Question about the bailout?

[cags]

Everything I see is about homeowners and irresponsible mortgages yada yada.

But its not just about homeowners. Am I correct in this? Its also small business loans.

Will small businesses go under without this bailout? And all those jobs with them?

If its just mortgages then I say let them move to a house they can actually afford. But the business end of it worries me. And the job loss. If I'm wrong someone correct me please

[mzmolly]

1. We need to protect both small business and homeowners.

Once a home is foreclosed it effects all other homeowners in the area, and prices begin to plummet even further than they have over recent years.

In regard to your question, why not also suggest people buy a business they can afford, hire as many people as they can afford to pay etc.?

[cags]

4. That didn't answer the question but people having to move isn't going to hurt all that much

but people losing jobs everywhere will.

I don't want to pay for people avoiding a move. I will gladly help pay to keep people in their jobs

[mzmolly]

9. I don't want to help business without helping homeowners.

Question for you - why not suggest that people sell their business to someone who can afford it?

[cags]

12. Jobs... Job loss will affect everyone... downsizing your house will not

[mzmolly]

16. Bologna.

When housing continues to decline in value, it does effect everyone. Why heck, what if a "business owner" lives next door to a foreclosed house? I'm sure you can muster up a tear for the poor business owner in such a case?

Again, if you suggest that people own homes who can afford them, then surely the same can be said of a business?

[cags]

26. I used to live in CA, I know all about housing decline, it always goes back up...

What is going to be done about these homeowners who can't afford their loans, are we just going to give them free money to pay it, that comes out of our pocket. What about their pockets, do they have to pay part of my mortgage too. I don't think so.

Jobs are more important... If you have a job, you can have a place to live...

Its a bad situation all around, but I'm not convinced that the bailout is really going to help anyone right now. Not even homeowners.

[mzmolly]

27. Apparently you don't understand the concept of a loan?

No one suggested tax payers make the house payments of those in danger of foreclosure. What has been suggested is that loans be written in terms that are affordable and reasonable whenever possible.

[cags]

29. So they will rework their loans to go up to 45 yrs or give them special interest rates that...

no one else can get. Fine, why do I need to pay for that? Explain that to me

[mzmolly]

35. Who said they get special interest rates? Many of these people were being scammed

with high interest rates. Did you complain then?

Now explain to me why I should help business owners when I don't own a business? Why can't a business be sold if someone can't "afford" it, if a home should be sold under the same circumstances?

I support helping business and homeowners. Not business vs. homeowners.

[cags]

40. Actually I did complain, my sister got one. And I do believe people were scammed

but tell me how they are going to help homeowners in trouble right now. They either have to rework their loans for a longer period of time or reduce their interest rates to ridiculous levels, or give them more money to be able to pay for their current mortgages. So how is this bailout going to help them?

[mzmolly]

44. Why do you assume that interest rates would be reduced to "ridiculous" levels?

I suggest they'd be reduced to REASONABLE levels and reasonable terms.

My husband worked for a predatory lender for about two weeks. He couldn't take advantage of people, so he quit. His boss who made 400K per year, quit for the same reason. The company in question was involved in charging people interest rates that were about 4% above the going rate and many had "balloon payment" terms involved on top of that. Do you think that was "reasonable?" This type of practice is part of the reason we are in the situation we're in...

We can write "reasonable" loans for those who were taken advantage of, and we should!

[cags]

49. Exactly! Will they be able to afford their home under reasonable terms?

They had to get special terms in the first place just to "afford" it. So what happens if they can't afford the home under reasonable terms?

[mzmolly]

53. No one said every homeowner could be spared.

Some will lose homes, regardless.

[cags]

55. So who will be spared? And how will they be spared?

[mzmolly]

60. People who are paying 10% interest,

who have a loan re-written for a reasonable 6% interest rate?

