The Housing Bubble

Superbowl? Everyone knows the market is nothing until “March Madness” ends. And then there’s the traditional Easter slump. And Memorial day is a dog. And who is out shopping from 4th of July through Labor Day. Then it’s back to school, so who wants to deal with that - and before you know it, the Christmas decorations are up at the mall …..

…the Christmas decorations are up gunshots are ringing out at the mall…

“…the Christmas decorations are up gunshots are ringing out at the mall… ”

Isn’t it sad. My wife was about 200 feet away from it when it happened. She is fine. It has been a surreal experience. I can’t even imagine what it was like for the surviving victims.

And the neo-cons wanted to destroy SS…… but they didn’t. Not to say they won’t keep trying.

As it stands, SS has already been destroyed, by both parties.

While we are on the subject of gov’t plans. I found this interesting this morning.
http://www.opednews.com/maxwrite/diarypage.php?did=5091
Pardon the early morning tin foil.

Feel free to forfeit your contributions my friend. I demand they make good on mine or I’m paid back in full.

While we are on the subject of gov’t plans. I found this interesting this morning.
http://www.opednews.com/maxwrite/diarypage.php?did=5091
Pardon the early morning tin foil.

All right - got to call BS on that one - or at least potential BS. An easy explanation for the i-beam being “cut” cleanly at an angle is that there’s a good chance that two i-beams were welded together at that point, at that angle, and the beam just gave away across the weld - the weakest point.

Not that I would entirely discount some kind of 9/11 conspiracy. That’s weak evidence at best though.

SS is a ponzi scheme, it’s well recognized that ponzi schemes are unsustainable.

read through the comments. there’s a link to explain the cut. basically, the cut was the result of the demolition, not the collapse.

whether…

I agree with the fundamental premise but I disagree that rep and dems don’t have viable candidates. Ron Paul would make monumental changes for the benefit of all for many years to come. Kucinich, Obama or Edwards are excellent candidates but who does the media focus on?? The bought and paid for used car salesman Romney and Rudy “I’m not a transvestite swinger” Guiliani and Hillary “I’m not bought and paid for” Clinton.

Yep. Ron Paul is ANYTHING but your typical republican. He’s more Jeffersonian

I never said they didn’t although they are very few. Most want to continue the behemoth in both parties. I agree wholeheartedly about Paul but he is a rare exception. I couldn’t disagree more about either Edwards or Obama. Hillary lite. Big government, big spenders just like GW and invasion friendly.

So who are the beneficiaries of my tax dollars Mikey(2)?

Only The Shadow knows. I’ve no problem with people wanting government to promote their interests; it’s the lying about it that bugs me.

Punishing the Republicans is fine and honorable.

Punishing the Republicans by voting for equivalent government meddling is not honorable and not a fix.

Punishing the Republicans by voting for Libertarians is sending a message of being AGAINST GOVERNMENT MEDDLING, PER SE.

It boggles my mind when people say they will vote for Socialist Hillary to punish Socialist Bush.

Bill — I agree with all that. I hope this gives a huge boost to Libertarian Party candidates and libertarians who are, as a practical matter, members of the Rep/Dem parties, such as Ron Paul. Can’t wait to see what he writes about all this.

Funny, I don’t know a single Dem who is for HC and I’m in northern CA.

I’m in northern VT and I don’t know any either. Hillary’s main stronghold of popularity seems to be in the media.

I have this little fantasy - when Hillary gets elected or her poll numbers start looking bad against the republican candidate Bill Clinton will show up and say “Ok honey you’ve done good work, now run over there and try to fix that healthcare thingy again”. He will turn back to the reporters asking “any Questions for me? I’ll be handling Mrs. Clintons responsibilities for now on.”

Oh, there’s plenty of Hillary fans in this part of northern California.

Most of the Dems around here who are not proclaiming fondness for Hillary are just playing games. They had hoped a viable alternative would emerge, but when it comes right down to it - they will vote for HRC.

