The States: At Least Michigan is Better Than Indiana

[trixR4kids]

Re: The States: At Least Michigan is Better Than Indiana

Uh huh...

 

[dxmnkd316]

Re: The States: At Least Michigan is Better Than Indiana

Yeah I remember when Wells Fargo preapproved me for something like $380k in 2011 when I was 26.

I said, thanks but no thanks. I’m not a moron. I bought a house for $200k and thought that was close to dead on for my budget.

 

[Kepler]

Re: The States: At Least Michigan is Better Than Indiana

Yeah I remember when Wells Fargo preapproved me for something like $380k in 2011 when I was 26.

I said, thanks but no thanks. I’m not a moron. I bought a house for $200k and thought that was close to dead on for my budget.

That's not the bubble, it's banking. When Dr. Mrs. and I applied for a loan for our $490k house we were approved for over $1.2M. That's how the industry works. The loaner is the pusher. He wants to hook you as hard as possible without actually killing you. It is fundamentally parasitic, pretending to be symbiotic.

 

[Handyman]

That's not the bubble, it's banking. When Dr. Mrs. and I applied for a loan for our $490k house we were approved for over $1.2M. That's how the industry works. The loaner is the pusher. He wants to hook you as hard as possible without actually killing you. It is fundamentally parasitic, pretending to be symbiotic.

Right but you can lead a horse to water but you can't force him to drink.

Can I sue Vegas after I go there next month if I blow more money than I could afford to because they offered me free booze and a fun atmosphere in the cheap?

 

[5mn_Major]

Re: The States: At Least Michigan is Better Than Indiana

Most individuals should have known better.

That's not to say that banks were not guilty of bad decision making. But the banks that made the worst decisions, usually came out the worst and had to get bailed out. US Bank for example is quite conservative and didn't give out bonkers loans. The result was that it was healthy during the crisis and went on a massive buying spree picking up dozens of small companies that had in fact made bad decisions.

In the end, things often are as they should be.

 

[trixR4kids]

Re: The States: At Least Michigan is Better Than Indiana

Sorry but the Vegas example is not even a remotely good comparison. Vegas is located in one place and wasn't systematically targeting hundreds of thousands of poor people telling them to take on loans knowing they likely can't be repaid and then buying up those assets, packaging them into larger debt obligations, and then selling them with AAA credit ratings causing a global financial meltdown. Obviously individuals are partially to blame but the majority of it goes to the banks and institutions that bare far more responsibility and the politicians that loosened the regulations on them. Putting the majority of blame on individuals is like something you'd see a college libertarian argue.

 

[Rover]

Re: The States: At Least Michigan is Better Than Indiana

Sorry but the Vegas example is not even a remotely good comparison. Vegas is located in one place and wasn't systematically targeting hundreds of thousands of poor people telling them to take on loans knowing they likely can't be repaid and then buying up those assets, packaging them into larger debt obligations, and then selling them with AAA credit ratings causing a global financial meltdown. Obviously individuals are partially to blame but the majority of it goes to the banks and institutions that bare far more responsibility and the politicians that loosened the regulations on them. Putting the majority of blame on individuals is like something you'd see a college libertarian argue.

Its a great comparison. Lets say you are poor, and you walk into the casino. They (the casino) is going to tell you that you have a chance to hit it big, and that they pay out 95% of what they take it and here's some teasers to get you started...all this sound familiar? But, if you're of limited means, no amount of glitz or pumped in oxygen should make you max out your credit cards to gamble, because the casino isn't as big as it is because people are winning money. Its because they're losing. Again - horse sense.

Likewise, if somebody tells you we can start you off at a low rate but then it can potentially go up, that's the same as the casino giving you a few free chips when you walk in and expecting you to pony up for more later. If you think you can gamble with the high rollers who do have the means to play, you probably also think you can afford a McMansion on a paper route salary, because hey somebody told you that you could and what's the point of common sense if you can hear what you want to hear?

The only thing you've hit on correctly is the AAA credit ratings on crappy securitized debt which is why the people (aside from AIG) who got off the easiest on all of this were the credit rating agencies. However, that happened after the population as a whole all thought they could borrow and refinance their way to a lifestyle that their actual earnings couldn't afford. That's on them, not the gubmint, banks, corporate Dems, extraterrestrials or anything else.

 

[trixR4kids]

Re: The States: At Least Michigan is Better Than Indiana

When casinos cause a global meltdown from buying up subprime loans (notice how the personal responsibility argument somehow doesn't apply here to the banks... hmmmmm) I'll grant the comparison.

