Big Tony's Plan to Avoid the Bailout
Keep in mind that the plan was related to me at the neighborhood bar. Though in the plan’s defense, it was posited just after we sat down.
Here’s the deal. All these bad debts are the cause of all of these failures. So when the debt goes into default, the Feds buy it. It’s now off the books of whatever irresponsible company owned it. The Feds own it at the current payoff price. They foreclose, or develop some sort of bailout for the individual owners of the debt. The money flows slowly and at the same time this confidence garbage is assuaged.
Maybe some people lose their houses, they probably shouldn’t have bought in the first place. So they rent from the Feds, or the Feds sell the property at a market rate and the new owners are the landlords.
The banks return to a balance sheet that makes business sense. The Feds can (we can) afford to stretch out the payments, in some instances maybe profiting, in other instances losing money. But, there’s no huge influx of money that isn’t there, other by borrowing. And the equity in the properties is still there, at whatever value it has over the coming years.
Go ahead and tell Big Tony he’s wrong.
11 comments:
uhh, Big Tony stole this from Glenn Beck or vice versa
Doesn;t mean it's a bad outline of a plan
Beck probably stole it from Tony, I forget, is he based in Atlanta? I don't remember anyone important looking sitting near us. I don't think Tony watches CNN.
And, by the way, Dale, you need to do a blog. Us liberal, commie, pinkos need some counterbalance.
One day. I was going to ask for a job at Cl, but probably not today.
For the rest of you, Creative Loafing filed a Chapter 11 bankruptcy petition today. That means that it will screw its creditors and emerge leaner and meaner.
Maybe some people lose their houses, they probably shouldn’t have bought in the first place.
The plan all along was forclose and take the equity. They knew these people couldn't keep up the payments, but they didn't care- they were certain the houses would go up in value, and they'd come away with money in their pockets.
They were basically taking advantage of people's hopes and dreams to fund their own real estate investments. It's very hard for me to say anything other than "Screw 'em."
This whole nightmare smacks of a modern day feudal system with the desparate "peasants" hoping to improve their lot by taking on more than they can afford while the cold-hearted "land owners" continue to plunder, rape, and pillage those beneath their economic standing.
Some things never really change ...
No one forced anyone to buy a house they could not afford.
Feudal peasants did not have the choice of doing anything else. People with stupid morgages had a choice.
Of coure, personal responsibility is passe these days, so why am I wasting my breath?
The folks borrowing the money didn't know what they were getting into.
The folks lending the money knew *exactly* what they were doing.
To moderate a feud:
You are both right in part Thomas and Dale.
"No doc" or "liar loans" were sometimes shoved on unsuspecting, unsophisticated buyers. They were also used by knowing buyers to move into something they couldn't afford on the assumption that the stupidly inflating real estate market would bail them out, at a profit.
"The folks borrowing the money didn't know what they were getting into."
Ummm, then they shouldn't have done it?
If they are that uninformed, they should have their voting rights becasue they are incapable of an informed decision.
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