And this, among their cheerleading, perhaps is what the media recognizes.

Why would anybody even try to discuss anything with a Partisan of such degree as you? It’s not worth wasting breath or bandwidth.

Lighten up NYCboy. If the idea that I, and many others are fed up with the lying, theft and graft of those who want to separate me from my wallet makes me a partisan, then so be it. But feel free to accept said graft and theft for yourself…. just don’t include the rest of us.

You’re telling me to lighten up, partisan? You are the one blowing the a$$ gasket and typing nonsense.

Why would anybody even try to discuss anything with a Partisan of such degree as you?

I’d say Exeter provides some much-needed balance in these parts.

I don’t agree with everyone here, either, but lots of people who don’t align with me ideologically make interesting points or have perspectives I don’t normally hear in Bohemian Commie Pinko Fantasyland.

Let’s face it. We have a big pile of crap here and partisan politics is what keeps it going. Voting for frick or frack won’t change anything.

First I’m a “partisan”. Now I “type nonsense”..

Some people are just never happy.

“partisan politics is what keeps it going.”

B-I-N-G-O!!!

“First I’m a “partisan”. Now I “type nonsense”..”

Partisan rants are nonsense. The fact you think that blindly following any party will lead to a perfect world is the definition of nonsense. The fact that you can’t understand this is what makes you a partisan.

What party am I following NYCityBoy? Show me where I’ve endorsed a single specific candidate? To suggest that my disgust with the supplyside corporatist agenda is a tacit endorsement of any party is simple minded at best.

Partisan rants are nonsense.

Not true. It’s one thing to say a party sucks; it’s another to blindly follow another. The former, if supported by facts, which exter’s was, involves critical analysis. The latter, which I didn’t see coming from exeter, is indeed nonsensical, as what the party stands for is subject to change.

I agree with exeter on the Repugnicans.

“What party am I following NYCityBoy?”

It looks like you’ve cleared your name, exeter. You are not a partisan like some others. Still, I think you’re smoking crack if you think Edwards is an “excellent candidate”.

Allow me to correct you. I don’t smoke crack or use any drugs for that matter and I KNOW John Edwards is an excellent candidate.

Excellent candidate for what?

Sorry. I didn’t realize you had typed “KNOW” in capital letters. You must be right about that lawyer that seeks the leftmost position on all of the issues including the housing issue.

Rescue Homeowners at Risk of Foreclosure: Many foreclosures can be avoided by timely help, such as renegotiating loan terms, finding a new lender, or catching up with past payments. Preventing foreclosures can also prevent vicious cycles that can bring down whole neighborhoods. Edwards proposed a national Home Rescue Fund to help prevent foreclosure. The Fund would work through local non-profits, government agencies, and community financial institutions. If necessary, the Federal Housing Administration, Fannie Mae, and Freddie Mac could work with community lenders to create affordable refinancing alternatives for these families.

This was taken directly from the John Edwards website. It pretty much hits on every point that HBBers are completely opposed to. What a great guy!

I’m with exeter!

Not partisan, but the right-wing wants to put even more money into the corporatists pockets. The left-wing pols claim to want money going into the pockets of J6P.

Personally, after all this bailout talk, there is really no option but Ron Paul…as much as I disagree with him about some very important points.

The govt needs to be turned upside-down. Maybe RP can rock the boat enough to get some serious changes pushed through (like letting the WORKERS actually keep the money they earn, rather than increasing profit margins which gets morphed into executive compensation).

Most seniors have no choice BUT to trust Medicare. It’s not really optional — or perhaps I should notify my HR department to please stop taking out that tax from my wages?

Do they have much choice? Sheesh.

