**NBC: More Bank Failures on the Way!!!!!!**

[Jehoram]

I just saw a video excerpt from tonights NBC Evening News regarding the Bear Stearns/JPMorgan deal of earlier today.

Their experts are saying the darkest times of this crisis are ahead of us and they have no idea how it will end up.

A lot of uncertainty right now.

[A_PoMo]

Yeah, I think my bank account failed today. No kidding. We have an Ebay business and business is BAD!

[JaneEyre]

I thought I heard that Bear Stearns went for $2.00 per share and that J.P. Morgan basically got that billion dollar "headquarters" building "for free"...It is predicted that we are in a crisis similar to the Great Depression. The perfect storm of the economic crisis with real estate, the mortgage foreclosures, and the billions spent on the wars is going to be a strong gale. We had better all have a hiding place.

[Jehoram]

I posted a couple of weeks ago (to hysterical laughter) that I felt it was wise to have a plan of action if the economy were to fail completely.

I still feel that way.

No one could possibly surf the wave of uncertainty that is coming. But I feel we should at least get out of the water for a while.

[JaneEyre]

I posted a couple of weeks ago (to hysterical laughter) that I felt it was wise to have a plan of action if the economy were to fail completely.

I still feel that way.

No one could possibly surf the wave of uncertainty that is coming. But I feel we should at least get out of the water for a while.

It is even predicted that "there will be a run on the banks"...

[James Griffin]

I thought I heard that Bear Stearns went for $2.00 per share and that J.P. Morgan basically got that billion dollar "headquarters" building "for free"...It is predicted that we are in a crisis similar to the Great Depression. The perfect storm of the economic crisis with real estate, the mortgage foreclosures, and the billions spent on the wars is going to be a strong gale. We had better all have a hiding place.

This will be a rough recession. The perfect storm is still about 20-30 years out.

[TRFrance]

I posted a couple of weeks ago (to hysterical laughter) that I felt it was wise to have a plan of action if the economy were to fail completely.

I still feel that way.


It is even predicted that "there will be a run on the banks"...

I personally don't think we're facing an economic collapse. We've had recessions before, even a depression. We've always come thru on the other side ok. I think the same will happen here, even though the economic correction will be painful to a lot of people.

[TRFrance]

I believe that the Euro will one day replace the US Dollar as the world's standard currency. For that to happen, a precipitous fall of the dollar and a serious recession may be what helps to bring that about.

But America's economy is too much of a powerhouse to just collapse and fall off the map. We may be replaced by Europe and even Asian economies, but I think we have enough wealth, power, know-how, and resilience as a nation to ride out the storm.

[Ferd]

Dont panic people.

analysts are starting to say that this looks to be signaling a bottom.

The EUR/USD (Euro against the Dollar) hit 1.5900 last night, but turned and is around 1.5717.

Dating back to WW2, every major financial dust up, has seen sharp improvements in the DOW within 6 months.

The Fed is going to make some statement tomorrow that might signal another reduction in the carry rate.

Things arent nearly as bad as some are saying. Lets hold on and dont jump out of any windows yet.

[Ferd]

Also, this "bank failure" really isnt a bank failure in the sense that we think of banks.

YOUR bank is fine. Bear Sterns is a bank that loans money to banks and holds large portfolios of mortgages. This is not a bank where your checking account is.

your money isnt at risk. chill out.

[Jehoram]

I think you are minimizing the issue Ferd. I also think you are painting those of us who have legitimate concerns as radically hysterical.

Look, economists are mentioning the D word, not me.

Tell me, how many enormous banks have collapsed in your life time?

And NBC just reported tonight that the worst is ahead of us, not behind us.

Sorry for the pessimism. Maybe it's all of those years of biblical prophecy and the predictions of financial collapse sweating out of me.

[TRFrance]

Also, this "bank failure" really isnt a bank failure in the sense that we think of banks.

YOUR bank is fine. Bear Sterns is a bank that loans money to banks and holds large portfolios of mortgages. This is not a bank where your checking account is.

your money isnt at risk. chill out.
Besides, most of us would not lose money in most bank failure situations, since the FDIC guarantees up to $100,000 per person per account.

[Ferd]

I think you are minimizing the issue Ferd. I also think you are painting those of us who have legitimate concerns as radically hysterical.

Look, economists are mentioning the D word, not me.

Tell me, how many enormous banks have collapsed in your life time?

And NBC just reported tonight that the worst is ahead of us, not behind us.

Sorry for the pessimism. Maybe it's all of those years of biblical prophecy and the predictions of financial collapse sweating out of me.

well, we can start with the one in England a few months ago. England didnt sink into the ocean.

then we can return to the 80's and the Savings and Loan failures. (to date that bailout was larger than this one.)

but AE, we are both on record and in six months one of us will be right.

If you are wrong, well, you were being careful and that isnt a bad thing.
If I am wrong, well, I missed it by a long shot and will have egg on my face. No?

[Ferd]

I think you are minimizing the issue Ferd. I also think you are painting those of us who have legitimate concerns as radically hysterical.

Look, economists are mentioning the D word, not me.

Tell me, how many enormous banks have collapsed in your life time?

And NBC just reported tonight that the worst is ahead of us, not behind us.

Sorry for the pessimism. Maybe it's all of those years of biblical prophecy and the predictions of financial collapse sweating out of me.

The D word you are referencing is Depression. more likely the D word that has been talked about is Deflation. still a possibility and could lead to Depression.

Stagflation is also a possiblility.

I still think it is not really that likely.

[Digging4Truth]

Besides, most of us would not lose money in most bank failure situations, since the FDIC guarantees up to $100,000 per person per account.

That guarantee has never been tested on a large scale... if at all.

[Ferd]

That guarantee has never been tested on a large scale... if at all.

D, honestly this has really no impact on regular banks!

most banks are not heavily invested in bad loans (the source of the problem)

what really needs to happen is folks need to just not panic.

[Digging4Truth]

The D word you are referencing is Depression. more likely the D word that has been talked about is Deflation. still a possibility and could lead to Depression.

Stagflation is also a possiblility.

I still think it is not really that likely.

It is not only likely... it would appear to be almost inevitable.

A major economic downturn and possibly a global collapse is nearing us.

The debt based economy has run its course and no one can find ways to prop it up any longer.

In terms that the average family can relate to... here is where we are.

Lets say your family "economy" has been great for years. You have had unlimited credit and new furniture, new cars, great trips, eating out... ahhh.. the good life.

But... over time the debt based life that you have been living is starting to reach the point that you can no longer pay the minimal payments.

You prop it up as long as you can by borrowing from this one to pay that one until you finally reach a place where the facade can no longer be kept up and finally the debt has reached a mass that can no longer be controlled.

This is approximately where we stand right now.

[Digging4Truth]

I thought I heard that Bear Stearns went for $2.00 per share and that J.P. Morgan basically got that billion dollar "headquarters" building "for free"...It is predicted that we are in a crisis similar to the Great Depression. The perfect storm of the economic crisis with real estate, the mortgage foreclosures, and the billions spent on the wars is going to be a strong gale. We had better all have a hiding place.

This is the way financial collapse works.

Wealth does not go away. Wealth is simply transferred from one pocket to another.

When major collapses occur then those with the money are able to obtain massive wealth for pennies on the dollar (which, ironically enough, is the actual worth of the current American Dollar)

[Digging4Truth]

D, honestly this has really no impact on regular banks!

most banks are not heavily invested in bad loans (the source of the problem)

what really needs to happen is folks need to just not panic.