[cags]

65. They can do that without a bailout... my sister did it. Its a simple refinance

[mzmolly]

66. No, it's not simple.

Especially given you understand that businesses are having a tough time getting loans. Try being a homeowner who's in foreclosure, or behind on a payment or two?

[cags]

68. So, Give them a special consideration to rework the loan, why do I need to pay for that?

[mzmolly]

71. Explain what you're paying for in such a scenario?

:shrug:

[avaistheone1]

72. I don't think we should be bailout people who have been using their homes as a cash register,

people's vacation homes, real estate speculators or home builders either.

Nor do I think we should be paying for bad credit card loans, defaulted student loans etc.

[mzmolly]

75. Agreed.

:hi:

[Tangerine LaBamba]

51. "I used to live in CA"

I'm sorry, but that sounds far too much like Sarah Palin claiming foreign relations expertise because she can see Russia from Alaska.

But, thank you for the great big laugh.

[cags]

56. I've bought and sold homes in CA and lived there most of my life. I made a lot of money on the ups

and downs of the market there. Is that better...LOL

[Tangerine LaBamba]

58. Who didn't?

I just want to know if you can see Russia from your house.

That's about as much as you seem to know.

[cags]

61. No need to be sarcastic silly little thing... just saying the markets decline... Its not a disaster

[Common Sense Party]

2. If something isn't done soon to put liquidity back in the credit system,

then, yes, small businesses will be unable to get loans.

The system right now is closed up as tight as a well-digger's sphincter in Alaska. Hardly anyone is lending anything.

Businesses won't be able to borrow to expand or continue certain operations. Some businesses will be forced to lay off.

Want to get a mortgage or a student loan? Forget it.

Want to buy a car? Fat chance.

The ripple effects from inaction...no one knows how bad it *could* be, but it's staggering to imagine.

[sendero]

10. Liquidity..

... is not the problem. Lack of trust, engendered by the fact that so much toxic derivative waste is held by so many entities, but there is no transparency. Nobody knows who has what so they assume the worst.

As for your dire prognostications, when this crap does finally implode, there will be a period of pain but it won't go on forever.

There is no way to get to the other side but to let this crap unwind. There is no power on heaven or earth that can prevent that from happening, it can merely be delayed, and not long at that.

[Tangerine LaBamba]

21. I agree

If you saw Rachel Maddow's Halloween candy explanation of this situation, you'd know that any kind of "bailout" is nothing but delaying the inevitable - only making it cost more in the end.

I say let it play out and then set about doing whatever needs to be done, in reasonable, measured terms, to put it back together again.

The mere fact that our "President" was in such a hurry to get something on the books should have been a clear warning to all that it is not an urgent situation. This is his style, his modus operandi, and it's exactly how we got the Patriot Act and the invasion/occupation of Iraq.

[texastoast]

3. Here are some links

http://blogs.wsj.com/independentstreet/2008/09/26/how-much-would-a-bailout-help-small-business/

http://washington.bizjournals.com/washington/stories/2008/09/29/story3.html

http://www.inc.com/news/articles/2008/09/bailout.html

http://www.tucsoncitizen.com/daily/all_headlines/97786

http://www.firstcoastnews.com/news/local/news-article.aspx?storyid=119256&provider=rss

http://blogs.wsj.com/independentstreet/2008/09/23/small-businesses-to-fed-wheres-our-bailout/



Looks like they will be footing the bill along with the rest of us if we lay down and take this shit.

[cags]

36. Thanks, that is what I was looking for

[Tangerine LaBamba]

5. That's a pretty cavalier statement:

"... let them move to a house they can actually afford." Rather narrow thinking there, and signs of a very hard heart.

What if they were able to afford the house when they bought it, but things went wrong for them - job loss, illness, death? What if they were swindled and sweettalked into a questionable mortgage by these brokers who we all know lack not only expertise but ethics?

You might want to consider not blaming the victims and look at the bigger picture.

[cags]

8. Bad things every day... Even to me... No one gets a free pass... No one gets a bailout

I don't have a hard heart. But owning a home is not a necessity for a happy life.

