Trump Thread 2.0

[Schnitzer318is]

While banks were certainly fraudulent with there actions leading up to the mortgage banking crisis and more should have been prosecuted, people were also very foolish with there financial decisions.

Regulation takes care of the above problem. I agree people were foolish. But if we are talking percentages here, it's like 75% industry and 25% borrower, at the most.

Look at it from the borrower's viewpoint. They have a mortgage broker telling them, "you can borrow the money for your dream home, for basically nothing on interest for the first 4 years. That's literally FREE money. Then since the housing market has been rising for the last 30 years (and going crazy up for the last 5) you can refinance your house before that ungodly interest rate kicks in for, again, basically no money. It's your piggy bank that you can break open everytime you refinance." That's putting an unfair burden on the consumer. If wall street, the insurance industry, and the Fed couldn't predict the housing crisis how can we expect the consumer to do it? I got out of brokering because I saw the above, and much worse, all the time. Loans were even being underwritten with NO PAYMENTS due during the first year or two!!! WTF???!!!

Hell, my wife and I took advantage of the situation. We bought a derelict (not too bad, but needed work) house for $42/sq ft when we were only 24. We went totally no doc (stated income) on the loan and took the teaser rate just to get into the house because we knew we didn't have the credit history or income for a standard 30 year fixed approval. So we knew going in we were going to keep our credit score up (always had good credit) and build up the history so we could refinance before the teaser rate hit. Then the market crashed and we enjoyed paying the lower taxes because the house value plummeted. With no intention of selling it, and having bought it well undervalue, the drop was of little concern. It is a large house so we even rented a room out to a friend for 6 years and that paid for half the mortgage...

^ But you can't expect the average consumer to be able to understand all of that. It's like asking a doctor's patient to study radiology so they can understand/read the x-ray films when the doc is giving his diagnosis so they can be sure he got it right. People trusted their broker, bank, etc to know whether they could afford the home or not. It's over and done with now, but as long as someone keeps screaming for de-regulation of all industry... it will happen again. As you mention, the market is in a bubble currently. A correction is coming. The Fed is raising rates to combat it, but Trump then throws them under the bus when the tariffs cause inflation of products, or the market goes down in response.

Flat tax hurts low income earners more than what we have in place now, The fair tax plans for this and puts everyone on a level playing field in regards to basic daily consumption costs. Me or Buddy, or Flyboy or any of the other higher earners paying 10% flat would been a HUGE reduction in taxation Vs the kid that is just out of school and making 38k a year, that 10% takes a bigger bite out their monthy budget than the same 10% out of my monthy budget. Its economics of scale, the more you make the less that 10% hurts you.

With the fair tax since its levied on consumption and what you buy, and there for gets every source of income, and EVERYONE pays taxes though out their day to day lives.

Exactly.

[Massive Lee]

Yesterday : "Matt Whitaker is a great guy" and appoints him as acting attorney general.

Then today no longer appoints him as acting attorney general: "I don't know Matt Whitaker"

[z31maniac]

Regulation takes care of the above problem. I agree people were foolish. But if we are talking percentages here, it's like 75% industry and 25% borrower, at the most.

Look at it from the borrower's viewpoint. They have a mortgage broker telling them, "you can borrow the money for your dream home, for basically nothing on interest for the first 4 years. That's literally FREE money. Then since the housing market has been rising for the last 30 years (and going crazy up for the last 5) you can refinance your house before that ungodly interest rate kicks in for, again, basically no money. It's your piggy bank that you can break open everytime you refinance." That's putting an unfair burden on the consumer. If wall street, the insurance industry, and the Fed couldn't predict the housing crisis how can we expect the consumer to do it? I got out of brokering because I saw the above, and much worse, all the time. Loans were even being underwritten with NO PAYMENTS due during the first year or two!!! WTF???!!!

Hell, my wife and I took advantage of the situation. We bought a derelict (not too bad, but needed work) house for $42/sq ft when we were only 24. We went totally no doc (stated income) on the loan and took the teaser rate just to get into the house because we knew we didn't have the credit history or income for a standard 30 year fixed approval. So we knew going in we were going to keep our credit score up (always had good credit) and build up the history so we could refinance before the teaser rate hit. Then the market crashed and we enjoyed paying the lower taxes because the house value plummeted. With no intention of selling it, and having bought it well undervalue, the drop was of little concern. It is a large house so we even rented a room out to a friend for 6 years and that paid for half the mortgage...