I’ve butted heats with exeter before. He has something in common with many here in that he doesn’t like the way things are currently going with the Bush. The difference is that while most here are free market libertarian types and he’s a democrat. He sees a powerful government as an agent that can be used for protection of the people from evil corporations. Libertarians see the powerful governement as the problem as it is always corrupted by specific business interests. Without its power, it wouldn’t be the target of corruption.

Austrian.. you are incorrectly ‘assuming’ that exeter is dem. It is the republicans since Reaguns that have perpetuated the myth that they wanted “small gov” when all the while making more orgs and more jobs Within gov all along. Or is it all people who get into gov make more room for their friends? Anyway, I don’t believe dems want any more interference at all nor bigger gov. Just more accountable gov. How would that be, a gov that was accountable for the things that are already set up. Not MORE warfare/military, but all the things like education. Just Accountability and good business practice in all things necessary for our USA.
But so far since reaguns, Bush 1 and 2 etc and the republican congress/senate will we ever see accountability or honesty.
I way get them all out.

Interesting point, although one could argue the difference between real growth and Bubbles. Clinton had a Bubble, Bush had a Bubble - we’re a Bubble economy now.

I think much of the arguing over Republican vs. Democrat really comes down to 2 things:

- Notions of what the parties represent that may no longer be true, or may never have been true.

- Personal (and perfectly justifiable) dislike of members of power in a given party that have corrupted the party on a local level and/or stolen the attention of the party on a national level. Not all Democrats are like Clinton, not all Republicans are like Bush, but they get all the attention and anger.

Ben — Are you working through the anger stage of the HB stages of grief?

As I said on another thread, I am very excited this AM because this plan has aroused exactly the opposite reaction that the bail-out crowd wanted. Again sorry for the loss of your fantasy.

‘President Bush acknowledges it’s ‘no perfect solution.’ Treasury Secretary Henry Paulson says it’s ‘no silver bullet.’

‘The plan negotiated by the Bush administration to freeze the low introductory rates on subprime home loans appears likely to help only a fraction of the homeowners who face huge jumps in their mortgage payments.’

‘Homeowners dialing up their mortgage companies to get their current rates frozen could be disappointed. The White House plan doesn’t force mortgage companies to give eligible homeowners a break. It is voluntary.’

I am perfectly happy to see “my fantasy” go straight down the drain.

The stories are not just negative, but largely dismissive. Everyone can see this Bush plan for what it is: all hat and no cattle. We will look back year from now at the foreclosure charts and probably not even see an inflection in the exponential growth curve.

“…all hat and no cattle.”

Money talks, BS walks.

Perhaps we’ll see class action lawsuits against participating lenders by borrowers who either aren’t eligible, or who are able to pay their higher rate loans timely.

“It is voluntary”… like our Military…how many American Son’s & Daughters of the Executive Branch & Senators are wearing fatigue’s?

True, Groundhog. Even as this plan, er, uh, fantasy was being announced, foreclosures hit a new high. Last night the news was full of hyperventilation over the plan along with the reports of the level of foreclosures.

Apparently not everyone is against the plan. Some commentators have even gone so far as to suggest it is not a bailout.

Jim Cramer’s Stop Trading! 12/6/07: Save Fannie and Freddie
posted on: December 07, 2007

http://seekingalpha.com/article/56621-jim-cramer-s-stop-trading-12-6-07-save-fannie-and-freddie

Does Cramer have any creds at this stage of the game?

Here is a money quote if ever there was one:

Cramer commented, “I’m tired of hearing that this is a bailout. Who cares? I’m about the money.”

All I want for Christmas is Jim Cramer’s two front teeth.

Cramer commented, “I’m tired of hearing that this is a bailout. Who cares? I’m about the money.”

This is exactly what the plan is about: taking care of the gamblers, er, investors who made bad bets, er, investments. Who cares that the plan flies in the face of hundreds of years of contract law? To hell with the law if it deprives me of making a buck!