The mortgage crisis is simply that... the mortgage crisis.

The economy is ready to collapse on its own. The mortgage crisis is just one of the many symptoms and, should a collapse or depression occur, will not be "the reason" any more than sneezing is "the reason" one has a cold.

[James Griffin]

Besides, most of us would not lose money in most bank failure situations, since the FDIC guarantees up to $100,000 per person per account.



That guarantee has never been tested on a large scale... if at all.

Agree with both of you. For A bank failure most are safe. But the FDIC reserve is I believe somewhere around 1.25% of deposits insured. It remains to be seen if they would withstand a real bank run.

For you youngsters. In the 80s during the Savings and Loan crisis, the main insurer was the FSLIC and I seem to recall the FSLIC going belly-up.

A run on the banks (once again I am not predicting one, merely speaking hypothetically) would have FAR more consequences today due to the integration of the financial sector which did not exist then.

[TRFrance]

Agree with both of you. For A bank failure most are safe. But the FDIC reserve is I believe somewhere around 1.25% of deposits insured. It remains to be seen if they would withstand a real bank run.

For you youngsters. In the 80s during the Savings and Loan crisis, the main insurer was the FSLIC and I seem to recall the FSLIC going belly-up.

A run on the banks (once again I am not predicting one, merely speaking hypothetically) would have FAR more consequences today due to the integration of the financial sector which did not exist then.

Very true.

Not trying to be a fearmonger but....Keeping money in a Canadian or other foreign bank account is something more and more people seem to be dong nowadays.

[James Griffin]

Very true.

Not trying to be a fearmonger but....Keeping money in a Canadian or other foreign bank account is something more and more people seem to be dong nowadays.

Hmmp my $102.13 is going offshore!!!!

[Digging4Truth]

Agree with both of you. For A bank failure most are safe. But the FDIC reserve is I believe somewhere around 1.25% of deposits insured. It remains to be seen if they would withstand a real bank run.

For you youngsters. In the 80s during the Savings and Loan crisis, the main insurer was the FSLIC and I seem to recall the FSLIC going belly-up.

A run on the banks (once again I am not predicting one, merely speaking hypothetically) would have FAR more consequences today due to the integration of the financial sector which did not exist then.

Indeed...

Do you know what the fractional reserve is that most banks use these days?

Is it 10%

[Fiyahstarter]

I think you are minimizing the issue Ferd. I also think you are painting those of us who have legitimate concerns as radically hysterical.

Look, economists are mentioning the D word, not me.

Tell me, how many enormous banks have collapsed in your life time?

And NBC just reported tonight that the worst is ahead of us, not behind us.

Sorry for the pessimism. Maybe it's all of those years of biblical prophecy and the predictions of financial collapse sweating out of me.

That's it. I'm pulling all of my money out of the bank and burying it in a hole in my back yard.

And don't none of you come poking around my house looking for my nestegg either.

[James Griffin]

Indeed...

Do you know what the fractional reserve is that most banks use these days?

Is it 10%

Have not checked in awhile but 10% sounds in the ballpark...

[TRFrance]

I've been thinking...
it the government has been reluctant to bail out homeowners facing foreclosure, was it right for them to bail out Smith Barney?

[Digging4Truth]

I've been thinking...
it the government has been reluctant to bail out homeowners facing foreclosure, was it right for them to bail out Smith Barney?

It's not right for the government to bail out either.

[Sister Alvear]

I think America does not really know what se is facing...however time will tell...

[Sister Alvear]

I just saw a video excerpt from tonights NBC Evening News regarding the Bear Stearns/JPMorgan deal of earlier today.

Their experts are saying the darkest times of this crisis are ahead of us and they have no idea how it will end up.

A lot of uncertainty right now.


I agree with you....

[Digging4Truth]

There was talk in another thread about banks changing their policies. I had thought that my issues stemmed from a recent purchase of my bank (Regions Bank purchased by AmSouth) but I am finding that people who are banking where there has been no change of hands are finding the same problem.

There are changes in the way the transactions are being processed resulting in un-called for charges.

Transfers to an account used to be instantaneous and now takes days.

Banks are sorting the days transactions not in order or receipt but from largest to smallest. This allows for the customer to incur the most possible charges and brings in more money for the bank to operate.

I had seen this as just fluke that I was facing but I am seeing that this is not the case. Then I ran across the video below this morning.

Listen to time marker 2:25 to 3:03. This guy is saying that changes are being made (including dumping tons of cash into the system) just to keep checks clearing from bank to bank.

So... what I thought was a customer service issue with my bank appears to be a sign of major issues such banks running so low that they are clearly unable to clear checks as they come through.

http://www.youtube.com/watch?v=jGQzf0nDLxI

[COOPER]

well, we can start with the one in England a few months ago. England didn't sink into the ocean.

then we can return to the 80's and the Savings and Loan failures. (to date that bailout was larger than this one.)

but AE, we are both on record and in six months one of us will be right.

If you are wrong, well, you were being careful and that isn't a bad thing.
If I am wrong, well, I missed it by a long shot and will have egg on my face. No?

Yep! The The Feds have an Ace in the hole.....it's called Fuel!!

The Feds pump money in to the economy by pumping up prices at the Pump!

Why do yo think they are giving out checks this summer?

We get the check, we buy the gas for vacation and summer activities.

[DividedThigh]

relax folks, be wise and always plan in good times and bad, most banks will be fine, the ones that go down, will deserve to be extinct, dt

[ChristopherHall]

Here's an NPR article on this:

Economy
http://www.npr.org/templates/story/story.php?storyId=88388277&ft=1&f=1003
JP Morgan Snaps Up Bear Stearns for $2 a Share
NPR.org, March 17, 2008 • JP Morgan Chase will acquire the troubled investment bank Bear Stearns at the fire-sale price of $2 a share, a deal quickly approved over the weekend by the Federal Reserve, which aims to keep the financial giant from collapsing from its losses in the subprime mortgage crisis.

The approval came as the Fed also took the extraordinary step Sunday of lowering its emergency lending rate to financial institutions by a quarter-point to 3.25 percent.

The moves, days before the Feds scheduled meeting Tuesday, smacked of desperation to many investors, stirring fear worldwide that other banks with sizable exposure to troubled credit markets could also implode. Stocks fell sharply in Asia and Europe, and oil prices set fresh records in Asian trading.

Stunned dealers and traders at Bear Stearns turned up for work Monday to find the value of their stock options in tatters and the future of their jobs up in the air. Just last year, Bear Stearns stock was trading at $172 a share, although it had plunged to $30 in recent days amid market rumors that the bank was heavily exposed to subprime losses.

JP Morgan Chief Financial Officer Michael Cavanagh did not say what would happen to Bear Stearns' 14,000 employees worldwide, or whether the 85-year-old Bear Stearns name would live on after surviving the Great Depression and a slew of recessions.

JP Morgan said it will guarantee all business — such as trading and investment banking — until Bear Stearns' shareholders approve the deal, expected to be completed during the second quarter. The acquisition includes Bear Stearns' midtown Manhattan headquarters.

Economy
Fed's Moves Highlight Fragile State of Markets
by Maria Godoy

Enlarge

Stock traders negotiate in Sao Paolo Monday morning. Brazil's stock market dropped amid fears the global credit crisis that sank Bear Stearns would spread.


