“Who Is Home Will U Steal Today”

"Who Is Home Will U Steal Today"Spotted the sign pictured at right in a KOMO News story about Occupy Seattle protesters disrupting the weekly courthouse steps foreclosure auction on Saturday at the King County Courthouse.

I’ll let the sign speak for itself, but I will say that I really don’t understand the connection these protesters appear to be making. Other signs at the protest:

  • “STOP ROBBIN’ OUR HOODS!”
  • “STOP ILLEGAL FORECLOSURES”
  • “NO MORE Foreclosures in OUR WA!”
  • “BANKERS LIED, ECONOMY DIED”
  • “Fund the needy, Not the greedy”
  • “BANKS TERRORISTS WORSE THAN AL QAEDA”
  • “HOMELAND SECURITY NEEDS TO DEFEND MY HOME”

How are foreclosures equivalent to corporate greed, theft, and terrorism?

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About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.

181 comments:

  1. 1
    anon says:

    If you don’t understand the relationship between the banks, bailouts, and foreclosures maybe your due diligence in researching a topic before reporting on it has yet to be satisfied. Otherwise, your claim of “without the sales spin” has little merit and it will be plain to all that you are selling ignorance.

  2. 2
    The Tim says:

    RE: anon @ 1 – Please enlighten us. How are foreclosures equivalent to corporate greed, theft, and terrorism?

  3. 3

    That may be spin, but it’s not “sales spin.” ;-)

    Seriously, there are some people who can make that type of claim. Those would be people who obtained the maximum loan amount that their bank would approve them for, especially if the loan was made over 3 years ago. You could also throw in some of the pick-a-payment type loans, and those variable rate loans that were certain to go up in rate no matter what the trend was in interest rates.

    On the other hand, no one was holding a gun to those peoples’ heads. That’s not quite the standard though. I do have a problem with banks taking advantage of the ignorant and naive when it comes to their loan offerings and loan approval process. So I’ll show a little sympathy to them, but again that only applies to some loans, and I doubt it’s anywhere close to 50% of all loans.

  4. 4
    anon says:

    RE: The Tim @ 2

    The mortgages are “funny money” due to fractional reserve banking practices for which a “real” as in “real estate” asset is being seized under threat of forcible eviction “terrorism”. Once the loan is converted by the bank to stock they aren’t even the holder anymore so you can add fraud to the list.

  5. 5

    RE: The Tim @ 2 – It’s obviously theft. The bank gave Mr. and Mrs. Doe $300,000 so that they could buy a house. Now the house is only worth $225,000, and that’s now all the bank will be getting back. $75,000 has been stolen!

  6. 6
    The Tim says:

    RE: Kary L. Krismer @ 3 – Even in the cases you mentioned (over-approval, pick-a-payment, etc.), how would it be “theft” for a bank to foreclose on a home that the buyer never should have been able to purchase in the first place? That’s a pretty big stretch.

  7. 7
    ChrisM says:

    Hmm, Tim, I think you’re being rather obtuse here.

    Foreclosures riddled with errors are (IMO) tantamount to corporate greed. What are you views on robosigning? How about :”problems” with improperly notarized documents?

    Anyways, some stories to review:

    http://blogs.wsj.com/developments/2011/08/09/washington-state-sues-bofa-over-foreclosures/

    “A lawsuit filed last Thursday by the Washington state attorney general shows why foreclosure-document problems aren’t limited solely to so-called “judicial” states where banks must use the courts to foreclose.

    Attorney General Rob McKenna alleged that a unit of Bank of America Corp. that handles foreclosures on behalf of the bank had improperly executed thousands of foreclosures over the last three years. The suit alleges that ReconTrust Co., a wholly owned BofA subsidiary that serves as a trustee in foreclosure sales, didn’t act in good faith when foreclosing on homeowners.”

    http://online.wsj.com/article/SB10001424052702303864404575572662815011760.html

    http://content.usatoday.com/communities/ondeadline/post/2010/12/arizona-nevada-accuse-bank-of-america-of-foreclosure-fraud/1

  8. 8
    The Tim says:

    RE: anon @ 4 – So, your argument is that no one should ever have to pay back any mortgage, because it’s not real money and the bank sells the loan on a secondary market? Astounding logic.

  9. 9

    RE: The Tim @ 6 – I would agree. What it would be is predatory lending. The funny thing is though, the banks made those loans assuming the property would go up in value, and that they’d perhaps get a windfall when the likely foreclosure came about. Didn’t quite work out that way.

    If the person made a sizable down payment, on a loan the bank should have known they couldn’t afford, perhaps you could view that as theft, but the recipient of those funds was the seller, not the bank.

  10. 10
    anon says:

    RE: The Tim @ 8

    It’s the fiat currency combined with the fractional reserve banking system compounded by the private federal reserve’s lack of regulation and the coup de grace of politicians bought and paid for by the banks. I pay my mortgage in good faith and will continue to do so until the greedy folks squeeze the money supply until there is no longer work for me. At which point I will have nothing to lose by making my own sign. Get it?

  11. 11
    The Tim says:

    By ChrisM @ 7:

    Hmm, Tim, I think you’re being rather obtuse here.

    Foreclosures riddled with errors are (IMO) tantamount to corporate greed. What are you views on robosigning? How about :”problems” with improperly notarized documents?

    I shared my opinion on those issues almost a year ago in the post A Simple Solution to the Foreclosure Paperwork Mess. Here’s an excerpt:

    …I agree that it’s not okay for the banks to just ignore the law when it happens to inconvenience them…

    Here’s my proposed solution to the whole mess. Forget foreclosure freezes. Forget endless reviews of millions of documents. Here’s my 3-point plan:

    • Free legal counsel for anyone who is current on their mortgage but has been truly wrongfully foreclosed.
    • Every time a bank is found by the courts to have initiated any degree of foreclosure proceedings on someone who was not behind on their mortgage, a $10 million fee is levied against the bank.
    • Fees collected pay for the legal representation of future legitimate claimants against the bank.

    The basic idea is to make it easy for people who have actually been victimized (not just the victims of documentation technicalities) to obtain appropriate recourse against the banks, and to make it really hurt when the bank actually screws up. This provides a strong incentive for the banks to get things right and a just outcome for the times that they get it wrong.

  12. 12

    RE: ChrisM @ 7 – Part of that is just posturing by someone who will be running for Governor. For example, the part about not getting proof of ownership. Washington law is very specific on how little the trustee has to do in that regard, and I would be shocked if that low standard wasn’t met.

    And a lot of the blame would go to the legislature. One of my complaints the last few years is that rather than set forth standards, the legislature makes everyone a fiduciary. The huge exception to that trend is in this area, where two times they lessened the standards that a trustee has to comply with. So who’s to blame that the trustee is not acting as a neutral third party? I would place the blame on the legislature (and current Governor) who twice enacted legislation which reduced the duties of deed of trust trustees.

  13. 13

    By anon @ 10:

    RE: The Tim @ 8

    It’s the fiat currency combined with the fractional reserve banking system compounded by the private federal reserve’s lack of regulation and the coup de grace of politicians bought and paid for by the banks. I pay my mortgage in good faith and will continue to do so until the greedy folks squeeze the money supply until there is no longer work for me. At which point I will have nothing to lose by making my own sign. Get it?

    I don’t get it. Are you saying you exchanged a promise to pay money for a house and now the money you have to pay it back in is becoming more worthless? That sounds like a good thing!

  14. 14
    David Losh says:

    RE: The Tim @ 2

    Whoa, snap from Tim.

    Here’s how it works. No one was making loans; they were creating financial instuments.

    No one cared, I mean the lenders, if the loan performed, or if there was a value to the property. The loans were bundled, and sold, globally.

    What we heard was that the stock market was going up, Europe was doing well, and China, along with India were break out economies. The price of property was going up based on supply, and demand.

    In reality, a very few coporate heads, of security brokerages, and insurances scams knew what was going on. Government regulators turned a blind eye.

    You even started a blog about the price of property exceeding value. So if you knew, how did larger corporate players, the Fed, and banking regulators miss it? They didn’t.

    I expected hyper inflation to save the day. That didn’t happen.

    So now we have this same scum buying, selling, trading, and swapping these notes while they end up with our interest payments along with our property. They have absolutely no skin in the game. They borrow at .05% to buy notes for twenty cents on the dollar. When they sell at auction for cash at an averaged price of fifty cents on the dollar they are making pure profit.

    The fact you would refuse to see is kind of telling. The same scams are going on today, it’s just a little easier to get people to pony up the interest payments, with a 20% down payment. The risk is lower, and the notes sell for a premium price.

  15. 15
    ChrisM says:

    RE: The Tim @ 11 – SIgn me up for your plan. But unless you’re looking to boost site traffic, this post seems deliberately provocative.

    You’re admitting the banks were negligent. How is that not corporate greed?

    The entire creation of MERS – isn’t that corporate greed?

    To your list of “simple solutions” I’d add rules that:
    1. banks must move property through foreclosure proceedings once 90 days (or 120) past due, and a loss realized on the books

    But, to be fair, I’m not quite clear on the definition of “Corporate Greed” – don’t we first need to define terms?

  16. 16
    Matt says:

    I’m sure you remember HARP, and what a woeful failure it was at the job it was intended to do, which is why it is apparently getting a refresh. The banks were more interested in closing down avenues to using HARP than in making it available to people.

    I think it’s pretty reasonable to see banks getting bailouts for their end of the crisis, while neither the banks nor the government are doing anything on the consumer side, and getting pissed enough to take to the streets.

    To say nothing of the robosigning scandal, the subprime bottom-feeders, and the practice of taking their free money from the Fed and loaning it _back_ to them at a profit, and yeah, they’re pretty unsympathetic in all this.

  17. 17
    anon says:

    RE: Kary L. Krismer @ 13

    It’s a race against a failing economy, where it stops nobody knows. When middle class people living well within their means and planning for the future can no longer afford the roof over their heads you will see what we are seeing now. Will it happen to me? It could, and my friend, it could happen to you too. You’ll be able to post your sign right here, until your hosting company shuts you down for failure to pay. Maybe then you will understand that the shark’s hunger will not be satisfied with millions of little fish and it has moved up to larger ones. They are eating their own, but I guess you can’t see that yet.

  18. 18
    No Name Guy says:

    One thing this mess (robo signing, false notaries, etc) is going to leave behind is a whole pile of clouded titles.

    I can see an army of lawyers making truck loads of money doing suits to quiet titles for years to come.

    Oh, and to the clown with the “No more more foreclosures in our WA” – they must not want any lending on houses either, since without the one, you’ll never get the other. What a twit.

  19. 19

    By ChrisM @ 15:

    The entire creation of MERS – isn’t that corporate greed?

    How so? At worst it only reduced expenses. The rest of the complaints are largely legal nonsense in most states and technicalities in others. The one size fits all for 50 states was stupid, but I don’t see how it relates to greed at all.

  20. 20

    By No Name Guy @ 18:

    One thing this mess (robo signing, false notaries, etc) is going to leave behind is a whole pile of clouded titles.

    Questionable in Washington, although there is a case pending before our Supreme Court which might lead to that type of a result in some cases.

    One thing though. In Washington once you’ve owned a property for 7 years with some sort of color of title (e.g. a deed of some sort), you effectively own the property. it’s a type of adverse possession, but when based on a deed the period is shortened to 7 years.

  21. 21

    BTW, I misread the sign on this piece. At first I thought it was a threat to go steal from the homes of people protesting.

  22. 22
    ChrisM says:

    RE: Kary L. Krismer @ 19 – As I said, I’m unclear on the definition of “corporate greed.” MERS was billed as an alternative to recording at the county level. Bypassing legal conventions in the interesting of saving dollars – is that greed?

  23. 23

    By ChrisM @ 22:

    RE: Kary L. Krismer @ 19 – As I said, I’m unclear on the definition of “corporate greed.” MERS was billed as an alternative to recording at the county level. Bypassing legal conventions in the interesting of saving dollars – is that greed?

