[Mars]

It remains to be seen how that goes. And you can bet, if he screws up, the Europeans will be back to making fun of us (as though they ever stopped)

[Polpolion]

Going into debt for some things is ok, but most people go into debt to buy things they don't need. They could have gotten a reasonable mortgage to buy a house that was within their income range, but instead they bought a suburban mcmansion. Whose fault is that?

What source are you supporting that statement with, again?

The whole subprime mortgage crisis?

So essentially you're the well studied, highly reliable source that deduced that this is the problem? The poor people? Okay. That's fine. Now that we got that figured out, we're back to the solving the problem in the easiest way possible: By telling poor people to stop being so poor.

Nobody forced me to lower the value of my home. 

The real estate appraisers and the potential buyers did. It's a buyer's market now.

Okay, so we know that the problem's not Scuddie's fault. If it's the buyer's fault that housing values are low, all we have to is make people stop buying houses at the best available price.

Nobody forced me to accept the fact that I now have a ridiculously high interest rate.

Actually the terms of your Adjustable Rate Mortgage do, IIRC. What does the word "Adjustable" mean?

Yes, I'm sure all mortgage rates are indeed adjustable, and I'm sure that they're adjustable within no domain. Why don't we all simply give ourselves a negative rate, and have the interest pay us? It's really that simple! Kosh is right, Scuddie!

Kosh, it's still a minority of the total population that bought into houses they couldn't afford.

The problem was not just them. Given the massive, record setting increase in foreclosures it was a sizable minority. But they were merely part of the problem, and I used them as an example.

Okay, I'll just say this: No normal person can afford any house. Unless you're one of the people who are insanely rich, then you're going to have to get a loan or mortgage something. Not everyone just happens to have $100K saved up, and it's really not an easy task trying to save up that much money.

Of course, I suppose we could all live in the ghettos, where the cost of maintaining the building is more than the building itself. Yeah, that'd be a good thing. It'd be a bit of a health hazard, and the size is probably insufficient for most families, but who needs their own bedroom, really?


Damnit, poor people just gotta stop being so poor and stupid people just gotta stop being so stupid. I obviously can't do anything to help that, so I'll just sit here on my Internets and complain about just how poor and stupid they are.

[Mika]

There hasn't been posts on which I would specifically need to reply (or somebody else did it already) on this thread for a couple of days. But I need to correct a couple of things:

First, I'm pretty sure nobody joked about US in the 1960s or 70s.

And I don't think there is anything funny about Obama failing to steer US away from crisis. Personally, I think US economy is in an irrecoverable condition, but I'll give the guy a chance and see what he gets done.

Scuddie, aren't you in UK? If so, I recall reading some of the real estate brochures in a hotel at a village close to Stansted airport (Mountfitchet?) back in 2005. Even then I was wondering how do the Brits get the money to buy such astronomically priced houses, which didn't even seem to be in good condition for me. Guess it is that they pay less taxes I thought back then, but still, 250.000 £ of a 300-years-old building is far too much.

I recall a Brit mentioning he lives in a rented house since he thinks it's more financially profitable to save his money since the house prices are inflated. And on top of that he mentioned that a lot of people are buying houses but in actuality cannot afford them, should the financial world change.

My father has been working in the banking sector for some 40 years. He saw the financial crash coming 12 years ago. We are located on the other side of the world, and do not know much about happenings in the US inland, but he did recognise this threat. If he could do this without any resources, no bank is excused in US. Furthermore, it seems that the general population has been successfully duped into thinking free lunches exist. This is the thing I don't understand, unless the general population itself has been as bloody willing to get short term profits as the bankers themselves.

Mika

[Scuddie]

I don't live in the UK, I live in Sacramento, CA, the city hit the hardest by the bursting of the housing bubble.  Reduction in home value is close to 40% for multi-unit properties since July 2005.  Guess what I have?  A condo.  Because of this, I owe more money than the home is worth, and the bank knows perfectly well I can't refinance due to this, and jacks the interest up as high as they can.  I purchased the home with 6% interest, I now pay 8.25% interest.  It would be cheaper to abandon the home, the only thing keeping me from doing this is the trouble I'd have to go through for a foreclosure.

[Mr. Vega]

Damn Sizzler, when did you stop being a moron?

[Scuddie]

My guess is about a year or so ago.

[Mika]

I don't live in the UK, I live in Sacramento, CA, the city hit the hardest by the bursting of the housing bubble.  Reduction in home value is close to 40% for multi-unit properties since July 2005.  Guess what I have?  A condo.  Because of this, I owe more money than the home is worth, and the bank knows perfectly well I can't refinance due to this, and jacks the interest up as high as they can.  I purchased the home with 6% interest, I now pay 8.25% interest.  It would be cheaper to abandon the home, the only thing keeping me from doing this is the trouble I'd have to go through for a foreclosure.