The Federal Reserve took dramatic measures over the weekend to reassure the increasingly anxious investment community, including negotiating the bargain-basement sale of Bear Stearns, one of Wall Street's biggest and most storied banks. The Fed's moves raise questions about just how deep the financial industry's woes go — and what other banks might be at risk.

Here, a look at what happened and what it means for the markets:

What was the Fed's role in the sale of Bear Stearns to JP Morgan?

The Fed extended JPMorgan Chase a $30 billion credit line to help it buy rival Bear Stearns, a firm with an 85-year history on Wall Street that was on the verge of collapsing due to losses in the mortgage market. JPMorgan is getting Bear Stearns for the rock-bottom price of about $2 a share — or about $236 million. That's a stunningly low price when one considers that Bear Stearns' shares were trading at $30 each on Friday, and that its company headquarters building in New York is valued at $1 billion by itself.

Why did Bear Stearns agree to be purchased for such a fire-sale price?

Bear Stearns really had no choice. The bank is facing an onslaught of rumors about its losses in the mortgage industry, and on Friday it reported some major liquidity problems — investors were pulling their money out and the bank was short on cash. The only way for Bear Stearns to keep doing business was to let itself be bought by another firm like JPMorgan. But the deal effectively wipes out most of Bear Stearns' shareholder wealth, and it's not clear whether it will win shareholders' approval.

What other measures did the Fed take?

Perhaps the Fed's most significant move over the weekend was the creation of a new program to give emergency loans directly to the 20 largest so-called "primary dealers." These are investment banks that do business directly with the Fed and which purchase the majority of Treasury securities.

In addition, the Fed lowered the discount-lending rate — that's the rate which it charges banks for very short-term loans — by a quarter-point, to 3.25, on Sunday.

Why did the Fed feel the need to take such dramatic action?

It's an indication of just how precarious things are in the financial markets. The fear is that if an investment giant like Bear Stearns fails, it could spark a run on other banks with sizable exposure to troubled credit markets, creating a domino effect of defaults.

Investment banks like Bear Stearns are the lifeblood of capital markets, providing the cash flow that keeps economic gears turning. They facilitate short-term loans to businesses, raise money for corporate expansions and IPOs and assist the trading of securities. Without them, financial markets would grind to a halt.

Does the Fed's intervention mean that things might be worse on Wall Street than they appear?

It certainly feeds those suspicions. The current credit crisis is largely being fueled by fear and uncertainty. Because they are not traded on a daily basis, mortgage-backed securities are difficult to value even in the best of times. Now that the mortgage market is in free fall, it's almost impossible to gauge just how much bad debt these banks have been left holding. That has made banks extremely nervous about making even short-term loans to each other.

Are other banks in serious trouble?

Yes, and everyone is asking who's most at risk. Some of the names mentioned most frequently are UBS and Lehman Brothers, both of which have a lot of exposure to subprime and mortgage-related securities. Shares of UBS dropped more than 14 percent in Zurich on Monday, after news reports suggested the company is weighing deep cuts in jobs and assets and might sell off its U.S. brokerage business.

Lehman, meanwhile, recently announced it was laying off 5 percent of its workforce. At one point, Lehman shares plummeted 48 percent on Monday. The stock closed down 19 percent, despite assurances from Lehman's CEO that the company was not having cash flow problems. The firm is one of several financial institutions that will report quarterly results on Tuesday, and investors are bracing for news of further losses.

"All of them could cause significant market volatility," Randy Frederick, director of derivatives at Charles Schwab & Co Inc., told Reuters. "Fear is higher now than it has been in a long time."

With reporting by NPR's Jim Zarroli, Chris Arnold and Uri Berliner


More on the Fed & Bear Stearns
March 17, 2008
Bear Stearns Collapse Costly to ManyMarch 17, 2008
A Brief History of Bear StearnsMarch 17, 2008
Fed Intervention Changes the RulesMarch 17, 2008
A Close Look at the Fed's Bear Stearns ActionMarch 17, 2008
Bear Sterns Move Breaks New GroundMarch 17, 2008
Bailing out Bear StearnsMarch 17, 2008
'Marketplace' Report: Bailout's Effects on WorkersMarch 17, 2008
Bear Stearns Bought Out by JP Morgan Chase


I have a feeling that the worst isn't over.

[Sister Alvear]

I don´t think it will be as esay as most would like it to be...even here in Brazil we feel the pressure of a failing dollar...

[COOPER]

The Feds are going to do what ever it takes to not have a repeat of the Great Depression.Let them.

[Sister Alvear]

I know many of you do not live the way we live so please excuse my thinking ... I really live thousands of miles from you folks and work under much different circumstances...

[DividedThigh]

fyi people the bear stearns , jpmorgan deal is contingent on approval of the shareholders, i dont beleieve that will happen, to cheap, negotiation will have to take place and the price rise, that is why the stock is headed up, dt

[Sister Alvear]

I do know that many countries are hoping for the downfall of America...So that alone should drive us to our knees...
Last night I must have feed (snacks) 50 children or more...they were all hungry...

Today I looked in my kitchen and wondered what do I have to cook??? Yet for 40 years HE has taken care of us so dear ones while men´s heart fail because of fear we can have peace in the storms of life...Pray much and walk close to Him.

[ChristopherHall]

My wife used to work for an investment firm known as C. H. Dean. She was explaining to me yesterday how the Fed’s actions over the weekend really helped a large segment of our economy to dodge the bullet. If Bear Sterns would have gone bankrupt it would have caused a domino effect through the economy with investment banks. She explained how most people have no idea how big or how serious this is for investment banking. At dinner the discussion among us and a few friends she has who still work at C. H. Dean was on how the Fed is positioning itself. All of these folks work in investments, they were explaining to me that the Fed’s actions are putting it in the position to respond to future bank failures like this one. They said it’s a real bad sign.

[James Griffin]

The Feds are going to do what ever it takes to not have a repeat of the Great Depression.Let them.

The Feds policies could lead to a another depression lol.

However there are forces at work now Totally out of their control now.

[ChristopherHall]

The Feds are going to do what ever it takes to not have a repeat of the Great Depression.Let them.

Technically the conservative position would be to stand back and let these investment banks go bankrupt.

[ChristopherHall]

I'll be suprised if it doesn't get far far worse.

[A_PoMo]

NEWSFLASH: Wholesale gas prices UP, new home construction DOWN. And the Fed is going to drop interest rates, AGAIN.

The bell tolls for us...

[Jack Shephard]

I thought I heard that Bear Stearns went for $2.00 per share and that J.P. Morgan basically got that billion dollar "headquarters" building "for free"...It is predicted that we are in a crisis similar to the Great Depression. The perfect storm of the economic crisis with real estate, the mortgage foreclosures, and the billions spent on the wars is going to be a strong gale. We had better all have a hiding place.

You are correct. I work for Chase bank. They made out good on the accurement of Bear Stearns. It just depends on if our CEO can work his magic on BS like he has Chase. We will see.

[Apprehended]

NEWSFLASH: Wholesale gas prices UP, new home construction DOWN. And the Fed is going to drop interest rates, AGAIN.

The bell tolls for us...

It is the sound of tolling bells.

The creaking sound is that of economic ship that is adrift upon the bloody sea of bad fiscal policy. Our loose economic policy is coming back to bite us where it hurts the most.

