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Old    Wes (pesos)      Join Date: Oct 2001       05-30-2013, 5:47 PM Reply   
...free market for the poor
http://colorlines.com/archives/2013/...sing_boom.html
Old    Paul (psudy)      Join Date: Dec 2003       05-31-2013, 11:41 AM Reply   
Damn rich people trying to make money! We should stop them!
Old    Pound (snyder)      Join Date: Feb 2006       05-31-2013, 11:54 AM Reply   
yeah, that's not FAIR. Everyone should be able to buy a house regardless of their income!

oh, wait... we already tried that.
Old    Andy Graham (ottog1979)      Join Date: Apr 2007       05-31-2013, 12:35 PM Reply   
This article is written by someone who has almost no idea of what they are talking about. Facts and analysis are completely disregarded in favor of conflicting statements and tired, worn-out cliches. Just one paragraph easily illustrates this:

Quote:
The irony of this foreclosure crisis, which was caused by Wall Streetís irresponsible behavior, is that it created the massive supply in homes that those very same financial institutions are now profiting from at a record pace. Having profited first from millions of risky mortgages and eventually taken away the homes that underwrote them, institutional investors are now purchasing those same foreclosed houses at rock bottom prices.
So wait... who took the hit to get those homes to rock bottom prices? Of course borrowers, but I wasn't aware that foreclosing on collateral was a money making venture for banks. That second sentence doesn't even make sense and/or isn't grammatically correct. It's like a middle school kid wrote it.

And what does $50-100MM priced apartments on Park Avenue have to do with investors buying up homes on Main Street? Oh yeah I forgot, gotta get that token Rich envy/blame thing in there somewhere.

Alas, I got snookered by the troll bait.
Old    Paul (psudy)      Join Date: Dec 2003       05-31-2013, 12:40 PM Reply   
" but I wasn't aware that foreclosing on collateral was a money making venture for banks"

Lol.
Old    John Anderson (fly135)      Join Date: Jun 2004       05-31-2013, 12:50 PM Reply   
Quote:
Originally Posted by psudy View Post
Damn rich people trying to make money! We should stop them!
Didn't the fed just print a bunch of money to buy the toxic mortgage assets from "rich" people who didn't want to lose out on their bad investments? Come to think of it... when the fed expands the money supply who gets that free money? Are they buying someone else's trash? Or are they just giving it away outright? If it's a loan and it gets paid back then there is no effective long term expansion of the money supply.
Old    John Anderson (fly135)      Join Date: Jun 2004       05-31-2013, 12:58 PM Reply   
Quote:
Originally Posted by ottog1979 View Post
So wait... who took the hit to get those homes to rock bottom prices? Of course borrowers, but I wasn't aware that foreclosing on collateral was a money making venture for banks.
It can be if the home owner has equity. They will foreclose on the homes as soon as possible and immediately heap on thousands of dollars of fees so they can either cash in on the equity or the fees.

Quote:
Originally Posted by ottog1979 View Post
That second sentence doesn't even make sense and/or isn't grammatically correct. It's like a middle school kid wrote it.
Makes a lot of sense. Banks were happy to loan to anyone because they collected lots of money to make the loans then sell them. Next the market crashes the fed and the govt step in to cover the investor's losses. The govt and the fed should have let the investors eat their losses and move on.
Old    Paul (psudy)      Join Date: Dec 2003       05-31-2013, 1:32 PM Reply   
In most states any equity gets returned to the homeowner. Banks get back what they have in it. You can't foreclose for more than your mortgage.
Old    Paul (psudy)      Join Date: Dec 2003       05-31-2013, 1:38 PM Reply   
" when the fed expands the money supply who gets that free money? Are they buying someone else's trash"

They expand the money supply buy setting the fed funds target rate. I think you are confused with QE1,2,3.
Old    Pound (snyder)      Join Date: Feb 2006       05-31-2013, 1:39 PM Reply   
Has anyone stopped to think who these evil "institutional investors" are?

That's right, it's you and me via our 401k's and retirement funds from our employers.

Are a few individual wealthy people buying distressed priced properties, sure. Hell, China's been buying commercial property in the US for decades.

Actually, you could spin this story another way.. if these investors are buying these houses for the purposes of providing rental properties to people, then the folks who went into foreclosure should be happy because now, they can get back into a house, which they wouldn't be able to do otherwise because i'd assume their credit is no longer acceptable to buy a home. So from that angle, these evil rich people are doing a good thing, no?
And you can't say they will be able to charge higher than market prices for rent, because as more and more rental properties are available, then people have a choice and the market place will set the price for rental rates. good ol' supply and demand.
Old    Andy Graham (ottog1979)      Join Date: Apr 2007       05-31-2013, 1:40 PM Reply   
Quote:
It can be if the home owner has equity. They will foreclose on the homes as soon as possible and immediately heap on thousands of dollars of fees so they can either cash in on the equity or the fees.
With due respect John, I've been in the banking business for 29 years. While this statement sounds good from an outside, "rich bank" conspiracy view point, I can assure you that banks do not make money on foreclosures. Not even close.

