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deliveredarling -> Freddie and Fannie (9/8/2008 7:54:52 AM)

The news is reporting a $20-300 billion dollar bail out for these companies. This is the amount it is going to cost taxpayers.

My question is, for those of us who don't have a Freddie or Fannie loan, we should we pay the extra taxes to cover it's "bail out"?

We should taxpayers be at all responsible for paying for this?

Just because the government decides it wants to bail it out, that doesn't mean we should have to pay for it.


Scenario two: Banks are failing, they are FDIC insured.

Where is the government getting the money to save all these banks and companies?

And where is it getting all the money it is pledging to help other countries?

I don't know about ya'll, but we simply don't have an extra money for severe tax increases.

It also looks as though, whoever gets into office will have to increase the taxes at an astronomical rate in order to "bail out" and continue helping other countries without ever addressing our problems right here!

Contribute your thoughts.



SwedishCovenant -> RE: Freddie and Fannie (9/8/2008 8:45:37 AM)

I'm wondering how the self-described Conservatives are going to justify this blatantly socialist action by the Federal government.

Will they contiunue to fly false colors, or drop the pretense and hoist the Jolly Roger?



ElmerFishpaw -> RE: Freddie and Fannie (9/8/2008 8:49:21 AM)

Talk about "welfare queens" LOL!!



WesP -> RE: Freddie and Fannie (9/8/2008 9:32:27 AM)

quote:

Scenario two: Banks are failing, they are FDIC insured.

Where is the government getting the money to save all these banks and companies?


From taxation.

quote:

I'm wondering how the self-described Conservatives are going to justify this blatantly socialist action by the Federal government.

Will they contiunue to fly false colors, or drop the pretense and hoist the Jolly Roger?


Did the President alone mandate this bailout? If not, then you need to look to the Democratic majority that currently exists. [&:]



cow451 -> RE: Freddie and Fannie (9/8/2008 9:56:39 AM)

quote:

ORIGINAL: deliveredarling

The news is reporting a $20-300 billion dollar bail out for these companies. This is the amount it is going to cost taxpayers.

My question is, for those of us who don't have a Freddie or Fannie loan, we should we pay the extra taxes to cover it's "bail out"?

We should taxpayers be at all responsible for paying for this?

Just because the government decides it wants to bail it out, that doesn't mean we should have to pay for it.


Scenario two: Banks are failing, they are FDIC insured.

Where is the government getting the money to save all these banks and companies?

And where is it getting all the money it is pledging to help other countries?

I don't know about ya'll, but we simply don't have an extra money for severe tax increases.

It also looks as though, whoever gets into office will have to increase the taxes at an astronomical rate in order to "bail out" and continue helping other countries without ever addressing our problems right here!

Contribute your thoughts.


The money is helping minimize the number of foreclosures. Loans that are renegotiated are still getting PAID.

The plan to inject up to $100 billion in each of the government-chartered mortgage giants could not only help lower mortgage rates but, some investors are hoping, buoy the overall economy. The plan could help banks feel more open to write new mortgages and to refinance existing mortgages at lower rates, offering a possible lifeline to consumers struggling with increasing payments."It saves Armageddon from happening," he said. "If you think about it this helps the financials, this helps the housing market.



NoShow -> RE: Freddie and Fannie (9/8/2008 11:48:59 AM)

quote:

The money is helping minimize the number of foreclosures. Loans that are renegotiated are still getting PAID.

The plan to inject up to $100 billion in each of the government-chartered mortgage giants could not only help lower mortgage rates but, some investors are hoping, buoy the overall economy. The plan could help banks feel more open to write new mortgages and to refinance existing mortgages at lower rates, offering a possible lifeline to consumers struggling with increasing payments."It saves Armageddon from happening," he said. "If you think about it this helps the financials, this helps the housing market.


Most of the people in banking, that I know, say that banks won't lend and that the bailout is more to cover the other side.



