On Wed, 21 Mar 2007 15:07:09 GMT, Ken Fortenberry
wrote:

wrote:
On Wed, 21 Mar 2007 13:47:48 GMT, Ken Fortenberry
wrote:

Tom Littleton wrote:
wrote :
I'm watching "Nightline," and apparently, folks think the "government"
ought to get involved to somehow help folks who overborrowed on
too-large houses at over-inflated prices because the lenders were too
lenient in lending...AFAIAC, let the lenders go under and the yuppie
****s live in boxes eating recalled dogfood....

Doubting this will help much,
R
...and if anyone with any sense wonders about why the US "public" ought
not to be trusted with much at all, here's gonna be Ayer answer...
agree with the overall sentiment. My suspicion is that
the folks ending up getting bailed-out will be the idiots
who lent out the cash. An equally stupid remedy, IMO.
The ones who lent out the cash at usurious rates have already
cashed out. For the most part they sold those mortgages to
unsuspecting investment houses under misrepresented circumstances
and it's those investment houses who are gonna get stuck holding
the bag. As for the yuppies being kicked out of their houses to
live in Frigidaire boxes and eat Alpo, they're more the victims of
loan sharks than anything else and they're not yuppies.

Uh, OK...and just how does any company, good, bad, or otherwise, force
someone into a mortgage, "usurious" or otherwise, on an overly-large,
over-valued/mortgaged, or otherwise
inappropriate-to-the-borrower's-situation home? Mortgages on "solid"
deals for folks buying appropriately were, and still are, easy to get.
Subprimes are, were, and always have been, well, subprime, and for a
reason. And keep in mind that much of the "in the news" cases are
folks with iffy credit (which in itself should make a point), limited
payback ability, and many were taking out home equity loans to pay off
other "shopping"/"lifestyle" debt.

And yeah, I'm sure that someone knows or read about some poor couple who
had to mortgage the house to pay for junior's heart transplant or
something, but that type of situation would be a _rare_ occurrence. The
great majority of this is, simply, people attempting to live wa-a-a-a-y
beyond their means.

I don't disagree with any of that but loans were made to people with
iffy credit and then those mortgages were sold as if they were loans
to people with good credit. As I understand it this was an aggregate
deal, that is the buyers thought they were buying, just for an example,
75% good credit mortgages and 25% iffy credit mortgages but ended up
with more iffy credit mortgages than good.

And just how does two institutional traders of negotiable paper have the
slightest thing to do with the homeowners/mortgagors? If XYZ Corp.
simply accepted whatever ABC Corp. said about the paper that the face of
which indicated something contrary to what ABC was claiming, they were
negligent. And anyone with just a smattering of walking-around sense
could and can see that if a mortgage created in the last 3-4 years is
above about 6%, something is up with the borrower/mortgagor, at least
insofar as to indicate a little due diligence is in order. And if
someone is selling bundles of 8-10-12% paper, they ain't selling
low-risk/good risk paper and no institutional trader would fall for some
bull**** indicating it was anything but subprime; institutional traders
can easily get a fair (in both senses) idea of what they are buying
simply by the interest rate.

The main reason for this is just like the old oilfield bumpersticker,
"Please God, let there be another oil boom...I promise I won't **** it
all away next time..." or the "dotcom" bust: greedy "yuppies" who don't
have a clue and who think it'll all last forever...or at least until
they make their money...

And this was, and is, all somehow legal.

Why in the hell would or should it be _illegal_? You might want to do a
little research on what "liberal" really means (and no, I don't mean
"libertarian").

I don't believe an S & L type bailout is warranted, like
you say the percentage of the market involved with iffy credit mortgages
is small, but I do think it should be illegal to misrepresent what
you're selling.

TC,
R