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mike frick
yorkville, IL
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mike commented on the article |How is consumption the problem, if every thing that is consumed comes from the earth and is returned to the earth?
Would not consumption be a problem if the things consumed went to someplace other than the earth and gone forever?
But the fact that the net loss is zero, we'll be OK, right? -
mike commented on the article |I forgot to address your comment: "It was the non-regulation of the mortgage market (and of Wall Street) which led to the proliferation of dangerous mortgages."
There is no evidence that the market was unregulated, if there was I would like to see it.
The mortgage market was most definitely regulated. Fannie and Freddie are, and were, government entities. Bush and Clinton both passed legislation regulating the mortgage market. Banks must conform and comply to all kinds of government regulation in order to do business.
To claim that an un-regulated mortgage market was the cause is preposterous.
Government regulation, used to further political expediency, is to blame.To suggest that even more regulation (mortgage contract modification) which would allow for more power and control to push more politically expedient agendas, defies common sense.
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mike commented on the article |
Thanks,
Yes, the risky loans were profitable, not because they were loans that the banks expected to be paid by the borrower, but because they were backed by the government if the borrower defaulted. Banks could not have sold the securitized risky mortgages because who would buy them if the borrowers had a high risk of defaulting? They were able to sell them because they were backed and guaranteed by the government. US taxpayer money was put at risk. Yes, profits were made by risky loan practices because of government guarantees.
If that was not the case, and the banks committed fraud or theft, then they should be prosecuted on those grounds. However, that is not the case, the banks only performed as the government encouraged them to.
Now, for the government to encourage banks to modify mortgage contracts is OK, I guess. As long as the government does not coerce or force banks into contract modifications. The purpose of government is to enforce contracts, because commerce depends upon entered and fulfilled voluntary business agreements. Who would do business and enter into agreements with others, if the government will not enforce those agreements?Keeping folks in homes that cannot afford them sounds and feels good. It does not follow rational reasoning and logic however.
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mike commented on the article |
To Whom,
Thanks for the reply.
There is plenty of honest information out there.
Thomas Sowell is a start.
He shows how Democrats and Republicans ruined both the housing markets and the financial markets.
Like so many disasters, the current economic crisis grew out of policies based on good intentions and mushy thinking.
For far too long, too many people have regarded home ownership as "a good thing." It is certainly true that home ownership has its benefits. But, like everything else, it also has its costs and its risks.
Weighing such trade-offs is something that each individual and each family can do for themselves. It is when such decisions are made by politicians-- of whatever party-- that trade-offs tend to vanish into thin air, replaced by pursuit of a "good thing."
Beginning in the 1990s, getting a higher proportion of the American population to become homeowners became the political holy grail of government housing policies. Increasing home ownership among minorities and other people of low or moderate incomes was also part of this political crusade.
Because banks are regulated by various agencies of the federal government, it was easy to pressure them to lend to people that they would not otherwise lend to-- namely, people with lower incomes, poorer credit ratings and little or no money for a conventional down payment of 20 percent of the price of a house.
Such people were referred to politically as "the underserved population"-- as if politicians know who should and who shouldn't get mortgages better than people who have spent their careers making mortgage-lending decisions.
But, in politics, power trumps knowledge. Banks whose mortgage loan approval rates for "the underserved population" did not match the prevailing preconceptions found that they could not get government regulatory agencies to approve their business decisions on opening new branches or enlarging their financial operations, the way competing banks did when those competing banks met the lending quotas set by the government.
If meeting those quotas required lowering the standards for granting mortgage loans, that was often considered a lesser evil than having government regulators stalling or vetoing the business decisions necessary for competing in the financial markets.
While Democrats spearheaded this crusade, Republicans joined in as well. The George W. Bush administration, for example, urged Congress to pass the American Dream Downpayment Initiative, which subsidized the down payments of prospective home buyers whose incomes were below a certain level.
Who could be against "the American dream" of home ownership or so mean-spirited as to ask how much it would cost the taxpayers or what risks it would create for the whole financial system? Certainly not most Democrats or Republicans in Congress or the White House.
The media were also part of this crusade for more home ownership, more widely available. If some segments of the population did not own homes as much as others, that just showed that there was something wrong with the mortgage lending process, as far as editorial office philosophers were concerned.
As the St. Louis Post-Dispatch put it, "lending institutions are being far more conservative than they have to be in determining the creditworthiness of minorities."
Later, disastrous default rates and foreclosure rates among "the underserved population" who had been given mortgage loans to satisfy government quotas suggest that the old-fashioned mortgage qualifications that had been pooh-poohed in editorial offices had more basis than the crusades of politicians and the press.
There are many other complications covered in "The Housing Boom and Bust." But behind all the complexities was a very simple fact: Monthly mortgage payments by millions of home buyers were what provided the money for the banks, the financial institutions that bought mortgages from the banks, and the Wall Street firms that created sophisticated securities based on those mortgages.
Riskier mortgage lending practices, imposed by government, were what set the stage for many mortgage payments to stop and thus for the financial disasters that followed. Political rhetoric, echoed in the media, seeks to obscure that painfully plain fact.
Thomas Sowell
Wednesday, April 29, 2009
Copyright © 2009 Salem Web Network. All Rights Reserved. -
mike commented on the article |
I happened to see Senator Durbin last night on the Senate floor pushing this bill. He blamed the disastrous housing situation on greedy bankers providing 'no documentation' loans and sub prime 'predatory' lenders.
I do not give these bankers credence, however Durbin did not tell the whole story.
The reason those bankers did what they did is because the government was pushing them to make those loans. Loans of too high a risk that bankers would not ordinarily make. The government also provided taxpayer money guarantees to the bankers who offered these loans.
In reality, it was politicians and government that caused the housing mess, and subsequent economic collapse.
Mr. Durbin's half truth is still a whole lie.
Government meddling caused the problem, government meddling can only cause another problem, not solve it. -
mike commented on the article |I just saw an Animal Rights article where several dairy calves were just dumped in a ditch. Those calves could have probably fed many hungry people.
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mike commented on the article |I strongly disagree. Factory farming provides lower cost food to the marketplace which in turn allows for more people at lower income levels to eat more nutritious diets then they would be able to otherwise.
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mike commented on the article |
Does anyone know how much energy is required to manufacture CFL bulbs? How much energy is required to recycle CFL bulbs at end of life as compared to incandescent bulbs? What is the total energy difference comparison throughout entire lifetimes of each bulb? From raw material to final disposal back into the earth?
In the winter time, when energy is needed to heat dwellings anyway, aren't incandescent bulbs 100% efficient when used as a source for light? -
mike commented on the article |The ethanol experiment, whether well intentioned or not, is causing people to die. Using land to grow fuel, that would have been used to grow food, has caused food prices to rise. People that would have only been hungry in the world are now starving to death.
I do not see meddling in the energy economy, versus free market decisions, as a viable solution to a possible fictitious problem.
Or perhaps people dying is the idea. They will not exhale CO2, drive automobiles, use electricity, or eat meat. -
mike commented on the article |
Emily,
"I'd love to see you do some research with an open mind,..." and "That debate is over. Here we are discussing what to *do* about global warming."
A contradiction? Open mind and the debate is over?
Shouldn't a coercive approach to a solution, of a problem arrived at by consensus, that will most likely impact the ability of many human beings to survive, be debated until there is absolute certainty as to the exact cause?
The climate is and has always been changing.
CO2 levels and global temperature have been higher before humans appeared on the scene.
How can deciding the fate of so many human beings be taken so lightly?
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