[mzmolly]

11. "No one gets a free pass... No one gets a bailout..." Except for business

in your scenario.

[cags]

14. If its truly a crisis, job loss will affect everyone. Downgrading your home will not

[Tangerine LaBamba]

15. Wanna bet?

What do you think is going to happen to that house?

Expand your thinking. You'll see a whole different, and much more complex, scenario.

[cags]

18. Someone else with a bit higher income who has to downsize too will buy it

with a proper loan

[mzmolly]

20. Again, why not say the exact same thing about the small business

in trouble? Someone with a higher income should own that business, no?

[cags]

28. Because it affects workers... food on the table... a roof over your head

that will be a crisis I am willing to pay for. I'm not willing to pay for someone having hardwood flooring instead of the linoleum that they can actually afford. It should be up to that family to decide how they can stay in that house or move... but as long as they still have their jobs they will be fine.

[mzmolly]

31. Again, if the weatlhy can buy up our homes, they can buy up our businesses.

When the business in question is sold to someone who "can afford it" than workers will be paid. You see, I'm not willing to keep a person in business who isn't able to afford to pay workers. See how that works?

[cags]

34. Are there enough buyers to buy up the businesses so that jobs are not lost?

[mzmolly]

37. Sure.

As I've said, the wealthy can afford to buy our homes and businesses. It's a Republican xanadu.

[cags]

So no real answer to that...

[mzmolly]

79. My answer

has been consistent.

[Tangerine LaBamba]

24. Another loan?

Someone "richer"?

Oh, so it's just a sequential downsizing, and the people at the bottom will end up homeless?

You're mouthing a version of "trickle down economics," and we all know how well THAT theory has worked out.

[mzmolly]

19. Again, the scenario that those who can afford to own homes also applies to

business. Why not sell the business(es) in question, to the same ownership society members who intend to buy up all of our homes when we can no longer afford them?

[cags]

30. There are not enough buyers to support that. Businesses will go under and people will lose jobs

[mzmolly]

38. The same can be said of homes. However, where is your evidence of this assertion?

I live in a desirable area, and we've had foreclosed homes on the market for years. I've seen housing values plummet in my area because of that. When I first moved to the location I'm in, homes sold in about one week.

[cags]

42. No the same cannot be said. There are a lot more homebuyers than business buyers

And thats the nature of the housing market. It goes up, it goes down. You have to ride it out sometimes...

[mzmolly]

47. That doesn't

mean that a business can't be sold.

[cags]

59. But what is the likelyhood of it when lots of businesses go under at the same time

[mzmolly]

62. The same likelyhood of many homeowners being

put on the streets at the same time I imagine? I live in an area with several vacant homes, many have been on the market for years.

[Tangerine LaBamba]

13. No one said it was a necessity

Where did you pull that one from?

I think maybe your need to punish is blinding you from seeing the whole situation and being able to understand people who might be different from you.

[cags]

17. LOL, Punish? But should everyone have to pay so that some don't have to downsize their house?

[mzmolly]

22. Should everyone have to pay so people can keep their business?

What is the point of keeping a job, if you're out of a home?

[cags]

32. If you have a job... you can always find a place to live. No job... your screwed

[mzmolly]

41. Why do you suggest

that if a business is sold to someone who can "afford" it, there would be no jobs?

[cags]

43. There are not enough buyers to buy up all the business that would close

[mzmolly]

45. What do you base this assertion

on?

[Tangerine LaBamba]

23. By your reasoning,

it's all right for everyone to pay because business owners made bad decisions.

That's what I mean by "punish" - yes - your attitude towards homeowners is punitive, yet, given the exact same circumstances, you approve of bailing out business people.

[cags]

33. Because businesses create jobs... without the jobs...we are in trouble... the house not so much

[mzmolly]

39. That does not address my point.

Why should a business owner who can't afford to keep that business be allowed to do so? If a business is sold, presumably the new business owner will have employees.