TheosCentric -> RE: Freddie and Fannie (9/8/2008 12:01:28 PM)

The gov't has no business in bailing out these companies.

What good is it really going to do?

People made bad decisions in obtaining home loans that they could not afford.

It was suggested that ARM's were bad to begin with, but people went with them as long as banks offered them, all for the American dream of owning a home.

What should the gov't do? Let the banks file bankruptcy and reorganize. Don't buy them out with taxpayer's money. That's making all of America bail out those who failed.



deliveredarling -> RE: Freddie and Fannie (9/8/2008 12:48:11 PM)

Once again, I am curious how PMI plays into this. If the PMI wasn't to pay for default loans and protect the mortgage company itself, then why do we have to pay it. It benefits us none and apparently doesn't do much for helping the mortgage industry either.[&:]



WesP -> RE: Freddie and Fannie (9/8/2008 1:29:14 PM)

quote:

The gov't has no business in bailing out these companies.

What good is it really going to do?


Actually, it should provide stabilization of the market so that a recovery is possible. Ignoring it would translate to a much larger recession in the future. If those 2 entities bankrupt out, what are the chances of lower middle class people getting a mortgage? It would be nearly impossible due to fear of economic collapse in that industry. Look at ARM's. This example is just another tactic used in the financial industry. There have been numerous different loan terms that have had to be regulated and changed in the past due to predatory lending. It will not end with this, but letting it go will embolden the more predatory lenders to further enslave the less economically viable people. Good decision-making absolutely enters into it, but there are times when we have crises in our personal lives that mandate borrowing that we really cannot afford. At that point, there is no safe alternative.

Edited because I somehow had the wrong quote to respond to. [&:]



Ps103 -> RE: Freddie and Fannie (9/8/2008 1:30:26 PM)

quote:

ORIGINAL: deliveredarling

Once again, I am curious how PMI plays into this. If the PMI wasn't to pay for default loans and protect the mortgage company itself, then why do we have to pay it. It benefits us none and apparently doesn't do much for helping the mortgage industry either.[&:]



Well, a lot of the bad loans were structured so there was no PMI--there were piggy-back loans for 100% of the selling price (some were even over 100%).

I wanted a house that is listed for 375k. To avoid PMI, I would ordinarily need a 75k down payment (which would give me that much equity in the house right out of the box). But I don't have the 75k. So my friendly lender--eager to get the loan--fixes me up with a 300k primary mortgage, then a 56,250 loan and another loan for the remaining 18,750. The lender is happy, because he got the business, and then turned around and sold all my loans to Fannie and Freddie, so he is off the hook. I am happy, because I got this sweet house that I couldn't afford--but hey, I avoided PMI! And besides, the housing market has no where to go but up, so I can refinance in a few years and by then, with the increase in value, the difference will be reckoned to me as equity.

Only that is not how it turned out. The price of my house did *not* go through the roof, when I go back to refinance no one wants to know me, and I now owe more for the house than I could possibly sell it for and I can't make any of the payments now that my nifty adjustable rates have adjusted.

At least that is my understanding of the problem.

But, if everyone *did* have PMI, what do you think would happen to the mortgage insurance companies when they had to pay off all those defaulted loans...?



Rockwall -> RE: Freddie and Fannie (9/8/2008 2:27:54 PM)

quote:

ORIGINAL: TheosCentric

The gov't has no business in bailing out these companies.

What good is it really going to do?

People made bad decisions in obtaining home loans that they could not afford.

It was suggested that ARM's were bad to begin with, but people went with them as long as banks offered them, all for the American dream of owning a home.

What should the gov't do? Let the banks file bankruptcy and reorganize. Don't buy them out with taxpayer's money. That's making all of America bail out those who failed.


Agreed 100%

I also heard that homeowners whose homes were going to be foreclosed were not going to have to file bankruptcy. That means that their credit will not have that stain on it and they will continue to open new lines of credit.



deliveredarling -> RE: Freddie and Fannie (9/8/2008 2:30:50 PM)

quote:


But, if everyone *did* have PMI, what do you think would happen to the mortgage insurance companies when they had to pay off all those defaulted loans...?


