- Access to mortgages severely crimped by Subprime and Liar's Loan meltdown - check
- Rising interest rates - possibly 7% interest rates by end of year - check
- Housing P/E historically out of whack - check
- Affordability out the window - check
- Massive (and unrecorded) REIC job losses - check
- Millions of unwanted homes on the market - check
- Plummeting housing demand (why buy when it'll be cheaper tomorrow) - check
- Realtors and mortgage brokers no longer trusted - check
- No more lines at new home developments - check
- Flippers and speculators out (or desperately trying to get out) of the market - check
- Ponzi Scheme over - check
That's just for staters.... what did I miss?
48 comments:
Second and third homes - how many homes does a person really need?
I don't own a home, but I don't take pleasure in watching people suffer losses even if they were sometimes due to ignorance.
In any case, two things constantly need to be reemphasized on this blog:
1) The crash in the U.S. housing market is very real. We haven't seen large across the board drops in prices yet because it is still in its early stages. For those who own a home and plan to live in it for years to come, good for you. I wish you the best. Just get out of any unnecessary debt and do what you need to do to get ready for rough economic times ahead.
2) The Stock Market is currently a giant ponzi scheme being inflated by massive excess liquidity. How long can it go on? Who knows. Maybe a year, maybe ten. But the reality is that in real dollars the DOW is still below its Y2K high and will have to hit 14,000 or so just to break even. The Nasdaq is still crashing if measured in real dollars. If measured in commodities such as oil, gold, silver, take your pick, the DOW is crashing. Paper wealth is becoming increasingly risky because it is dependent upon increasingly unstable relationships between Industrial, "Core" nations, as well as, those in the "Non-Integrating Gap" like Nigeria, Sudan and Iran.
The point is this. We're all in the same boat, renters and homeowners. Right now none of the economic numbers look good (that is, the unmanipulated numbers) and there is great risk of a national financial crisis looming on the horizon. Add to this a government that thinks integrating 20 million poor people into the country is a good idea and we are ripe for major problems. This is not doom and gloom. Its facing reality.
One last thing:
Keith, in another post you talked about the good that high fuel prices would do by forcing us to make serious choices about our living habits and alternative energy.
Please read these two articles at
Energy and Capital. Google "The Cavalry Stays Home" and "Receding Horizons."
An often overlooked issue is that high energy costs translate to high production costs for everthing, including alternative energy. This effect has the tragic irony of making needed alternatives economically unfeasible to the Corporations we expect to develop them.
20 million illegals who crossed the border to work in the house construction boom, which will receive a citizenship from Bush right after the bust to collect welfare at taxpayer's expense. Boo boo booyah...CHECK!
An often overlooked issue is that high energy costs translate to high production costs for everthing, including alternative energy.
With the right amount of funding and a government not controlled by oil or secret societies, we can have alternative energy very cheaply. I give you an example. A professor from Purdue University has successfully created a reaction between aluminum and gallium that splits hydrogen from water. According to his invention, all that you need to do is add water in the tank with an aluminum/gallium alloy to have a car running on hydrogen. However, surprise surprise, the "Department of Energy" (controlled by Cheney) is making his research difficult by cutting funds and other suspicious activities.
massive national debt
trade imbalance
price of gas
Iraq
American Idol season over
Kieth,
You are missing the fact that fools are still buying homes thinking they are getting a "good deal" because they paid 10% below "asking" price.
CHECK MATE!
RayNLA
7% interest rates by year end? Is article about England? Even if it is... that strikes me as a stretch.
Read the article I linked to in this post - 6.47% avg. mortgage rate last week, 7% around the corner with the 10 year bond meltdown underway
what happens when the rest of the world (japan, china, etc) wise up and realize the US in on its way to insolvency and the dollar is toast? they stop buying up the 10 years.
hint: it ain't stopping at 7%
Additional Crash Checklist:
No more home equity loans - check
Increased energy bills - check
Increased job layoffs - check
Loss of job bonuses - check
Increased medical expences - check
Higher insurance rates - check
Rising food costs - check
Increased business failures - check
Increased Bush-co war costs - check
Bush and Cheney still not in federal prison - check
On the other side:
* FED still pumping money into economy at ~ 13% rate - check;
* It's 2007, but 1929 ( no gold standard) and helicopter Ben knows what to do to prevent Great Depression -II.