^ But you can't expect the average consumer to be able to understand all of that. It's like asking a doctor's patient to study radiology so they can understand/read the x-ray films when the doc is giving his diagnosis so they can be sure he got it right. People trusted their broker, bank, etc to know whether they could afford the home or not. It's over and done with now, but as long as someone keeps screaming for de-regulation of all industry... it will happen again. As you mention, the market is in a bubble currently. A correction is coming. The Fed is raising rates to combat it, but Trump then throws them under the bus when the tariffs cause inflation of products, or the market goes down in response.



Exactly.

Sorry, I'll admit I stopped reading after your first few sentences.

When I bought my first house in 2009, the banks said "Oh, you can afford to spend WAY more than that."

We didn't.

At that point, my ex-wife and I made north of $100k per year, and we didn't even want to spend $100k on a house. We ended up doing it, but with much trepidation. We literally spent $99k on a house.

We didn't want to buy anymore than we could afford on one salary. That's why went to the Caribbean every year, we had like 5 cars at one point, etc.

Were the banks shitty? No doubt. If you're so stupid to way overreach your ability to pay, that's on you. It's no one else's fault.

I lean pretty left, but JFC, if you decide to buy a $300k house on a very marginal salary, you're the one who made that decision. No one else.

This idea that you HAVE to spend that much is insanity.

That's 100% on the borrower.

[Wschnitz]

Sorry, I'll admit I stopped reading after your first few sentences.

When I bought my first house in 2009, the banks said "Oh, you can afford to spend WAY more than that."

We didn't.

At that point, my ex-wife and I made north of $100k per year, and we didn't even want to spend $100k on a house. We ended up doing it, but with much trepidation. We literally spent $99k on a house.

We didn't want to buy anymore than we could afford on one salary. That's why went to the Caribbean every year, we had like 5 cars at one point, etc.

Were the banks shitty? No doubt. If you're so stupid to way overreach your ability to pay, that's on you. It's no one else's fault.

I lean pretty left, but JFC, if you decide to buy a $300k house on a very marginal salary, you're the one who made that decision. No one else.

This idea that you HAVE to spend that much is insanity.

That's 100% on the borrower.

Its not 100% on the borrower, Banks are supposed to know better then to loan out money there is a high chance they could not get back.

[cale]

Its not 100% on the borrower, Banks are supposed to know better then to loan out money there is a high chance they could not get back.

TIL it's not the person who signs to borrow money who is responsible for getting in over their head. Next up is thieves who didn't know stealing the thing that was left unlocked was still wrong.

Yes there is a certain amount of legislation necessary to keep purchasers from getting in over their heads, and some lenders are guilty of misleading individuals into being able to afford more than they really can. However at the end of the day, you know how much you earn and you should know how much you can reasonably pay towards a loan. If you're too stupid to figure that out, I'm ok with you going bankrupt because you wanted a 4k Sq/ft house and two new cars.

[mbonder]

Here's the flip side of your statement: "Banks are supposed to know better than to loan out money there is a high chance they could not get back", what if the borrower actually does pay the loan back? Then the bank helped someone who was higher risk achieve the dream of home ownership and the bank made some money doing so. Both not bad things.

Isn't the bank a private corporation that can choose to operate how they wish within the rules? If they choose to take a calculated risk to loan money to someone that potentially isn't going to pay the money back, isn't that on them?

I'm going to use Cale's logic here as well. If the banks were stupid enough to extend a loan that they knew might not get paid back, then I'm ok with them going bankrupt if that possibility becomes a reality.

Which is why I wasn't really a big fan of bailing out the banks that chose to operate the way they did as the American citizens essentially mitigated the risk held by the banks and became the insurance policy against bankruptcy, which I think is bullshit.

I'm certainly not arguing for no regulations of the banking industry, but I do feel that if we are expecting consumers to have some level of introspection in relation to their financial capabilities I also expect that to transfer to the the other side of the table as well.

[Massive Lee]

Trump's a no-show in Paris at the ceremony to honor American militaries who died on the battlefields during WW1. Because of a few raindrops... ;-(

https://www.politico.com/story/2018/11/11/trump-paris-cemetery-rain-982947

"President Donald Trump’s decision to cancel his visit to an American military cemetery outside of Paris threatened to overshadow his trip here, as government officials, historians, and fellow Republicans hammered him for more than 24 hours for that move."

“President@realDonaldTrump a no-show because of raindrops? Those veterans the president didn’t bother to honor fought in the rain, in the mud, in the snow — & many died in trenches for the cause of freedom. Rain didn’t stop them & it shouldn’t have stopped an American president,” wrote former Secretary of State John Kerry, a veteran of the Vietnam War.

[tttoon]

Bone spurs playing up

[Schnitzer318is]

However at the end of the day, you know how much you earn and you should know how much you can reasonably pay towards a loan. If you're too stupid to figure that out, I'm ok with you going bankrupt because you wanted a 4k Sq/ft house and two new cars.

