banky's Journal: How is this a partisan issue?

http://today.reuters.com/news/articlenews.aspx?type=inDepthNews&storyID=2006-12-11T134431Z_01_N08363043_RTRUKOC_0_US-USA-HOUSING-DEFAULTS.xml&src=121106_0854_TOPSTORY_foreclosures_rising

I've seen a number of blogs essentially "blame" Bush and/or the Republican party for the increase in foreclosures.

Ok, so, what, Delay invented the ARM? Hasturt was responsible for covering up the idea that your payments could one day increase? Frist personally led the surge in McMansion purchases?

I *suppose* you could argue that the Republican fiscal policy was in part based on the housing boom which relied on people taking these stupid, risky mortgages, but still aren't you always left with "assholes wanting 4x more house than they ever need risking their ass"?

If I'm wrong, I welcome the correction, it just seems to be that this is about people, not party. (Or maybe, "If the Congress can engage is deficit spending, why can't I"? That sorta makes sense too EXCEPT I DON'T BELIEVE IN DEFICIT SPENDING SO I DON'T SPEND MORE MONEY THAN I HAVE. What a concept.)

Our loan guy tried to sell us on some ... "alternative" mortgage products. There's some that seem like an excellent, albeit calculated, risk, but some of those ARMs seem like utter insanity justified by the even more insane for a 4k sq ft home for you, the wife, your dog and "maybe a kid".

Anyway I welcome reasons pro or con. Alle economics!

Hard to disagree with you

[dave-tx]

You're completely right about the current culture of people (Americans in particular, I don't know about other places) living beyond their means. This, I believe, is the heart of the problem. We are a nation of credit. Too many of us abuse that, and, while it's not their job to be role models, our government certainly doesn't set any good examples about responsible spending. It's clear to me that the average American doesn't get it, when the only comment that our increasting debt brings is "So long as I

It's about partisan beliefs...

[TechnoLust]

Certain factions believe that it's government's job to take care of people because they are helpless and stupid. Other factions feel that people should think for themselves. So when the people that ARE stupid make a big mistake, they yell, "WAHHHH! Why didn't the gov. take care of me!?!?!?!" I believe that we shouldn't protect the idiots, because we're lowering the average IQ for the country.

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[banky]

I'm not wearing pants.

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[TechnoLust]

Are you working for home, or did you think it was one of those "Went to work with no pants on" dreams?

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[Captain Splendid]

I think he's referring to your sig...

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[TechnoLust]

Ah... yes. I thought he was just being banky. :-)

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[banky]

i have sigs disabled.

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[TechnoLust]

Mine is (not exactly correct) German for "There's a TechnoLust in my underpants." I guess that's why he thought you said that. I don't usually see my sig, so I had forgotten what it said and assumed you were just making a statement. :-)

How is it? or "Bush's Bubble"

[Jeremiah Cornelius]

The tech crash erased that option. The liberal solution would have been to try and find a new tech boom, which in the case of the Gore administration would almost certainly have been a micro and alternative energy boom.

The Bush solution was different. The decision was made to base the economy on the real estate market. Record low interest rates flooded money into the mortgage market and the housing market boomed. The Treasury department structured its bonds to encourage money to flow into the housing market

An old hand

[tqft]

Some comment from an old market hand:

http://www.bloomberg.com/apps/news?pid=20601039&si d=aYwCAToaB484&refer=columnist_baum [bloomberg.com]

"And that was before mortgage lenders lured unqualified borrowers into the market with exotic adjustable-rate mortgages, known as option ARMs, compounding the pressure to unload homes. (Some of these homeowners are starting to understand that not paying is not an option!) "

"In this business cycle, it will be some damned silly thing in housing that does the economy in. "

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[tomhudson]

Sounds about right .... its unfortunate that a lot of people are going to get hurt, but there's a reason why its called "speculation". ARMs, zero-cash-down, 110% financing and "no-document" loans (aka liars' loans) were sheer insanity.