    I called it saving expenses. But as I’ve mentioned in the past, the grantor/grantee index of the county auditor is a really poor tool for tracking the ownership interests in a mortgage. Mers is a far better, more modern system, for doing that.

    It’s like the difference between looking for something in a book and searching for it on a PDF of the book. I really doubt the saving of recording fees had much to do with it at all, because the old system was just plain cumbersome. In effect, the same factors that lead to the Torrens system of recording ownership lead to Mers.

    http://en.wikipedia.org/wiki/Torrens_title

    Apparently only about 3,500 parcels of land in King County have been converted over to Torrens.

    http://www.kingcounty.gov/business/Recorders/Services/RegisteredLandSystem.aspx

  24. 24

    RE: ChrisM @ 22 – I put too many links in my response, but basically grantor/grantee indexing is cumbersome when it comes to this sort of thing. Wait for my post to clear moderation for a further explanation.

  25. 25

    First of all, the occupy protestors are just as illiterate as the tea partiers.That doesn’t make their protest more or less valid. But I never heard the Tim say anything negative about the Tea Partiers, only that he found it offensive to call them Tea Baggers. They were making a big stink about Obama being born in Kenya, and looked for all the world to me like a bunch of hooligan thugs.
    Second of all, nobody put a gun to the lender’s heads and forced them to lower lending standards. They were eager to assure people that they could afford the loans they were getting, and I’ve heard numerous stories about people who were qualified for conventional loans but were weaseled into getting subprime loans because the commissions were higher. How many people thoroughly read the loan documents? Between that and robosigning, I don’t have much sympathy for the banks. They lied to investors, they continue to cook the books, they pressured and threatened appraisers, they conned ratings agencies into giving these packaged loans AAA ratings, and they were a huge part of perpetrating this bubble. These big banks got bailed out by the US government, but those who got foreclosed on were only offered words of sympathy.
    Sure, people who bought at the top of the market, people who purchased houses they couldn’t afford….they were stupid. But the banks? They were malicious. Maliciousness gets rewarded but stupidity does not?

  26. 26
    Dweezil says:

    Am I reading the title for this correct?
    “Who is home, will you steal today?”

    Anyhow, using the word “steal” is a bit of a stretch. But the banks are definitely greedy bastards.

  27. 27
    The Tim says:

    RE: Ira Sacharoff @ 25 – A few thoughts:

    1) I never posted here about the Tea Party protests because they didn’t touch on Seattle-area real estate issues, as far as I saw.

    2) I don’t have any sympathy for the banks, either.

    3) I have been consistently against all bailouts, for banks or anyone else. And as they say, two wrongs don’t make a right.

  28. 28
    pfft says:

    oh god, the tim is a real estate blogger?

    let’s start here:

    “Robo-signing” of mortgages still a problem
    http://www.cbsnews.com/stories/2011/07/18/national/main20080533.shtml

  29. 29
    The Tim says:

    RE: pfft @ 28 – So, if a bank breaks the law that makes it okay for people who haven’t paid their mortgage to keep a home that they can’t afford? See my comment @ 11 above.

  30. 30
    pfft says:

    By The Tim @ 29:

    RE: pfft @ 28 – So, if a bank breaks the law that makes it okay for people who haven’t paid their mortgage to keep a home that they can’t afford? See my comment @ 11 above.

    no, it means that a lot of foreclosures are possibly illegal.

    ““STOP ILLEGAL FORECLOSURES”

    get it? if a bank doesn’t know that it owns the house and illegally robo-signs a house away that is illegal. property rights in this country are very strict so that we know for sure who owns property. the bankers were so reckless is making loans that they don’t have the paperwork!

    you’re a housing blogger, I know this in part because of you. how could you not connect the dots?

  31. 31
    pfft says:

    By The Tim @ 29:

    RE: pfft @ 28 – So, if a bank breaks the law that makes it okay for people who haven’t paid their mortgage to keep a home that they can’t afford? See my comment @ 11 above.

    like it or not bailouts were/are necessary.

  32. 32
    Scotsman says:

    RE: pfft @ 31

    “like it or not bailouts were/are necessary”

    Really? Rewarding bad behavior is somehow neccessary? All it has done is kick the can down the road. All the bad things people hoped to rectify will still happen. Nothing has been fixed, and in fact there still aren’t even any adults in the room willing to talk about real solutions.

  33. 33
    pfft says:

    By Scotsman @ 32:

    RE: pfft @ 31

    “like it or not bailouts were/are necessary”

    Really? Rewarding bad behavior is somehow neccessary? All it has done is kick the can down the road.

    how do you know? Sweden had a bailout and 20 years later there has been no bigger disaster.

    does anyone really thing that we’d be better off if bears stearns, fannie and freddie went into bankruptcy in quick order? would we really be better off? no!

    former mccain economic advisor said we staved off a depression.

    Blinder, Zandi Say U.S. Bailouts Likely Averted a Depression
    http://www.bloomberg.com/news/2010-07-28/blinder-zandi-say-u-s-bailouts-likely-averted-a-depression.html

    The U.S. response to the financial crisis probably prevented a depression, slowed a decline in gross domestic product and saved about 8.5 million jobs

  34. 34
    David Losh says:

    RE: The Tim @ 29

    Let me clear that up for you a little. I think a lot of people could afford the mortgage payment. The problem is the property is worth, in most cases, at least 30% less in four years.

    Property values going up was a lie. Property values weren’t going up at all. The price of property was going up. Banks knew it, and kept on making larger loans. It gave an illusion of value.

    Now some one looking at sacrificing to keep a property that is dropping in price seems wrong to me. You have a child. You are going to be making interest payments on a property that is going down in value every month. The economy all around you is going down. Unemployment is rising, and you are just beginning to see that whatever you put, or pay into, this property will be lost forever.

    Banks are sending out letters encouraging people to short sell, or go into foreclosure, or paying them for a deed in lieu of foreclosure. Why is that? I’ll save you the suspense, it’s because they control the property, the value, and the price. There are enough suckers out there who continue to mill the dollars around so banks make massive profits.

    Banks want you to send the property back. The old loan is done, and the new loan will start from scratch, it’s a new day, and new amortization schedule. It’s a new, “premium” loan to sell. And a new bunch of crooks willing to bet on the come.

    Wait a minute, did we forget about the people who lost jobs, businesses, had hours cut, or are now facing longer hours at the same pay? Did we forget that loan servicing fees accumulate with every skipped payment, or late payment? How about all the credit card debt that has people on the ropes?

    Oh, I get it, you’re OK so every one else should just shut up, and pay up.

    These bankers collapsed a global economy. They put people out of work. They put people out of thier homes.

  35. 35

    By Ira Sacharoff @ 25:

    First of all, the occupy protestors are just as illiterate as the tea partiers.That doesn’t make their protest more or less valid. But I never heard the Tim say anything negative about the Tea Partiers, only that he found it offensive to call them Tea Baggers. They were making a big stink about Obama being born in Kenya, and looked for all the world to me like a bunch of hooligan thugs.
    Second of all, nobody put a gun to the lender’s heads and forced them to lower lending standards. They were eager to assure people that they could afford the loans they were getting, and I’ve heard numerous stories about people who were qualified for conventional loans but were weaseled into getting subprime loans because the commissions were higher. How many people thoroughly read the loan documents? Between that and robosigning, I don’t have much sympathy for the banks. They lied to investors, they continue to cook the books, they pressured and threatened appraisers, they conned ratings agencies into giving these packaged loans AAA ratings, and they were a huge part of perpetrating this bubble. These big banks got bailed out by the US government, but those who got foreclosed on were only offered words of sympathy.
    Sure, people who bought at the top of the market, people who purchased houses they couldn’t afford….they were stupid. But the banks? They were malicious. Maliciousness gets rewarded but stupidity does not?

    Ira nailed it!

    And my belief is it’s not about “corporate greed” so much as “corporate fraud”. But I guess they go hand in hand don’t they?

  36. 36
    Scotsman says:

    RE: pfft @ 33

    ” Zandi Say U.S. Bailouts Likely Averted a Depression”

    Yup, sure did- pushed it back from 2009 to 2014. Did it by borrowing more money so when the depression does hit it will cause even more damage. You still confuse balance sheet expansion with correction. We aren’t getting richer, we’re getting poorer. Debt is growing faster than the net output of the economy. It’s still true that you can’t borrow your way out of debt.

  37. 37
    Scotsman says:

    In other semi-related news, OWS is about to be brought down by . . . drumming.

    http://hotair.com/archives/2011/10/24/down-twinkles-ows-at-risk-of-fracturing-over-drumming/

  38. 38
    Azucar says:

    By Scotsman @ 36:

    RE: pfft @ 33

    It’s still true that you can’t borrow your way out of debt.

    Well, I’m not saying that it’s going to work or even that this is what they’re trying to do, but if you do it on a large enough scale can you borrow your way enough to stimulate the economy and cause inflation, thus lowering the value of what you already owe? Inflation of everything (including wages and homes) would help to get some people out from “under water” status on their mortgages.

    Like I said, I’m not saying that it will work or that it is even what they are trying to do, but in theory it it is a way to borrow your way out of debt (if the scale of your actions is large enough to affect the overall economy).

  39. 39
    Blurtman says:

    Tim, One of the oldest investment scams is to pump up the value of an asset and unload it on unsuspecting suckers. The classic boiler room operation where touts pump penny stocks to unsuspecting senior citizens and then dump the shares is a common example. This simple scam was conducted on a large scale by the investment banks and their leaders, including a recent US Treasury Secretary, Hank Paulson. The Investment banks made huge profits on the transaction fees alone of creating and selling mortgage backed securities, and even more by dicing up tranches and packaging them into Credit Defalt Obligation (CDO) securities, and even more by taking out multiples of credit default swap insurance on CDO’s created to fail.

    The demand for these toxic securities created a huge demand for the mortgages that were the raw materials for these securities, driving up the price of homes. When this fraudulent bubble burst, tanking the economy, the bagholders were the unsuspecting homeowners, many of whom lost their jobs as a result of this huge scam tanking the economy. So yes, when the servicing arms of these same criminal investment banks foreclose on the victms of this crime wave, it is a scandal, and truly outrageous.

  40. 40
    pfft says:

    By Scotsman @ 36:

    RE: pfft @ 33

    ” Zandi Say U.S. Bailouts Likely Averted a Depression”

    Yup, sure did- pushed it back from 2009 to 2014. Did it by borrowing more money so when the depression does hit it will cause even more damage. You still confuse balance sheet expansion with correction. We aren’t getting richer, we’re getting poorer. Debt is growing faster than the net output of the economy. It’s still true that you can’t borrow your way out of debt.

    you didn’t answer why sweden, which had a similar bailout 20 years ago, hasn’t had another crisis. sweden has one of the strongest economies in the world.

    “Yup, sure did- pushed it back from 2009 to 2014.”

    really? about a year ago you said we’d already have had another collapse already…

    “It’s still true that you can’t borrow your way out of debt.”

    no, it’s been proven again that you can borrow your way out of debt. under your scenario our deficits would be even bigger because the economy would have gone through another depression. remember the forumula?

    lower gdp=lower employment=less in wages=less tax revenue=less debt.

    where is austerity working? nowhere.

    “Debt is growing faster than the net output of the economy.”

    yeah because the economy collapsed genius. any cutbacks would add more debt and further depress the economy.

  41. 41
    robotslave says:

    Can we get some real-world examples of these people we’re talking about, the ones who knew perfectly well that they wouldn’t be able to make payments when they took out their mortgages?

    Unless my memory is failing me, there were armies of people who were quite strongly motivated to explain to borrowers how they would, in fact, be able to repay their loans. I think a lot of them worked for banks.

    And as has already been said, the banks issuing mortgages were turning around and immediately selling them for a tidy profit to securitization shops, which had a bottomless demand for new paper. There was a *lot* of money being made, and the incentive to vet borrowers crumbled in the face of that easy profit. Is “greed” not a good word to describe that?