Cale, I undertand yours, and z31's position. And I agree, people should know what they can afford, and what they can not. I wish home economics was still a course that was taught in school. Might really help with the problem.

But here's the issue with the 2008 crisis in particular. Banks were loaning money out for basically free. In some cases with no payments due for the first 2 years (which still accruing the teaser rate). You'd have to be an idiot to turn that down. You could plan to live at the house for free. How many wall street investors, developers (were also being loaned money with ridiculous terms), or investment banks would turn down money for 2% interest that they could then reinvest (home buyer was expecting/told a larger than 2% increase in value) and earn a profit on? None of them would turn that down.

As I said, I am all for personal responsibility, and accountability. But you can't expect someone to not take a risk when they basically feel they are playing with house money. Matters are not always cut and dry, black and white. The system was set up to make investors, banks, and ratings agencies money... and they did not care about what happened to the consumer. In the case of the financial sector, regulation will always be needed to avoid this type of behavior. It's been proven time and time again.

[naplesE30]

The federal govt played a huge part with Freddie and Fannie backing up crap loan. Banks were greedy and fraudulently selling junk loans, and people were buying houses on 5 yr bubble where they only had to pay miniscual amounts on interest for the first 5 yrs. Plenty of greed, irresponsibility to go around. At the end of the day if you can’t afford a house using a traditional15/30yr mortgage structure you can’t afford the house. An adult should know better. After all they are the ones with everything to lose, and who signs on the line. A bank or any other institution is going to look out for their bottom line first. As far as I know they do not have any fiduciary responsibility to the borrower..

[parkerbink]

The Washington Redskins finally drop offensive name:



Dan Snyder, owner of the NFL Redskins, has announced that the team is dropping “ Washington " from the team name, and it will henceforth be simply known as, "The Redskins."



It was reported that he finds the word " Washington " imparts a negative image of poor leadership, mismanagement,
corruption, cheating, lying, and graft, and is not a fitting role model for young fans of football.

[Massive Lee]

Ah, ah, ah. Good one.

Should have been renamed Washington's Swampers...

BTW Trump loses Arizona's senate seat to a Dem...

https://www.politico.com/story/2018/11/12/2018-arizona-senate-election-sinema-mcsally-984928

"Democratic Rep. Kyrsten Sinema has defeated Republican Rep. Martha McSally in the battle for the open Senate seat in Arizona, giving Democrats their second Senate pickup of the cycle."

[mrsleeve]

ah, ah, ah. Good one.

Should have been renamed washington's swampers...

Btw trump loses arizona's senate seat to a dem...

https://www.politico.com/story/2018/11/12/2018-arizona-senate-election-sinema-mcsally-984928

"democratic rep. Kyrsten sinema has defeated republican rep. Martha mcsally in the battle for the open senate seat in arizona, giving democrats their second senate pickup of the cycle."

thats not enough !!!!!!

[z31maniac]

Cale, I undertand yours, and z31's position. And I agree, people should know what they can afford, and what they can not. I wish home economics was still a course that was taught in school. Might really help with the problem.

But here's the issue with the 2008 crisis in particular. Banks were loaning money out for basically free. In some cases with no payments due for the first 2 years (which still accruing the teaser rate). You'd have to be an idiot to turn that down. You could plan to live at the house for free. How many wall street investors, developers (were also being loaned money with ridiculous terms), or investment banks would turn down money for 2% interest that they could then reinvest (home buyer was expecting/told a larger than 2% increase in value) and earn a profit on? None of them would turn that down.

As I said, I am all for personal responsibility, and accountability. But you can't expect someone to not take a risk when they basically feel they are playing with house money. Matters are not always cut and dry, black and white. The system was set up to make investors, banks, and ratings agencies money... and they did not care about what happened to the consumer. In the case of the financial sector, regulation will always be needed to avoid this type of behavior. It's been proven time and time again.

Just because she'll let you raw dog it, doesn't mean you have to do it.

Sorry, the "how could you turn that down" line of reasoning just doesn't work when you put it under any scrutiny.

[Schnitzer318is]

Just because she'll let you raw dog it, doesn't mean you have to do it.

Sorry, the "how could you turn that down" line of reasoning just doesn't work when you put it under any scrutiny.

It depends on your situation. If that mortgage for 2-4 years, is a cheaper monthly payment than renting a place. It's basic economics. Literally tens of thousands of people took them up on that offer.

You are looking at it from YOUR perspective only (I agree on a personal financial level). Which I suppose is only to be expected given the present political climate we are in. You, and I, care about our credit score. There hundreds of thousands out there who don't and saw the loans as cheap housing only, in which case the responsibility falls on the lenders to not underwrite a loan that will fail when the loan re-amortizes.