WASHINGTON, July 11, 2008
Senate Passes Foreclosure Rescue Bill
Plan Will Back FHA Loans To Give Struggling Homeowners New Fixed Rate Mortgages
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Feeling the squeeze? Here's a look at actions and statements from key players in Washington.
Struggling homeowners who can't afford their mortgages and banks facing big losses would get government help under a foreclosure rescue that has broad bipartisan support.
The $300 billion plan was approved on 63-5 vote that reflected broad bipartisan support despite a White House veto threat.
Final action on the legislation is weeks off. The House wants to rewrite some details, and lawmakers are negotiating with the White House in efforts to avoid a veto.
The centerpiece of the plan would let the Federal Housing Administration back up to $300 billion in new loans to give struggling homeowners more affordable, fixed-rate mortgages. It allows lenders who agree to take a substantial loss on the mortgages to reclaim at least some money and avoid a costly foreclosure.
Rep. Barney Frank, D-Mass., the Financial Services Committee chairman and an architect of the bill, said the few but significant revisions House leaders are seeking could be made in as little as one week. Key players are preparing for a week of intense negotiations to resolve differences on Capitol Hill and with the White House, with an eye toward producing a bill President Bush could sign later this month.
The measure includes a long-sought modernization of the FHA and would create a new regulator and tighter controls on Fannie Mae and Freddie Mac, the government-sponsored mortgage giants. It also would provide $14.5 billion in housing tax breaks, including a credit of up to $8,000 for first-time home buyers.
Congressional Democrats are divided over important elements of the plan, including limits on loans the FHA may insure and Fannie Mae and Freddie Mac may buy. The Senate measure sets them at $625,000, while House leaders - including Speaker Nancy Pelosi, D-Calif., - want the cap as high as $730,000.
House leaders also oppose the immediate effective date of the Senate plan, preferring to phase in the new regulations for Fannie Mae and Freddie Mac over six months.
Shares of the two government-chartered mortgage financers have taken a beating over the last two days and are currently trading at levels last seen in the early 1990s. If the prices don't recover, the two companies will have difficulty raising more money through stock sales to compensate for their own losses from the housing bust. Investors are afraid their stakes will vanish if the government is forced to rescue the companies along with distressed homeowners.
Another key point of dispute is $3.9 billion in the Senate measure for buying and rehabilitating foreclosed properties. The House's band of conservative "Blue Dog" Democrats oppose the money, arguing that it would swell the deficit unless paired with cuts or tax increases to cover the cost.
But many Democrats, particularly members of the Congressional Black Caucus, are fighting to keep the funding, which they say will help prevent the communities hardest hit by the housing crisis from sliding into blight.
The White House singled out the money in its veto threat, calling it a bailout for lenders who helped cause the mortgage meltdown.
Lawmakers and the Bush administration agree on the central concept behind the measure: allowing the government to backstop new mortgages for struggling homeowners.
To make it more palatable to Republicans, the Senate measure would take responsibility for any losses away from taxpayers and instead cover them by diverting an affordable housing fund drawn from Fannie Mae and Freddie Mac profits.
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See all 81 Commentsback in 1970 they discover these well and had them all capped and put on guard for the past 40 years, what a joke. gas would be pennys and oil in the penny for us americans. this has to get out into the media so everyone please help.
go to rense.com
look under GAS PRICE MANIPULATION AND GULL ISLAND OIL
AND START SCREAMING WHAT THE FFFFFFFFFFFFFFFFFFFFFFF
for-america@h
otmail.com
I have always paid my taxes and bills on time.
I have never lived my life on credit, so I don''t owe anybody anything outside of taxes.
...now I have to help pay for those citizens that overextended themselves on credit, so I am indirectly paying for their houses.
I am an American, and I am slowly giving up on America.
Not only are they going to saddle us with bailing them out, they want us to insure their new loans.
Democrat Welfare at it''s finest, ladies and gentlemen.
The DumboCraps made the banks make bad loans to get votes from sub-prime folks! Acorn was their partner in this scheme.
Posted by RingADing3 at 07:22 PM : Jul 11, 2008
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My response: You''re out of your mind! NOBODY makes bankers make loans to anyone! GREED does that!
During the Bush years, there was a ''hands off- anything goes'' policy toward banking. They knew if the loans they made went ''belly up'' a friendly GOP Congress would bail them out!
The only problem is too many bad loans were made, by too many lending sources, so there''s too many to bail out! Congress can''t bail every business out, go home, and get re-elected! So, they have selectively bailed out certain ones.
Most of these problems are a result of Bush-GOP policy that says spending money and running up debt is NOT really a problem as long as you have positive growth!
If you want to blame Reid-Pelosi, blame them for stuff they''ve screvved up, not for stuff they haven''t, OK?
Believe me, there''s plenty of that! I dislike them only slightly less than you!