Damned, it is your login name that always places you in UK (I think they have a military slang word Scuddie). Losing 40 % value of house is nothing new, I have heard a lot worse numbers after divorces. Also, I find it strange that increasing interest rate from 6 % to 8.25 % would wreck somebody's economy. But it all goes back to the question: do you believe that US economy recovers or not? If it does, the interest rate dip is only momentarily.

By the way, if you find that the interest rate is above the normal rate and that the bank is taking advantage of your situation, take a look at what your legislation says about usury. The highest interest rates should be mandated and controlled by state (at least here). Also, you could ask the bank do they really believe they can get rid of the house if their interest rates force you to sell it.

Oh yeah, I do have my own mortgage to pay also. The interest rate was something like 5.2 % if I remember it right. Haven't bothered to check it later.

Mika

[Kosh]

Damn Sizzler, when did you stop being a moron?

Looks more like he's fallen back into that trap.

So essentially you're the well studied, highly reliable source that deduced that this is the problem? The poor people? Okay. That's fine. Now that we got that figured out, we're back to the solving the problem in the easiest way possible: By telling poor people to stop being so poor.

No, lots and lots of people came to that conclusion long before me, as Mika said.

Okay, so we know that the problem's not Scuddie's fault. If it's the buyer's fault that housing values are low, all we have to is make people stop buying houses at the best available price.

I'm not really seeing the point of this. He said "no one forced me to lower the value of my home", and I pointed out that statement was incorrect.

Yes, I'm sure all mortgage rates are indeed adjustable, and I'm sure that they're adjustable within no domain. Why don't we all simply give ourselves a negative rate, and have the interest pay us? It's really that simple! Kosh is right, Scuddie!

Don't be an idiot, the banks set the rate. There was also a special kind of mortgage called an "Adjustable Rate Mortgage", where you would have low interest "teaser" rates, until about a year or two later the "adjustment" happens and the interest skyrockets. I'm not sure if this is what scuddie has, but it did sound like it from his description.

Okay, I'll just say this: No normal person can afford any house. Unless you're one of the people who are insanely rich, then you're going to have to get a loan or mortgage something. Not everyone just happens to have $100K saved up, and it's really not an easy task trying to save up that much money.

Duh, the point is whether or not you can afford the mortgage repayments. If you buy a house that is worth more, you need a bigger mortgage. The bigger the mortgage is, the bigger your monthly payments are. If your monthly payments are too much, you must be living in a house you can't afford.

[Polpolion]

So essentially you're the well studied, highly reliable source that deduced that this is the problem? The poor people? Okay. That's fine. Now that we got that figured out, we're back to the solving the problem in the easiest way possible: By telling poor people to stop being so poor.

No, lots and lots of people came to that conclusion long before me, as Mika said.

That's still an assertion, though.

Okay, so we know that the problem's not Scuddie's fault. If it's the buyer's fault that housing values are low, all we have to is make people stop buying houses at the best available price.

I'm not really seeing the point of this. He said "no one forced me to lower the value of my home", and I pointed out that statement was incorrect.

There we go. Why are you even debating?

Yes, I'm sure all mortgage rates are indeed adjustable, and I'm sure that they're adjustable within no domain. Why don't we all simply give ourselves a negative rate, and have the interest pay us? It's really that simple! Kosh is right, Scuddie!

Don't be an idiot, the banks set the rate. There was also a special kind of mortgage called an "Adjustable Rate Mortgage", where you would have low interest "teaser" rates, until about a year or two later the "adjustment" happens and the interest skyrockets. I'm not sure if this is what scuddie has, but it did sound like it from his description.

Exactly my point.

Okay, I'll just say this: No normal person can afford any house. Unless you're one of the people who are insanely rich, then you're going to have to get a loan or mortgage something. Not everyone just happens to have $100K saved up, and it's really not an easy task trying to save up that much money.

Duh, the point is whether or not you can afford the mortgage repayments. If you buy a house that is worth more, you need a bigger mortgage. The bigger the mortgage is, the bigger your monthly payments are. If your monthly payments are too much, you must be living in a house you can't afford.

I figured that not being able to afford the house was the same as not being able to afford the mortgage and not being able to afford the mortgage was the same as not being able to afford the house, and I just combined the two. Looks like I shouldn't have done that.

Damn Sizzler, when did you stop being a moron?

Looks more like he's fallen back into that trap.

You got me there. I can't argue with that; All of my arguments are inherently flawed because I'm a moron. Congratulations, Kosh; you win. You've won a debate with a moron.

[Mars]

Meh . . . w/e I'm gonna go sow global poverty, instability and economic woe throughout the world, along with all the rest of the Stupid Americans^TM

[Kosh]

I figured that not being able to afford the house was the same as not being able to afford the mortgage and not being able to afford the mortgage was the same as not being able to afford the house, and I just combined the two. Looks like I shouldn't have done that.

Exactly my point.