[ChristopherHall]

NEWSFLASH: Wholesale gas prices UP, new home construction DOWN. And the Fed is going to drop interest rates, AGAIN.

The bell tolls for us...

“1 Woe to those who make unjust laws, to those who issue oppressive decrees, 2 to deprive the poor of their rights and withhold justice from the oppressed of my people, making widows their prey and robbing the fatherless. 3 What will you do on the day of reckoning, when disaster comes from afar? To whom will you run for help? Where will you leave your riches?” – Isaiah 10:1-3 (NIV)

*Taps*

[ChristopherHall]

It is the sound of tolling bells.

The creaking sound is that of economic ship that is adrift upon the bloody sea of bad fiscal policy. Our loose economic policy is coming back to bite us where it hurts the most.

Yep.

[ChristopherHall]

"1Now listen, you rich people, weep and wail because of the misery that is coming upon you. 2Your wealth has rotted, and moths have eaten your clothes. 3Your gold and silver are corroded. Their corrosion will testify against you and eat your flesh like fire. You have hoarded wealth in the last days. 4Look! The wages you failed to pay the workmen who mowed your fields are crying out against you. The cries of the harvesters have reached the ears of the Lord Almighty." - James 5:1-4 (NIV)

[Jack Shephard]

Also, this "bank failure" really isnt a bank failure in the sense that we think of banks.

YOUR bank is fine. Bear Sterns is a bank that loans money to banks and holds large portfolios of mortgages. This is not a bank where your checking account is.

your money isnt at risk. chill out.

You are correct Ferd. Many of the 'banks' that are going under are not your typical 'savings and loan' banks. These one taking a dive are your mortgage banks. Countywide, the nations top primary mortgage holder, was saved by Bank of America. People were talking about CW as being this huge bank going under. The truth is only in a very few areas did they have bank branches. They did not have very many checking/savings type of account holders. To my knowledge there has been not traditional bank that has closed its doors, except some mom and pop banks. Chase, my employer, is the nations top in Home Equity lending and I think we are 2nd or 3rd largest bank in America. We have some 1.5 million home equity products on our books. That is a ton. Now some of them have been reduced or block to keep from over spending by the consumer, but there may have been 13k that this was done to out of 1.5 million. CW stopped almost ALL of their Home Equity lines of credit no matter what the 'loan to value' is.

It is a tough time to be a lender and a borrower, but if you all practice responsilbe borrowing and the banks practice responsible lending there will be no worries. The kicker here is that these mortgage banks that have gone under have done so because of crafty lending that did not pan out. Adjustable Rate Mortgages (ARM's) and Negative Amoritization Mortgages(NEGAM) have been the killer. They have put people in situation, some of you may be in right now, where consumers owe more on the home than the home is worth. Either the bank takes the loss or the consumer. Many, many people are walking away from homes cause they can not afford the adjusted payment. I saw one mortgage that the ARM payment for 500k loan was $1300 a month. Once it adjusted it was $3000 a month. Who can afford a jump like that? It is a tough time, but not as tough as the news/media would like people to think. If you watch Fox News, a more conservative media, you can see the economy is not as bad as say NBC, a more liberal media, shows. Depends on who you want to believe.

[DividedThigh]

You are correct Ferd. Many of the 'banks' that are going under are not your typical 'savings and loan' banks. These one taking a dive are your mortgage banks. Countywide, the nations top primary mortgage holder, was saved by Bank of America. People were talking about CW as being this huge bank going under. The truth is only in a very few areas did they have bank branches. They did not have very many checking/savings type of account holders. To my knowledge there has been not traditional bank that has closed its doors, except some mom and pop banks. Chase, my employer, is the nations top in Home Equity lending and I think we are 2nd or 3rd largest bank in America. We have some 1.5 million home equity products on our books. That is a ton. Now some of them have been reduced or block to keep from over spending by the consumer, but there may have been 13k that this was done to out of 1.5 million. CW stopped almost ALL of their Home Equity lines of credit no matter what the 'loan to value' is.

It is a tough time to be a lender and a borrower, but if you all practice responsilbe borrowing and the banks practice responsible lending there will be no worries. The kicker here is that these mortgage banks that have gone under have done so because of crafty lending that did not pan out. Adjustable Rate Mortgages (ARM's) and Negative Amoritization Mortgages(NEGAM) have been the killer. They have put people in situation, some of you may be in right now, where consumers owe more on the home than the home is worth. Either the bank takes the loss or the consumer. Many, many people are walking away from homes cause they can not afford the adjusted payment. I saw one mortgage that the ARM payment for 500k loan was $1300 a month. Once it adjusted it was $3000 a month. Who can afford a jump like that? It is a tough time, but not as tough as the news/media would like people to think. If you watch Fox News, a more conservative media, you can see the economy is not as bad as say NBC, a more liberal media, shows. Depends on who you want to believe.

some sanity at last, both you guys are on to the truth of the deal here, people that panic lose, rule number one, do i need to repeat that, lol,dt

[Ferd]

It is the sound of tolling bells.

The creaking sound is that of economic ship that is adrift upon the bloody sea of bad fiscal policy. Our loose economic policy is coming back to bite us where it hurts the most.

would you mind explaining this bad fiscal policy?

[Ferd]

NEWSFLASH!

Lehman Brothers and Goldman Sachs both reported better than expected earnings.

stock market is up 234 points this morning.

Half the days important news is in in a positive. Next is the Feds action this afternoon.

i really think we will find the bottom by the end of this week.

PS, all you guys watching NBC/ABC need to turn that off and watch CNNs Bulls and Bears and FoxNews's Niel Cavuto.

BALANCE PEOPLE BALANCE.

[A_PoMo]

NEWSFLASH!

Lehman Brothers and Goldman Sachs both reported better than expected earnings.

stock market is up 234 points this morning.



So it's true! The rich get richer and poor get poorer! And all that time I thought that was just a Bible verse and a campaign slogan :)

[Digging4Truth]

The Feds policies could lead to a another depression lol.

However there are forces at work now Totally out of their control now.

Indeed...

As one person said on a video I saw yesterday... "What's wrong with recession/depression?"

Recessions & depressions allow for a realignment of the economy. These processes get rid of bad risks and return a stronger economy when it is all over.

The problem is that continual attempts to circumvent recessions end up only bringing worse recessions and even depression upon the economy.

[Digging4Truth]

So it's true! The rich get richer and poor get poorer! And all that time I thought that was just a Bible verse and a campaign slogan :)

Yep...

Better than expected earnings for whom?

The investment class.

The working class doesn't benefit much from this news.

[A_PoMo]

Indeed...



Recessions & depressions allow for a realignment of the economy. These processes get rid of bad risks and return a stronger economy when it is all over.

.

I'll try to remember that this afternoon as I try to figure out a way to pay my bills. This wonderful recession has cut my income by 90%. I guess I'm one of those pesky bad risks the economy needs to get rid of. And all this time I thought I was one of those small business guys that is supposedly the back bone of the economy. Nice!

[Jehoram]

Why can't we talk about this reasonably instead of everyone with a genuine concern being marginalized as hysterical?

Look people, this is the topic of conversation in our country currently. I am not some sort of whacko conspiracy freak.

I just think the whole situation is alarming.


Weak dollar, weak employment, weak housing market, over-extended banks, huge federal debt.