    The government bought truckloads of toxic mortgage securities to keep the banks from going under. The government hasn’t given a dime to borrowers to avoid foreclosure. That might not be greed, per se, but it doesn’t seem quite fair, either.

  42. 42
    Ray Pepper says:

    Maybe this will help Tim and those who are being accused of seeking a free house when in fact they are seeking to protect their homes from thieves.

    If John Smith snatches a woman’s purse in crowded jostling parking lot and then loans the money from the bag to you, who do you want to pay? Would you admit that you took the loan and agree to pay the criminal, John Smith, or would you say, wait, unless I know the money is going to the woman whose purse was snatched I’m not paying anything to reward the thief for his crime!

    STOP THINKING YOU DID SOMETHING WRONG PEOPLE! YOU DIDN’T STEAL THE PURSE (I.E., THE MONEY FROM THE PENSION FUNDS) WALL STREET DID IT. AND YOU ARE A PERSON OF DIGNITY AND POWER TO DECIDE WHETHER WALL STREET GETS AWAY WITH SNATCHING THE PURSE. FIGHT ON!

  43. 43

    By Ira Sacharoff @ 25:

    Second of all, nobody put a gun to the lender’s heads and forced them to lower lending standards.

    As I mentioned, the system to some extent was based on a belief property values would always go up. In addition though, you have the credit card model where rather significant numbers of defaults are more than acceptable.

  44. 44
    Scott Weitz says:

    Does anyone know what percentage of the foreclosures are Fannie or Freddie loans? I know the number has fluctuated, but I would estimate 50-80% of the foreclosures are actually owned by FNM or FRE.

    Most don’t realize that most of the homes are not going back to banks, but rather to these quasi-governmental agencies (GSEs) with blank government checks keeping them afloat and the banks are simply servicers (cogs in the system) that get paid to do the ‘dirty work’ of foreclosure.

    That said, I do agree that banks were a huge part in the ‘bubble’ that has led to the collapse, and they are the ones that have benefitted the most via the bailouts and other governmental support. In fact, they have paying out bonuses that exceed even the pre-bubble levels due to the easy money policy of the Fed (the carry trade of borrowing at close to 0% and re-investing that borrowed capital), and generating trading (gambling) profits. No one can argue that we don’t live a crony capitalist society right now in which the banks get socialism (bailouts; no risk of failure) and the public gets capitalism (sink or swim).

    I for one support the theory of the Occupy group – I sympathize with their frustrations, and hope that they can find a voice to actually produce ‘change’ to create a more equitable system for all.

  45. 47
    Scotsman says:

    RE: Azucar @ 38

    “can you borrow your way enough to stimulate the economy and cause inflation, thus lowering the value of what you already owe?”

    In some situations, yes. But it’s like shooting yourself in the foot- you still end up poorer. No matter what you do, 2+2 still =4 in the end. AKA there is no free lunch. And in our current situation we won’t get general inflation, and certainly not wage inflation, so we just end up screwing ourselves as the contraction still happens.

  46. 48
    Scotsman says:

    RE: pfft @ 40

    “really? about a year ago you said we’d already have had another collapse already…”

    “yeah because the economy collapsed genius.”

    Ok, I’m confused- but not as confused as you are. Which is it, collapse, or no collapse? I know you’re not the sharpest tool in the shed, but try to at least keep your own arguments straight.

  47. 49
    Scott Weitz says:

    RE: Azucar @ 38

    Two problems:

    1) Its impossible to do this in an equitable fashion (note that we’ve done this the past few years as we’ve printed more money in the past 3 years than every before in history) – all the money has gone to banks, and the government who used it to 1) repair their balance sheets (banks) and 2) continue to write checks they can’t afford (government). The average person hasn’t benefitted at all.

    2) Printing money deflates that value of the dollar (see Germany before the Hitler era who thought that would be a great idea and Zimbabwe – similiar horrific outcome) and the damages will far exceed the benefit.

  48. 50
    Scotsman says:

    Speaking of idiots, here’s one now. Larry Summers (past president of Harvard, leading economist, etc.) thinks lower (more relaxed) lending standards will cure the housing market. Who’s up for round two?

    “First, and perhaps most fundamentally, credit standards for those seeking to buy homes are too high and too rigorous. The characteristics of the average successful applicant in 2004 would make that applicant among the most risky today. The pattern should be the opposite, given that the odds of a further 35 percent decline in house prices are much lower than they were at past bubble valuations”

    http://www.washingtonpost.com/opinions/how-to-stabilize-the-housing-market/2011/10/23/gIQA7lveAM_story.html

  49. 51
    Jonness says:

    The moral of the story is, always question authority, and always ask yourself what’s really behind the free handouts. Most likely what seems like a free handout is really just a clever way of stealing your freedom and independence.

    Let’s say a serial killer with a crazed look in his eye invites you inside for a free meal and a movie. You realize it could be dangerous, but you don’t feel like going to work in the morning to pay for your own way, so you go inside the serial killer’s home. After the meal, you start feeling drowsy and drugged. The next thing, you wake up locked in a closet with your hands tied and your head in a specially fitted lockbox that muffles your screams.

    You are a good well-meaning person who has always given your friend, neighbors, and perfect strangers the shirt off your back; thus, you deserve the best that life has to offer. But whose fault is it that you wound up in that closet?

  50. 52
    2kt says:

    RE: David Losh @ 14

    I see much rumbling as usual, Dave, but very little substance in your post. At the end of the day it boils down to a simple thing – you can not own what you can not pay for.

  51. 53
    Macro Investor says:

    RE: The Tim @ 11

    “The basic idea is to make it easy for people who have actually been victimized (not just the victims of documentation technicalities) to obtain appropriate recourse against the banks, and to make it really hurt when the bank actually screws up. This provides a strong incentive for the banks to get things right and a just outcome for the times that they get it wrong.”

    You and Kismer are being obtuse. You put up these straw arguments that people who don’t pay deserve to be foreclosed. Nobody’s ever argued against that.

    What you are saying is “might makes right”. What kind of society do we have when banks with clout can just ignore the laws and do what ever they please? Maybe only a few people were actually wronged. That’s not the point. When people don’t see the law playing fair, they’ll ignore it too. Then we’ll have vigilante law.

    Robo signing is fraud and perjury, as are many many other things pointed out to you on these threads. You’ve had years to read them. And you’ve had years to do your own research. You have not. That is obtuse.

  52. 54
    2kt says:

    RE: Macro Investor @ 53

    All fine thoughts but one problem – banks don’t really get hurt by fines and penalties – the costs are passed on to customers through higher fees.

  53. 55

    By Jonness @ 51:

    The moral of the story is, always question authority, and always ask yourself what’s really behind the free handouts. Most likely what seems like a free handout is really just a clever way of stealing your freedom and independence.

    Let’s say a serial killer with a crazed look in his eye invites you inside for a free meal and a movie. You realize it could be dangerous, but you don’t feel like going to work in the morning to pay for your own way, so you go inside the serial killer’s home. After the meal, you start feeling drowsy and drugged. The next thing, you wake up locked in a closet with your hands tied and your head in a specially fitted lockbox that muffles your screams.

    You are a good well-meaning person who has always given your friend, neighbors, and perfect strangers the shirt off your back; thus, you deserve the best that life has to offer. But whose fault is it that you wound up in that closet?

    Then the police come in and buy the serial killer a mansion as long as he promises he won’t lure anyone else in with a promise of a free pizza and a movie.
    You, who are still tied up in the closet with the scream muffling lockbox? They just leave you there, because you didn’t have to enter the serial killer’s house.

  54. 56
    Sweet Pea says:

    RE: Scotsman @ 37

    I’m thinking they might be brought down by something more like this:

    http://www.businessinsider.com/class-warfare-breaks-out-within-the-occupy-movement-2011-10

  55. 57
    David Losh says:

    RE: 2kt @ 52

    Let me be more clear. People are out of work.

    When people bought properties the economy was booming, or so it seemed. When people refinanced at lower rates, it seemed like a smart move, all it did was start the amortization over, and reaffirmed the debt.

    Now people are faced with paying off a debt that exceeds, or far exceeds the value of the property.

    If the value of the property is going up you might struggle through. If the value is going down your incentive to hold on is less. People faced with a loss of income have to make these choices.

    I know hundreds of people who have had a loss of income. Just because you have a job today doesn’t mean that it won’t happen to you. Some people just get a little behind on a temporary set back and the service fees, late fees just add to what needs to be caught up.

    How about the two income family who loses an income, even for a while. Do you think the banks have done anything? heck no. They want blood, or foreclosure. How about a cut back in hours?

    Or better yet the company you work for goes out of business.

    Even worse is that you built your business during the good times only to have it be a milestone today.

    Banks could have come up with policy, and procedure. They didn’t. They came up with a loan modification scheme to get people out of the home. They want to get a refi package on their desk. If the loan docs don’t work, they foreclose, and make more money.

    Millions of people took out loans they could afford, and maybe still can. The real question is if they should continue to pay.

  56. 58
    Ray Pepper says:

    RE: 2kt @ 52

    “you can not own what you can not pay for.”

    For the millions who continue to reside in these homes, and taking care of them, YOU need to be PAID for watching over these properties until the rightful legal owners are found. In the absence of a paycheck (since banks are NOT placing you on the payroll) FREE RENT should be accepted by the occupier if that is YOUR desire.

    The Banks surely do NOT own these homes any more then the homeowner who has not paid for it. Until the REAL OWNER is found its up to the person occupying the premises to watch over it as long as they can, while they SAVE like they never have before, until the rightful owner is located LEGALLY!

    Because the future of the home is UNCERTAIN saving becomes essential…

  57. 59
    Jonness says:

    By robotslave @ 41:

    Is “greed” not a good word to describe that?

    Yes. And many of my friends and neighbors who bought into the hype warned me that they were getting rich, and I was missing the gravy train by holding off because I thought we were having a housing bubble that was on the verge of collapsing. For years, I was criticized for living frugally and saving my money in hopes prices would tumble in the future. As people leveraged into homes beyond what they previously realized they ever could possess, they thought I was nuts for passing up all the free and easy wealth. According to them, I was being left in the dust and was choosing a life of poverty, struggle, and toil.

    Is “greed” not a good word to describe my house-buying friends and neighbors’ actions during the bubble runup? And now that it’s all collapsing in on them, instead of taking responsibility for the consequences of their actions and decisions, they are doing exactly what I suspected they would do, blaming everybody but themselves for where they have ended up.

  58. 60
    Scotsman says:

    RE: Sweet Pea @ 56

    Yup- I get a kick out of seeing the very issues they’re protesting against and trying to eliminate crop up in their micro society. It’s painfully obvious any plan for a more perfect world must first eliminate human nature. ;-)

  59. 61
    2kt says:

    RE: David Losh @ 57

    All people have problems, some more, some less, but we all do. At the end of the day one should not borrow money they can not repay and if they can not repay it and thus unable to meet the contract they should move on and either sell or turn the keys in.

    You own what you paid off or can pay for. The rest you just lease from those who loaned you money for it. Don’t be a child. The world does not own you a living, Dave. Live on cash. It’s a free country. You force the banks to eat losses by crumdowns in court, the only thing you accomplish is you raise everyone else’s banking fees. There is no credit tooth fairy.

  60. 62
    2kt says:

    RE: Ray Pepper @ 58 – I have read enough of your posts and clicked enough of your lnks to know that you are just another fast buck artist. God speed, Raymundo.

  61. 63
    robotslave says:

    “There is no credit tooth fairy.”

    Ah, but there is. You just have to be a bank or an automaker or similar if you want a visit from her.

    Corporate debt is negotiable, and sometimes even optional. Consumer debt is a sacred responsibility that can never be lifted.

  62. 64
    pfft says:

    By Scotsman @ 48:

    RE: pfft @ 40

    “really? about a year ago you said weâ��d already have had another collapse alreadyâ�¦”

    “yeah because the economy collapsed genius.”

    Ok, I’m confused- but not as confused as you are. Which is it, collapse, or no collapse? I know you’re not the sharpest tool in the shed, but try to at least keep your own arguments straight.

    you need to go back and read what I wrote.

