps! The tax code is
about to bite these people in the ass... If you want a real estate loan
you must not take legitimate business deductions... thereby paying far
higher income tax... but we aren't raising your taxes!! If we keep or somewhat
lower the tax rates... severely limit or reduce deductions, resulting
in a higher tax bill, have we raised your taxes??!!
If, as the president states there are millions of small business owners...
most of whom files as "Sole Proprietor's... or S-Chapter Corporations (in
effect self employed)... then he has determined that these millions of
Americans are not worthy of any assistance...
Sunday, March 1, 2009
What am I Missing...
A number of years ago the defense department went through budget cuts... to save
from its budget, The Navy closed down Moffett Field in Sunnyvale, CA... and turned it over to other federal agencies... and NASA... some budget savings... some savings to "we the people"!!!....
In moving Marine and Army combat and support personnel from Iraq, where combat has been winding down (reduced operational cost)to Afghanistan where combat is ratcheting up (higher operational cost)... will save us how much???!!! A key point in where will the money come from in the new budget is the savings from the Iraq war... What am I missing...
Insofar as we are going through another Abraham Lincoln revival... "you can fool all of the people some of the time; and some of the people all of the time; but you cannot fool all of the people all of the time..."
I'd suggest that if Mr.Obama intends to continue along these lines he replace Mr.Orzag with Penn & Teller as director's Office of Management and Budget...
A dolt is a person who cannot keep from bungling.... now, think congress...
What am I missing...
from its budget, The Navy closed down Moffett Field in Sunnyvale, CA... and turned it over to other federal agencies... and NASA... some budget savings... some savings to "we the people"!!!....
In moving Marine and Army combat and support personnel from Iraq, where combat has been winding down (reduced operational cost)to Afghanistan where combat is ratcheting up (higher operational cost)... will save us how much???!!! A key point in where will the money come from in the new budget is the savings from the Iraq war... What am I missing...
Insofar as we are going through another Abraham Lincoln revival... "you can fool all of the people some of the time; and some of the people all of the time; but you cannot fool all of the people all of the time..."
I'd suggest that if Mr.Obama intends to continue along these lines he replace Mr.Orzag with Penn & Teller as director's Office of Management and Budget...
A dolt is a person who cannot keep from bungling.... now, think congress...
What am I missing...
Saturday, February 28, 2009
It's the Foreclosures Stupid... It's the Foreclosures
Sunday, February 22, 2009
Congress failed to require real, true, viable loan modification in the Housing & Economic Recovery Act as well as EESA and again in the ARRA. "We the People" have now spent or committed to spent some $2 Trillion, with trillions more to come, all without ever having addressed the root cause of this crisis.... the real estate defaults and foreclosures. In addition, proper loan modification WILL eliminate the vast majority of loan defaults that have brought about the massive increase in bankruptcy filings. Should our bankruptcy judges have the authority to modify real estate loans… most probably the answer is yes, however this is and ought to be a separate issue apart from the current economic crisis.
It has been stated that some 58% of loans that have been modified to date are back in default and foreclosure. A review of these loans will reveal that the cause for these failures has been the method of modification... the rate and terms applied in these instances have been a prescription for failure. Therefore, I suggest that congress require that any lender, brokerage, insurance company, or and any other firm that has received TARP or other federal funds, either directly or indirectly; and holds a beneficial interest in an any loan secured by 1-4 unit real estate, either directly or indirectly, be required to offer to modify all real estate loans with less than 3 years remaining to the next rate adjustment along the following lines:
WITHOUT the time consuming, meaningless process of (effectively) re-qualifying for a new loan, the existing loan balance is to be modified into a 50 year amortized loan, with a 5 year reset and an initial rate of 4%. The maximum rate change each 5 years would be +/- 2%; with a 9% lifetime cap. Loans already in default would carry a forbearance agreement added as part of the process.
This method of modification will reduce the loan payment by some 55%; while at the same time preserving the amount due to the lender. The aggregated annual savings of in excess of $150 Billion realized would, most likely, go into savings, pay down revolving debt or be spent fueling the economy through the purchase of goods and services (cars?). All of these options are positive and necessary for a cure to this crisis.
In most instances, this process would eliminate the urge to simply walk away from a property in which the homeowner has no equity. They require a home for their family; and what is better than the one that they already have. This proposal will stabilize not only the real estate and financial markets... but also the lives of these millions of Americans... while at the same time providing the knowledge and hope that, given time, they will regain the lost equity in their homes... the hope and positive attitude that my proposal brings to the table cannot be overlooked.
It is quite easy to verify that the number of families currently effected by this crisis is not, as reported 13 million, but more likely over 25 million real estate loans are in jeopardy... we cannot continue to ignore these people... as to stay on the present course, impacts every American family negatively.
Every time a homes sells as an REO or "Short Sale" the real estate tax base is reduced... the states and local governments are all reeling from these loses. This plan will put an end to this hemorrhage in tax revenue too.
What am I missing?
We keep hearing from the din on CNBC, Fox News, CNN and radio personalities... as well numerous members of congress and of the hoards of people carping about providing assistance to people who "got in over their heads".... so help me understand the following scenario that is occurring in the vast majority of industries and every state and city throughout the country... company names are interchangeable...