It's not very pretty.

[Ferd]

You are correct Ferd. Many of the 'banks' that are going under are not your typical 'savings and loan' banks. These one taking a dive are your mortgage banks. Countywide, the nations top primary mortgage holder, was saved by Bank of America. People were talking about CW as being this huge bank going under. The truth is only in a very few areas did they have bank branches. They did not have very many checking/savings type of account holders. To my knowledge there has been not traditional bank that has closed its doors, except some mom and pop banks. Chase, my employer, is the nations top in Home Equity lending and I think we are 2nd or 3rd largest bank in America. We have some 1.5 million home equity products on our books. That is a ton. Now some of them have been reduced or block to keep from over spending by the consumer, but there may have been 13k that this was done to out of 1.5 million. CW stopped almost ALL of their Home Equity lines of credit no matter what the 'loan to value' is.

It is a tough time to be a lender and a borrower, but if you all practice responsilbe borrowing and the banks practice responsible lending there will be no worries. The kicker here is that these mortgage banks that have gone under have done so because of crafty lending that did not pan out. Adjustable Rate Mortgages (ARM's) and Negative Amoritization Mortgages(NEGAM) have been the killer. They have put people in situation, some of you may be in right now, where consumers owe more on the home than the home is worth. Either the bank takes the loss or the consumer. Many, many people are walking away from homes cause they can not afford the adjusted payment. I saw one mortgage that the ARM payment for 500k loan was $1300 a month. Once it adjusted it was $3000 a month. Who can afford a jump like that? It is a tough time, but not as tough as the news/media would like people to think. If you watch Fox News, a more conservative media, you can see the economy is not as bad as say NBC, a more liberal media, shows. Depends on who you want to believe.


Very good points.

Even NBC and ABC are still pointing out that the curent crisis in the financial market could spill over into other sectors.

ABC used the "house of cards" analogy this morning. the point they were making is that things are bad and getting worse. Dianne Sawyer was just beating the Tresury Secretary up trying to get him to say this is a recession. The fact is, a recession is not a subjective thing. It is based on objective measurables. we dont the data to make that kind of statement!

bottom line is, while NBC and ABC are saying that things could enter other markets, they have not yet

[ChristopherHall]

You are correct Ferd. Many of the 'banks' that are going under are not your typical 'savings and loan' banks. These one taking a dive are your mortgage banks. Countywide, the nations top primary mortgage holder, was saved by Bank of America. People were talking about CW as being this huge bank going under. The truth is only in a very few areas did they have bank branches. They did not have very many checking/savings type of account holders. To my knowledge there has been not traditional bank that has closed its doors, except some mom and pop banks. Chase, my employer, is the nations top in Home Equity lending and I think we are 2nd or 3rd largest bank in America. We have some 1.5 million home equity products on our books. That is a ton. Now some of them have been reduced or block to keep from over spending by the consumer, but there may have been 13k that this was done to out of 1.5 million. CW stopped almost ALL of their Home Equity lines of credit no matter what the 'loan to value' is.

It is a tough time to be a lender and a borrower, but if you all practice responsilbe borrowing and the banks practice responsible lending there will be no worries. The kicker here is that these mortgage banks that have gone under have done so because of crafty lending that did not pan out. Adjustable Rate Mortgages (ARM's) and Negative Amoritization Mortgages(NEGAM) have been the killer. They have put people in situation, some of you may be in right now, where consumers owe more on the home than the home is worth. Either the bank takes the loss or the consumer. Many, many people are walking away from homes cause they can not afford the adjusted payment. I saw one mortgage that the ARM payment for 500k loan was $1300 a month. Once it adjusted it was $3000 a month. Who can afford a jump like that? It is a tough time, but not as tough as the news/media would like people to think. If you watch Fox News, a more conservative media, you can see the economy is not as bad as say NBC, a more liberal media, shows. Depends on who you want to believe.

It’s my understanding that deregulation of the banking industry (pushed through by conservatives) is what has opened the door to these crafty and predatory lending practices on such a massive scale.

[Ferd]

So it's true! The rich get richer and poor get poorer! And all that time I thought that was just a Bible verse and a campaign slogan :)

what? dude, that is increadbly silly.

what? you want banks to report that life sucks and eveyone has gone bankrupt? that would make you happier?

well my friend, to feed your current commie scentiment, the CEO of Bear Sterns lost $900,000,000 bucks last week.

at least 1 rich guy got a lot poorer.

That should make you happy! whew hoo!

[Jehoram]

Weak dollar, weak employment, weak housing market, over-extended banks, huge federal debt, unbelievably high automobile and home heating fuel.

[DividedThigh]

lets blame bush, that is the sentiment from the left, no matter what the man does he is blamed, even for things he cant control, lol, hysterical, dt

[Ferd]

Weak dollar, weak employment, weak housing market, over-extended banks, huge federal debt, unbelievably high automobile and home heating fuel.

ok. what does that mean? are you suggesting these are government policies or are these functions of the business sector.

obviously the federal debt is gov. policy. We have a congress and a president to blame for this.

[Ferd]

lets blame bush, that is the sentiment from the left, no matter what the man does he is blamed, even for things he cant control, lol, hysterical, dt

oh dude, dont you know? George Bush ran for president so he could jack up the price of gas so his rich oil buddies could get richer!

[Jehoram]

lets blame bush, that is the sentiment from the left, no matter what the man does he is blamed, even for things he cant control, lol, hysterical, dt


He is the worst Republican President in history.

Period.

And I'm a Republican.

[Ferd]

He is the worst Republican President in history.

Period.

And I'm a Republican.

then you have no clue about historic context.

[Jehoram]

ok. what does that mean? are you suggesting these are government policies or are these functions of the business sector.

obviously the federal debt is gov. policy. We have a congress and a president to blame for this.

I don't "mean" anything.

Just stating economic conditions, that's all.

By the way, does anyone have the latest stats on inflation? I haven't paid much attention to that as of yet.

[DividedThigh]

i am sorry i thought that was richard nixon, you guys need to chose, lol

[Jehoram]

then you have no clue about historic context.

Name a Republican president who was worse than Dubya.

[Jack Shephard]

It’s my understanding that deregulation of the banking industry (pushed through by conservatives) is what has opened the door to these crafty and predatory lending practices on such a massive scale.

You may be right. Though the fact of the matter is that no one should have lended on mortgages like this. These ARMS that adjust either 3,5, or 7 years are bad deals. I know alot of people here in the Phoenix metro area is alot of people obtained these mortgages cause home values went up so they figured pay 'x' amt and my home will still go up in value and still make me money so I can sell in 3 years or so and make alot of cash. Good idea, bad theology. It worked for some but killed I mean killed others. Some families out here have lost so much value in the home, but yet tax values have not changed people are burning their own home in hope to get their insurance money and move on. These loans have come down to people breaking the law and risking goin to jail for a long, long time. Obviously people have to make the choice to do wrong, but if someone feels that is the only way out that means that these types of deal should have never been done in the first place.

[Jehoram]

i am sorry i thought that was richard nixon, you guys need to chose, lol

Nope.

He just got caught playing politics.

[A_PoMo]

Hey Ferd,

Thanks for the 'commie mindset' comment. That was spot on. I'll try to remember that the next time I am tempted to start a capitalist business. I've started three so far in my life.

BTW: I feel reealllly bad for the fat cat CEO that lost all that money. Poor guy.