  63. 65
    pfft says:

    By Scotsman @ 47:

    RE: Azucar @ 38

    “can you borrow your way enough to stimulate the economy and cause inflation, thus lowering the value of what you already owe?”

    In some situations, yes. But it’s like shooting yourself in the foot- you still end up poorer.

    no you don’t. this is well studied. we’ve know this for 70 years.

    when you save the economy from certain collapse you save tax revenue and hence your budget deficits are lower than they would be. if you save the country from mass unemployment you save tax revenue. people who don’t have jobs can’t buy taxes.

  64. 66
    Ray Pepper says:

    RE: 2kt @ 62

    Depending on your definition of fast buck I just maybe. But, when you seek the truth, and FIND IT, then you know what path you must take.

  65. 67
    The Tim says:

    RE: Scott Weitz @ 46 – Agree with all of that 100%. I just don’t see how stopping all foreclosures is the solution or even really related at all…

  66. 68
    pfft says:

    By Scotsman @ 50:

    Speaking of idiots, here’s one now. Larry Summers (past president of Harvard, leading economist, etc.) thinks lower (more relaxed) lending standards will cure the housing market. Who’s up for round two?

    “First, and perhaps most fundamentally, credit standards for those seeking to buy homes are too high and too rigorous. The characteristics of the average successful applicant in 2004 would make that applicant among the most risky today. The pattern should be the opposite, given that the odds of a further 35 percent decline in house prices are much lower than they were at past bubble valuations”

    http://www.washingtonpost.com/opinions/how-to-stabilize-the-housing-market/2011/10/23/gIQA7lveAM_story.html

    just because it was too easy to get a loan before doesn’t mean it’s not too hard to get one now.

  67. 69
    2kt says:

    RE: Ray Pepper @ 66

    The definitions are known and they don’t change, just like people. It’s always another guy who is at fault and there’s always that swell fellow who will tell you what you need to hear and take your money under some “absolutely legal because everyone is doing it” scheme or another.

    The piper will have to be paid at some point, Raymundo, be it “legal owner” or “we the people” because it ain’t really kosher.

    But for now, it’s Doctor Pepper’s time, so enjoy it while it lasts.

  68. 70
    2kt says:

    RE: robotslave @ 63

    Everything is negotiable if you have something to negotiate with. Life is not fair in spite of what they told you in elementary school.

  69. 71
    Ray Pepper says:

    RE: 2kt @ 69

    “But for now, it’s Doctor Pepper’s time, so enjoy it while it lasts”

    Oh..thats were you are mistaken…Its NOT MY time. It has always been MY TIME. I support where I see the damage. The family unit has been CRUSHED by this corruption on Wall Street. I have ZERO tolerance for any entity that seeks to break down the family unit.

    I Coach in excess of 100 kids each year in Metro Parks Bball and Soccer. I see the divorces and financial misery that has been implemented on families by this corruption. I offer my support and education when warranted.

    BTW the Occupy Seattle,Occupy Wall Street, and Occupy Tacoma movements I find causing far more damage then good to our society. NOTHING has come along yet to change my opinion of these protestors. The message being heard is distorted and falling upon deaf ears to our society and that is truly sad.

  70. 72
    Scotsman says:

    RE: pfft @ 65

    Uh, HELLO! That’s not saving the economy- as you’ve described it that’s saving the government and reducing the deficit. It adds nothing to the “economy” or the average standard of living. You can’t just pull money out of your butt and claim it’s the same as wealth. Ponder dilution. Give it up.

  71. 73
    2kt says:

    RE: Ray Pepper @ 71

    Every time there is an economic crisis, families suffer in great numbers. It is sad how many homeless people there are. Capitalism is not the most fair system.

  72. 74
    Macro Investor says:

    By Jonness @ 45:

    By The Tim @ 8:

    RE: anon @ 4 – So, your argument is that no one should ever have to pay back any mortgage, because it’s not real money and the bank sells the loan on a secondary market? Astounding logic.

    I believe adults should think like adults and take responsibility for their actions and decisions like adults. I’m highly against the whole government as Santa Clause routine that 99.9% of America is making it’s living off of without having to exert any effort to stop and use a couple of brain cells along the way. But I think I’m the rare exception, because I raised myself since birth. It appears most other people have been treated like babies their entire lives and have never had to think for themselves.

    I’d love to hear how you raised yourself since birth. You just popped right out and asked the doctor for a job. You are to be commended sir!

    You argument is as silly as Tim’s. Some people didn’t invest wisely. Therefore, it’s okay for banks to commit fraud and perjury to get them out of the house faster. Forget the law. Just do what’s most expedient. It someone wrongs you, take the law into your own hands. Hang em. And if you make an occasional mistake. So what. It was still cheaper and faster than calling the cops and waiting months for a trial. Did I mention I hung the CORRECT person most of the time?

    When people stop believing the law protects them equally, watch out.

  73. 75
    David Losh says:

    RE: 2kt @ 61

    Let me try this again, because millions of people have been forced out of homes they could afford at the time they bought them, and were making payments on them.

    You people, and you know who you are, keep throwing out the person making $20K who bought a $500K home with an Option ARM. How about the millions of people who had jobs, bought well within the means they had, then lost everything in the span of about a year, between 2007, and 2008?

    How about the retirees who have that much less, or better yet, the people who are buying today? How about the people who get that 4% loan on a property that is $100K over priced? That is another net loss to the over all economy.

    It isn’t just the payments on residential mortgages, but all portfolios that are losing value.

    Every property that a bank takes is another loss for the consumer, and a profit for the bank. It’s been going on for three years with no end in sight. Banks aren’t paying back the bail out, and the mortgage fraud is still going on.

    Nothing has changed. Banks make more profits, and more individuals end up below the poverty line.

    We have a single industry that is in control of the global economy. It has to stop.

  74. 76
    David Losh says:

    RE: 2kt @ 73

    It’s laughable when people begin equating the United States with capitalism.

    Our Declaration of Independence, Constitution, and Bill of Rights are based on individual freedoms from oppression. If a group becomes oppressive we have the right, or duty, to change that.

  75. 77
    Scott Weitz says:

    RE: The Tim @ 67

    Completely agree – the foreclosures MUST happen….as well as simplifying the bankruptcy code so the debt bubble can deflate. We will never be a vibrant economy with the enormous levels of debt at the consumer, corporate, and governmental levels.

    As for Real Estate specifically, no amount of of government intervention will prevent the real estate bubble from getting to a equilibrium where the average income can afford the average home…unless we go purely Socialist (which I can’t imagine happening in the US for some time).

  76. 79

    By Macro Investor @ 53:

    RE: The Tim @ 11

    “The basic idea is to make it easy for people who have actually been victimized (not just the victims of documentation technicalities) to obtain appropriate recourse against the banks, and to make it really hurt when the bank actually screws up. This provides a strong incentive for the banks to get things right and a just outcome for the times that they get it wrong.”

    You and Kismer are being obtuse. You put up these straw arguments that people who don’t pay deserve to be foreclosed. Nobody’s ever argued against that.

    Actually if you go back and read what I wrote, it’s that less than half the people with loans can complain that they were taken advantage of, and those people are likely best described as ignorant and naive (and perhaps even stupid). Somewhere personal responsibility has to come into play. You don’t win simply because the entity you were dealing with was huge.

    How many people here who support people being foreclosed also support people who ran up $30,000 of credit card debt while making $36,000 a year? Yes the banks need to be restricted in what they do in that area too. The increasing of minimum payments was only a start in that area, and didn’t go far enough. But it’s not entirely the banks’ fault that people run up credit card debt that they can’t afford to repay.

  77. 80

    By 2kt @ 54:

    RE: Macro Investor @ 53

    All fine thoughts but one problem – banks don’t really get hurt by fines and penalties – the costs are passed on to customers through higher fees.

    Complete and total nonsense. If they could charge the higher fees and earn more money, they would do so with or without the penalty.

  78. 81
    doug says:

    RE: Jonness @ 45

    Your bank gave this guy a $2M loan ($20,000 a month is at least that much) when he had $60,000 in income? Sure, what your neighbor did is indefensible, but what did the bank expect?

  79. 82
    The Tim says:

    By Macro Investor @ 74:

    You argument is as silly as Tim’s. Some people didn’t invest wisely. Therefore, it’s okay for banks to commit fraud and perjury to get them out of the house faster. Forget the law. Just do what’s most expedient. It someone wrongs you, take the law into your own hands. Hang em. And if you make an occasional mistake. So what. It was still cheaper and faster than calling the cops and waiting months for a trial. Did I mention I hung the CORRECT person most of the time?

    When people stop believing the law protects them equally, watch out.

    I can’t tell if that was directed at me specifically, but you apparently missed what I said @ 11 above. I’m proposing a system in which a bank that attempts to foreclose on someone who isn’t behind or on a mortgage they don’t hold is fined $10 million per offense. Not sure how that equates to “it’s okay for banks to commit fraud and perjury.”

    Disregard if that part wasn’t really directed at me.

  80. 83
    doug says:

    RE: The Tim @ 67

    Well, it’s been reported in many cases that to gain a mortgage modification, banks have advised owners to stop making payments, then started foreclosure once they have done so.

    The banks are in over their head so far that they are acting illogically. People are losing their job, quickly gaining back work, and still being booted over a missed payment or two.

    Bottom line, banks got $700billion in our money, then refused to negotiate with homeowners. That looks wrong to people. They think some of that money should have gone to negotiating with homeowners.

    I know some foreclosures are going to happen, you know it too, Tim. But it does seem like you are being a little willfully stubborn in this thread. Read the above paragraph. That’s what the OWS peopl see. That, and their neighbor or themselves living with the fear of destitution. It’s just that simple.

    Also, some of the OWS protestors aren’t very sophisticated economically. Kind of like the general population. I’ll take that over T.E.A = Taxed Enough Already when taxes are as low as they’ve ever been in the modern era. (save about 4 years of Reagan/Bush 1)

  81. 84

    By doug @ 83:

    RE: The Tim @ 67 – Well, it’s been reported in many cases that to gain a mortgage modification, banks have advised owners to stop making payments, then started foreclosure once they have done so.

    This is probably similar to calling many companies for tech support. Chances are the person on the the other end of the line is an idiot.

    In the case of loan modifications or tech support, I don’t think the company really wants to be giving out bad advice, but that happens.

  82. 85
    MacroInvestor says:

    By The Tim @ 82:

    By Macro Investor @ 74:

    You argument is as silly as Tim’s. Some people didn’t invest wisely. Therefore, it’s okay for banks to commit fraud and perjury to get them out of the house faster. Forget the law. Just do what’s most expedient. It someone wrongs you, take the law into your own hands. Hang em. And if you make an occasional mistake. So what. It was still cheaper and faster than calling the cops and waiting months for a trial. Did I mention I hung the CORRECT person most of the time?

    When people stop believing the law protects them equally, watch out.

    I can’t tell if that was directed at me specifically, but you apparently missed what I said @ 11 above. I’m proposing a system in which a bank that attempts to foreclose on someone who isn’t behind or on a mortgage they don’t hold is fined $10 million per offense. Not sure how that equates to “it’s okay for banks to commit fraud and perjury.”

    Disregard if that part wasn’t really directed at me.

    It was directed at you. If I commit one fraud I go to prison. If the bank commits thousands, they get a small fine. Yes, $10 million or any amount to a bank is a small fine. You can figure that one out, smart engineer that you are. You are advocating different law enforcement for corporations. That’s hard to swallow.

    Personal responsibility has nothing to do with it, and when you say that it’s a straw man.

  83. 86
    MacroInvestor says:

    RE: Kary L. Krismer @ 79

    You’re doing it again. It’s not about personal responsibility, and nobody would argue with you on that. So that’s a strawman argument.

    It’s about law enforcement letting banks do anything they want. Robo signing is fraud and perjury, and if you say it’s just a “mistake” then you are being obtuse.