Caterpillar recently announced that, due to reduced and canceled orders from China and other countries around the world, and fearing that this could be a long drawn out down turn in income, and to stretch out its cash reserves it was cutting back in expenses... laying off people... cutting outlays, turning off lights, turning down the thermostat suggesting that employees wear sweaters...it internalized and cut costs wherever possible and then renegotiated its multi-million dollar debt with "ABC Bank"... The bank, feeling that Caterpillar has been a good customer, and is current on its loan payments, owes it millions of dollars and has done "all of the right things" agrees to a rate and term modification of the company debt... and in doing so maintains the firms fine credit rating... given the cause, Wall Street "experts" (are there really any?), deemed this a very prudent business decision on the part of the Caterpillar management... the stock sort of holds steady... not a bad feat in this business climate...
"Bob and Betty Jones”, are residents of Moline, IL... Bob has worked at Caterpillar for 20+ years... and has some seniority, in the cut back he gets to keep his job... but his hours get cut by 30%... Betty is the local librarian... due to the economy the city decides to cut expenses and close the library one extra day per week... thus Betty's hours get cut by 20%... "The Jones’s" have stellar credit... great retirement accounts... outside of their mortgage, little debt.... fearing that this could be a long drawn out down turn in income, and in order to stretch out their reserves, cut back in expenses... turn down the thermostat, and wear sweaters, turn off lights around the house... buy chuck instead of prime... use regular grade of gas instead of the recommended mid-grade... instead of dining out each Friday, they cut that to once a month... and then to a less expensive restaurant...cut back on any credit card use... internalize to find and reduce expenses wherever possible... and lastly contact the very same "ABC Bank", their mortgage holder, to negotiate a modification in only the rate and term ...of their $150,000 loan. The bank recognizes that the "Jones’s" have been very good customers... HOWEVER, BECAUSE they are current on their loan, ”ABC Bank" refuses their request; advising them that, before the bank will even entertain any modification, they first must be delinquent by at least 60 days... and in the process, make a mess of their previously superb credit rating…
For "ABC Bank", Caterpillar is simply too big to allow to fail... "Bob and Betty" don't have a large enough mortgage... simply don't owe "ABC Bank" enough, and it's OK if they fail... What I am missing... At this juncture of these economic and real estate catastrophes it is not just the “sub-primer’s” who are in trouble… this cancer has metastasized throughout the entire country… There are far more “Bob and Betty Jones” in need a relief than people who “stretched the envelope”… does anyone really want to contemplate the result of some 25 million mortgage defaults…
What am I missing…?
Caterpillar recently announced that, due to reduced and canceled orders from China and other countries around the world, and fearing that this could be a long drawn out down turn in income, and to stretch out its cash reserves it was cutting back in expenses... laying off people... cutting outlays, turning off lights, turning down the thermostat suggesting that employees wear sweaters...it internalized and cut costs wherever possible and then renegotiated its multi-million dollar debt with "ABC Bank"... The bank, feeling that Caterpillar has been a good customer, and is current on its loan payments, owes it millions of dollars and has done "all of the right things" agrees to a rate and term modification of the company debt... and in doing so maintains the firms fine credit rating... given the cause, Wall Street "experts" (are there really any?), deemed this a very prudent business decision on the part of the Caterpillar management... the stock sort of holds steady... not a bad feat in this business climate...
"Bob and Betty Jones”, are residents of Moline, IL... Bob has worked at Caterpillar for 20+ years... and has some seniority, in the cut back he gets to keep his job... but his hours get cut by 30%... Betty is the local librarian... due to the economy the city decides to cut expenses and close the library one extra day per week... thus Betty's hours get cut by 20%... "The Jones’s" have stellar credit... great retirement accounts... outside of their mortgage, little debt.... fearing that this could be a long drawn out down turn in income, and in order to stretch out their reserves, cut back in expenses... turn down the thermostat, and wear sweaters, turn off lights around the house... buy chuck instead of prime... use regular grade of gas instead of the recommended mid-grade... instead of dining out each Friday, they cut that to once a month... and then to a less expensive restaurant...cut back on any credit card use... internalize to find and reduce expenses wherever possible... and lastly contact the very same "ABC Bank", their mortgage holder, to negotiate a modification in only the rate and term ...of their $150,000 loan. The bank recognizes that the "Jones’s" have been very good customers... HOWEVER, BECAUSE they are current on their loan, ”ABC Bank" refuses their request; advising them that, before the bank will even entertain any modification, they first must be delinquent by at least 60 days... and in the process, make a mess of their previously superb credit rating…
For "ABC Bank", Caterpillar is simply too big to allow to fail... "Bob and Betty" don't have a large enough mortgage... simply don't owe "ABC Bank" enough, and it's OK if they fail... What I am missing... At this juncture of these economic and real estate catastrophes it is not just the “sub-primer’s” who are in trouble… this cancer has metastasized throughout the entire country… There are far more “Bob and Betty Jones” in need a relief than people who “stretched the envelope”… does anyone really want to contemplate the result of some 25 million mortgage defaults…
What am I missing…?
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