* Capitals still freely flow between countries (and Brits still buying Florida properties)
* China and Japan still buying US Bonds and other MBS.
The bottom line:
S T A G F L A T I O N !!!
Corrupt David Lehreah fired - check
Casey Serin's blog shuts down - check
Greg Swann puts anything on his blog that talks about the housing market - nope
That's a pretty good summary. Not much more needed. I'll just add emphasis on a couple of details.
The most important is that the bulk of the adjusting ARMS have YET to occur. According to implode-o-meter 77 mortgage companies have gone tits up and we haven't even reached the CREST of adjusting ARMS. Its just like a big flood and watching the rising water level on the levee. We've already got a multitude of leaks but in 2008 the water WILL BE coming over the levee. We haven't seen NOTHING yet, just lots of hints of whats to come. One look at the graph is all anybody needs to figure that out.
Secondly, you've hinted at how the supply of subprime has dried up and that comes from two different directions. 77 mortgage companies gone AND the tightening of loan lending requirements from the balance of the mortgage world. Zero down and stated income? That's going to be a thing of the past if it isn't already. And look at the buttload of potential buyers that are getting squashed on there credit records with delinquencies and foreclosures. With the tightening of loan requirements most of them will be eliminated as potential buyers. I think it will almost be impossible to have your home foreclosed on and immediately go out and buy another. So the pool of potential buyers is shrinking a great deal as well and for a variety of reasons.
>> Flippers and speculators out...check
Man, some things never change. Was watching a bank foreclosure auction on the local news last night, with quickie interviews with a bunch of the bidders. Lo and behold, they were ALL flippers, speculators and investors. Don't these dopes learn? Me thinks that there's going to be an entire 2nd wave of foreclosures on THESE folks, who think the bottom is *now*.
RJ...Thanks for your post and I agree with everything you said .America has got to get back to being productive again .Enough of the get rich quick schemes .
It's to bad that the great concept of America got into this current mess . I guess the seeds of this current destructive cycle has been in the making for a long time .I want my fellow Americans to go back to a 30% total monthly debt nut.
Another point I would like to make is just because everyone around you is losing their minds just don't lose your own . The worse side of mankind has come out in this housing boom .Stay human and try to be kind to your fellow man .The price tag for this easy money debt cycle is going to be huge.
I have a friend right now that wants to flip houses because they are bored with their current job .It doesn't matter what you say to people like this because they are looking for a easy way out of the choices they have made. I talked this person/investor into pulling a stupid offer they had on a dog house but I know they will go back for another deal in the near future .
anon 7:02 am said "how many does one need"- funny because I remember Ben Stein on Fox News Cashing In saying everyone will have 2 homes (or 3) and it is the best way to go.
anon said : " 20 million illegals who crossed the border to work in the house construction boom, which will receive a citizenship from Bush right after the bust to collect welfare at taxpayer's expense. Boo boo booyah...CHECK!"
Well W will give them amnesty in order for his brother JEB! to run for Pres in 2012 with his latino wife!
You missed out a key part of this supposed crash....prices HAVE NOT FALLEN. But keep spinning your crahs story to the renters here, gives them some hope.
No savings - check
Can't put 10% down - check
Can't qualify for mortgage - check
157,000 news jobs - but look under the rug. . .yes, there are a lot of new jobs out there - dog walkers, nail parlor clippers, theme park workers, bellhops, etc. . .people now need two or three jobs to make up for one good manufacturing job, or one decent programming job (now outsourced to India). . .
There willbe knife catchers all the way to the bottom just as was the case with the NASDAQ crash. I remember all of the experts calling the bottom on every uptick from March 2000 to March 2003.
Anonymous said...
Second and third homes - how many homes does a person really need?
