Socialist thinking can often pop up in the most unexpected places.
One of the “most powerful bond investors in America” is calling for a full-fledged government bailout of homeowners who are struggling to pay their mortgages. Pimco Chief Investment Officer and founder Bill Gross thinks the Fed and monetary policy need to step aside for direct government intervention by President George Bush.
“Write some checks, bail 'em out, prevent a destructive housing deflation that Ben Bernanke is unable to do," wrote Gross on his September blog, which appeared in an Associated Press story on August 23. “This rescue, which admittedly might bail out speculators who deserve much worse, would support millions of hard working Americans whose recent hours have become ones of frantic desperation.”
The story, written by AP Business Writer Jeremy Herron, failed to make mention of a taxpayer cost for such a move by the Bush administration.
Gross suggested the Bush administration could beat the Democrats at their own game – by offering more handouts.
“And if you’re a Republican office holder, you’d win a new constituency of voters – ‘almost homeless homeowners’ – for generations to come,” wrote Gross. “Get with it Mr. President and Mr. Treasury Secretary. This is your moment to one-up Barney Frank and the Democrats.”
Gross has also been active in calling for a Fed rate cut – by as much as 2 or 3 percentage points.
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A person builds a home on a
August 23, 2007 - 16:15 ET by Darth DutchA person builds a home on a hill, the house is destroyed in a mudslide or flood, and someone calls for a government bailout.
A person cannot make their mortgage payment because they agreed to a mortgage that they could not in any stretch of the imagination afford, and someone calls for a government bailout.
I feel for the people, especially those who were legitimately duped into their mortgage, but really, why must there be a bailout for everything?
What happens when the government is bankrupt? On whom do we call for a bailout?
Dutch
we call the government for a
August 23, 2007 - 16:23 ET by TruthMongerwe call the government for a bailout - duh
China?
August 23, 2007 - 17:55 ET by rbchaffeWe call on China for a bailout, of course! ;-)
Ouch! Kind of doing that
August 23, 2007 - 17:59 ET by PeskyDaneOuch! Kind of doing that now, aren't we?
Symbiosis
August 23, 2007 - 21:14 ET by SportPoliticsIf we don't have the money to spend, the 90% of everything in the stores that is made in China won't be bought.
It's sort of terribly convenient and profitable circle.
Wow SP... Where ya'
August 19, 2008 - 18:23 ET by bigtimerWow SP...
Where ya' been...long time no see.
"America isn't the problem...America is the solution." ~ Rush Limbaugh
Holy smokes, Batman!
August 19, 2008 - 18:28 ET by BlondeThere you are!
I missed you.
David Gregory, do you know which damn network you lie for? ~ Uncle Jimbo, @Blackfive
Welcome Back Sporty!
August 19, 2008 - 22:42 ET by R D HelmLOL-Long time, no see.
Glad you decided to drop in. :-)
-Dave.
And how much does Bill Gross
August 23, 2007 - 16:21 ET by Mr. KafirAnd how much does Bill Gross (already extremely wealthy) expect to make on this government handout??? Perhaps it will save his ass since he invested so poorly in the first place??? Sorry, Billy, you have to take your medicine along with everyone else.
Are they gonna pay off my
August 23, 2007 - 16:27 ET by Dan The Man 2Are they gonna pay off my mortgage? I have been resposible for the last 24 years paying it on time and refinancing 2 times to make the payments lower. I mean I deserve something besides the elevator minus the car.
Nuke em til they glow then shoot em in the dark.
The message seems to be, if
August 23, 2007 - 19:15 ET by sublight68The message seems to be, if you work hard, live within your means and take personal responsibility for your decisions and actions then you're a sucker.
Instead, spend recklessly, dig yourself deep into debt, make ill-informed choices and seek immediate gratifciation in every aspect of your life. Then when things go wrong, blame someone else and hold out your hand for a payoff.
What incentive is there to play be the rules? To have any self-restraint? I'm tired of paying for teenage mothers with 3 kids by as many fathers. I'm tired of paying for people who keep rebuilding in flood plains, hurricane alleys, and fire and mud slide areas. I'm tired of ponying up to cover bankruptcies, insurance fraud...and on and on.
I have no problem helping out those truly in need when something unforseen happens. But those are usually the people who have the most interest in helping themselves.
Make your choices and live with them.
Question
August 23, 2007 - 16:39 ET by 10ksnookerWhat does Bill Gross have invested in mortage companies who were giving out loans to unqualified buyers? Taxpayers have a right to know.
It does show economics in the "paper or plastic" school agenda does not rank high.