So if you agreed with me about all that stuff why were you trying to argue with me?

You got me there. I can't argue with that; All of my arguments are inherently flawed because I'm a moron. Congratulations, Kosh; you win. You've won a debate with a moron.

No, you're just acting like one now.

Meh . . . w/e I'm gonna go sow global poverty, instability and economic woe throughout the world, along with all the rest of the Stupid AmericansTM

No need, you just elect people to do that.
There we go. Why are you even debating?[/quote]

I meant I didn't see the point in what you said.

[Mars]

The point in what I said was, no matter what I do, people will still do the easy thing and blame the yank.

[Mika]

I figured that not being able to afford the house was the same as not being able to afford the mortgage and not being able to afford the mortgage was the same as not being able to afford the house, and I just combined the two. Looks like I shouldn't have done that.

My continuation question would be:
How much tolerance should you allow between able to pay the mortgage and unable to pay the mortgage?

Mika

[Charismatic]

Phew! Obama has his work cut out for him, doesn't he?

Too much so. Atleast we can blaim him for the states bankrupcy.

[karajorma]

Damn Sizzler, when did you stop being a moron?

Looks more like he's fallen back into that trap.

Watch it! Mr. Vega's comment is only really a flame if TheSizzler takes it as such. While yours is an ad hominem at best and a deliberate flame at worst.

[AlphaOne]

Damn and i thought we had it rought here. Oh yeah and dont complayn about 8,5% interest rate. People here would kill to get those kinds of rates. Instead you have a minimum of 12-15% rate with a maximum of about 50% .

Guess that explains why bank's here have reported massive proffits over the past several years. With net profits raising from some 5- mllion euros to more then 400 million euros per trymester.


Anyway i have a question.

Since over here 90% of the population actualy owns theyr own home they dont have loeans or anithing on the houses etc.  And they are not paying monthly rates on the homes they live. That beeing said how come such a massive economical crisis has hit us hard also.

I mean if we had a very powerfull stock market with lots of companies and stuff listed that would get hit by market crashes i could understand but we dont. We are not so much dependent on what hapenes in the stock market .


One might think that this is because we dont have any big companies to be listed.


Well we actualy a LOT of them but most of them choose not to get listed on the stockmarket .

So my question is why ??

Am i missing something or what??

People still pay up the bank loans some of them even ahead of time. And while appartment sales have slowed and prices have gone down a bit they only affect houses appartments that are older then 15-20 years. And even then not by a large margin a mx of some 20% i would say.

That is still way way way over the REAL values of the houses.


My guess is that at least some people are attempting to force a crisis at least in some places.

No im not a conspiracy freak. But i mean we had media attack's form some of the biggest players out there inclueding the Goldman Sachs bank or whatever its called and another one soon after they went bust.

We had media attack reporting we were negociating emergency funding from FMI and so forth.

At the same time the gouvernor of the central bank was dumbstruck since we did not need the money we had more then enough cash reserves to pay up imediatly all of our short to mid term loans.

So again Why ? who benefits ??

I believe the bank's most of all . Since they are in a sort of open war with the central bank here. The central bank has imposed some very very very harsh conditions regulations and so forth on all banks over here.

Some of them even got measures taken against them for increasing the interest rates artificialy and something to do with speculative money beeing brought in taken out monetary attack's on the national currency etc etc.

At least 2 bak's got stuk with a few billion euros cuz the central bank pulled most of the currency from the market in order to stop an attempt to artificialy increase the value of the euro compared to our national currency and make a massive profit out of this. Instead they got tens and hundreds of millions losses because they could not sell what they had for several days last i heard it took them some 2 weeks to get rid of everithing at a much lower rate then they bought.


anyway if anyone can make heads or tales out of my so called english spelling please fill me in on WTF is gooing on with these types of situations and why this current economical crysis seems well artificial.

[Mika]

Do you happen to be from Hungary?

Mika

EDIT: Forget it. Noticed that you were from Romania. Could it be so that Romania is in similar condition as Hungary?

[Mika]

I think Romania has got some amount of companies from other European countries, but if I recall correcly the wages have been increasing so much that Romania is not any more so cheap place. Also, I recall hearing that the Romanians workers have not been very loyal to the companies and this is something what most of the foreign companies will not accept (train the workforce and then they go after the highest available wage).

I think these are the reasons we are seeing companies returning from Romania. Some amount of growth in Romania is also caused by loans from EU, with certain conditions. And since the economy is getting stronger everybody wants to get as big lump of money as they can.

Maybe this can help you to piece it together?

Mika

[Mars]

Company loyalty is almost zero in the US because companies will fire you without warning, so why should average joe be loyal to them?

[Mika]

I know. My comment about Romania were just my observations and recalls of the news pieces I've read. There is nothing else to it.

In this case I feel the companies themselves have deserved that treatment. It all goes back to looking good quarter yearly to the stock holders. Which happen to be the people themselves.

Mika