June 02, 2007 7:02 AM
---------------------------------
I own a ski condo. I don't need it. But I don't need a TV or a laptop or a blender or 95% of the things I own. And neither do you if you think about it. Do you need a cell phone? Do you need running water? All of us could live just fine without all those things.
Yes I suppose I could rent one every weekend and the cost wouldn't be much different, but I enjoy being able to leave my gear there, not have to worry about making reservations, not having to worry about check in/out time, not having to worry about can I bring a dog or not, not having to wate time checing in/checking out, packing/unpacking every time I use it. I don't NEED all these conveniences but it's nice to have.
And I also drive my evil foreign made V8 gas guzzling full sized SUV to get to the ski condo. Sorry but I don't think a Prius could make it through the passes all that well and I actually NEED to make it there and back in one piece.
Flip This House exposed as a scam - check
Home Depot sales crash - check
Remittances back to Mexico drop - check
Bush popularity rating tanks - check
rj:
I do take pleasure in watching others suffer losses. Let me give you two examples and if you think I'm a bad person, good for you. I don't. (1) people that couldn't shut up about how much money they had made on their genius "investment" in a home in 2005. I doubt there's anyone reading this blog that can't think of at least one of these people immediately. I want them to see that, not only are they not geniuses, but they are actually quite stupid for passing up what will probably prove to have been a once-in-a-lifetime opportunity to sell at crazy-inflated prices, because they were lemmings and followed the crowd and believed double-digit price inflation was the new paradigm. (2) anyone who bought into the inflated market, for "status" or for "investment" or even just for a roof, and thereby pushed an inflated commodity out of the range of those that refuse to make a bad financial decision. Both sets of people were ignorant, both deserve to have their financial asses handed to them, and I'm going to enjoy the show.
People that do stupid things en masse cause major problems for everyone, including those of us that are not stupid. The other issues you mentioned in your post can also be credited to stupid people. The stock market is basically the same problem as housing, but the average American has a much bigger stake in the housing market than in stocks. And energy prices - how much of this is due to decisions of the masses to live in exburbs and drive SUVs 100 miles a day back and forth? How about the masses voting the worst president in history back into office after he picked a war for WMD that didn't exist? Think Bush has been good for gas prices?
In some ways, we are all in the same boat, and that pisses me off based on many decisions of the stupid masses. If people were not gullible idiots, markets would not be subject to wild price fluctuations and gas would not cost 3.50/gallon in the US today. However when it comes to housing we are not all in the same boat. I am not a slaptard, and I did not sign my own financial death certificate by taking out a 800k mortgage to get a mediocre place in a mediocre 'burb. And so, I am going to thoroughly enjoy watching the dumb and greedy that pumped this commodity into the stratosphere take it in the cornhole as they learn how not good they are at "investing". And somewhere in the 2010s, the pile of money that I am now diligently assembling might be used to buy me a roof and some walls outright, at a historically good price point. Or I might just keep myself free and liquid. Regardless, I'm going to enjoy watching the financial suffering on the way down. It's righteous man.
Anyone who can't spend at least two months out of the year at their vacation home is a moron. You can always rent it for much cheaper instead of paying the property taxes and insurance on something you hardly ever use. That's like buying an airplane because you travel once in a while. Even a timeshare is better than a vacation home. At least you don't have to do maintenance yourself.
If you're filthy rich, then you can buy as many houses as you want. Anyone who works should be saving for tough times. The troll who claims to own a vacation ski home is either an idiot or a liar and probably both.
You can buy as many homes as you want, but it's not a smart thing to do, just like a single person who owns two cars. You have to make double the payments and double the taxes and insurance payments. If you're rich, then no big deal. For the average person, it's plain stupid.
anon June 02, 2007 8:17 AM :
First of all get a handle when you leave a comment. Just click "other" and type anything, so we don't have to reply to your comment by addressing anon June 02, 2007 8:17 AM. Christ, man.