 

[St. Clown]

Re: The States: At Least Michigan is Better Than Indiana

When casinos cause a global meltdown from buying up subprime loans (notice how the personal responsibility argument somehow doesn't apply here to the banks... hmmmmm) I'll grant the comparison.

Even though banks should know better, they weren't directly purchasing subprime loans in the way you're describing. Those loans were packaged into derivative tranches, buried so deep within the assets, that almost every housing expert in the nation thought they were solid investments. The minority of experts who thought they were bad investments could barely fill a single classroom at a medium-sized university. In other words, fewer than 300 people in the nation, perhaps the world, realized what was actually happening before it happened.

The banks were at fault for buying up those derivatives without taking the time to really know what was in them - relying too heavy on Moody's, S&P, etc.. The mortgage companies (diclaimer: most often wholly, or partially owned by the banks or are the banks, but not always) were at fault for issuing mortgages to people who couldn't afford them should the market turn around on them (when does that actually happen? ).

In any transaction, it takes two people for a sale/purchase to be made; both sides should take ownership for their errors in judgment.

 

[ScoobyDoo]

Re: The States: At Least Michigan is Better Than Indiana

Even though banks should know better, they weren't directly purchasing subprime loans in the way you're describing. Those loans were packaged into derivative tranches, buried so deep within the assets, that almost every housing expert in the nation thought they were solid investments. The minority of experts who thought they were bad investments could barely fill a single classroom at a medium-sized university. In other words, fewer than 300 people in the nation, perhaps the world, realized what was actually happening before it happened.

The banks were at fault for buying up those derivatives without taking the time to really know what was in them - relying too heavy on Moody's, S&P, etc.. The mortgage companies (diclaimer: most often wholly, or partially owned by the banks or are the banks, but not always) were at fault for issuing mortgages to people who couldn't afford them should the market turn around on them (when does that actually happen? ).

In any transaction, it takes two people for a sale/purchase to be made; both sides should take ownership for their errors in judgment.

This is good stuff here.

 

[trixR4kids]

Re: The States: At Least Michigan is Better Than Indiana

Even though banks should know better, they weren't directly purchasing subprime loans in the way you're describing. Those loans were packaged into derivative tranches, buried so deep within the assets, that almost every housing expert in the nation thought they were solid investments. The minority of experts who thought they were bad investments could barely fill a single classroom at a medium-sized university. In other words, fewer than 300 people in the nation, perhaps the world, realized what was actually happening before it happened.

The banks were at fault for buying up those derivatives without taking the time to really know what was in them - relying too heavy on Moody's, S&P, etc.. The mortgage companies (diclaimer: most often wholly, or partially owned by the banks or are the banks, but not always) were at fault for issuing mortgages to people who couldn't afford them should the market turn around on them (when does that actually happen? ).

In any transaction, it takes two people for a sale/purchase to be made; both sides should take ownership for their errors in judgment.

Fair enough (and thanks for the deeper explanation) but this is also a far better and more accurate explanation than blaming individual homeowners for taking on a loan that they were told was a good asset, was going to appreciate in value, and that they qualify for, by someone who clearly knows better. The lack of oversight and regulation over the large scale transactions of these ****ty assets is by far the bigger problem than individuals independently making the poor decisions to take on loans that they shouldn't have (especially when banks were going out of their way to target these folks specifically at a mass level).

 

[dxmnkd316]

Re: The States: At Least Michigan is Better Than Indiana

Fair enough but this is also a far better and more accurate explanation than blaming individual homeowners who were also told that what they were buying was a good asset that was going to appreciate in value and that they qualify for.

Yeah, but none of us absolved the banks or entirely blamed the homeowners.

 

[trixR4kids]

Re: The States: At Least Michigan is Better Than Indiana

Yeah, but none of us absolved the banks or entirely blamed the homeowners.

Clearly you've never read Rover's posts.

 

[TalonsUpPuckDown]

Re: The States: At Least Michigan is Better Than Indiana

I would read anything by Andrew Ross Sorkin (especially Too Big To Fail which HBO made a movie out of) they are pretty solid. I keep meaning to read The Big Short as well. Lots of articles over the years that sadly I never kept a list of. I will see if the GF's parents have any suggestions her Dad taught Micro and Macro for 15 years and both were bankers for decades. I honestly hated economics until I started talking about it with them.

These books are excellent. Also recommend The Greatest Trade Ever by Gregory Zuckerman.