    You also argued that mers is “okay” because it’s cheaper and easier than the grantor index. That argument says it’s okay to ignore the law if it’s expedient to do so. Which is an argument for anarchy. So does that make you against personal responsibility, so long as it saves money?

  84. 87

    By doug @ 83:

    The banks are in over their head so far that they are acting illogically. People are losing their job, quickly gaining back work, and still being booted over a missed payment or two.

    As to the first comment, banks are not the smartest entities in the world, obviously, but I think part of what you might be complaining about is the servicers. They bid to do less work on the cheap, and are overwhelmed. I don’t feel sorry for them at all.

    As to the second comment, you’re not likely to lose your house over a missed payment or two. Dealing with that has always been relatively easy.

  85. 88

    By MacroInvestor @ 86:

    It’s about law enforcement letting banks do anything they want. Robo signing is fraud and perjury, and if you say it’s just a “mistake” then you are being obtuse.

    It’s likely not fraud, and it’s not even necessarily perjury. Signing someone else’s name would be forgery. Just throwing words out to make an argument doesn’t make an argument.

  86. 89

    By MacroInvestor @ 86:

    You also argued that mers is “okay” because it’s cheaper and easier than the grantor index. That argument says it’s okay to ignore the law if it’s expedient to do so. Which is an argument for anarchy. So does that make you against personal responsibility, so long as it saves money?

    What law is being ignored with Mers? There are some states that require these things to be recorded, but I doubt it’s many of them. And in most of those states it probably doesn’t affect the homeowner in any way if the law is not complied with. Recording is for notice to third parties.

    Again, just throwing out terms (in this case “illegal”) doesn’t make an argument.

  87. 90

    The Answer to the Conundrum

    Let it settle by itself, don’t try to prop it up by paying down principles.

    We’re broke and can’t afford that on the tax payers’ dime anyway.

    Lower prices are good for many, so using that as an excuse to try to prop prices up hurts many too.

  88. 91
    The Tim says:

    By MacroInvestor @ 85:

    It was directed at you. If I commit one fraud I go to prison. If the bank commits thousands, they get a small fine. Yes, $10 million or any amount to a bank is a small fine. You can figure that one out, smart engineer that you are. You are advocating different law enforcement for corporations. That’s hard to swallow.

    Personal responsibility has nothing to do with it, and when you say that it’s a straw man.

    If The Tim had become dictator of the world in 2008, virtually every bank would be out of business by now, as they would have received zero bailouts and been forced to value their holdings at true market value, not fantasy bubble values.

    I’m not sure how you would send a bank to prison, so I don’t even know how to argue with your logic here. In my proposed solution, if a bank committed fraud thousands of times they would be fined $10M each time, for total fines of $20 billion and up ($10M * 2,000).

    Yes, banks are big, but I don’t see how $10M per instance could be considered a “small fine.” Bank of America, the biggest bank in the nation, has total assets of $2.3 trillion. Thousands of $10M fines wouldn’t put them out of business, but it wouldn’t be chump change, either.

  89. 92
    tomtom says:

    The irony in all this is that BANKS DO NOT WANT TO FORECLOSE ON HOMES. The banks get rich by you paying off your loan. By having to take back the collateral, they get a non-revenue producing asset which they eventually have to sell for less than the book value, paying the expenses of that process. The best way to crash a bank is to have then foreclose.

  90. 93
    David Losh says:

    RE: The Tim @ 91

    That’s an absurd talking point. None of what banks did is illegal, just ask Kary. The banks demanded money to perform the tasks that we all rely on. Even the new officials in Libya were quick to point out that Sharia Law, which doesn’t allow for interest, and advocates debt forgiveness in seven years, would be moderate. Our bail out is paled in comparison to Europe.

    People ran up debt based on the fact the economy looked healthy. You want every one to be as smart as you are and know that the global economy was going to collapse.

    Well, you aren’t that smart. You focus here, on this site on the people who took out mortgages, or bought properties, and ignore the global market place of those debt instruments.

    Banks, Wall Street, Fincial Institutions, and Insurance Companies projected an image of being solvent when they were simply trading worthless paper. These people drained the economy of cash then hoarded it.

    The money is still there, but now that banks have had the gift of government cash, and sweet heart deals, they are still holding the entire economy hostage. They want the government to provide jobs. They are refusing to lend. They want gaurantees that regulations will be relaxed.

    So foreclosure is what we see. Foreclosure will be a net drain on the economy for years or decades to come. Every one who owns property, with a mortgage, without a mortgage, is caught in a trap. It’s a stacked debt.

  91. 94

    By tomtom @ 92:

    The irony in all this is that BANKS DO NOT WANT TO FORECLOSE ON HOMES. The banks get rich by you paying off your loan. By having to take back the collateral, they get a non-revenue producing asset which they eventually have to sell for less than the book value, paying the expenses of that process. The best way to crash a bank is to have then foreclose.

    Which again gets back to my distinction between the banks and the servicers.

  92. 95
    doug says:

    “As to the second comment, you’re not likely to lose your house over a missed payment or two. Dealing with that has always been relatively easy. ”

    This impression I had could have been the result of hysterical reporting on the matter. ;-)

    “Yes, banks are big, but I don’t see how $10M per instance could be considered a “small fine.” Bank of America, the biggest bank in the nation, has total assets of $2.3 trillion. Thousands of $10M fines wouldn’t put them out of business, but it wouldn’t be chump change, either.”

    Tim, your solution could work well, and could even make the OWS folk happier. BUT: it will never, ever, ever pass precisely BECAUSE of this. We can’t even pass a reform that limits leveraging to a reasonable level (protecting the banks from bankrupting themselves) without the banks and half the politicians screaming bloody murder.

  93. 96
    David Losh says:

    RE: tomtom @ 92

    I also thought that then realized that the banks never paid face value for the Note. They buy the Note for a discount, the Note was used as a collateral for financial instruments, then sell the Note again at a discount. These mortgages sucked trillions of dollars out of the economy before the property is foreclosed, sold for cash, then that cash is used to start the process over again.

    It’s a hiccup that gave banks, and financial institutions trillions of dollars to play with now. They don’t have to wait ten years, of fifteen, or thirty. They have the cash now which they use to make more profit. They don’t need to care. As more people go into poverty another crop, another tier, steps up to be further fleeced.

  94. 97

    By David Losh @ 93:

    That’s an absurd talking point. None of what banks did is illegal, just ask Kary.

    That’s not what I’m saying.

    Rather than focus on sloppy procedure, which may or may not cause anyone harm, I’d rather focus on actual injury.

    As a practical matter, someone signing a foreclosure affidavit is not going to know any more than what their computer tells them, no matter how much time they spend reviewing the files. This is not like an old real estate contract with a seller where they personally received each payment and entered it in their books. Everything is automated and GIGO. So if there’s an error in a foreclosure process, it’s not likely the fault of the person preparing the foreclosure documents, and that error is not something they’re likely to find. It’s some error in the bank’s processing of payments.

    What amazes me is how much attention robosigners get here, and how little attention the foreclosure of people in the military received. There you have real harm. They were foreclosed out of their homes when they should not have been. In contrast, with robosigners you have something that is merely the bright shiny object of our foreclosure problems–a meaningless distraction.

  95. 98
    doug says:

    RE: The Tim @ 91

    If you let the banks go broke (and I’m not necessarily advocating against that) What would you do with all the pensioners who suddenly have no money?

  96. 99

    RE: The Tim @ 91
    If The Tim had been dictator of the world in 2008, he’d probably be hiding in some hole now, hoping the angry mobs didn’t find him:)

  97. 100

    By doug @ 95:

    “As to the second comment, youâ��re not likely to lose your house over a missed payment or two. Dealing with that has always been relatively easy. ”

    This impression I had could have been the result of hysterical reporting on the matter. ;-).

    Possibly. It’s been a couple of years now, but I had a client once who wanted to go on market in about April. We met with her first in January. When April rolled around I checked King County before meeting with her again and saw a Notice of Trustee’s Sale had been filed the prior week. I was concerned, but when we met with her she had already worked out the modification. After four or five timely payments the balance would be added to the end of the loan.

    That’s the situation I’ve talked about in the past where they almost didn’t continue the foreclosure sale, even though she had made all the payments. Somehow the ball was dropped, possibly because of high employee turn over and low bidding to do the job. I think I spoke with at least 5 people over a three month period who were dealing with her file.

  98. 101

    By Ira Sacharoff @ 99:

    RE: The Tim @ 91
    If The Tim had been dictator of the world in 2008, he’d probably be hiding in some hole now, hoping the angry mobs didn’t find him:)

    That wouldn’t happen until 2048.

  99. 102
    tomtom says:

    By David Losh @ 96:

    RE: tomtom @ 92

    I also thought that then realized that the banks never paid face value for the Note. They buy the Note for a discount, the Note was used as a collateral for financial instruments, then sell the Note again at a discount. These mortgages sucked trillions of dollars out of the economy before the property is foreclosed, sold for cash, then that cash is used to start the process over again.

    When the loan was made, somebody paid out $500,000 to the previous homeowner to purchase the home worth $500,000 (for example). Who paid this money out and why would they turn around and sell the note for less than $500,000 to the banks?

  100. 103
    quinn says:

    It seems to me that mortgages were funded through a fraudulent financing scheme perpetrated by investment banks, rating agencies, and mortgage originators. Most buyers were not fully aware of this scheme, and made risky home-buying decisions based on an assumption that there were no structural flaws underpinning the credit market. So while there was no direct theft, I think it is perfectly reasonable to view what happened as a form of indirect theft.

    And frankly, I feel the worst for families with children that bought during the bubble, not because they were trying to make a quick buck off of the market, but because they had significantly less tolerence for shady landlords and less mobility. This is just one kind of situation that I think Tim can’t even begin to grasp when he advocates letting the “free” market do its work.

  101. 104

    RE: tomtom @ 102 – The main reason for a discount would be a change in interest rate–up. Many notes are probably sold at a premium today.

    If you’re dealing with a package of notes, they might have some sort of a default allowance included.

  102. 105
    2kt says:

    RE: Kary L. Krismer @ 80
    Credit card rates are up, bank fees are up. Let’s split some hairs, shall we?

  103. 106
    Dirty Renter says:

    RE: Ira Sacharoff @ 25
    Sorry, Ira, the surviving big banks were not bailed out, barring Citicorp.
    As a former re lender, I could only imagine the outrage if, in 2005, the banks had stopped the mortgage lending, due to questionable valuations and underwriting standards. Could you imagine the outrage of the reic? The POTUS, Congress, Fannie & Freddie, HUD, et al…were crowing about the ‘Ownership Society’.
    Make no mistake, the greedy realtors, greedy appraisers, greedy investors, greedy monolines, greedy ratings agencies, greedy pension fund managers chasing yield, sleeping regulators of all sorts….were just as responsible for this bubble and it’s ensuing crash, as the bad, evil, dirty, filthy bankers.

  104. 107
    Dirty Renter says:

    RE: Macro Investor @ 74
    Really Macro…you should be honest with yourself…the so called robo-signing scandal is nothing but a shakedown mechanism for the states to help solve their budget woes, with the AGs high-fiving each other and shouting ‘SHOW ME THE MONEY’. It appears they are going to get between $25 – $30B, a job well done. The sticking point is that the AGs want to continue going back to the $well$ but the bankers want to cement it shut.

  105. 108

    By Dirty Renter @ 106:

    RE: Ira Sacharoff @ 25
    Sorry, Ira, the surviving big banks were not bailed out, barring Citicorp.
    As a former re lender, I could only imagine the outrage if, in 2005, the banks had stopped the mortgage lending, due to questionable valuations and underwriting standards. Could you imagine the outrage of the reic? The POTUS, Congress, Fannie & Freddie, HUD, et al…were crowing about the ‘Ownership Society’.
    Make no mistake, the greedy realtors, greedy appraisers, greedy investors, greedy monolines, greedy ratings agencies, greedy pension fund managers chasing yield, sleeping regulators of all sorts….were just as responsible for this bubble and it’s ensuing crash, as the bad, evil, dirty, filthy bankers.