I think they would go out of business as they should because their own insurance isn't worth squat evidently.

You did explain the loan thing in very good terms.

This is what bothers me. People saw this coming, they knew about the predatory lending and did nothing.

The greed was more important than the future consequences, which they knew would fall any ways.

And yet it was allowed.

This bailout won't stop the future money hounds from coming up with some other trick. They seem to think that if the government doesn't bail them out that the economy will crash and burn because nobody can get home loans.

I got news for them, the home loans are hard to get now. They are concerned about the rise of interest rates. Whooptee do. They can raise them all they want, the truth of the matter is, no matter whether they get bailed out or not, people aren't buying houses, builders aren't building as fast. Loans aren't being extended.

It won't change a thing for the common folk. However, it will put the screws to banks, mortgage companies and builders. Banks won't be earning anymore interest because they aren't loaning any money.

Mortgage brokers won't be selling mortgages because people won't be buying. Builders won't be building because there won't be anyone to sell to.

They say this is for the people, IT IS NOT, it is for the people who will benefit monetarily. Bankers, brokers , builders and the the INVESTORS.

It's not for or about us people.



NoShow -> RE: Freddie and Fannie (9/8/2008 2:51:28 PM)

quote:

ORIGINAL: TheosCentric

The gov't has no business in bailing out these companies.


Sure they do. Those companies are GSEs, for government-sponsored enterprises. Whether there is a legal obligation or not, it's always been implied that the federal government was backing them. Many decisions\choices were made, based on that backing.

quote:

What good is it really going to do?


Freddie Mac and Fannie Mae are so intertwined in the mortgage and credit market, a failure by them would be devastating to our country and to a certain extent the world. Hopefully, a bailout will prevent that.

quote:

People made bad decisions in obtaining home loans that they could not afford.

It was suggested that ARM's were bad to begin with, but people went with them as long as banks offered them, all for the American dream of owning a home.


Regardless of what you hear and read, the bailout is not being done to keep people out of foreclosure. That's an after-effect they'll take and spin in their favor.

quote:

What should the gov't do? Let the banks file bankruptcy and reorganize. Don't buy them out with taxpayer's money. That's making all of America bail out those who failed.


Actually, the government is buying these companies. For the same reason as above, to help keep the countries credit from collapsing.



rhippie -> RE: Freddie and Fannie (9/8/2008 2:51:55 PM)

quote:

ORIGINAL: SwedishCovenant

I'm wondering how the self-described Conservatives are going to justify this blatantly socialist action by the Federal government.

Will they contiunue to fly false colors, or drop the pretense and hoist the Jolly Roger?


Who said we have to justify it? Freddie and Fannie should be allowed to fail; what's the problem?



rhippie -> RE: Freddie and Fannie (9/8/2008 2:54:44 PM)

quote:

ORIGINAL: Ps103

quote:

ORIGINAL: deliveredarling

Once again, I am curious how PMI plays into this. If the PMI wasn't to pay for default loans and protect the mortgage company itself, then why do we have to pay it. It benefits us none and apparently doesn't do much for helping the mortgage industry either.[&:]



Well, a lot of the bad loans were structured so there was no PMI--there were piggy-back loans for 100% of the selling price (some were even over 100%).

I wanted a house that is listed for 375k. To avoid PMI, I would ordinarily need a 75k down payment (which would give me that much equity in the house right out of the box). But I don't have the 75k. So my friendly lender--eager to get the loan--fixes me up with a 300k primary mortgage, then a 56,250 loan and another loan for the remaining 18,750. The lender is happy, because he got the business, and then turned around and sold all my loans to Fannie and Freddie, so he is off the hook. I am happy, because I got this sweet house that I couldn't afford--but hey, I avoided PMI! And besides, the housing market has no where to go but up, so I can refinance in a few years and by then, with the increase in value, the difference will be reckoned to me as equity.