The debate on whether homeowners are culpable in all this is laughable. The gravy train was in danger of coming off the tracks when lenders started running out of prospective buyers who qualified for loans under traditional underwriting rules. The only solution was to find more "customers" who had no business being approached in the first place. These guys were aggressively marketing to these "customers" with pitches that were market tested to maximize the loan amounts in every case. Countrywide was nothing more than a direct marketing organization whose sole purpose was to originate as many loans as possible to keep feeding the tranches. Not only were they lending money without requiring documentation, they were falsifying income in many instances in order to qualify their "customers" for higher lending limits.

In the face of this onslaught it's the fault of the "customer" for not having the financial sophistication to tell a bunch of rich people offering them free money "Thanks, but no thanks, I don't want to be responsible for an economic catastrophe." Yeah, sure...

 

[trixR4kids]

These books are excellent. Also recommend The Greatest Trade Ever by Gregory Zuckerman.

The debate on whether homeowners are culpable in all this is laughable. The gravy train was in danger of coming off the tracks when lenders started running out of prospective buyers who qualified for loans under traditional underwriting rules. The only solution was to find more "customers" who had no business being approached in the first place. These guys were aggressively marketing to these "customers" with pitches that were market tested to maximize the loan amounts in every case. Countrywide was nothing more than a direct marketing organization whose sole purpose was to originate as many loans as possible to keep feeding the tranches. Not only were they lending money without requiring documentation, they were falsifying income in many instances in order to qualify their "customers" for higher lending limits.

In the face of this onslaught it's the fault of the "customer" for not having the financial sophistication to tell a bunch of rich people offering them free money "Thanks, but no thanks, I don't want to be responsible for an economic catastrophe." Yeah, sure...

Well said.

 

[Deutsche Gopher Fan]

Re: The States: At Least Michigan is Better Than Indiana

“A fight broke out between officials at the West Virginia statehouse on Friday after Republicans displayed an anti-Muslim poster comparing Rep. Ilhan Omar to 9/11 terrorists, with the heated argument resulting in one injury and one official resigning.”

https://thehill.com/homenews/state-...-terrorists-causes-fight-to-break-out-at-w-va

 

[ScoobyDoo]

Re: The States: At Least Michigan is Better Than Indiana

These books are excellent. Also recommend The Greatest Trade Ever by Gregory Zuckerman.

The debate on whether homeowners are culpable in all this is laughable. The gravy train was in danger of coming off the tracks when lenders started running out of prospective buyers who qualified for loans under traditional underwriting rules. The only solution was to find more "customers" who had no business being approached in the first place. These guys were aggressively marketing to these "customers" with pitches that were market tested to maximize the loan amounts in every case. Countrywide was nothing more than a direct marketing organization whose sole purpose was to originate as many loans as possible to keep feeding the tranches. Not only were they lending money without requiring documentation, they were falsifying income in many instances in order to qualify their "customers" for higher lending limits.

In the face of this onslaught it's the fault of the "customer" for not having the financial sophistication to tell a bunch of rich people offering them free money "Thanks, but no thanks, I don't want to be responsible for an economic catastrophe." Yeah, sure...

I don't disagree with any of this either. I was just super glad I wasn't ignorant enough to fall for it.

 

[ScoobyDoo]

Re: The States: At Least Michigan is Better Than Indiana

“A fight broke out between officials at the West Virginia statehouse on Friday after Republicans displayed an anti-Muslim poster comparing Rep. Ilhan Omar to 9/11 terrorists, with the heated argument resulting in one injury and one official resigning.”

https://thehill.com/homenews/state-...-terrorists-causes-fight-to-break-out-at-w-va

What the **** is wrong with people?

 

[French Rage]

Re: The States: At Least Michigan is Better Than Indiana

What the **** is wrong with people?

Well, for WV, their parents are cousins, for starters.

 

[Kepler]

Re: The States: At Least Michigan is Better Than Indiana

These books are excellent. Also recommend The Greatest Trade Ever by Gregory Zuckerman.

The debate on whether homeowners are culpable in all this is laughable. The gravy train was in danger of coming off the tracks when lenders started running out of prospective buyers who qualified for loans under traditional underwriting rules. The only solution was to find more "customers" who had no business being approached in the first place. These guys were aggressively marketing to these "customers" with pitches that were market tested to maximize the loan amounts in every case. Countrywide was nothing more than a direct marketing organization whose sole purpose was to originate as many loans as possible to keep feeding the tranches. Not only were they lending money without requiring documentation, they were falsifying income in many instances in order to qualify their "customers" for higher lending limits.

In the face of this onslaught it's the fault of the "customer" for not having the financial sophistication to tell a bunch of rich people offering them free money "Thanks, but no thanks, I don't want to be responsible for an economic catastrophe." Yeah, sure...

This is a great post, welcome to the political threads.