    I completely agree that the lenders were not solely responsible for the bubble, and other parties played big parts, but Citibank is not the only surviving big bank that was bailed out:
    Last I checked, Bank of American was pretty big, so is JP Morgan Chase, and so is Wells Fargo:
    http://money.cnn.com/news/specials/storysupplement/bankbailout/

  106. 109
    Dirty Renter says:

    RE: Ira Sacharoff @ 108
    I gave BAC a pass because The Bernank wouldn’t let them back out of the Merrill deal. :)

  107. 110
    sally buttons says:

    Anyone with an ounce of equity plus a mailbox experienced regular (ongoing) invitations to engage with predatory lenders. Some missed out on all this teethbreakin stuff but to suggest that it didn’t happen or millions of folks were stupid is one-eyed hindsight: it’s recent history rewritten. The enormous paintbrush lumping all underwater home owners as “greedy” suggests virtually anythang professed here today is questionable real estate koolaid and we should be thankful that seasoned contributors offered counterpoint. Thanks, you guys.

  108. 111
    thinkchip says:

    Sorry if this point has been made. tl:dr

    It’s as simple as contractual fraud. The banks/gov are stealing the homes because they inflated the values of the assets through monetary and other regulatory policy, then fraudulently induced nice folks into borrowing gobs of money (from the same banks/gov) to purchase these inflated assets.

  109. 112
    The Tim says:

    RE: thinkchip @ 111 – So when these nice folks who were fraudulently induced into borrowing more than they could afford to pay back inevitably stop paying back the loans, how is it “theft” for the bank to repossess the house that was purchased with the aforementioned borrowed money?

  110. 113
    sally buttons says:

    RE: The Tim @ 12 – Racket (crime), a systematised element of organized crime.

  111. 114
    iShortedYourHouse says:

    Where has the idea of personal responsibility gone? Many people deserve to lose their homes, not be bailed out on my dime – this is the only way we will return to equilibrium.

    While banks and bad government policy are partially to blame, so are borrowers. If these borrowers were prudent and did not take loans, CDOs could not have been created.

    PREDATORY BORROWERS is a term that needs more airplay. I have heard the argument made they were not finance majors – in that case they should have looked at the traditional mortgage model (30 yr fixed, 20% down). If they could not afford that, they should not have taken the loan and purchased the house. Many others were liar loans or knew outright they could not afford the loan, they took it anyway and planned on flipping the house for profit.

    The fact is, people got caught being greedy. When homes were appreciating rapidly and being sold windfalls, they were not sharing the profits with the banks or the taxpayers – they should now have to eat the entirety of the consequences on the downside.

  112. 115
    2kt says:

    RE: sally buttons @ 110

    Yep, the good old “devil made me do it” is still alive and well.

  113. 116
    hello says:

    Hahaha, I first didn’t understand what “Who Is Home Will U Steal Today” meant.

  114. 117
    David Losh says:

    RE: The Tim @ 112

    You should read the comments before being cocky.

    You have a job today in a precarious field. You may be able to get another job, but maybe not. I talk with hundreds of people who don’t have the jobs they did when they purchased the home.

    There again there are choices you have to make when you have kids. Should you continue to drop money into the black hole of a mortgage, for no return, as far as I can see, ever, or pay for your kids education rather than have them take on debt?

    All because lenders inflated the price of everything in the economy by easy payment plans.

    Let’s pretend you are a very smart guy. You have done all the right things. You saved your money, you waited, you put down an obscene amount of moeny as a “down payment” to make the bank feel better, and they just turn around to sell that “premium” loan.

    You lose money every month in the price of the property. Over the next five years builders wise up, and go back to building apartments or rental income units. Rents follow the housing bubble, and that wise purchase that you waited, and saved for is just another place for you to maintain.

    Everything your grand pa told you is no longer true because we over built, changed land use, and building codes to be able to double the number of housing units quickly. In the mean time that rental income continues to chug along, and more people enter that end of the market place.

    You missed the boat. You made a mistake. Your life is now filled with a job you are grateful to have to save for things that go with the life you chose.

    I’m sorry, I want more. I’m sorry but every dollar of mine is working for a return. I think only an idiot would have money in the bank, or build a worthless portfolio based on paper. The game is rigged for guys like me, and I’m coming to take anything you might hold dear.

  115. 118
  116. 119
    David Losh says:

    RE: tomtom @ 102

    This is simple. yes, the seller got paid. Most of the time they had a mortgage that was also satisfied. This cleared a lot of loans.

    The lender borrows the money to make the loan. It’s a mill that got stopped, and that’s how we had a crash. A lot of lenders, and insurers of lenders defaulted. That’s where we hear the term “bail out.”

    It all has to do with, number one, interest income. That was free money paid back at a higher rate than the rate that the money was borrowed for by the lender. That goes over to the side. It’s a real profit.

    The phantom paper profit was in bundling these loans and selling them as financial instruments.

    Let me try this another way. When a lender borrows at a discount it’s easy to get a return. Even if the property sells for fifty cents on the dollar it sells for real money, enough to continue to service the cheap debt. The remaining money is lent again for consumer credit, it buys other Notes, it invests in other companies that insure other debt. The lender is in the business of having money make money, and they do make money.

  117. 120
    sally buttons says:

    RE: 2kt @ 115 – Churchbells all say: Millions of people got jacked! Nasty is poverty’s condemnation or schadenfreude for friends/neighbors/family/etc. who got jacked.

  118. 121
    2kt says:

    RE: sally buttons @ 120
    Even more nasty is lack of personal responsibility that is becoming a norm and has huge costs to the society.

  119. 122
    Tim McB says:

    RE: quinn @ 103

    Amen.

  120. 123
    sally buttons says:

    RE: 2kt @ 121 – I guess you are right. F ’em all.

  121. 124
    David Losh says:

    RE: 2kt @ 121

    Funny! Yeah, that there personal responsibility.

    I’m a guns, and gold bunker dweller from way back. Being fiscally conservative had it’s day in the 1980s. Beyond that you are just talking trash.

    You can have a million dollars today, and it’s worthless. You can pay all of your debt, be debt free, and invest in micro lending programs. You will get nowhere, slowly.

    This building wealth slowly hit the road in the 1990s with the tech dot com expansion. Once you hit 1998 and beyond, you need to be global, because the economy is global.

    You want to be a backwater low life? Fine, do that. Tell me about your money and call me in another year, you may want to do something.

    The heroes take from the bank, and invest for themselves. Give the banks nothing, but they are the major players in the game. They steal, you need to steal more.

  122. 125

    There’s really a wide range of situations people are in. At one extreme you have someone who lied on their credit application to get a loan that any moron would know they couldn’t afford. At the other you have someone who was doing just fine until they got T-boned by someone running a red light.

    And overlaid against that is the fact that there’s a wide range of education and intelligence. Some people know what they were doing was risky, and others didn’t.

  123. 126
    2kt says:

    RE: David Losh @ 24

    God bless you, Dave.

  124. 127
    mukoh says:

    By David Losh @ 24:

    RE: 2kt @ 121

    Funny! Yeah, that there personal responsibility.

    I’m a guns, and gold bunker dweller from way back. Being fiscally conservative had it’s day in the 1980s. Beyond that you are just talking trash.

    That says it all, the ramblings of a house cleaner on finance who has not lent in any major amounts, and is over the hill watching people pass him by.

    Dave, you missed a lot in the bunker.

  125. 128
    David Losh says:

    RE: mukoh @ 127

    Been waiting for you man. How’s that dead plat build em up going for you. Are you seeing some screamin’ deals out there?

    You’re exactly what these people are looking for. Big time operators wanting to make a fast buck on misery.

    Profits increased 25%, thanks for asking.

  126. 129
    David Losh says:

    RE: mukoh @ 27

    Oh, wait, as long as we are sharing this special moment; I’m making a presentation tomorrow to a group of Japanese business people, about cleaning.

    Go figure, cleaning, a global business opportunity.

    Always fun to have your keen insight on the under belley of Real Estate.

  127. 130
    mukoh says:

    RE: David Losh @ 128 – Those dastardly banks sold plats to people who made money on them! There is none left BTW. :) Have fun with the japanese cleaners. :) Japanese Maids for Hire is a new brand I hear waiting to explore.

  128. 131
    David Losh says:

    RE: mukoh @ 130

    You’re right there are none left. Sundquist has a lot under contract waiting for the $500K buyers. I see all of South Everett is ready to pop.

    The banks made money at the developers expense, Some, I hear, took a nasty hair cut.

    Now I’ve been cleaning up a few builder messes lately. The builders are looking a little shaky, but you seem to be doing alright.

    What I keep saying is that the buyers must be idiots. I mean you must be looking at the absolute brain dead to plunk down money on these depreciating “assets.”

    So, yeah, every body can make a buck. It all depends on how you want to do it.

    And its Seattle House Cleaning, House Cleaning Seattle, Seattle House Cleaners, House Cleaners Seattle, A Spring Cleaning, Spring Cleaning Seattle, Seattle Condo Cleaning, Condo Cleaning Seattle, Seattle Janitorial, Seattle House Painting, dot com, along with some others. Thanks for letting me get a plug in there.

    The Japanese business model is what I was just researching. It’s interesting that they sell products along with the services. They combine services, and do all kinds of work. Tomorrow we’ll be talking about Residential, Commercial, and Industrial Cleaning. They do it all in one corporation.

    Sorry kid, but Real Estate is dead. I’m putting a team together for next year, but it is simply to offer people the help they need to get rid of their property. There are much more profitable ways to make a buck.

  129. 132
    mukoh says:

    RE: David Losh @ 131 – Nice keep us all updated on your extensive portfolio of domain names and your endeavors in putting “teams” together. BTW Select is sold out of $600k homes next to Sundquist and almost at Bentley. So is Shelton/Erin etc…

  130. 133
    David Losh says:

    RE: mukoh @ 132

    Wow! I’m impressed. That’s kind of like the multiple offers of million dollar homes in East Bellevue. They tell me those interest rates are so low it’s a great time to buy.

    Margins seem to be a little thinner though.

    I still say that if a builder were smart they would follow the older Glover Homes business model of generating rental income for the long haul.

    Adapt, or die trying.

  131. 134
    Ray Pepper says:

    dont stop you two..I got the popcorn out………

  132. 135
    mukoh says:

    RE: Ray Pepper @ 34 – I had mine out from the point of his blabber on page 1 with 2kt. :) Almost got a bag done.

  133. 136
    2kt says:

    RE: mukoh @ 35

    I no longer drink tea when I read Dave.

  134. 137
    2kt says:

    By David Losh @ 19:

    RE: tomtom @ 102
    Let me try this another way. When a lender borrows at a discount it’s easy to get a return. Even if the property sells for fifty cents on the dollar it sells for real money, enough to continue to service the cheap debt. .

    RE: 2kt @ 36

    Now, here’s the Nobel prize winner if I ever saw one.

  135. 138
    Nick Sincere says:

    Then there are the people like in this anecdote:

    Two recent SU graduates visit a development one Saturday in summer 2007. They like it and begin talking about getting a mortgage with the onsite lender. They go back and forth with the lender who says they should get an ARM and they insist they want a fixed-rate. He gives them a hard sell but they don’t back down It ends up they will take a week to think about it and come back the following Saturday having agreed that they want the place but need some time and the lender tells them he will have the paperwork all ready the next week if they decide they want to take the plunge. The following Saturday they come back and they lender has a big stack of paper for them ready to sign on various pages. They ask if it’s for a fixed rate mortgage and he says sure it is. They tell him they’d like to take it aside and look at it, he says don’t worry about it it’s all just boilerplate stuff. They insist on looking through it and take it aside and lo and behold, buried within all the “boilerplate” is the ARM that he wanted to sell them. So they bail on it. But the lender was attempting perpertrate a blatant fraud on them. Seems like along with “personal responsibility” you just shouldn’t trust anyone at all anytime. Including maybe yourself, unless you’re certain you know yourself and your true intentions.