[DividedThigh]

Know something, none of the people in the govt liked grant except lincoln, lincoln liked him because he would fight, well give me a president that will fight, not just wimp around and talk to much while being stabbed in the back, no i dont like all of his policies, and yes he has done things i dont agree with, but he picked the right supremes for me, and also he will fight the enemy, that is good enough for me, dt

[Jehoram]

I guess none of this matters any way.

I mean why save for tomorrow when the rapture could happen today?

[Ferd]

Yep...

Better than expected earnings for whom?

The investment class.

The working class doesn't benefit much from this news.

You guys are giving me whiplash!

first you guys are freaking out over how bad the economy is, then when the news comes in that will either make things much worse or not quite as bad, you guys are all mad because it didnt come back MUCH WORSE!

Its like you WANT the economy to tank!

[Jehoram]

Hey Ferd,

Thanks for the 'commie mindset' comment. That was spot on. I'll try to remember that the next time I am tempted to start a capitalist business. I've started three so far in my life.

BTW: I feel reealllly bad for the fat cat CEO that lost all that money. Poor guy.

Ferd is being a bit more illogical than normal.

It's the new baby.

He's not getting any sleep.

[Ferd]

Name a Republican president who was worse than Dubya.

LOL! Herbert Hoover?

[Ferd]

Hey Ferd,

Thanks for the 'commie mindset' comment. That was spot on. I'll try to remember that the next time I am tempted to start a capitalist business. I've started three so far in my life.

BTW: I feel reealllly bad for the fat cat CEO that lost all that money. Poor guy.

just commenting on your comment. not trying to suggest you are a communist.... I worded that reply very spicifically.

cool. 3 businesses? hows that working out for you?

[Jehoram]

Know something, none of the people in the govt liked grant except lincoln, lincoln liked him because he would fight, well give me a president that will fight, not just wimp around and talk to much while being stabbed in the back, no i dont like all of his policies, and yes he has done things i dont agree with, but he picked the right supremes for me, and also he will fight the enemy, that is good enough for me, dt
Yep.

He'll fight everyone.

He'll fight Democrats, Republicans, Koreans, Iranians, Iraqis...well you get the drift.


He's a big-spending, gay-tolerant, open-border conservative wannabe.

[Jehoram]

LOL! Herbert Hoover?


Don't think so.

[Ferd]

Ferd is being a bit more illogical than normal.

It's the new baby.

He's not getting any sleep.

Dude, Sunday night I got NO sleep just thinking about what we need to get done before Jack gets here!

egads!

[Jehoram]

Dude, Sunday night I got NO sleep just thinking about what we need to get done before Jack gets here!

egads!

You get a free pass today.

We can completely understand your lack of critical thinking and rational thought.

[A_PoMo]

just commenting on your comment. not trying to suggest you are a communist.... I worded that reply very spicifically.

cool. 3 businesses? hows that working out for you?

They've been doing well for 15 year. This economy is killing two of them though. Literally. They're all but dead and I'm going down with it.

Thanks for asking.

[Jehoram]

They've been doing well for 15 year. This economy is killing two of them though. Literally. They're all but dead and I'm going down with it.

Thanks for asking.

I'd tell you to go take out a loan, but well.......the banks seem to be closing.




LOL

[ChristopherHall]

You may be right. Though the fact of the matter is that no one should have lended on mortgages like this. These ARMS that adjust either 3,5, or 7 years are bad deals. I know alot of people here in the Phoenix metro area is alot of people obtained these mortgages cause home values went up so they figured pay 'x' amt and my home will still go up in value and still make me money so I can sell in 3 years or so and make alot of cash. Good idea, bad theology. It worked for some but killed I mean killed others. Some families out here have lost so much value in the home, but yet tax values have not changed people are burning their own home in hope to get their insurance money and move on. These loans have come down to people breaking the law and risking goin to jail for a long, long time. Obviously people have to make the choice to do wrong, but if someone feels that is the only way out that means that these types of deal should have never been done in the first place.

My point was in relation to your previous comment regarding news media and people choosing who to believe. You had mentioned Fox News as being a more positive and conservative voice in the news media. I wanted to just make note that it was deregulation of the banking and securities industry, supported by conservatives, that has allowed this leaven to do the damage it has.

[Digging4Truth]

You guys are giving me whiplash!

first you guys are freaking out over how bad the economy is, then when the news comes in that will either make things much worse or not quite as bad, you guys are all mad because it didnt come back MUCH WORSE!

Its like you WANT the economy to tank!

Well bro... I am not sure where you got that assessment out of my post.

No sir... not wanting the economy to tank... any more than anyone wanted the Titanic to sink.

But when it started to fill with water folks went running for the life rafts and no amount of the band continuing to play changed what was happening.

In the sinking of a ship there is still the rising & falling of the waves. The ship goes up and the ship goes down but its position against the water level is a continual decline despite the small fluctuations of height.

There will be rushes... there will be times people bail... but the overall trend is what tells us where we are headed.

[DividedThigh]

Yep.

He'll fight everyone.

He'll fight Democrats, Republicans, Koreans, Iranians, Iraqis...well you get the drift.


He's a big-spending, gay-tolerant, open-border conservative wannabe.

lets get this straight bro, i said i dont agree with many things he has done, but i do want him to fight the battles we need to fight, much better than a democrat, i suppose it would have pleased you if al gore had been president after 911 and then he would have blamed the aggression of the islamofascists on global warming, good grief, dt

[Jehoram]

lets get this straight bro, i said i dont agree with many things he has done, but i do want him to fight the battles we need to fight, much better than a democrat, i suppose it would have pleased you if al gore had been president after 911 and then he would have blamed the aggression of the islamofascists on global warming, good grief, dt

I don't agree with Al Gore on much of anything...but the guy can't be any more whacked than Dubya.

For the record, I votes for DUH-bya twice.

I was stupid and drank the Republican KoolAid.

McCain is an exact replica of DUH-bya. Look for another 75 zillion illegals to invade us over the next few years.

Spare me the drama dude. if a Democrat president had presided over this sort of sewage we call an economy everyone on this board would be screaming to throw the dirty bum out.

Me included.

[Digging4Truth]

I don't agree with Al Gore on much of anything...but the guy can't be any more whacked than Dubya.

For the record, I votes for DUH-bya twice.

I was stupid and drank the Republican KoolAid.

McCain is an exact replica of DUH-bya. Look for another 75 zillion illegals to invade us over the next few years.

Spare me the drama dude. if a Democrat president had presided over this sort of sewage we call an economy everyone on this board would be screaming to throw the dirty bum out.

Me included.

I fear that McCain could be Dubya on steroids in some areas.

[DividedThigh]

I don't agree with Al Gore on much of anything...but the guy can't be any more whacked than Dubya.

For the record, I votes for DUH-bya twice.

I was stupid and drank the Republican KoolAid.

McCain is an exact replica of DUH-bya. Look for another 75 zillion illegals to invade us over the next few years.

Spare me the drama dude. if a Democrat president had presided over this sort of sewage we call an economy everyone on this board would be screaming to throw the dirty bum out.

Me included.

ok dude, i just guess we will have to agree to disagree, i know some people who are close to him, and although i dont agree with him at times i believe he is sincere, peace out, dt

[ChristopherHall]

McCain's a puppet. He's decided to say what they tell him to say and do what they tell him to do. He sold out to the machine behind the RNC. McCain isn't his own man. All his policies are borrowed from Bush. He's not his own man.

