October 08, 2008

John McCain now wants to spend $300 billion of taxpayer money to buy up mortgages from failed housing gamblers at their fraudulently inflated prices.

And then the Republicans became Democrats and the Democrats became Republicans.

And if EITHER candidate or party calls for the taxpayer to pick up the tab for failed housing gamblers' and fraudsters' mistakes and behavior, then a rebellion unlike anything we've seen since the 1960's should commence.

If one penny of your money - people who made rational financial decisions and didn't gamble on obviously overpriced houses, people who didn't commit mortgage fraud, people who lived within their means - IF ONE PENNY OF TAXPAYER MONEY IS GIVEN TO FRAUDSTERS, GAMBLERS AND FAILED FLIPPERS, THEN REVOLUTION THEY WILL HAVE.

If they did anything like this, what would be next? Cover your stock losses? Cover that bad bet you made on the Cubs? Cover your bar tab?

I can't believe this would even be considered, let alone proposed by a major party candidate. A nation of laws and contracts and free markets, which just changes the rules in the night, voids the contracts, doesn't prosecute the fraudsters, and rewards gamblers and failed flippers while penalizing responsible citizens. That's not America folks. Not the America I remember.

But here they are, led by the desperate and soul-less McCain, who you remember said in March:

* "It is not the duty of government to bail out and reward those who act irresponsibly, whether they are big banks or small borrowers."

But now the monkeys are getting dangerously close to direct election-year housing gambler payoffs. The NAR, NAHB and NAMB are powerful. So are China, Saudi Arabia, Toll Brothers, KB Home, Wells Fargo, Bank of America, JP Morgan and Citigroup. They all want a floor under housing prices. Even if that means having the government overpay for the houses to bail out the gamblers.

This will not stand. Period. And in this case you shouldn't care about Obama or McCain or Democrats or Republicans. This goes well beyond politics. This will not stand.

McCain Homeownership Resurgence Plan - "The direct cost of this plan would be roughly $300 billion because the purchase of mortgages would relieve homeowners of “negative equity” in some homes"

Obama rejects McCain's mortgage buyup plan
- Democrat Barack Obama's campaign criticized John McCain's mortgage bailout plan Wednesday, saying it would cause the government to lose money by paying too much for bad loans.

McCain mortgage plan shifts costs to taxpayers
- Under McCain's newly announced plan, the government would take the hit for writing down mortgage balances for at-risk borrowers.

McCain Adviser Offers Details on Mortgage Plan


Anonymous said...

Why don't they just extend these people's mortgages to 50 to 100 years so that they can get an affordable monthly payment (they couldn't really afford the house anyway). That way - it's not really a handout. They'll pay interest for years.

Anonymous said...

I am a Republican who will be voting for McCain... but I have to say that what McCain said about buying up bad mortgages gave me nausea. I could not believe what he was saying. It made me angry.

McCain needs to get a clue. Conservative Republicans such as myself are finding more difficult to vote for him. If McCain had only taken a different stance on this bailout, then he would be up in the polls by at least 10%. The American public is very angry, and McCain should have recognized it.

It pains me to see him give in to Paulson, Bernanke, Pelosi, Frank, et al. Hopefully, Sarah Palin can talk some sense into him.

I was shocked this morning thinking that I actually agree with Obama on this issue. McCain better get a clue or it will be too late.

i've had it said...

A few days ago I said in another thread that this would be the ultimate end...the govt. buying the mortgages and setting a price floor. Well, just because they may buy a house at 50% on the dollar doesn't mean that price will establish the lowest long run price. Ultimately, once the house is put up for sale by the owner the market will determine the price; and it will be either lower or higher depending on what people can afford with normal mortgages. If people can't pay what they are asking, then the price will come down. If they can then a new higher price will be established.

I'm opposed to the above BIG TIME. But I knew it would just be a matter of time before this idea was put out there. My position is that the govt. should in no way pick up the tab for these mortgages; this is immoral and illegal.

i mean, what if the govt. did this and the unpaid balance is also forgiven, then do people get to keep any gains when they go to resell? this would be absolutely outrageous and immoral.

but you can bet your booties this is exactly what the politicians and left wing interest groups want to have happen.

Anonymous said...