Baliout? What for? Nobody
August 23, 2007 - 16:51 ET by bassndudeBaliout? What for? Nobody came to bail me out when the oil field work crashed in the early 80's. Had to sale my truck and welder, not to mention the fortune in pipe fitting tools. Spent my savings trying to find work. In the end, had to go to work for someone else at less money, climbing on iron 40 floors above the street. Really tho, those were some good years. I learned some valuable lessons. Time for these people to learn that nothing lasts forever. Also, always check your safty rope after and during welding on the outside of a highrise:-)
Save a SeAL, club a liberal!!
Who is trying to save whom
August 23, 2007 - 17:17 ET by jdhawkWho is trying to save whom and for what? It appears that PIMCO's bonds (PIMCO is a group of mutual funds that specializes in bonds) have a flat tire.
The reason that Mr. Gross is so exercised is that those companies that are tied to the subprime market sold, and are continuing to sell, their bonds to maintain liquidity. They have been selling their bonds at firesale prices in order to do that.
PIMCO makes it money managing bond mutual funds. If people are not buying and selling bond mutual funds, they don't make money. And, more importantly, a market (can't determine the bid and ask price of the bond) can't be made for the bonds if they are being dumped by the bushel barrel to increase liquidity.
Ergo, Mr. Gross wants a bailout for speculators and homeowners that can't make their mortgage payments so that the bond market will right itself and his companies will continue to prosper.
Not the list bit self serving, eh, Mr. Gross?
Mile long cubes
August 23, 2007 - 18:19 ET by pickerseniorReminds me of communist style living I saw in Gdansk Poland, and St. Petersburg Russia a couple of years ago. Big boxes of cubes (called homes), probably about 250 square feet for families of 4 or more, in multi-story houses several blocks long. In that worker's paradise, there were no house payments, an American Sociaist dream.
Now, they are either falling down, or providing free homes to the rat population. Wonder what happened to all those people with no house payments?
This is how they live today. (an improvement.) Not many houses there, even in the countryside where Putin lives.
http://www.wademan.com/VisionQuest/St%20Petersburg%20203%20Apartment%20Blocks.JPG
"IF Liberals didn't live it, it doesn't exist!"
Gov't car payments
August 23, 2007 - 18:24 ET by Mica the MagnificentIf the gov't paid off their mortgages, then the gov't would have to come back in a few months and pay off their Mercedes loans because they won't be able to afford that either.
But according to Bill Gross, the repubs would get the 'luxury car' vote for generations if they did.
Fault
August 23, 2007 - 18:30 ET by JDWIf the borrower understands the instability of the loan yet accepts it realizing Fed Man will rescue all, defaults will occur.
Sen Clinton feels for the borrowers and is pushing for Fed Man to come to the rescue. No chance she does not realize the impact on inflation?
JDW
News media: Scoreboard for terrorists
Gov't Bail Outs
August 23, 2007 - 19:39 ET by BlondeSo I ask you, my NB friends.
My windstorm policy went from $1,600 a year to $5 grand a year. (No need for sympathy...it is what it is).
But am I an idiot for paying this? The way I figure it, where I live, a serious hurricane would probably flood my house, rather than blow it down. So I'd not consider going bare on my flood policy.
In the current "government bailout mode", if my house DOES get blown down....the feds will bail me out.
My thought is, I could bank enough cash in two years to replace my roof, if we only get hit by a Cat 3/4 & I lose my roof.
Thoughts? I mean, seriously, if the Guv is going to bail out every stupid Tom, Dick & Harry, why should I be Blonde and a responsible citizen? I can think of many more fun ways to spend $5 grand a year....a trip to Tahiti comes to mind.
David Gregory, do you know which damn network you lie for? ~ Uncle Jimbo, @Blackfive
Is Your Lender A Patriot Or Terrorist?
August 19, 2008 - 16:43 ET by EdwardThe lenders got themselves into this housing mess with their mortgage fraud. Let all these lenders, Freddie Mac and Fannie Mae go down and out of business and let's start fresh. This mortgage fraud story Is Your Lender A Patriot Or Terrorist? is just one of several that was published in Broowaha Reno by an investigative reporter calling himself Craig B. out of Reno, NV.
An Open Letter to Our Home Loan Lenders.
I am writing you to request an immediate note modification as already allowed for by all your investors. For years, Freddie Mac, Fannie Mae, HUD and the VA have had foreclosure mitigation standards for note modifications in place. They allow for principal forgiveness and interest rate reduction to market or below market rate. That begs two questions: 1) why have lenders not followed them before, and 2) why have lenders instead chosen their senseless fanaticism to foreclosure?
As you know, President Bush has blamed the collapse of the American economy on “too many houses were built.” You and the other home loan lenders financed those “too many houses built.”