  136. 139
    David Losh says:

    RE: 2kt @ 36RE: mukoh @ 35

    There again why would people pay a mortgage at all in this day, and age? Why would people keep a property when cash can generate so much more cash than a property will ever pay them?

    You don’t want to believe that lending is to blame for a global economic collapse? Fine, it was the people buying option ARMS. It makes no difference it’s done.

    Millions of people are out of work. The economy you knew isn’t coming back. The Tea Party won’t fix Europe. More foreclosures won’t generate more profits. Construction is going the way of fishing, and timber.

    It’s done.

    Right now the Republican Party is making a lot of noise about how it can all be fixed by lowering taxes, and getting rid of regulations. That won’t do anything. We are way past the era of when we could lower a 50%, or 70% tax bracket.

    If you guys have some better idea then educate me. If you think it’s all coming back, or going back to the way it was then outline that for me.

    Telling me your fantasies about how the debt market works isn’t a reality. The reality has been explained a dozen times here, more eloquently than I have. Educate me about how sticking it out, or buying into a dream is going to get us past this level of poverty.

  137. 140
  138. 141
    ChrisM says:

    I’m rather shocked to agree with David Losh, and to so vehemently disagree with Tim. I’ve been following this site diligently since at least 2008, and this post (of Tim’s) makes me wonder if he’s jumped the shark.

    It is obvious both borrowers and banks (or lenders, whatever) were engaged in fraudulent (or equivalent, sorry Kary) behavior, and since 2008 the taxpayers have been paying for that behavior.

    I hope my stance is clear:
    1. Borrowers should face their pain via timely foreclosure and destruction of their credit record
    2. lenders should face their pain via write-offs and corresponding hit to the balance sheet and thus stock price
    3. assets (or houses, or property, whatever) should be have a market value defined at auction, or some other market-clearing action, where all non-interested parties may participate at the individual parcel level, and obviously the property get transferred to the highest bidder

    Is this really rocket science????

    As a potential home buyer (since 2007) I’m enormously pi**ed off that I’ve had to put off my dreams of mature grape vines and plentiful fruit trees for four plus years with no end in sight.

    In the meantime, these weird posts seem only to drive up traffic. Can someone please enlighten me if I’m incorrect?

  139. 142
    The Tim says:

    By ChrisM @ 141:

    I hope my stance is clear:
    1. Borrowers should face their pain via timely foreclosure and destruction of their credit record
    2. lenders should face their pain via write-offs and corresponding hit to the balance sheet and thus stock price
    3. assets (or houses, or property, whatever) should be have a market value defined at auction, or some other market-clearing action, where all non-interested parties may participate at the individual parcel level, and obviously the property get transferred to the highest bidder

    Is this really rocket science????

    Hmm, I am confused. which part of my post or my comments has led you to believe that I disagree with any of that?

    In fact I agree 100% with your points. All I was saying in this post was that I don’t understand the connection the protesters are trying to make between foreclosure and theft. If you stop paying your mortgage, you lose your home.

    I’m proposing no additional penalties for borrowers and a $10M per instance fine for banks that screw up foreclosures and somehow people seem to think that I am pro-bank. I don’t get it.

  140. 143
    Ray Pepper says:

    RE: mukoh @ 135

    now that is funny…………I’m serious…the last line “almost got a bag done” is hilarious.

    After reading idiotic posts I will now begin to respond with this clip after each one:

    http://www.youtube.com/watch?v=0iqFO-Udq6s

    We are all friends anyway………………………….Are we not?

  141. 144
  142. 145
    doug says:

    RE: The Tim @ 142

    The OWS movement is about economic injustice. It’s not a direct comparison, it’s an indirect comparison:

    Wall Street made bad decisions and got scads of money. Bank executives got huge cashouts for driving their companies into the ground. These same bankers wail and caterwaul about raising the top marginal rate 3%. They claim class warfare at any kind of higher taxes. Then they tell us we have to share the pain, and everyone has to take a paycut, and reduced services. Hell, let’s raise the retirement age by 3 years. No big deal, right?

    Everyday people made bad decisions. In some cases, they also got fired and laid off indirectly because of stupid business practices on Wall St. They got… nothing. Except the promis of more pain.

    Why is this tough to understand? It’s not just that foreclosures are going through, it’s that the banks took OUR money, and then used it to pad their fat bank accounts instead of any kind of mortgage modification. It’s the comaprison of how the financial elite are treated, and how everyday citizens are treated. There is no leeway, no concern, no rescue for the average citizen.

    Tim, it’s as simple as one of their slogans: they got bailed out, we got sold out. You respond saying, “well, I wish the banks got some pain too.” And “I would’ve let them fail.” But that doesn’t matter, Tim, because they DIDN’T. They’re getting away scot free. You’re surprised people are protesting this?

  143. 146
    masaba says:

    Ahh, Tim, another one of your ridiculous posts where you act incredulous that people are mad at the banking and real estate industries that brought our country’s economy to it’s knees. Why on earth would people be mad at the entities that got ‘bailouts,’ and afterwords have done virtually nothing except continue to give their CEO’s golden parachutes and corporate bonus pay?

    Those angry people should just be happy that the banks got bailed out with their money, because, according to the bankers and politicians, it could be a lot worse!

    I agree with you that not all of the signs make perfect sense (this is probably to be expected in any group of protesters), but the underlying basis for the anger is unquestionably justified.

    It’s posts like these that made me decide not to donate to your fund drive.

  144. 147
    Ray Pepper says:

    RE: masaba @ 146

    OK I get to use this now….This is from Tim: http://www.youtube.com/watch?v=yytbDZrw1jc&NR=1

    also this: TIGHT WAD!

  145. 148
    doug says:

    RE: Ray Pepper @ 47

    Great comeback, Ray. Way to contribute.

  146. 149
    The Tim says:

    By masaba @ 146:

    Ahh, Tim, another one of your ridiculous posts where you act incredulous that people are mad at the banking and real estate industries that brought our country’s economy to it’s knees. Why on earth would people be mad at the entities that got ‘bailouts,’ and afterwords have done virtually nothing except continue to give their CEO’s golden parachutes and corporate bonus pay?

    Those angry people should just be happy that the banks got bailed out with their money, because, according to the bankers and politicians, it could be a lot worse!

    I agree with you that not all of the signs make perfect sense (this is probably to be expected in any group of protesters), but the underlying basis for the anger is unquestionably justified.

    It’s posts like these that made me decide not to donate to your fund drive.

    Again, you (and other commenters) are reading things into my post and comments that simply are not there.

    I have neither said nor implied that I am “incredulous that people are mad at the banking and real estate industries.” I have railed against both quite frequently myself.

    All I said in this post was that I do not understand the logic that equates foreclosures with corporate greed, theft, and terrorism. If you stop paying your mortgage why shouldn’t you forfeit the house? That’s not pro-bank, it’s just common sense.

  147. 150
    masaba says:

    RE: The Tim @ 149

    You don’t understand why people are mad that the banks were bailed out (with taxpayer money) and they were left to be foreclosed upon? You don’t get that? You don’t understand how that would feel like theft to some people?

    Honestly, I feel like I have been robbed simply because my tax money went to bailout Wall Street, which in turn resulted in more million dollar CEO bonuses.

    Perhaps the sign should just say: ‘This is Bullshit’

  148. 151
    The Tim says:

    RE: masaba @ 150 – Where have I said that I don’t understand why people are angry with banks? I totally get it, and I have said over and over in this thread that I agree, and I’m angry with the banks as well.

    I just disagree that “banks suck and bank bailouts suck” equals “borrowers who stop paying their mortgage should get to keep their home.”

  149. 152

    I think people are reading The Tim wrong here. He’s an engineer, and engineers sometimes come off like Vulcans on Star Trek. The logic shows, but not the compassion. I never read Tim say that he feels bad for all the people who have been foreclosed on, and I’m sure he does feel that way, but the dude’s an engineer, and instead of saying how he knows how horrible it is for those going through foreclosure, he presents his logical plan to fine banks who illegally foreclosed, but wouldn’t fine those who’ve been foreclosed.

  150. 153
    mukoh says:

    RE: Ray Pepper @ 144 – I love it. This is a blast to read thru DL.

  151. 154
    mukoh says:

    RE: doug @ 45 – How much of YOUR personal money was taken by the banks to make money with?

    OWS is a hogwash of earthies, hippies, who think just because someone makes $300K+ a year needs to share it with all the kind and caring people who never made even half that.

    Nobody’s home is getting taken away if they make their payment (some select cases do not count). YOU ARE TAKING MY HOME! Should be changed to THEY ARE TAKING MY HOME AS I HAVEN’T PAID FOR IT IN MONTHS!.

  152. 155
    masaba says:

    RE: Ira Sacharoff @ 152

    Sorry, Ira, but I am also an engineer.

    The government collected our tax money. The government then bailed out the wealthy bankers with that tax money, while leaving others to be foreclosed upon and to go bankrupt. They did this mostly because the banks scared the shit out of everyone saying that without the bailout our entire economic system would collapse. A hefty amount of lobbying and political donations helped secure the bailout as well, I’m sure. The banks then used said money to pad the wallets of their CEOs.

    This whole process feels like theft and extortion to some people; they are mad about it. Can’t say that I blame them, and the logic isn’t that hard to follow.

    Tim claims that he agrees with every part of this, except that he doesn’t understand how some folks can just carry a sign saying that it is robbery. Perhaps it is because writing what I said in the above paragraph on a sign would be a lot of work, especially for folks who don’t know the difference between ‘who’s and whose.’ :)

  153. 156
    The Tim says:

    By masaba @ 155:

    Perhaps it is because writing what I said in the above paragraph on a sign would be a lot of work, especially for folks who don’t know the difference between ‘who’s and whose.’ :)

    Well some people made it work:

    (via BoingBoing)

  154. 157
    Evelyn says:

    People are bringing their own pain to an ongoing movement protesting the uneven distribution of wealth. Corporations are confiscating the world’s resources and re-distributing the wealth. Large shareholders are becoming incredibly wealthy and this re-distribution is leaving more and more poverty worldwide. Our workforce at home is less and less able to compete in a global economy. Real estate was promoted by “news” media and experts, as you have reported, as a way to survive this economic downturn. Banks were partners in exploiting this fear. When the corporations are failing, they always seem to have enough money to buy our legislature and get a bailout as happened with the banking industry. This is the connection.

  155. 158
    Scotsman says:

    I firmly believe justice prevails in the end, Sometimes it takes years, even decades, (Nazi war criminals?) but the past always seems to catch up with evil in the end. The real consequences of the bubble, general over-leveraging in the world’s economies, etc. have only begun to show up. Banks, governments, the “evil” 1%, all are still benefitting from delay and prolong tactics. But it’s increasingly evident those tactics are near the end of their effectiveness- this can isn’t going that much further down the road.

    People the world over are already angry and destructive, yet the party hasn’t really even gotten started. A sustainable and healthy level of total government involvement in the U.S. economy is probably about half of what it is now. A lot of free cheese is going away soon. Think about the number of unhappy people that will breed and how they will express that anger. Look at the riots in Greece and France, the fist fights in european parliaments, etc. Plenty of “justice” lies ahead.

  156. 159
    doug says:

    RE: mukoh @ 154

    Over $5000 if I multiply my portion of the nations tax receipts at that time by $700 billion.

    Ad hominem attacks, that’s all you have? Here’s your argument in funnier form: http://www.youtube.com/watch?v=aF8wLg5Asgo

  157. 160
    David Losh says:

    RE: mukoh @ 154

    $288K the last time I counted.

    You have a very simplistic view.

  158. 161
    David Losh says:

    RE: The Tim @ 51

    Let’s say you bought a house in 2003, better yet 1998 when prices were reasonable.

    You watched the value go up, and made your payments. Let’s set aside that maybe you lost a job, or had financial hardship in 2007, 2008, and lost your home.

    Let’s deal strictly with the numbers Your interest payments double the amount you pay for the property. When you get to a 15 year point, where the property really begins to amortize, your property is now worth the original asking price that you agreed to.