[Pressing-On]

McCain's a puppet. He's decided to say what they tell him to say and do what they tell him to do. He sold out to the machine behind the RNC.

Excuse me while I roll my eyes!

:bliss

[DividedThigh]

Excuse me while I roll my eyes!

:bliss

nice, lol,dt:laffatu:kickcan

[BrotherEastman]

This will be a rough recession. The perfect storm is still about 20-30 years out.
Why 20-30 years? I asked you about this before, you haven't answered.

[Digging4Truth]

Jim Rogers On Bernanke, The Fed & Our Current Financial State
http://www.youtube.com/watch?v=lTXEWh2yT_g

[RandyWayne]

Just imagine if the Capital Gains tax was slashed in half combined with an aggressive push to tap a few more domestic oil wells..... We would find that the "recession" would end very quickly!

[originalsecretplace]

Are any of you angry at the greed and dishonesty that has caused the vast majority of these events?

Most Americans that I've talked to are not in favour of government intervention and all that. But to let these large institutions free reign to bring down the economy is just plain stupid.

I realize that some people get greedy and live beyond their means but we make people wear seltbelts while driving and have other laws in place to protect people. Why not have laws in place to prevent these institutions from taking advantage.

It's the little guys who get the short end of the stick in either case.

[Jack Shephard]

My point was in relation to your previous comment regarding news media and people choosing who to believe. You had mentioned Fox News as being a more positive and conservative voice in the news media. I wanted to just make note that it was deregulation of the banking and securities industry, supported by conservatives, that has allowed this leaven to do the damage it has.

Agreed. My original comment was to state that now it seems the more conservative media is looking at the economy in a good light. It might be tied to covering their buns cause they helped to get us into this situation in the first place. But it might be because they see the economy as trending stronger than some of the more liberal media. I personally think the economy is in a tight spot, but not as bad as some let on to be.

[RandyWayne]

Are any of you angry at the greed and dishonesty that has caused the vast majority of these events?

Most Americans that I've talked to are not in favour of government intervention and all that. But to let these large institutions free reign to bring down the economy is just plain stupid.

I realize that some people get greedy and live beyond their means but we make people wear seltbelts while driving and have other laws in place to protect people. Why not have laws in place to prevent these institutions from taking advantage.

It's the little guys who get the short end of the stick in either case.

First off, I do agree that there has been a lot of predatory-type lending on the part of many or most mortgage companies. While it always existed ever since the first bank came into being, the bulk started in the 90's as HUD rules forced Real Estate and mortgage banks to advertise and serve everyone -to the point where it was considered discriminatory for a billboard showing high end house to be placed an in affluent neighborhood unless it was also displayed in the slums somewhere. When this happened, lo and behold, business increased! The rapid rise in home prices allowed banks to lend to ANYONE, regardless of their credit history. Now we have people defaulting on ARM loans that have not even adjusted to their higher payments. Do THESE people need to be bailed out?

I agree that the banks share much fault... but the "little man" who cannot even make his LOWER payment (and should have been denied a loan in the first place) is equally to blame. Then there are all the idiots who trash their homes before moving out..... We have seen PLENTY of these since were currently house hunting in the Phoenix valley right now.

One last thing. Who has more power to bring down the country? The banks somehow "working together" or the government?

[RandyWayne]

Agreed. My original comment was to state that now it seems the more conservative media is looking at the economy in a good light. It might be tied to covering their buns cause they helped to get us into this situation in the first place. But it might be because they see the economy as trending stronger than some of the more liberal media. I personally think the economy is in a tight spot, but not as bad as some let on to be.

Can you imagine how much this economy would have been talked UP had a democrat been in office the past 4 years?

[DividedThigh]

First off, I do agree that there has been a lot of predatory-type lending on the part of many or most mortgage companies. While it always existed ever since the first bank came into being, the bulk started in the 90's as HUD rules forced Real Estate and mortgage banks to advertise and serve everyone -to the point where it was considered discriminatory for a billboard showing high end house to be placed an in affluent neighborhood unless it was also displayed in the slums somewhere. When this happened, lo and behold, business increased! The rapid rise in home prices allowed banks to lend to ANYONE, regardless of their credit history. Now we have people defaulting on ARM loans that have not even adjusted to their higher payments. Do THESE people need to be bailed out?

I agree that the banks share much fault... but the "little man" who cannot even make his LOWER payment (and should have been denied a loan in the first place) is equally to blame. Then there are all the idiots who trash their homes before moving out..... We have seen PLENTY of these since were currently house hunting in the Phoenix valley right now.

One last thing. Who has more power to bring down the country? The banks somehow "working together" or the government?

be careful randy the libs will come after you, speaking to much truth and common sense, lol,dt

[ChristopherHall]

Can you imagine how much this economy would have been talked UP had a democrat been in office the past 4 years?

Dude, the economy wouldn't be being talked up. This isn't about politics, its about greed and corruption. Frankly, both sides have had their hand in it.

[Jack Shephard]

Can you imagine how much this economy would have been talked UP had a democrat been in office the past 4 years?

Good call OB1. LOL I think that the libs tend to get the benefit of the doubt at times. JMO. I am not defending the Cons either. Both are due the good words and bad critisizm.

[Digging4Truth]

Originally Posted by RandyWayne

One last thing. Who has more power to bring down the country? The banks somehow "working together" or the government?

The banks control the government.

We were warned:

" If the American People ever allow the banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property, until their children will wake up homeless on the continent their fathers occupied. The issuing of money should be taken from the banks and restored to Congress and the people to whom it belongs."
-Thomas Jefferson

We failed to listen.

Others knew the power of controlling the currency of a nation:

"Let me issue and control a nation's money, and I care not who writes its laws"
- Meyer Rothschild (1743-1812)

The Federal Reserve is neither Federal nor it is a reserve of any kind.

It is a privately owned bank and has no reserves of any kind. When it wants to make money it prints the money... out of thin air... from nowhere... and charges you full face value for it... even our own government.

[RandyWayne]

Good points, but the government could always do away with the Feds. They WON'T but they technically could.

Also, I was also referring more to tax policy then fiscal. Throw in energy policy for good measure.....

The government could effectively end this recession by slashing capital gains (which dramatically increases economic activity) and aggressively drilling for oil -which in turn would have the effect of popping the price-per-barrel bubble.

[originalsecretplace]

First off, I do agree that there has been a lot of predatory-type lending on the part of many or most mortgage companies. While it always existed ever since the first bank came into being, the bulk started in the 90's as HUD rules forced Real Estate and mortgage banks to advertise and serve everyone -to the point where it was considered discriminatory for a billboard showing high end house to be placed an in affluent neighborhood unless it was also displayed in the slums somewhere. When this happened, lo and behold, business increased! The rapid rise in home prices allowed banks to lend to ANYONE, regardless of their credit history. Now we have people defaulting on ARM loans that have not even adjusted to their higher payments. Do THESE people need to be bailed out?

I agree that the banks share much fault... but the "little man" who cannot even make his LOWER payment (and should have been denied a loan in the first place) is equally to blame. Then there are all the idiots who trash their homes before moving out..... We have seen PLENTY of these since were currently house hunting in the Phoenix valley right now.

One last thing. Who has more power to bring down the country? The banks somehow "working together" or the government?