Second, if water-splitting were as easy as throwing some Al and Ga in a beaker full of water, we would have known it in the 1800s at the latest, and fuel cell technology, which has been around since the 1800s, would be everywhere. There probably wouldn't be an oil industry or global warming. Very smart people have been working on catalytic water-splitting for a long time, using organometallic and biomimetic systems. It doesn't work real well. No, they didn't forget to try throwing in simple metals. If you threw in these metals you'd probably form their hydroxides stoichiometrically and get 1.5 molecules of hydrogen per molecule of metal. That's horifically expensive and impractical. If this prof is claiming he can do this reaction catalytically, he's probably effed up something in his experimental apparatus and is measuring things incorrectly, or he's lying. If he has managed to find a catalytic system based on these metals and has reported it in a patent, than many other scientists have been testing his system and will shortly be affirming his results, and he will be lauded in Science magazine, so don't worry so much.
Scientists eff up experiments. Remember cold fusion? Ha ha. I spent several months during my grad studies trying to reproduce results by some catalytic researcher from Japan who, as it turns out, effed something up.
Want to see a real modern-day scam artist masquerading as a scientist? Check this out:
http://www.blacklightpower.com/
Dude got a strange result in an experiment years ago. Instead of trying to figure out why the result is strange, he decided it meant new physics. Wrote his own 1000 page physics book. I kid you not. Got millions in venture capital. Argued with real scientists, all of whom believe him to be delusional or a scam artist. Dude claims his process extracts energy by reducing the energy level of hydrogen to less than its ground state. Heh heh.
Anyway, this should give you an idea of why that prof's funding is getting cut. It's probably what should happen, and if he's right and the funders are wrong, like I said, you'll see him in Science magazine shortly.
Good article by Charles Hugh Smith showing the mechanics of interest rates which basically says that our prime interest rate is driven by demand for our Treasury Bonds, which the Fed sells to 'create money'.
http://www.oftwominds.com/blog.html
It's down the page called "Why Interest Rates Will Have to Rise".
When demand lowers for these bonds, due to investors finding better investments, the interest rate has to go up or no one will buy. The interest rate is the profit margin the bond buyers get from those bonds. No one buying means no more mogambo (money created from thin air).
The point here is that interest rates are not caused solely by the whim of the Federal Reserve. When the Chinese, the Arabs and other big buyers of our Treasury Bonds find better deals, the interest rates will rise automagically (unless Congress wants to stop borrowing money).
My own addition to this is that rising interest rates on federal debt will hasten the coming of hyperinflation. Just to service the debt will require more and more borrowing (selling more high interest bonds) until poof. No more dollar or wheelbarrows of dollars required to buy a cup of coffee.
WHAT DID I MISS?
Well in a normal market there are always new buyers coming from upstream. Say, that on average the first time home buyer buys a home at 30 years of age (actual number doen't matter). Well, every year there are going to be, coming upstream, these new buyers. The bubble - everybody can get a 0 down loan - has sucked up these new buyers from upstream and put them in a home already because they didn't have to wait to qualify. When they "arrive" at the normal home buying stage of their lives in 2007 - 2011, they're now in a home already. No more new demand.
They may well be sellers now, instead of buyers, because there 0 down option ARM loans are resetting .
car manufactors catching hell car sales down across the board and that includes Japanese made cars i'll bet they aren't saying
repossesions up (just trust me) can't afford a car and a house at the same time the cost of both are or one in itself is and are over priced.
everyone has credit card bill up the waazoo and can't pay them. for that matter any unexpected (or forgotten about)bill that shows up right before the mortgage is due
the government lying saying the economy is in tip top shape because the #'s say so. everyone works for and reports to G. Bush and you believe him?
abandoned houses all over littering the communities. front yards beginning to look like a scene from an abandoned town in the middle of the mid-west.
no more property taxes for schools so we can pay for the perks of the school administrators. how is it they keep getting raises but the supply of wide eyed kindergartners is going down. i mean they are only learning 1,2,3, red white and blue stand in line and respect your neighbors. LOL not a lesson well learned.