Will we ever know?
...now I have to help pay for those citizens that overextended themselves on credit, so I am indirectly paying for their houses.
I am an American, and I am slowly giving up on America.
Posted by OzarkBard at 07:29 PM : Jul 11, 2008
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My response: Yeah! You''re right, it stinks alright!
There''s a lot of people giving up on America, you''re not alone!
You''ve learned that the people who run the government---are the government. And they enrich themselves and cheat the public. It''s a stuff lesson to learn.
Have faith in yourself and not public officials, and you''ll seldom be disappointed. Because most of them don''t deserve your vote, your cooperation, or your respect!
What...are they just going to pull it our of theirass?
Why should my tax dollars go toward bailing out stupid people?
Why should my tax dollars go toward bailing out stupid people?
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Good question. Why not ask BILL CLINTON, THE ******** WHO DEREGULATED THE HOME MORTAGE INDUSTRY and took away the rules that had been made AFTER THE LAST TIME THIS CRISIS HAPPENED in the 1980''s.
We are paying for his recklessness today.
Greedy bankers/mortgage loan officers made the loans because they got paid by the mortgage.
Everyone wants the American dream (money) and they got theirs.
This is the same greed that caused the .com bubble/bust and the Enron blowup. Greed caused the sub-prime mess.
This is the same greed that caused the .com bubble/bust and the Enron blowup.
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You''re right. The dotcom bubble and the Enron scam happened ON CLINTON''S WATCH, too.
What caused the mess is collateralization. In collateralization the individual loan quality is lost and therefore is not worried about.
Everyone bought these CDO''s: Banks, Investment Banks, Trading Houses, Individuals, Brokers, Foriegn Governments and etc. No one now knows what the correct value is for each CDO because the quality of the underlying mortgage has been lost.
What caused the mess is collateralization.
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Lenders just do whatever the regulators allow. They are driven by profit and competition.
The government makes the rules. The Clinton administration changed the rules. The mess we have today is the result.
The worst part is - WE SUFFERED THE SAME DISASTER IN THE 80''S, and Clinton systematically dismantled the rules that had been established to prevent a repeat of that disaster. WE NOW HAVE A REPEAT OF THE DISASTER.
ARM loans, negative amortization loans, high risk loans all contributed. And the real estate professionals KNEW THIS WOULD HAPPEN, but nobody listened.
Not only are they going to saddle us with bailing them out, they want us to insure their new loans.
Democrat Welfare at it''''s finest, ladies and gentlemen.
Posted by DemWatcher at 07:59 PM : Jul 11, 2008
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My response: Mister, don''t you dare ''cry foul''!
We wouldn''t be in this mess if it weren''t for Bush and the 110 GOP-controlled Congress!
For six years, Bush and a GOP Congress spent money like there was no tomorrow and ran up the national debt fm approx. 4.6 trillion to over 10! There was no earmark or half-witted pork barrel project they wouldn''t finance! Like the infamous half-billion dollar ''highway to nowhere'' for the use of 10-12 people! Outrageous! And, totally irresponsible! Not to mention the 2 1/2 billion a wk going toward a contrived war!
Some percentage of these loans has to be protected!
The cost of millions of people kicked out onto the streets will be enormous! And we wouldn''t be in this shape if it weren''t for Bush economic policy that says you can run up massive debt as long as you have positive growth! Baloney. Even GOP economists said this wasn''t true! But, did King George listen to them? H3ll, no! He did what he wanted to! So, now we''re beginning to enter the ''patch it'' stage prior to the ''fix it'' stage!
We wouldn''''t be in this mess if it weren''''t for Bush and the 110 GOP-controlled Congress!
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We wouldn''t be in this particular mess if Clinton hadn''t systematically dismantled the regulations that had been put in place after the LAST TIME THIS SAME CRISIS HAPPENED in the 1980''s.
It''s not the Democrats. It''s not the Republicans. It''s
SIXTEEN YEARS OF BABY BOOMERS.
Slick Willy is a Boomer. Dubya is a Boomer. Hillary is a Boomer. Arnold Schwarzenegger is a Boomer. Joseph Hazelwood is a Boomer. 60% of Congress are Boomers.
I THINK THAT EXPLAINS EVERYTHING...
Having said that, we need to quit trying to save people from their own bad judgement. If it takes two incomes to meet your minimum monthly expenses, then what do you do if you lose one of the incomes? Many mortgage insurances have options to cover disability or loss of job. Stop spending every dime you earn and start saving! You should have 6 months income in savings.
They don''''t care squat about saving the homeowners.
Having said that, we need to quit trying to save people from their own bad judgement.
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Wait - now YOU don''t care about saving the homeowners from being victimized by lenders who try to persuade them to make decisions they aren''t sophisticated enough to make.
Can you make up your mind?