I'm not sure that the banks are working togther but they are all taking advantage and digging for money where ever they can. The government works for the "big money" wherever it is -- doesn't it? It doesn't really represent "the people". I'm not sure if it ever did -- really.

They'll always be people defaulting on loans. But according to what I've read the banks like to extend credit to the people with bad credit because they make alot of their money from fees -- interest, late fees, NSF, etc. The banks write off bad loans the same as any other business. The problem is they got so greedy they managed to over extend themselves. Now it's time to pay the piper, I guess.

Is it true that the law for bankrupt (chapter 11?) was changed to really benefit the lendors?

I'm Canadian so I don't know about all the problems in the US economy or how they came about except for what I've read or heard. We have some banks in Canada that got hit in the pocket book with the sub-prime stuff and inflating the cost of a home so they could lend more money in the US. Here we don't have that situation although the credit card companies charges outrageous interest rates.

I've also read about credit card companines in the US targeting students.

We've had problems with payday loan companies lately. They are being investigated for what amounts to loansharking.

All in all I think credit is too easy to get even in Canada. I remember 20 years ago when you could hardly get a card with a $500 limit but know they are gving out thousands of dollars if you give them a name and phone number.

[RandyWayne]

We've had problems with payday loan companies lately. They are being investigated for what amounts to loansharking.

What??? 300-1000 percent interest loans is considered loan sharking? Hell HAS indeed frozen over!

[scotty]

I live in Goshen,




enough said.

[ChristopherHall]

First off, I do agree that there has been a lot of predatory-type lending on the part of many or most mortgage companies. While it always existed ever since the first bank came into being, the bulk started in the 90's as HUD rules forced Real Estate and mortgage banks to advertise and serve everyone -to the point where it was considered discriminatory for a billboard showing high end house to be placed an in affluent neighborhood unless it was also displayed in the slums somewhere. When this happened, lo and behold, business increased! The rapid rise in home prices allowed banks to lend to ANYONE, regardless of their credit history. Now we have people defaulting on ARM loans that have not even adjusted to their higher payments. Do THESE people need to be bailed out?

I agree that the banks share much fault... but the "little man" who cannot even make his LOWER payment (and should have been denied a loan in the first place) is equally to blame. Then there are all the idiots who trash their homes before moving out..... We have seen PLENTY of these since were currently house hunting in the Phoenix valley right now.

One last thing. Who has more power to bring down the country? The banks somehow "working together" or the government?

Randy…..

My wife and I are fighting to keep our home. Thank God we don’t have an adjustable rate mortgage. We have a standard fixed rate mortgage and when we began dreaming the American dream we could easily afford a home. It was only another $120 a month compared to renting. Logic was…why not put our money into building equity? So we bought a home and times were actually going quite good.

But the cost of living increased exponentially for us. Our gasoline bill is four times what it used to be. For many families their health insurance premiums have gone through the roof. Wages are not rising to meet rising costs of living or inflation and so money isn’t going as far as it used to. The fallout in the housing market caused our home’s value to drop so significantly we owe more on our current loan than our house is worth.

Many folks are being swept away in the rising tide of rising cost of living compounded by negative equity through dropping home values. In many cases folks will actually save money by defaulting and loosing their homes. They look to either be bailed out or to give it back to the bank and cut their family’s losses.

Some of them had financial plans that were just blown out of the water. If you would have told me gasoline would be $4 a gallon in 2008 back when I bought my home I would have laughed you to scorn. A lot of these people defaulting on their loans didn’t plan for the economy to get this bad. After all…so many folks like Ferd promised them everything would be cool. LOL

[DividedThigh]

once again the wind bloweth, emphasis on the bloweth, lol,dt

[ChristopherHall]

Good points, but the government could always do away with the Feds. They WON'T but they technically could.

Also, I was also referring more to tax policy then fiscal. Throw in energy policy for good measure.....

The government could effectively end this recession by slashing capital gains (which dramatically increases economic activity) and aggressively drilling for oil -which in turn would have the effect of popping the price-per-barrel bubble.

Actually bro I’m not convinced it would be wise to do away with the Fed now. The entire economy would have to be trashed with it. It plays too important of a role today. But we agree, it's the thing that should not be.

If we cut capital gains taxes we’d have to pass a law forcing corporate powers to take those cuts and distribute them to their employee’s through payroll to get the money into our economy. As it stands right now most companies would take the money saved and invest in foreign markets. Then the cut in capital gains taxes that you propose would end up strengthening India, China, or some economy in Europe.

If we began aggressively drilling for oil we’d have a lot of oil to refine. As you know the oil here in the US isn’t like the oil in the Middle East. More goes into refining oil found in our neck of the woods. The increased cost of aggressive drilling, refinement, and distribution could conceivably drive costs up by adding additional costs in production not drive them down.

We need to find an alternative energy source. I vote for more nuclear power. And stronger requirements for fuel efficent vehicles. Not to mention a national project dedicated to finding an alternative power source for vehicles.

[ChristopherHall]

once again the wind bloweth, emphasis on the bloweth, lol,dt

Such are they that are born of the Spirit my dear brother. ;)

[DividedThigh]

Such are they that are born of the Spirit my dear brother. ;)

whatever, lol,dt

[TRFrance]

The Feds are going to do what ever it takes to not have a repeat of the Great Depression.Let them.

They may just be postponing the inevitable.

[RandyWayne]

We need to find an alternative energy source. I vote for more nuclear power. And stronger requirements for fuel efficent vehicles. Not to mention a national project dedicated to finding an alternative power source for vehicles.

I vote for more nuclear as well. MUCH more. Nuclear combined with a fleet of PLUG IN hybrids (versus the conventional ones) would do wonders for actually reducing oil use.
But aggressively drilling for more oil WOULD dramatically lower the per-barrel cost and refinery capacity has nothing to do with it as it currently stands. The current cost of 100+ a barrel is just as inflated as home prices were and some stocks during the dot com boom. Even increasing total domestic production by a couple of percent would help pop this bubble and we would see a 30-50 dollar drop in barrel price.

[Digging4Truth]

They may just be postponing the inevitable.

The more they prop up and try to circumvent the coming recession/depression the harder it will come down on us when it finally happens.

[berkeley]

I live in Goshen,




enough said.

egypt?

[scotty]

egypt?

biblical egypt.

[berkeley]

biblical egypt.

ah, k. I was thinking of a physical location.

[scotty]

ah, k. I was thinking of a physical location.

Actually it is,

Joseph settled Israel in a small plot of land within Egypt called Goshen. God brought droughts and plagues upon all the land of Egypt, the people were in a literale depression. But all that Israel had in the land of Goshen where they lived was prosperous. Crops thrived, livestock, rains fell, all was good.

Why would we be any different today? If we are Gods people living in Goshen then what have we to worry about the famine around us.

Would love to be there physically though.

[OP_Carl]

I personally don't think we're facing an economic collapse. We've had recessions before, even a depression. We've always come thru on the other side ok. I think the same will happen here, even though the economic correction will be painful to a lot of people.

The real question is if the bad times will be prolonged, as they were in the days of the Great Depression, by monetary policies made with the intention of improving things that worked the opposite result.

We need to tighten credit and shore up our currency. Lowering interest rates is putting the dollar in free-fall, which is the lion's share of today's high dollar price per barrel of oil, and gallon of gasoline.