cities crying poor because the #'s and money don't match: bankrupt
slicker and more savvy figuring out how to make a serious dollar out of this mess. already they are figuring out how to go around the arm alt-s schemes and get another kind of financing and people are falling like a lead ball for it. i hope it's jose and juan and maria and gaudalupe perhaps after loosing the house they will go back home. it's to hard to make a living in america.
more bank robberies, more liquor store holdups, more muggings that will make that mugging of the 93 year old woman in new york look like a few love taps.
gas so expensive you have to figure out to eat hot dogs (the multi meat mixed kind not beef) or fill up for the week. everyone has figured out the american weakness and like a blackmailer who has the REAL goods and could distroy your life they are using it like a cracked out whore (ho) getting all the sex for that next fix from her pimp. America being the ho and the oil cartel being the pimp.
still no savings after being warned you may be unemployeed in a NY minute. but i still need my farragamo's, bmw and interior decorator first. and once i have the $10,000 platinum diamond wedding ring paid for i'll be ready. oh i forgot the boat, and the hummer to pull it. i guess it'll be public school for the kids no no no public school that is a luxury i must keep.
apartment rentals should be up considering that most people find a place to live before they walk away from some of these foreclosures
my only question is when will all this hit the fan? will it be in sensored doses (like the housing crash). or will it be one day and it's reported on all the news networks for most people far too late. no one ever listens to doomsday sayers. too negative. are people to embarassed to admit they are in serious trouble because they still have to keep up apperances? the bible says the want of money is not a sin it's the love of money that is the sin because you can not serve two masters. these people (bankers) are so deceitful that they figured out how to circumvent that. they wanted the money and loved it once they had it. No amount was ever enough.
An extra pair of shorts when you see the new re-adjusted payment amount.......check!
HAHA We have an idiot troll who's trying to convince us that having running water and owning a second home are of equal importance in modern life. I'd like to see how many people can live in New York or Los Angeles without running water compared to not owning a second house.
Then the moronic realtroll compares having a cell phone which costs $50/mo to having two mortgages, which would cost at least $4000/mo PITI. How about a $25 blender compared to a $250,000 house? Damn these real estate trolls are stupid. It's no wonder they got caught holding the bag of shit on that flip flop condo. LMAO
Nobody leaves good ski equipment sitting in an empty cabin for 10 months out of the year you stupid lying jagoff wannabe Trump
Second homes are great as long as the neighborhood kids dont go on a burning spree when they bust into them in their quest to party and get laid.....
Belchorama - great post and great common sense. There is a lot of talent that frequents this board. I just have to fast forward through the trolltards and I'll get to read good insight and some damn funny stuff too. I've had as many laughs from this forum as any other I can remember. Kudos!
P.S. I'm a big schadenfreude fan too.
I'm taking my house downpayment and buying an Infiniti G35 instead. I figure by the time I've paid it off, house prices will have dropped enough for me to get in the market...............:-)
Pigs War Over Who Will Survive the Mortgage Collapse
June 1, 2007 (LPAC) - A group of hedge funds which have been betting vast sums that subprime mortgages will fail, are now demanding public action be taken to stop the banker-lenders from interfering with defaults and foreclosures. The Financial Times of London reports that the hedge fund Paulson & Co. led a group of 25 firms in a request to the International Swaps and Derivatives Association, complaining that mortgage bankers sell credit derivatives (which these hedge funds buy) to insure themselves against failure of the usurious loans, and then somehow renegotiate the mortgages that fail -- thus these loans are not reported as failed and they don't have to pay off on their lost bets.
A spokesman for Paulson & Co. told Executive Intelligence Review that investors make a fortune by keeping or buying up failed loans and manipulating the credit-insured market, which he said is leveraged to 1,000% or even 10,000% of the value of the loans.
Hundreds of billions in losses are building up to crash upon hedge funds, mutual funds, banks and others who have milked the mortgage bubble. Who will eat the losses; who will survive the smashup?
Paulson & Co. (no relation to Treasury Secretary Henry Paulson) is a real vulture fund, specializing in taking stock positions and then staging anti-management revolts to block planned capital investments, and forcing payouts to shareholders instead. Victims include Algoma Steel in Canada and Reliant Energy in Texas. The Financial Times reports that Paulson & Co. "last year launched a specialist fund to bet on a downturn in the subprime market. The fund is up more than 90 per cent in the year to date."
