Wednesday, January 2, 2008

They made their beds why shouldn’t we let them sleep in it?

We all know about the trouble housing marketing going on right now. The busting of the homing market has effected many people in this country. From the single mother of lower middle class income trying to figure out how she can pay the bills and keep from having her house fall under foreclosure to the CEO of large bank trying to figure out how to turn his company around since it is clear they can’t dump their subprime loans on someone else.

It’s clear that all of this trouble is effecting everyone, even if we aren’t people with these loans or part of the companies that deal with them and many economic forecast say that it’s more likely to get worst before it even begins to look like it’s well get better.

Sir the people in Washington will do (and are doing) what they think they should to make sure the impact isn’t too bad. One of the steps to done to try and advert an economic crisis is to that there has been some bailing out. Which leads to the question…


At least that is something I have heard more then a few times and to be honest I am not sure if this is the best thing to do or not.

But to be honest it depends on who we are helping out, because some people I am more open to throwing a life boat then others.

I’m not sure I how much help really should go to the people/companies that sold these loans to people. Honestly the only reason I see to help them is the fear that if nothing is done this might take out some of the big players in the American Banking industry and of course crash our economy. But I’m hardest on these companies because the people working at them should have know better. They should have looked at the people who they where giving subprime loans to or more importantly when they did they should have stopped since many of those people really couldn’t (or I should say would be able in the future to be able to) afford to pay those loans at the terms set.

In fact I am even hard on our banks because they are a big reason why we are dealing with this crap right now. Example Washington Mutual pushed hard to get laws changed to make it hard for people to go into bankruptcy because of credit card debt. Now it seems that one of the reason for so money foreclosures is that people who might have gone in to bankruptcy couldn’t and so they to user their income to pay off their credit card bills instead of their mortgage.

But that is only one example there has been a lot of deregulation in the banking industry done on behest of the banking industry.

It might be because I’m a little to nice but I the people who should be helped first and foremost are those who going to lose there homes because these subprime loans. From the looks of it President Bush is going to do something to help some people who may face troubles in the future. But the bill is so narrow, that it leaves out a lot of people (like those who may have missed a payment or not really have good credit) whom maybe the people who will need the most help. Also the bill he past won’t do anything for people who already faced foreclosures because of bad loans.

Another big reason I would help them over the banks is that unlike the lenders a lot of people where not fully informed on how these loans worked and the lenders made big pushes to lure people in to taking out loans. There many things like ads aimed at poorer income people telling them that “Hey, you not think you could afford a home but we can help” or “Need money let use refinance and get you the cash you need.” It was shameful and you can still see these types of ads on air/print.

And to end this off I don’t think any help should be giving to speculators. They tried to game the system I can’t cry because they where the ones that ended up getting played. What’s worst about the speculators is the fact that the average person who is faced to the fact that they might lose their home gets mixed up with them when people talk about not wanting to help anyone who got a subprime loan.

Whatever is done to help people that are in trouble now I think it is a good ideal to regulate the banking industry so we can be sure we wont face this problem again in the future. Make it so the banks have to make sure people have the income to pay off their mortgage before they lend to them. Maybe make it so the banks should make sure that the person taking out the loan knows the terms of the loans 100%.

Honestly, because of this I clear must say we should treat the banking industry like little children. Even though there will be times that they whine about wanting something we have to be firm and tell them no from time to time because the bankers don’t really know what is good for them and this subprime loan/housing crisis is just proof of that.

And if you want more just look at credit cards.

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