Thursday, September 29, 2011

Housing still key to economic recovery Video from Dylan Ratigan

What about just working with the people to modify the loan they have so it reflects the current value before you decide to "get them out of the house" as Henry said.  Why drive the market down even more by continuing foreclosures.  We have subsidized the banks and the banks are still in trouble and now we want to make even more middle class Americans take the hit for something they had nothing to do with......?????What about the people who can afford their home but think it is BS that they have to be paying an asset that has dropped 30 to 60 %  when banks are still in business after creating the system that would collapse.  I don't care about moral hazard, that is a 2nd grade argument.  the government screwed the people with tarp and now they are letting the banks do the same.  One more thing is should other private sector investors gain the benefit of buying a foreclosure that might even be below market value?  Why not give it to the current owner at the same price?  OH Heavens no we do that because it would send the wrong signal!  As opposed the signals that have already been sent saying it is acceptable to commit fraud and still get your bonus.  It is OK to created the biggest wealth grab from the middle class regardless of legality and then have the American People bail you out so you can keep your high paying job and get a million dollar bonus?  Yes of course remember this is America where we have decide that let freedom ring is the catch phrase that means allow criminal bankers to stay out of jail. 

This solution to "get people out of their homes" is going to be one more way to continue to transfer money to the elites at the expense of the middle class.  If we worry so much about moral hazard why don't we worry about the opportunists that are salivating for the chance to get rich from the crisis?  The middle class hardworking  American has been shafted and no one will take up their cause.
This is more than a 22 % problem of homes being underwater.  the  real number more like 50% because even if you are not underwater you are going to have to bring money to the table in order to sell unless you make a profit, that is if you ever find a buyer at the full market price estimate.
The country can not survive as cash only, half of the jobs in the country are tied up in mortgage, finance , banking, real estate, construction etc etc....
The government had a chance to clear the bad debt and let the banks fall if they were to fall a long time ago but they were scared, the certainly will not let a bank fail before an election year.  So we are in for a long run of getting worse before it gets better.  We will not grow our way out of this mess in my opinion and we seem to be edging closer to recession.

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