The hedge funds betting on collapse and default have hired former Securities and Exchange Commission chairman Harvey Pitt to publicly state their complaint against the mortgage bankers who are not foreclosing on homeowners they have squeezed. Pitt reportedly coined the phrase "corporate Darwinism" to credit law-of-the-jungle immorality as the cause of higher economic efficiency.
On May 15, Federal Reserve Board Chairman Ben Bernanke told the 2007 Financial Markets Conference on credit derivatives, "we should ... always keep in view the enormous economic benefits that flow from a healthy and innovative financial sector. The increasing sophistication and depth of financial markets promote economic growth by allocating capital where it can be most productive."
Three-Headed Dog From Hell Becoming Number-One Subprime Mortgage Lender in U.S.A.
June 2, 2007 (LPAC)--The three-headed dog from Hell, Cerberus Capital Management, the private equity fund/hedge fund, is headed toward becoming the biggest subprime lender in the United States, if a pending deal to acquire Option One, the "troubled" mortgage subsidiary of H&R Block, comes through, reported the New York Times on June 1 in a lead story in its business section. After carving up and destroying the U.S. auto industry--first assaulting General Motors, and then, on May 14, announcing the purchase of Chrysler--Cerberus is now out to take over the distressed housing market by buying up more subprime mortgage lending companies.
The fawning New York Times says that Cerberus is the "smart money" which is "swooping in and taking over those battered businesses, seeing opportunity amid the wreckage." The "opportunity" includes making tens of thousands of jobless families in the United States also homeless, when their homes are foreclosed upon. The plan is, that Cerberus, which already acquired control of Residential Capital in 2006, when it took over GMAC, the credit arm of General Motors, and bought up Aegis Mortgage, a subprime lender from Houston, will become "the biggest subprime lender in the country." The plan to buy Option One is still pending.
Lyndon LaRouche has a plan to deal with the likes of the blood-sucking Cerberus: There must be a freeze on home foreclosures in the United States, since it is the banks which are bankrupt, not the victims of their lending policies; and hedge funds should be made illegal. Controlling the hedge funds would also curtail the "locust" practices of the private equity firms like Cerberus. One note on what exactly Cerberus is: While it formally identifies itself as a private equity fund, it plays the same role, and does the same work, as hedge funds, thus blurring the definitions.
The June 1 Times article provides a useful chart on who is buying the bankrupt subprime lending companies. The "smart money" investors include Ellington Capital hedge fund, the Citadel Investment Group, Farallon Capital, Second Curve Capital hedge fund, and Citigroup.
As LPAC has reported previously, the predator fund, Cerberus, is a major funder of the Bush-Cheney faction of the Republican Party, and has also provided major financing for Al Gore, Jr.'s political operations.
Just returned from Seattle WA,and can ony say that everyone in California must be exterminated.I had no idea we were this bad.After we are exterminated please send trash trucks,demolition crews,and fire depts. Thank you
BTW ,Seattle looks to be doing fine with R/E.I noticed very few for sale signs,almost non existant.Still must put out a friendly warning-Read your contracts ,have patience,avoid bidding wars,and no ARMS.I don't know if it's too soon to Crown Seattle with- most likely to not implode award(Very Distinguished) ,but I would vote for them.Cali gets the BIG WHORE award.
And again Fair Warning to sucksville Oregon,what were you thinking?I Hate Oregon.Cuz I'm a hater.
Let's see, I'll buy a house so I can use it two weeks out of the year. On top of that, I'll have to pay for taxes and insurance for the entire year. Instead of skiing or going to the beach at different parts of the world, I'll go to the same place every year for two weeks. It seems like a stupid concept to me if you're middle class or even upper middle class. If you're not there to keep the A/C running and foundation watered, the house will fall apart.
Less people coming up to buy homes.No more boomers being made. I guess thats good since we are running out of land. Only 96% of available land in the USA left!!