While there is some truth to your second statement, there are also many, many, many investors that got CRUSHED in 2008. Many banks and other institutions held Fannie/Freddie stock.

Whether or not the government should have let investors eat losses is certainly debatable. That said, "investors", especially in the case of mortgage backed securities, includes just about all of us (pensions, life insurance, 401k bond funds).

It's not just the Rich that are investors.
The "Rich" are not the same consistent group of people.
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Old    Pound (snyder)      Join Date: Feb 2006       05-31-2013, 1:44 PM Reply   
also, if you have equity in the home, why would you be in foreclosure? The only way to have equity is if you owe less than the house is worth? couldn't you just sell the house and cash out, or refi? I don't get that one. what am i missing?
Old    John Anderson (fly135)      Join Date: Jun 2004       05-31-2013, 2:07 PM Reply   
Quote:
Originally Posted by snyder View Post
also, if you have equity in the home, why would you be in foreclosure? The only way to have equity is if you owe less than the house is worth? couldn't you just sell the house and cash out, or refi? I don't get that one. what am i missing?
Just because you don't understand it doesn't mean it doesn't happen. You can have equity and run short on money. And yes you could plan ahead and sell the house. Or you might see others who don't have equity not getting foreclosed on after missing many payments and think that you've got enough time to get back up to date. That's what happened to a musician friend of mine on fell on hard times, except they foreclosed quickly and heaped on $4k of fees very quickly.

He cashed in favors from family and raised the money to get out of foreclosure but the bank kept stalling him. They could never give him a firm figure to get out of foreclosure because they couldn't keep up with how quickly the fees accumulated. IOW stalling him and tacking on more fees. He eventually paid and got out of foreclosure, then sold the house and paid back family with the equity. The bank was Chase.
Old    John Anderson (fly135)      Join Date: Jun 2004       05-31-2013, 2:09 PM Reply   
Quote:
Originally Posted by ottog1979 View Post
Whether or not the government should have let investors eat losses is certainly debatable. That said, "investors", especially in the case of mortgage backed securities, includes just about all of us (pensions, life insurance, 401k bond funds).
So welfare is fine as long as you have some money?
Old    Andy Graham (ottog1979)      Join Date: Apr 2007       05-31-2013, 2:35 PM Reply   
Did Wes really think his posting was going to change anyone's mind? Is it likely that I'll get you to see it differently? Probably not. Shame on me (and Wes). How often do you have political debates and honestly change someone's opinion or have them change yours?

Truth is, arguing (incessantly in some cases) about politics/economics is a distraction from real life, the here and now. That's why for the most part, I've given such debate up as a waste of time and frivolous. I regress now & then - my mistake today. But I'm going to focus the remainder of today on my real life clients, going to a nice dinner with the wife, getting the boat ready for tomorrow and touching base with the boys to see if they want to go and/or otherwise see how their life is going. I'll leave the debate about theoretical groups of people, generalized macro economic theory, short simple sound bites about highly complex issues to others for now. We'd all probably be a little happier doing the same (not that I'm telling anyone what to do).
Old    Wayne Robbins (melton1wake)      Join Date: Oct 2011       06-01-2013, 4:25 AM Reply   
Andy, your last post was exactly correct imho. Enjoy your dinner, wife, boys and boat.

Last edited by melton1wake; 06-01-2013 at 4:27 AM. Reason: statement was not clear
Old    Wes (pesos)      Join Date: Oct 2001       06-01-2013, 2:57 PM Reply   
Andy, I don't think most of the postings here are "to change someone's mind." I do enjoy learning from the education and experience of those here on WW, yourself included.
Old    PLR (dbdb)      Join Date: Oct 2005       06-03-2013, 10:44 AM Reply   
Truth is, arguing (incessantly in some cases) about politics/economics is a distraction from real life, the here and now. That's why for the most part, I've given such debate up as a waste of time and frivolous. I regress now & then - my mistake today. But I'm going to focus the remainder of today on my real life clients, going to a nice dinner with the wife, getting the boat ready for tomorrow and touching base with the boys to see if they want to go and/or otherwise see how their life is going.


I think this is my favortie thing I have read in the last week. Focus on the imoportant things.

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