“…Indeed, there were rumblings of rebellion among some institutional investors. “Why would anybody in his right financial mind agree to a five-year price freeze, especially when we’re staring in the face of possible inflation?” asked Roger W. Kirby, managing partner at Kirby McInerney, which has represented investors in class-action lawsuits over securities. “Mr. Paulson has overestimated the generosity of people on Wall Street.”…

NYT

Pro Bear, you’re taking this devils advocate thing to the extreme. Try Valium

“Concerning Fannie Mae and Freddie Mac, Cramer said, “They’re totally insolvent! Give me a break. They’re completely and utterly insolvent. Its just we’re not allowed to say it. … The only reason I mention those two … is that those two are less likely to go after me.” He identified fear of liability as the reason more people are not telling the whole truth about the mortgage problem. “It’s like when Enron filed a lawsuit against me. … It’s a good thing they went out of business.” ability to recover.

He called that right. What he’s wrong about is their

.

Folks,

With all due respect I do think this plan will work. Let me explain why. The type of people who took these loans do not care about 2 years from now they only know today they get to live in a McMansion for pennies on the dollar (teaser rate payments). So what if the house is going down in value they still get to live in the “good areas”. They are living for today and 5 years from now is so beyond their thinking it might as well be 100 years from now. Many of these payments are lower than they could rent a good apartment. Ask yourself why would they still walk away from their homes? They will have to pay rent anyway, right? This plan is disgusting but I think it will keep people in their homes and take many off the market within the next year or two.

“What he’s wrong about is their…”

What happened to that post?

Try Prozac.

What I find interesting about the bail-out is that it stops interest rates on subprime climbing, correct? What many don’t think about is that in the last two years people had negative amoritization loans where the loan rate my have been 5%, but they weren’t even paying that (you know, 1.9% + 4% tacked onto the principal of the loan). Therefore, even if people were force to pay the principal plus the 5%, they would have been buried. This bailout is not going to help at all. I sure as hell can’t afford a $350k 2 bedroom 2 bath condo (and I’m an engineer!!!). Next year is going to be a good year.

My 2008 predictions:

1) Housing price deflation in the U.S. will continue unabated as the bailout-induced tempest-in-the-teapot blows over.

2) NHZ’s country will soon experience the uncontained spillover of the U.S. subprime debacle in the form of falling residential real estate prices.

I’ll reprise my prediction made a week or so ago:

Newspaper headline dated 12/7/08

“Bailout Begain With Great Fanfare and Hopes, Ended in Disappointment and Failure”

Ben, I hope you’re right about the future prospect of federal bailouts. But I agree with nhz.

If the government let’s this thing play out like they should, several large banks and brokerage firms will go bankrupt. Dozens of multi-national corporations will lose millions of un-insured deposits.

I just can’t see them letting that happen without pushing the mother of all bailouts up the heiny of my workin’-man brethren.

I personally see this bailout plan about pure panic in the government. They are trying to stem the tide of foreclosures in order to prevent the economy coming down with it. If they can slow down the rate at which this meltdown can occur it will give them the soft landing they desire. Lower interest rates will ease on the other end as well. I have noticed that 15 and 30 year FIXED mortgage rates have dropped to the same they were back in 04. If the governments bailout wont work for you since you make too much money, then they will lower rates low enough that those people will be able to get alternative loans via traditional means. YES I know that that means they will have to come up with cash they do not have but a small percentage will be able to get a new fixed product. Every little bit counts. The Fed has already tipped its hand by lowering interest rates to save the economy. The question still remains? Will this increase in liquidity be enough to slow the rate to where we avoid an overall economic meltdown? If so, it will cause unintended asset inflation in other speculative markets. What markets will those be? or if it fails to stem the tide enough to matter then how does one protect their savings in order prevent being taken down with everyone else. So far I am in Hedge funds that short the RE market, REIT’s, Shorting the US Dollar. What other investment vehicle can one use to protect against the 2 possible outcomes. Oh yea I am am in oil, gold and gold mining companies as well. Can one short the consumer?