    If you bought in the 1960s, 1970s, or 1980s you did get an appreciated value. Today that’s all over. You have a net loss.

    Real Estate is a business. Banks stand to make an absolute fortune from what you are going to pay them.

    Yes, I think millions of people globally should stop paying. I’m not supposed to say that, but from a business stand point they should. People need to adapt. They were lied to, swindled, and compromised. They need to start taking back their financial freedoms by giving banks nothing. Give corporations nothing. Buy cheap, and put your money to work.

  159. 162
    ChrisM says:

    http://www.oregonlive.com/portland/index.ssf/2011/10/in_downtown_portland_fears_tha.html

    “Organizers of Occupy Portland say they fear as much as $20,000 donated to the group through a PayPal account has disappeared.

    They also say the group’s finance committee has hijacked the demonstration’s Internet domain name and filed for incorporation against the wishes of the group’s decision-making body. “

  160. 163
    The Tim says:

    RE: ChrisM @ 162 – “WHO’S DOMAIN NAME WILL U STEAL TODAY”

  161. 164
  162. 165
  163. 166
    Ray Pepper says:

    RE: ChrisM @ 162

    I think they spent the WAD on Hack and Sacks. Everytime I drive by these movements in Seattle or Tacoma I see ALOT of Hack and Sack activity. Please someone look into this!

  164. 167

    RE: ChrisM @ 62 – They should have put the money in a bank!

  165. 168
    Dirty Renter says:

    By doug @ 159:

    RE: mukoh @ 154

    Over $5000 if I multiply my portion of the nations tax receipts at that time by $700 billion.

    Ad hominem attacks, that’s all you have? Here’s your argument in funnier form: http://www.youtube.com/watch?v=aF8wLg5Asgo

    Doug, the following link will verify that the bank portion of TARP was only $200B. GM, Chrysler, Fannie & Freddie, & AIG, received the rest.
    http://money.cnn.com/news/specials/storysupplement/bankbailout/

    And of the $200B, only about half that number was needed by the banks. BNY, JPMorgan, Wells Fargo begrudgingly took the TARP to provide cover for CitiBank. IMHO, the reason C was saved was that it is our only truly international bank. It should be noted that the Treasury made money off the bank portion of TARP.
    It’s too bad that the executives of the failed banks, Wachovia, Washington Mutual, Countrywide, Bear, Lehman & Merrill, et al, were not prosecuted or at least ‘made poor’ for their lack of judgement judgement. The current bashing of the surviving banks, who were managed more conservatively, is bad for current economy. Since there was no justice for the worst of the offenders, the survivors are now the target of the mob.

  166. 169
    Scotsman says:

    It was all planned from the beginning:

    “The basic point is that the recession of 2001 wasn’t a typical postwar slump, brought on when an inflation-fighting Fed raises interest rates and easily ended by a snapback in housing and consumer spending when the Fed brings rates back down again. This was a prewar-style recession, a morning after brought on by irrational exuberance. To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble.”

    http://azizonomics.com/2011/10/26/reinflating-the-housing-bubble/

  167. 170
    2kt says:

    RE: David Losh @ 139

    Dave, your ideas of massive defaults and wiping out of banking system would lead to chaos, massive civil unrest and violence. The problems are many and there are not any quick fixes, however the history shows the radical changes rarely bring good results.

  168. 172
    David Losh says:

    RE: 2kt @ 170

    Exactly what we have.

    The foreclosure system isn’t working well for the economy in general.

    We do have massive defaults, and it will continue.

  169. 173
    David Losh says:

    RE: Hugh Dominic @ 171

    Uh oh, will this go unchallenged?

    Real Estate is a part of my business model so yes I’ve lost a lot of income. We’ll come out the other side, don’t worry about us.

    It’s the idea that people who put life on hold came out worse that bothers me. Millions of people, actually billions if you think globally did all the things that we have all done for generations. People worked jobs, bought houses, and put kids in college, all with the idea that over time it will all get paid for. It’s been that way since the 1950s.

    Now you want all those people who have lost all those dreams of a better future to pay attention to you.

    I’m sorry you live in deplorable conditions, but do you really? How about the millions of people who were encouraged to take that chance, told the economy is strong, that the world is your oyster, and yet it was all a deliberate lie.

    I’m talking about the people in Europe, and emerging markets, who will literally lose everything. That debt will become generational. People in emerging markets haven’t had the bubble collapse yet. How are they going to fair? Should we allow this corrupt, and brutal debt market system destroy them?

    Just because a movement, here, targets the foreclosure system that is extremely manipulated, doesn’t mean that these protests have to do with who bought a house, and who waited. It’s just pointing out the dead canary in the mine shaft.

  170. 174

    By Hugh Dominic @ 71:

    I still claim that my family was more grievously harmed by this bubble than most by NOT buying. We have lived in intolerable conditions for 5 years while waiting for the market to drop to equilibrium.

    That was the choice you made. Living in those conditions was what you wanted to do instead of risking a downward adjustment in value.

    Last night I found something I created in August 2007, before we bought our new house, which was part of some overall financial planning I was doing then (not just related to buying a house). For the new house portion there was the following:

    Advantages: “Would live in a nicer place” and “Will lock in tax gain exclusion on old house.”

    Disadvantage: “Prices are high right now–downside risk.”

    For you the risk of prices dropping kept you where you were, because that was more of a concern for you. For me the reverse.

    Of course I had one other bid advantage to moving: “Move further away from Ira!” ;-)

  171. 175
    doug says:

    RE: Dirty Renter @ 168

    Thanks for the schooling on how the funds were disbursed, DR! Buying trillions in garbage assets through QE will probably end up costing us, too. Either way, between QE 1 and 2, TARP, and the proposed (and state-level enacted laws) laws for austerity to pay for tax cuts for the rich, you can see where the priority appears to have been.

    I can’t say that I agree 100% with the OWS crowd. It’s just easy to see where they’re coming from.

    I think that a combination of cutting some spending (mostly military adventurism and the cost controls in the ACA), raising some tax rates slightly and getting rid of some kickbacks and loopholes (yes, mortgage interest exemption included) would solve a lot of our problems.

    Also, we should continue to keep the banks honest via capitalization limits. None of these things should be THAT hard to do.

    I don’t want to sieze anyone’s wealth just because they’re well off.

    However, wealth has been steadily accumulated by the richest portion of the country at the expense of the middle and lower classes. This speaks to the fact that the wealthy generally hoard their money far more than everyone else. Since the economy does well when money is MOVING, it seems clear that we need to somehow skim some money (with higher taxes) in order to provide jobs for the poor and middle class, and stimulate spending. This is what will lead to wealth and product creation, and a strong economy.

    Even Adam Smith thought the rich would see the need and moral obligation of the rich to provide the bare minimum for the poor,(in this case, providing them with jobs and donating to the general wellfare.) He underestimated their isolation and entitlement.

    There are several lessons to be learned from the financial crisis, some liberal and some conservative. One thing I thought was crystal clear was that economy is primarily demand-driven. That when demand craters, so goes the economy, no matter HOW much money and supply capability exists.

    But then I see stuff like Rick Perry’s 20% flat tax (with NO CAPITAL GAINS TAXES). And I just about despair.

    We’ll never learn anything.

  172. 176
    mukoh says:

    RE: doug @ 159 – Doug, just FYI if you are under $90k a year bracket your share of that is puny compared to someone who pays 30% after going over $208k. So trust me you didn’t pay exactly 5k. Top earners in the 10% contributed to well over 65% of the taxes.

  173. 177
    Hugh Dominic says:

    By Kary L. Krismer @ 74:

    By Hugh Dominic @ 71:

    I still claim that my family was more grievously harmed by this bubble than most by NOT buying. We have lived in intolerable conditions for 5 years while waiting for the market to drop to equilibrium.

    That was the choice you made. Living in those conditions was what you wanted to do instead of risking a downward adjustment.

    Exactly. How about we all live with the consequences of our choices, and stop claiming special status and exemption from consequences because we are victims? Or get a bailout due to the impact on others of our own failure?

    This country is founded on those principles. You can take a risk and be right and it should pay off. If you’re wrong, you lose. So be careful, and be smart.

  174. 178
    Hugh Dominic says:

    By David Losh @ 73:

    RE: Hugh Dominic @ 171

    It’s the idea that people who put life on hold came out worse that bothers me.

    Now you want all those people who have lost all those dreams of a better future to pay attention to you.

    Not really. I don’t remember getting any sympathy or help when I was on the outside of the market and not making huge paper gains, either. I just want everyone to stop hypocritically looking for help now that things didn’t turn out like they hoped. I’d like them to pay for their imprudence. My biggest regret is that there is no way to recapture the personal salaries, bonuses, and gains that were paid out earlier in the process.

    I’m sorry you live in deplorable conditions

    No you’re not. You’re a racist and you want the whites to suffer and be driven out of your neighborhoods.

    How about the millions of people who were encouraged to take that chance, told the economy is strong, that the world is your oyster, and yet it was all a deliberate lie.

    “I was told houses always go up in value! I was duped! I demand compensation!”. If you believe you are a victim of fraud, please name the alleged perpetrator and use our courts. If your perpetrator was “the system” or “whitey” then I wish you luck.

    Just because a movement, here, targets the foreclosure system that is extremely manipulated, doesn’t mean that these protests have to do with who bought a house, and who waited.

    Yes the foreclosure system has been extremely manipulated. Note holders have been delayed and prevented from access to their collateral as new laws were written to change the foreclosure process ex post facto.

    The effect on those who waited has been the manipulation maintains higher prices for longer by limiting market activity. The protesters want more of that manipulation. Thus more waiting. Thus the protests oppose me.

  175. 179

    By Hugh Dominic @ 77:

    By Kary L. Krismer @ 74:

    By Hugh Dominic @ 71:

    I still claim that my family was more grievously harmed by this bubble than most by NOT buying. We have lived in intolerable conditions for 5 years while waiting for the market to drop to equilibrium.

    That was the choice you made. Living in those conditions was what you wanted to do instead of risking a downward adjustment.

    Exactly. How about we all live with the consequences of our choices, and stop claiming special status and exemption from consequences because we are victims? Or get a bailout due to the impact on others of our own failure?

    This country is founded on those principles. You can take a risk and be right and it should pay off. If you’re wrong, you lose. So be careful, and be smart.

    I can’t say I disagree, but I would again point out this [President Obama’s refinance plan] isn’t really intended to help the homeowner. It’s intended to help President Obama by stimulating the economy (and perhaps getting a few votes from those taking advantage of the program).

    Edit: Bracketed material added because I didn’t realize what thread I was in when posting.

  176. 180
    David Losh says:

    RE: Hugh Dominic @ 178

    You had me at deplorable conditions.

    OK you didn’t take advantage of any opportunities that were presented to you, and now you want to be compensated for being a good boy. Tim wants to be compensated; let’s throw a whole bunch of people under the bus who waited patiently.

    OK, now you have what you wanted. There is a total, global, economic collapse. Is it just like you pictured it, or is it still manipulated? Uh oh, maybe you should wait some more.

    The alternative is to jump in like Tim did to buy in the middle of an extremely questionable market place, making an extremely questionable “deal,” but relying on his own research. He is the only one to blame.

    So, you have choices again today, but you still want to complain about it. There are still opportunities today. Maybe you should wait some more.

    Now about the protests, these are global. Here in the United States the target is Wall Street, which is a good place to start. In the news we are told it’s austerity in Greece. The German economy, or the Chinese are bailing out the Euro. The Euro is up, down, going away, or the greatest thing since sliced bread.

    Here’s a fact, there are seven billion people in the world. They need to be fed daily. Your petty concerns don’t get seven billion people fed daily. A jobs program of refinance won’t feed seven billion people. The population of India is growing the fastest as I recall. They have a full on cast system, but were occupied by England, sounds lovely, but I’m thinking in time they will be in charge of the world’s economy.

    Wait if you want, vilify me, blame somebody else, but the game is going to continue.

  177. 181

    […] 180 comments, 10/24: "Who Is Home Will U Steal Today" […]

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