[cags]

46. There are not enough buyers to buy up all the business that would close.

[mzmolly]

48. Again, your evidence?

:hi:

[cags]

54. Well I'll have to find you some and bring it to ya...Sarah Palin LOL...

But for me its just common sense

[mzmolly]

64. It's common sense to me that keeping people in their homes when

possible is best for everyone, banks and tax payers included.

[cags]

67. Yes, as long as I'm not paying to keep them in a home they can't afford

thats fine with me. Do all the reworking they want. I don't care how they do it, but I don't see how I have to pay for them to rework their own personal loans

[mzmolly]

69. Why do you think you're paying?

No one suggested you or I, make anyone's mortgage payment or for that matter business loan payment. What has been suggested is that any legislation that comes to the floor include options for homeowners to loans rewritten if one can demonstrate that they can make a reasonable payment.

[cags]

73. What!!! Are you saying the bailout is not going to cost the taxpayers???

[mzmolly]

77. I'm saying if we get an equity stake

in the end it may not. And, if we keep homeowners in their homes, it will cost us less, regardless. Vacant homes don't help banks lend anyone money, including those business owners you care about.

[Tangerine LaBamba]

50. Do you realize

that people who own businesses also own houses?

You might want to consider signing up for a basic economics course.

In the meantime, I wish you an open heart and best of luck.

<click>

[texastoast]

52. I think we are talking about two different things

Small businesses create jobs for people. People who own those SMALL businesses need to be able to borrow money to keep people employed. I don't see them asking for a bailout (unless they are interviewed making a very valid point--"Wah! I want a bailout too!). They are worried that with the guvment bailing out the ENORMOUS, deregulated greedmeisters of Wall Street, the money to keep their business alive and people employed will dry up. And understandably so.

I think both borrowers and lenders bear responsibility, the heavier of which on the lenders' side. Lenders KNOW from looking at an applicant's finances whether or not the loan will be affordable. They should have NEVER loaned the money to the applicant. Zero down! A $500,000 house for $800 a month! Bigass come-ons for which THEY need to pay--not the taxpayers.

The applicant is at fault as well in most cases (with deference to those who became ill, lost jobs, etc.). Most knew they could not afford, but likely were less savvy in understanding what a reverse mortgage is. They KNEW they were taking a chance with an adjustable rate mortgage. Lack of understanding and not reading your loan papers is no excuse, in my opinion.

Many, many Texas newbies bought huge homes because they could--not because they could afford them. A lot of attitude I heard was "Hey, they let us!" The idea of keeping up with the Joneses infects many people.

I'll say it again. NOBODY should buy a home until they have been able to discipline themselves to save up enough money for a substantial downpayment, have at least six months' worth of bills in liquid cash, and sound potential to be able to pay for that house. Many new expenses must be budgeted. Disasters must be expected.

Democrats believe in pay as you go (theoretically). Republicans are borrowers and spenders.

We need to get back to saving more and spending less. And instant gratification will bite you on the ass. Bush was completely Orwellian in using the words "ownership society." He has no clue what it really means.

Somebody is going to suck this one up. Wall Street should have no bailout. Capitalism should be allowed to fail, otherwise it is socialism. Main Street should have no credit cards. We really can live without them. We just have to change our habits and our perception of "need."

[mzmolly]

57. Many predatory lenders took advantage of people who were not financially savvy.

These people are not to blame. They are told "you qualify for X amount" and they likely made a few payments. Factor in inflation and the cost of gas coupled with balloon payments and increasing interest rates it doesn't take a rocket scientist to understand what happened. A predictable disaster...

[texastoast]

63. Yes, indeed

No money for the predators. Not one dime.

And no credit cards. Zippo. Debit cards only.