“YES I know that means they will have to come up with cash that they don’t have …”

You’d be amazed at how people without means can somehow come up with cash when the proper incentives are applied.

Well, none of that matters since “real estate always goes up!” and “everyone wants to live here” and finally “Prices no longer matter.”

Oh, wait… that’s all BS created by the REALTORS! Oops!

Lisa - I was surprised to read Kathleen Pender’s very negative review of the plan in yesterday’s SF Chronicle (online) and even more surprised that the online vote being taken showed 90% against the plan — such a reaction in the center of bleeding-heart city says a lot, IMO.

“This morning’s San Francisco Chronicle ran a front-page, negative story on the bailout plan. ”

Oh they probably want more, more, more…it’ll never be enough anyway.

NIM - actually, the vote was 90% flat-out against and only 4-5% in favor and 4-5% wanting more.

I just don’t understand all of this. The SIVs, CDO’s, etc. are still being artificially supported. They still don’t know the actual worth. It will NOT help housing sales at all since there are actual loan requirements and there is still a glut. So, this appears to be complete BS.

I like Cramer, too. I just don’t want to see his “boys” as he exits an SUV going to a nightclub. For that matter, I really didn’t need to see Brits and Paris’ gurly bits either.

Roidy

Morocco, Spain, France, Italy, you name it and the shows all showed developments in these countries, like Morocco, going through the roof pricewise by the minute.

How could a policy whose likely immediate effect is to dry up whatever sources of loanable funds remain intact post-credit-crunch possibly result in “the market coming back?”

The only way this makes sense to me is if a subsequent policy is soon to be announced for the govt to step up to the plate as mortgage lender of last resort, complete with taxpayer-provided loan guarantees up to $1m, or whatever figure is pulled out of the air at the next gathering of high muckety-mucks.

Well triage is the first step of any plan to deal with the rising tide of foreclosures. Them that need no help and them that are beyond help won’t be part of any plan. The real question is, can we find enough people in the middle to have a significant affect upon a foreclosure-driven RE market? The thing is, the definition of a “comparable” is that the sale involves an arms length transaction by a typically motivated seller and a typically motivated buyer. As foreclosures peak and short sales peak, those sales become “typical.” IMHO. If only the desprate are selling, all sales will be as desperation prices.

PB, I see three possibilities:
1.) The plan is to give them enough time to come up with an actual government bailout plan as you describe.
2.) The plan is to imply the above so that the markets stabilize while all the talking is going on.
3.) The Idiots are simply a cargo cult hoping that if they hold off collapse a little while, the appreciation fairy will return and grace the economy with all tha free money.

I’m betting on three, personally. Of course it is probably true that when THE PLAN fails to bring the foreclosure rate down to 2003 levels, the PTB WILL work on a bigger bailout.

Very weird. But even weirder is the term of the grace period. Five years. Which would indicate to me that this is the amount of time the lending industry thinks it will take for “the market to come back” to where the FB can sell the home for what is owed to the lender.

5 years is also perfect timing if you think the next president will be a one-term Democrat.

Very weird. But even weirder is the term of the grace period. Five years. Which would indicate to me that this is the amount of time the lending industry thinks it will take for “the market to come back” to where the FB can sell the home for what is owed to the lender.

I think it’s a bet that theFB’s wages will rise enough over 5 years to make the payments affordable. It’s consistent with that old school “Buy as much house as you can afford” mentality, because your income will always go up.

Does income always go up?

I agree with the notion that this is a just a trial balloon for the Super Bailout. Some ideas:

- Super Bail Out Plan: Government becoming the main lender to all. Huge houses for everyone, absurdly large loans, etc. Of coures, the system will somehow work out that the people with the worst credit and who are least likely to pay the loan will get the most help. Savers and those who make more than the median income will probably be barred from assistance; that way, we can rent out crummy apartments while our tax dollars help bums buy McMansions and rims for their Hummers.