Excellent post.
You are so right - there are *much* bigger problems facing us.
Since the majority of US citizens will face increasing economic hardships to some degree over the next years, we should seriously start planning on how we can work together to resolve these problems
for the benefit of the whole.
Too much emphasis over these last years has been placed on "self", when we need to start broadening our view of the larger crisis looming over our heads now.
RJ said...
I don't own a home, but I don't take pleasure in watching people suffer losses even if they were sometimes due to ignorance.
In any case, two things constantly need to be reemphasized on this blog:
1) The crash in the U.S. housing market is very real. We haven't seen large across the board drops in prices yet because it is still in its early stages. For those who own a home and plan to live in it for years to come, good for you. I wish you the best. Just get out of any unnecessary debt and do what you need to do to get ready for rough economic times ahead.
2) The Stock Market is currently a giant ponzi scheme being inflated by massive excess liquidity. How long can it go on? Who knows. Maybe a year, maybe ten. But the reality is that in real dollars the DOW is still below its Y2K high and will have to hit 14,000 or so just to break even. The Nasdaq is still crashing if measured in real dollars. If measured in commodities such as oil, gold, silver, take your pick, the DOW is crashing. Paper wealth is becoming increasingly risky because it is dependent upon increasingly unstable relationships between Industrial, "Core" nations, as well as, those in the "Non-Integrating Gap" like Nigeria, Sudan and Iran.
The point is this. We're all in the same boat, renters and homeowners. Right now none of the economic numbers look good (that is, the unmanipulated numbers) and there is great risk of a national financial crisis looming on the horizon. Add to this a government that thinks integrating 20 million poor people into the country is a good idea and we are ripe for major problems. This is not doom and gloom. Its facing reality.
One last thing:
Keith, in another post you talked about the good that high fuel prices would do by forcing us to make serious choices about our living habits and alternative energy.
Please read these two articles at
Energy and Capital. Google "The Cavalry Stays Home" and "Receding Horizons."
An often overlooked issue is that high energy costs translate to high production costs for everthing, including alternative energy. This effect has the tragic irony of making needed alternatives economically unfeasible to the Corporations we expect to develop them.
"With the right amount of funding and a government not controlled by oil or secret societies, we can have alternative energy very cheaply."
I agree with you - if those conditions were met - but as you pointed out Cheney/Bush and his crony's like it just the way it is.
Anonymous said...
An often overlooked issue is that high energy costs translate to high production costs for everthing, including alternative energy.
With the right amount of funding and a government not controlled by oil or secret societies, we can have alternative energy very cheaply. I give you an example. A professor from Purdue University has successfully created a reaction between aluminum and gallium that splits hydrogen from water. According to his invention, all that you need to do is add water in the tank with an aluminum/gallium alloy to have a car running on hydrogen. However, surprise surprise, the "Department of Energy" (controlled by Cheney) is making his research difficult by cutting funds and other suspicious activities.
I have to say I really like your post - not so drastic as extermination, but definitely a good head butt to those who still think eveything is "cool" :)
Shakster said...
Just returned from Seattle WA,and can ony say that everyone in California must be exterminated.I had no idea we were this bad.After we are exterminated please send trash trucks,demolition crews,and fire depts. Thank you
Right on.
Huge monetary gains for the few, while putting masses and masses of people out of work, and into the streets.
Just what our economy needs to get back on track.
Eventually, we'll see more doctored stats as unemployment increases, since those who loose their jobs will eventually run out of unemployment benefits (if they get any) - becoming part of the faceless, unwanted and unaccounted for within our country.
Several past work associates of mine are (or were) working for Option One Mortgage Company in Irvine, Ca.
Most of them work within the technology area, so they have marketable skills to hopefully transfer to something with decent wages.
However, outsourcing to India has not helped the US IT employment market either, so even these higher skilled jobs are in jepoardy of never coming back in
sustainable numbers here in the US.
Most of these people voted for Bush, and at that time the housing boom was well underway, so all looked fine from their perspective then - with plenty of (ATM) spending cash for dining out and trips, all looked great.