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I mean it both ways. Personal responsibility has gotten lost along with ethics and integrity. If you don''t know how to buy a house, then educate yourself before making an offer. There must be a "Homebuyers Guide for Dummies" out there. If you have three kids with another on the way, a car older than 3 years, credit card debt, and you are paying child support to your ex, then you can''t afford to buy a house. It''s not rocket science.
By the way, I think the "Dummies" books are great. We are currently reading "Diabetes for Dummies".
I''m getting an ID by the name of "Juan Gonzalez" and pretending I am an illegal immigrant.
Since I work for myself on cash basis, I sill stop claiming ANY income and stop paying taxes, AND I will get free healthcare.
I''ll post to tell you all how it goes....
Your assetion that ''lenders just do whatever the regulators allow'' is a gross over simplification and inaccurate. They go BEYOND! They falsify their records, they cheat where they think they can, and then they make it up! Example: Enron crew.
I grant that there were rule changes under Clinton, but there has been an escalation of that under Bush & GOP Congress, they made it worse! PLUS, they ran up both the national debt and created a budget deficit!
As a result, the dollar is becoming worthless!
My point: no amount of blaming Clinton---the GOP ''Swan Song''---can or will ever, divert the bulk of responsibility for this mess away from the parties who are responsible---the Bush administration & 110th Republican-controlled Congress!
Don''t confuse the bus driver who turned the bus over with a ''hot engine'' with the guy who took over, exceeded the speed limit, burned out the engine, and now is driving the bus toward the end of the road and over the cliff to the ravine below!
What mistakes they made was because they''re each irresponsible in their own way(s), not because they''re ''baby boomers''!
My original comment on this subject was going to be:
OH! Great. The Democratic-controlled Congress is finally getting around to passing some relief?! Everyday that goes by there''s around 8,200 more foreclosures! Don''t hurry now, don''t put yourselves out at all!
If it were a lobbyist shoveling a ''campaign contribution'' or assorted bribe, you guys could get legislation passed quick enough alright!
Remember to vote your underachieving incumbent politician out of office in November! I''m counting on Californians to come through for the U.S. and vote Pelosi out of office! She''s holding Congress back, please recall her! Pretty please! With sugar on it!
I have no problem with this if it was directed to help the dwindling middle class. If you bought a house at $625,000 - $730,000 dollars and now need help, you should probably re-evaluate your priorities and start living more like the rest of lower - middle class America - in $100,000 dollar homes!
Any bail out should be directed to the most people and that by far is those on the lower end of the scale!
I fully expected Congress to put impeachment on the table when we elected them to office. Rather than knuckling under to Bush threats, Congress should be threatening him with charges for the war crimes he has committed. -All talk and no guts.
I fully expected Congress to put impeachment on the table when we elected them to office. Rather than knuckling under to Bush threats, Congress should be threatening him with charges for the war crimes he has committed. -All talk and no guts.
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Posted by RandyNason
Great post!
What is shocking is information that 92% of all mortgages are paid on time ... we dont hear about that though ....
The small portion of mortgages that are in default should be left to thier demise .. If banks and lenders were greedy & silly enough to fund loans for folks who had risky credit then they should suffer the consequences ... sink or swim ..
As some others have posted .. if we make irresponsible decisions with our finances ... Should the government bail us out?
I doubt it ..
We have lost our way ...
I doubt it ..
We have lost our way ...
Posted by dowjones20k at 06:11 AM : Jul 12, 2008
You COMPLETELY ignore the Regulations and Laws put in Place after the Great Depression, Regulations and Laws people had grown up with and fully expected to protect them from lenders who would do anything for profit. Yes we lost our way when we Elected Fascist Republican''s, people our FATHERS told us were no good, to run our Government. THEY and THEY alone removed those protections we grew up with. THEY and THEY alone are responsible for this MESS yet AGAIN!! Sieg Heil Bush
This is a slippery slope. If anyone is bailed out, every single American homeowner who has EVER lost a home to foreclosure should sue the Federal government for discrimination and singling out some for preferential treatment. The fact that so many in so many other recessions and at other times were ignored--means that those who receive help now are treated better than those who have lost everything before and those who will lose everything after.
That is discrimination.
Posted by Edward1975 at 01:07 AM : Jul 12, 2008
Listen up SPORT!! Big Business made this NATiON WHAT IT IS!! It was NOT THE Laborer crafting a product from his blood and sweat!! It was the Boss sitting in his OFFICE Making THE tough decisions to go over seas who is the real hero, the real reason our nation is the BEST!!
You can listen to my superior opinion on everything from who to vote for to what products to buy 24-7 on my website, SEE YOU THERE!!!!
And in January of this year, the National Review''s David Gitlitz could only explain the looming recession on something other than economic reality:
If the U.S. is capable of talking itself into an economic downturn, we may be on the cusp of the first recession in history caused by a bad mood ... it''s not difficult to understand why the economic mood of the country is so bad. It''s nearly impossible to avoid the media''s constant deluge of economic negativism...