- They are just trying to pass the buck to the next President or beyond. 5 years is a very convenient amount of time, don’t you think?

- Wages will not rise. Trust me, that’s the LAST thing the banks, debt-pushers, and other crooks want - people being able to afford to buy things instead of basically renting them forever from the bank.

‘a trial balloon for the Super Bailout.’

IMO that’s more paranoid fantasy. I have asked this on the radio and elsewhere everytime this comes up since 2005: this country borrows $3 billion per day. Where the heck is the money going to come from? And don’t say that the Fed will just print it. First, it’s illegal. Second, the central banks have said consistently and in unison for years that they need to drain the liquidity swamp. They have already printed too much and they know it.

One other thing to consider for the inflationists out there; the US dollar, weak as it is, is the Fed’s single source of power. Considerable power. If they were to let the currency crash, it stands to reason they would lose this power (see Mexico). With massive entitlements ahead, I think they will ultimately fail, but they can keep their power for a decade or more, and I can’t see them giving it up to save some hedge fund a few bucks or condo flippers in Miami. A market this large can’t be bailed out, IMO.

“They have already printed too much and they know it.”

Ben — Glad you have faith in the Fed’s judgment on this.

IMO Paulson and Bernanke have hacked Ben Jones’ login. Ben Jones has been tied up and locked in a closet.

“Ben Jones has been tied up and locked in a closet.”

Scary thought.

I also think the backlash illustrates another fact that both parties seem to forget: generally, people are for assistant to the poorer among us… as long as they do not end up materially above people who are working harder/making more money. Nothing boils the blood of someone in the working class more than seeing a non-worker (for instance) in a nicer place then they have, eating better food.

Good point, AKron.

I’m just as worried (if not moreso) about the FHA expansion.

Are the taxpayers insuring these mortgages? I’ll put this on record now: the FBs will default. Either the taxpayers will be liable for the losses or the banks will take the hit.

I’m voting that the banks who got us into this mess take the losses, thank you very much!

And “the consumer” won’t buy the overpriced stuff.

I kinda like free markets. Don’t you?

Yeah, I’ll be sure to stop buying cars, electricity, gasoline, etc.

Free markets = market - government.

Nice work. Now name us one free market. Take as many guesses needed.

People will continue to buy essentials. Maybe demand for flat screen TVs might fall off a cliff, but people still need bread, eggs and milk.

Corporations need to start thinking in terms of “everything we send up into the air is something we bought and then threw away”

The cheap and easy stuff will cut out 30% or more of your targeted reductions and will help pay for implementing the rest of it. The increased efficiency and/or selling of previously wasted materials will offset a huge portion of those costs, if not exceed them. Then you can’t forget about the corporate taxes of all the new businesses that will be working on this and the purchasing power/income taxes of the employees.

I’m sure that government regulations are the worst way to go about reducing pollution - what is really needed is for the polluters to realize on their own how beneficial it is.

I grew up in an area where our electricity was from coal-fired power plants. When I was in high school, the school district hired some consultants to come in and analyze their energy usage. $50,000 in fees later, the school system was saving $500,000 a year in energy costs with no noticeable difference in comfort levels. That translates to a direct reduction in carbon emissions from reduced electrical needs.

My sister used to be a chemical engineers for a very large chemical corporation. They spent a lot of effort trying to figure out how to turn every single waste product they produced into something useful that they could sell. After a few years, selling the “waste” products was more profitable than the core business.

Brian in Chicago: good points, I think there are many opportunities in this area.