Only that is not how it turned out. The price of my house did *not* go through the roof, when I go back to refinance no one wants to know me, and I now owe more for the house than I could possibly sell it for and I can't make any of the payments now that my nifty adjustable rates have adjusted.

At least that is my understanding of the problem.

But, if everyone *did* have PMI, what do you think would happen to the mortgage insurance companies when they had to pay off all those defaulted loans...?


Oh come on PW31.....you know the mortgage insurance companies aren't that stupid!! They wouldn't have written the insurance on a lot of these loans!!



ElmerFishpaw -> RE: Freddie and Fannie (9/8/2008 4:46:42 PM)

I heard an interesting quote....make of it what you will....just throwing it out....won't debate it either way...
"Capitalism will always be around, because socialism will always bail it out"



Ps103 -> RE: Freddie and Fannie (9/8/2008 4:50:23 PM)

quote:


Oh come on PW31.....


...Huh?



cow451 -> RE: Freddie and Fannie (9/8/2008 4:52:16 PM)

quote:

ORIGINAL: ElmerFishpaw

I heard an interesting quote....make of it what you will....just throwing it out....won't debate it either way...
"Capitalism will always be around, because socialism will always bail it out"

Or, "Socialism will be always around because capitalism needs it."



ekserekseez -> RE: Freddie and Fannie (9/9/2008 12:55:07 AM)

The government has no business bailing these out. In fact, Freddie and Fannie have no business existing.

If you think that this "bailout" is going to stabilize the economy, or keep the housing market from collapsing, or anything else, you're wrong. What this bailout is doing is this: reinforcing and rewarding lack of personal responsibility.

It's one thing to give charity to people. It's another thing for the feds to steal my money and then give it to some social climber who wanted a house bigger than he could afford, just to make his wife happy because her sister had a house that size. I give to the poor, but I donate to soup kitchens, I don't buy them crack or cheap vodka.

This bailout is crack or booze for credit junkies.



iknownothing -> RE: Freddie and Fannie (9/9/2008 3:14:54 AM)

What I find maddening is the way political hacks did not try to make sure these institutions were solvent, even though the American taxpayer would be on the hook if they failed. Please see this link:

http://online.wsj.com/article/SB122091796187012529.html?mod=googlenews_wsj



ekserekseez -> RE: Freddie and Fannie (9/9/2008 6:43:04 AM)

That's because political hacks like to spend taxpayers' money.



mapachito13 -> RE: Freddie and Fannie (9/9/2008 8:18:34 AM)

All these headlines about bank bailouts and failures have made my dad remark how reminiscent it was of the 1930's. If Freddie or Fannie fail the stock market would be next and then whammo - global recession!



deliveredarling -> RE: Freddie and Fannie (9/9/2008 8:23:19 AM)

My mom said the same thing. She also said that if the government didn't bail out F and F, this country would go into a depression greater than the Great Depression.

I don't see how that could be, but......



mapachito13 -> RE: Freddie and Fannie (9/9/2008 8:27:10 AM)

Mainly because even though your loan may not be directly to Fannie or Freddy it may be underwritten or insured by them!

That this is happening shows how slow this administration was to be proactive and keep their eyes on things going on within these borders!

Stuff like this doesn't happen overnight!



SwedishCovenant -> RE: Freddie and Fannie (9/9/2008 8:47:33 AM)

quote:

ORIGINAL: WesP

quote:

I'm wondering how the self-described Conservatives are going to justify this blatantly socialist action by the Federal government.

Will they contiunue to fly false colors, or drop the pretense and hoist the Jolly Roger?


Did the President alone mandate this bailout? If not, then you need to look to the Democratic majority that currently exists. [&:]


(Certain comments removed by popular demand)

http://www.forbes.com/afxnewslimited/feeds/afx/2008/09/09/afx5402870.html

The Treasury Department works for the President. Your attempt to blame the (Dem) Congress for the actions of the GOP Executive was ill-informed, at best.



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