I was odd-man out and voted against Bush, since I foresaw nothing good coming from this new administration.
Bush bought his way in the first time which should have been a wake-up call for this country, but then he was elected the second-time around - shame on us.
I'm glad I made the choices I did, but sad to see how blinded so many people were and still are.
This is a global problem - way beyond the housing crisis - that will impact us all to some degree.
Aristotle had it right, which is why it works to the benefit of the few *not* to do this ...
Aristotle’s theory is that by giving power to the middle class (the majority), the minorities of rich and poor will not be able to draw the government into oligarchy or democracy, respectively. Also, by setting up the natural enemies of rich and poor as the opposition to the government, one ensures that the government will not be overthrown by the people, for the rich and poor, loathing each other as they do, will never collaborate on anything. Rather, the government plays the arbitrator, gaining friendship from both and hatred from neither: “The arbiter is always the one trusted, and he who is in the middle is an arbiter,” (Politics, Book IV, Part XII).
Anonymous said...
Three-Headed Dog From Hell Becoming Number-One Subprime Mortgage Lender in U.S.A.
June 2, 2007 (LPAC)--The three-headed dog from Hell, Cerberus Capital Management, the private equity fund/hedge fund, is headed toward becoming the biggest subprime lender in the United States, if a pending deal to acquire Option One, the "troubled" mortgage subsidiary of H&R Block, comes through, reported the New York Times on June 1 in a lead story in its business section. After carving up and destroying the U.S. auto industry--first assaulting General Motors, and then, on May 14, announcing the purchase of Chrysler--Cerberus is now out to take over the distressed housing market by buying up more subprime mortgage lending companies.
The fawning New York Times says that Cerberus is the "smart money" which is "swooping in and taking over those battered businesses, seeing opportunity amid the wreckage." The "opportunity" includes making tens of thousands of jobless families in the United States also homeless, when their homes are foreclosed upon. The plan is, that Cerberus, which already acquired control of Residential Capital in 2006, when it took over GMAC, the credit arm of General Motors, and bought up Aegis Mortgage, a subprime lender from Houston, will become "the biggest subprime lender in the country." The plan to buy Option One is still pending.
Lyndon LaRouche has a plan to deal with the likes of the blood-sucking Cerberus: There must be a freeze on home foreclosures in the United States, since it is the banks which are bankrupt, not the victims of their lending policies; and hedge funds should be made illegal. Controlling the hedge funds would also curtail the "locust" practices of the private equity firms like Cerberus. One note on what exactly Cerberus is: While it formally identifies itself as a private equity fund, it plays the same role, and does the same work, as hedge funds, thus blurring the definitions.
The June 1 Times article provides a useful chart on who is buying the bankrupt subprime lending companies. The "smart money" investors include Ellington Capital hedge fund, the Citadel Investment Group, Farallon Capital, Second Curve Capital hedge fund, and Citigroup.
As LPAC has reported previously, the predator fund, Cerberus, is a major funder of the Bush-Cheney faction of the Republican Party, and has also provided major financing for Al Gore, Jr.'s political operations.
Shakster makes a great point:
When I travel out of country for a while, then return, I get a big shock and think, MAN we Americans are a bunch of ugly, loud, fat fu**s....
They will most likely be an acceleration in home forclosures.
Sellers can only hold out so long -and the payments never stop.
"They may well be sellers now, instead of buyers, because there 0 down option ARM loans are resetting"
Ex-Californian said...
WHAT DID I MISS?
Well in a normal market there are always new buyers coming from upstream. Say, that on average the first time home buyer buys a home at 30 years of age (actual number doen't matter). Well, every year there are going to be, coming upstream, these new buyers. The bubble - everybody can get a 0 down loan - has sucked up these new buyers from upstream and put them in a home already because they didn't have to wait to qualify. When they "arrive" at the normal home buying stage of their lives in 2007 - 2011, they're now in a home already. No more new demand.
They may well be sellers now, instead of buyers, because there 0 down option ARM loans are resetting .
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