In my newspaper today there is a story about how the regional power company (a monopolist that is 50% owned by local government) is consulting on ‘energy efficient homes’. Many new homes in the area get a huge (expensive) heat pump system that runs on electricity; because of that ‘efficiency’ the government provides extra subsidies and some tax incentives. Normally homes would be heated with systems running on natural gas (and partly solar heat); quick calculations show that the heat pumps are using far MORE energy than the normal gas heating (electricity produced mostly with natural gas and some coal here). And to top it off, these homes have a contract where you have to buy your power from this same power company for the next 20 years - and they decide about the electricity cost! For the consumer it is a bit less uneconomic, because of different taxes on electricity and natural gas. Still, just the yearly cost for the heat pumps is already higher than the total energy cost for other more basic homes without any ‘energy efficient’ label. Another example of how government regulation (together with corporate greed) can make things worse instead of better.

My sister used to be a chemical engineers for a very large chemical corporation. They spent a lot of effort trying to figure out how to turn every single waste product they produced into something useful that they could sell. After a few years, selling the “waste” products was more profitable than the core business.

Good anecdote. That’s the kind of innovative thinking (and financial result) that can spur increased efficiencies and greener methodologies in our country.

People will continue to buy essentials . . . but people still need bread, eggs and milk

Thank you Captain Obvious!

I just appreciate the irony of discussing energy conservation after our nation has gone on one of the most wasteful sprees of energy in years. How much energy was wasted cutting down forests and paving over farms to build huge, energy-inefficient McMansions so people have a place to park their 8 MPG Hummer?

Nice… maybe we should have some sort of “energy waste fee” sent out to the McMansions owners as part of the “mortage freeze and global warming act of 2008″ or something?!

When I was in high school, the school district hired some consultants to come in and analyze their energy usage. $50,000 in fees later, the school system was saving $500,000 a year in energy costs with no noticeable difference in comfort levels

Here in Texas we air condition empty schools every summer from June-August.

the game has been exposed.. everything will be checked and doublechecked.

“…everything will be checked and doublechecked.”

If you are right about this, then perhaps a vanishingly small number of FBs will qualify for the teaser freezer, plus a massive amount of lending fraud could be exposed in the process of determining who qualifies! You are getting my hopes up…

as others have suggested, it could amount to nothing but campaign lip service.. They’re not including caveats like “this is not a cure” by accident. There is no cure.

“If you are right about this, then perhaps a vanishingly small number of FBs will qualify for the teaser freezer, plus a massive amount of lending fraud could be exposed in the process of determining who qualifies! You are getting my hopes up…”

Okay but if you lied about your income what are the chances that you can actually afford the home? Also, if you lied and you know that they are verifying loan info, wouldn’t it make more sense to quietly exit (Stage Right)?

ah yes.. someone forgot to include an amnesty provision in the plan.. But why throw 200,000 people in jail at tax payers expense when they are already imprisoned in their own homes..

Here’s a plan.. If any FB defaults give them a thorough background check, specifically their loan apps.. That will prevent more foreclosures than this rate-freeze will.

“Okay but if you lied about your income what are the chances that you can actually afford the home?”

That was the point I was trying to make earlier, but I wasn’t clear enough. My bad.

Actually it’s worse then that. Accounting for inflation, wages have declined since 03′. It’s right there in the new release.

Yeah, I can’t tell one vacuous bimbo from another.

http://biz.yahoo.com/ap/071206/home_foreclosures.html?.v=7&.pf=loans

“Home foreclosures shot up to an all-time high in the third quarter, fresh evidence of the problems afflicting distressed homeowners amid the housing meltdown.
The Mortgage Bankers Association in its quarterly snapshot of the mortgage market released Thursday said that the percentage of all mortgages nationwide that started the foreclosure process jumped to a record high of 0.78 percent during the July-to-September period. That surpassed the previous high of 0.65 percent set in the prior quarter.”

Highest ever, fastest rate of increase, the rate of increase is still increasing.

Another aspect of the story is that 57% of the new foreclosures are Alt-A and prime. It is not a sub-prime issue anymore.

For me, it was the dog and pony show also known as Nov jobs report.

How about several CDOs defaulting? (or whatever the correct technical/procedural term is.)