This is conservatism. The dismissal of economic burdens from others making less money than you. The belief that an ideal economy can thrive with a small boat of winners and a giant sinking ship of losers. The insistence that your economic dissatisfaction is illegitimate, and can only be explained by a brainwashing from the media or politicians.
Gramm''s only unique remark was expanding the blame beyond "big media" and "the Democrats" to ... everybody. Calling America "a nation of whiners" only made glaring the fundamental elitism of conservatism.
But make no mistake. Gramm is conservatism.
The Huffington Post
...gas prices have fallen, I think new home sales, maybe it was old home sales, anyway, one of them set a record last month. And, and this 4 percent growth has been going on month after month after month after month. It''s really an extraordinary economy. And yet, when you look at the polls you''re so fond of, they show that the American people think they''re fine, but that the rest of the people in the country are doing poorly economically. Why is that? ... Because, obviously people know how they''re doing, but they have to rely on the media to tell them how the rest of the economy is outside their neighborhood. And the media has been entirely negative.
A year later, just before the 2006 congressional elections, Barnes lamented in the Weekly Standard: "The economy, strong as it is, hasn''t produced a feeling of prosperity."
In June 2007, Washington Post columnist George Will concluded that Democrats had a "Prosperity Problem," based on Will''s world of cherry-picked stats:
In the 102 quarters since Ronald Reagan''s tax cuts went into effect more than 25 years ago, there have been 96 quarters of growth. Since the Bush tax cuts and the current expansion began, the economy''s growth has averaged 3 percent per quarter, and more than 8 million jobs have been created. The deficit as a percentage of gross domestic product is below the post-World War II average. Democrats, economic hypochondriacs all, see economic sickness.
(cont)
Posted July 11, 2008 | 09:53 AM (EST)
Phil Gramm thinks that the economy is wonderful and those that feel otherwise are mistaken. This is does not make Gramm uniquely callous. It just makes him a conservative.
For several years, conservatives have been mightily trying to insist the economy tastes great, so shut up and eat it.
At the end of 2004, the National Review''s economic editor Larry Kudlow proclaimed, "The U.S. economy is hitting on all cylinders as 2004 passes into 2005 ... Most in the mainstream media steadfastly refuse to give the economy a break." He railed that "amidst all this economic good news," a "declinist rant" was being perpetrated by "big-media."
15 months later, Kudlow regurgitated:
It''s always amazing to listen to conventional demand-side economic pundits and mainstream reporters who try as hard as they can to minimize the excellent performance of the American economy ever since lower marginal tax-rate incentives were put into place almost two-and-a-half years ago. ... Of course, you can''t please the worrywarts.
In December 2005, Fox News'' Fred Barnes also pointed a finger at "the media" for marring the pretty picture:
(cont)
3: Profound Character Attributes %u2014 RWAs are more likely to:
* Be dogmatic.
* Be zealots.
* Be hypocrites.
* Be absolutists
* Be bullies when they have power over others.
* Seek dominance over others by being competitive and destructive in situations requiring cooperation.
4: Blindness To One%u2019s Own Failings And To The Failings Of Authority Figures Whom They Respect%u2014 RWAs are more likely to:
* Believe they have no personal failings.
* Be highly self-righteous.
* Use religion to erase guilt over their acts and to maintain their self-righteousness.
1: Faulty reasoning %u2014 RWAs are more likely to:
* Make many incorrect inferences from evidence.
* Hold contradictory ideas that result from a cognitive attribute known as compartmentalized thinking.
* Uncritically accept insufficient evidence that supports their beliefs.
* Uncritically trust people who tell them what they want to hear.
* Use many double standards in their thinking and judgments.
2: Hostility Toward Outgroups %u2014 RWAs are more likely to:
* Weaken constitutional guarantees of liberty such as a Bill of Rights.
* Severely punish %u2018common%u2019 criminals in a role-playing situation.
* Admit they obtain personal pleasure from punishing such people.
* Be prejudiced and hostile against racial, ethnic, nationalistic, sexual, and linguistic minorities.
* Volunteer to help the government persecute almost anyone.
(cont)
This is a slippery slope. If anyone is bailed out, every single American homeowner who has EVER lost a home to foreclosure should sue the Federal government for discrimination and singling out some for preferential treatment. The fact that so many in so many other recessions and at other times were ignored--means that those who receive help now are treated better than those who have lost everything before and those who will lose everything after.
That is discrimination.
Posted by toldyouso12
See if you recognize any of these traits:
Right Winged Authoritarians (RWA):
Research has discovered a wide range of RWA scale relationships over the years, which can be organized into four general categories. (The Authoritarian Specter)
(cont)
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