[cags]

70. Exactly!!! No money for the predators... and that is who will get it with this bailout...

[mzmolly]

74. Will they get it if we bailout business?

:eyes:

[cags]

76. Maybe, Thats a price I'm willing to pay to save American jobs. That was my original question

[mzmolly]

78. That's a short sighted

answer. You're not playing the entire scenario though. What happens to vacant homes that are not sold? Who owns them ultimately? It's the failing banks. This is part of the problem. A bank is better off if someone is making a payment on a home in question vs. having a vacant home that generates zero income.

[cags]

80. But you still have not been able to answer how they are going to get the money to pay for the loan

If they could not have afforded a 6% fixed interest rate in the first place and decided to go for the lower rate with the chance of it rising, how are they going to be able to afford to do it now.

Most people chose those loans because they could not afford the basic fixed rate loans. Most people will still not be able to afford it. You still haven't been able to tell me how all these people are going to get the money to stay in their homes.

Thats my problem.

[mzmolly]

81. dupe

deleted.

[mzmolly]

82. You are talking in circles.

As I've noted to you previously in this conversation ...

A) Many of the problems stem from unreasonably high interest rates.
B) Balloon payments are also of issue.
C) Rewriting the loans for a fixed market rate, would be a possible solution for those who can afford a payment based upon said rate.
D) Banks are not able to recoup anything when a home is foreclosed and vacant, thus part of the problem.
E) Many people were suckered into the loans in question. It's not a matter of "choice." It's a matter of deregulation inserting a used
car salesman philosophy into the housing market which blew up as many knew it would.
F) People will have to demonstrate that they can make the new/reworked payment in order to stay in their homes.

[cags]

83. I'm just wondering how they will be able to afford that fixed market rate when they couldn't afford

it in the first place.
They couldn't afford the 6% fixed so they took the 4% adjustable. Just makes me wonder how they will be able to afford the 6% fixed now, especially when the cost of living is higher too.

Not sure how many this will help and why the need for bailout if you believe just reworking the loans will work.

[mzmolly]

85. I'll respond to you again when you either read what I've written

or demonstrate the ability to understand it cags.

Peace

:hi:

[cags]

86. OK Later...LOL

[dkofos]

6. It's a SCAM. It's a manufactured crisis to rob the tresury.

[Skink]

7. The Fed is moving to hide the liquidity that's out there.

So that wall street can have another party at tax payer expense. Bernake is now like Colin Powell in front of the UN.

[Tangerine LaBamba]

25. EXACTLY!!!!!!!!

Again, I cite Rachel Maddow's Halloween candy explanation of this latest "crisis":

http://www.youtube.com/watch?v=VjAKPutvMjM

[liquiddaddy]

84. The President's Saturday Radio Address

Good morning Americans across America. If you've seen more of my ass lately, don't blame me! Before I dust you chumpses off like greased lighting to the Bushco compound in Desmuchados, Paraguay with my pardon stamp still warm, (not too long from now, God willing) I'm having to do a few last minute things for some asshole buddies of mine. I was happy just to bide my time in the secret sub-terrainian rec room set up to my special Doctor-Strangelovian specifications, see, and make my own history, if you know what I mean.

But the other day, Hanky Paulson and Benny the Weasel Bernanke come slithering into my rumpus room all shaky and piss-pantie, telling me "Mr. President, the money's all gone. Not a dime is left in the treasury - just some moldy cheese and a couple of IOU's from Karl. What are we gonna do?!" I said, "look, Hank, I thought you were the chairman of Golden Sacks. Pull yourself together. If we need some money, just print it up. What's the problem?"

He says it's more complicated than that - we need tons more money. Everybody we know has been spending the money on so much worthless stuff that we're all broke again. I said, "how much you need?"

See, I got this gettin' stuff down pat. I'm telling you little people out there that if we don't get 700 bil toot sweet everybody in this whipped pooch of a country is gonna be livin' in tar paper shanty's and eatin' Gains Burgers for supper. So, break that check book out, America, and let's get busy. Together we can make this happen.

God Bless you, and have a nice day.