President Bush signs HR 3648, The Mortgage Forgiveness Debt Relief Act of 2007. It created a three-year exception for debt forgiveness on home loans.
Home loan lenders are increasingly being accused and * proven of pandering, Unclean Hands and being a threat to American economic interests and security. President Bush and millions others are rightfully blaming lenders for the American recession. Unreasonable lender insistence on foreclosure is driving the American economy further into recession. That is an increasingly contemptible tactic as it pushes us nearer to global depression.
Home value continue to go down because of lender initiated foreclosures. Lender foreclosures only make the recession worse. They drive home values further down as they add to the already enormous inventory of houses for sale.
Because of home loan lenders previous illegal lending practices and now irrational frenzy to foreclose in violation of their own investor existing guidelines, home values have dropped further putting me upside down. Your loan to me is more than the current value of my home.
The Feds, to boost the American economy, have recently done several aggressive emergency fund rate cuts. They have stated they will continue to cut interest rates to stimulate the economy. Those interest rate reductions should be passed through to me. Your investor guidelines even allow for it, and strongly encourage it, to avoid foreclosure.
Realtors are correctly not interested in taking any more listings for upside down properties as they are flooded with them and can no longer afford the costs to market a declining in value product.
Permanent loan forgiveness and permanent interest rate reductions would immediately put a floor under the collapse of housing prices. That would pull America out of this ruinous recession. Are you a patriot or a terrorist?
For a patriot, a note modification is the only answer. Without a note modification, I am facing bankruptcy. Bankruptcy attorneys are getting court-ordered note modifications. It is against public policy and unconscionable to throw people out of their homes because they are upside down because of lenders previous illegal lending practices.
The American Congress, President and Presidential candidates all support a freeze of several months on foreclosures, and a freeze of several years on upward interest rate adjustments. Senator McCain said that “the home lenders created the housing problem, they have to solve it, NOT the American government.” So, solve it. Follow your own investor foreclosure mitigation standards for note modifications. They have been in place for years.
My proposal is fair and reasonable as the current interest rate and the current fair market value of the house support it. I propose a note modification of an interest rate reduction to a fixed 4.000% and a debt forgiveness of $175,000, with a 30 year fixed fully amortized loan.
Sincerely,
cc: US Senators Obama, Clinton, McCain, Reid, Ensign
US Representative Pelosi
* Gledhill, Maree, King, Sickler & Kahan, Barry & Countrywide, Clark & First Centennial Title, Vaughan, Stewart & Wells Fargo, Mapes & Prudential Nevada Realty; Zane, Dugan, LeGault, First American Title & RemCor Realty, Homier
P.S. How about cleaning house and prosecuting these * evildoers and putting them on your banned lists?
Copyright © 2008 Craig B
Ed
Edward, I can cut-and-paste, too. :-)
August 19, 2008 - 17:13 ET by R D HelmEvery day it seems we hear endless stories about the mortgage and foreclosure crisis. The MSM just won't give you the whole story. Just a few facts to chew on today as you listen to more foreclosure and bad loan horror stories.
1. This whole mess started because the media and liberals in congress were rattling their sabers over the lack of mortgages being offered to people with bad credit, limited incomes and poor job histories. So .. the loans were made, and now you see what happened. If the mortgage market had been left to operate without the threats of government interference things would have been quite a bit different.
2. In 1999 only about 62% of privately owned homes carried a mortgage. Not sure what the figure is today, probably a bit higher. But of all the homes out there with mortgages, 97% of those mortgages are up to date .. that means not in default. That means that when you hear the media bleating about the mortgage crisis you could be talking about 3% of 62% of all privately owned homes. For those of you educated in government schools that would mean about 1.86 homeowners out of every 100 that are having a problem. This is NOT a crises.
3. There are a lot of people out there who own homes who should be renting.
4. In about two years you're going to hear the bedwetters in congress and the media together with some liberal "activist" groups griping about the lack of available mortgages for people with bad credit,limited incomes and poor job histories ... and this whole mess will get cranked up again.
-Boortz.com
-Dave.
*
August 19, 2008 - 17:04 ET by R D Helm*
There will be a taxpayer/inflation crisis
August 19, 2008 - 17:05 ET by sarcasmoIf these gamblers get bailed out despite their irresponsibility, though.
JMR
The tax & spend drug war looks racist in the real world.
Drug War & Racism
August 19, 2008 - 18:24 ET by EdwardWe Really Lost This War!
Ed
RD, we're thinking the same
August 19, 2008 - 18:17 ET by EdwardHi RD,
We're thinking the same. I don't want a government bail-out of the lenders or Freddie, Fannie. I want the ones punished who put us here.
Ed
RD, good copy & paste ;)