Hello Panic,

This issue cuts across both party lines here. McCain is talking about using the money to buy up mortgages directly from people. We could at least keep some people in their homes and find slightly more deserving candidates that way.

That is compared to the proposal to buy 700B of assets based on the secretary of the treasury's opinion, from what ever the fraudsters offer.

Basically the way its currently happening is marginally worse. And your buddy Obamma is supporting it.

Vote Ron Paul.


Anonymous said...

And that my friends is the summary of our one party system and the 2 candidates jockeying for it:

One big clusterfu@k.

Agent 99 said...

When I suggested this a few weeks ago, I was KIDDING.

I will leave the country if this happens. I'm not kidding.

Anonymous said...

"FactChecking Debate No. 2October 8, 2008Nonsense in NashvilleSummaryMcCain and Obama debated for the second time, in Nashville. We noted some misleading statements and mangled facts:

McCain proposed to write down the amount owed by over-mortgaged homeowners and claimed the idea as his own: “It’s my proposal, it's not Sen. Obama's proposal, it's not President Bush's proposal.” But the idea isn’t new. Obama had endorsed something similar two weeks earlier, and authority for the treasury secretary to grant such relief was included in the recently passed $700 billion financial rescue package.
Both candidates oversimplified the causes of the financial crisis. McCain blamed it on Democrats who resisted tighter regulation of federal mortgage agencies. Obama blamed it on financial deregulation backed by Republicans. We find both are right, with plenty of blame left over for others, from home buyers to the chairman of the Federal Reserve."


michael said...

after i heard that i may vote for obama.

still planning on bob barr. but if mccain starts to get traction i will vote for obama.

mccain's plan is the stupidest thing i've ever heard.

michael said...

i take back my last post. back to voting for barr 100% after reading the link keith posted.

from the article...

"...and Obama has mentioned the idea as well."

patrat said...


patrat said...


Anonymous said...

What a bunch of baloney hooey balooey. Americans are getting mad at $300 billion when trillions more have been wasted on federal pork/welfare programs over the last generation? I'm sorry but $300 billion is nothing compared to the money we spend on military crap and welfare queens. As far as McCain goes, you might as well vote for Ronald McDonald if this is what passes for presidential candidates. McCain is too weird and too much of a commie; Palin, he/she/whatever is a welfare queen and has no business in any office other than in a trailer park; Osama/Obama wants more of your $$$$ and is a diversity preaching Nazi, and Biden is like voting for one of those store manniquins at JC Penney. As far as the third parties go (yes there are more than TWO parties in America), they might as well bend over, lube up and get ready for the Larry Craig treatment since most Americans don't want freedom, they want $$$$ for nothing, chicks for free. Does anyone really think the middle/medieval class is libertarian? I think not if they want bailouts and special treatment.


John S said...

Actually, Hillary Clinton already proposed such a plan 6 months ago and Barak has signed on in theory. No new news here. And do you really think $300 billion of welfare mortgage is really any worse than spending $110 billion (so far) on a bailout of just AIG? The individual mortgage bailout might work. (I just need a crummy $150,000 to pay off my mortgage. Then I'm debt-free.)

Nick said...

I believe that the McCain plan makes sense. I am a struggling homeowner. I am having a hard time making ends meet and we just need a little break. I would be happy if the government takes what I paid for my townhouse (about $400,000) and lower it to $20,0000 and plus give me a ten percent equity stake. Also, the government should wipe out my HELOC loans and credit card debt. You DOPES, I told you that this was coming! HA, HA, HA, LOL, LOL, LOL.

Anonymous said...

If a plan even remotely close to what McCain (McMansion?) is proposing goes through I would REVOLT. I did not invest in real estate, I invested in stocks, some of those have gone down, do I get a direct bailout? I'd like to sell some of my shares at a price above what anyone is willing to pay also.

A bottom in housing prices will happen...when they reach a point where people who earn money and spend it responsibly think the prices are reasonable. They will sell like hotcakes, as they're needed by people.

Putting in an artificially high floor only continues the need for people to take on credit that they can't pay off. Unbelievably stupid plan!!! And frankly criminal.

Anonymous said...

Dear Mr. McCain, my house is paid for but it has lost $100,000 in value. Will you please send me the $100,000 to cover my loss just as you will reduce the mortgage of a risk taker from $400,000 to $200,000 so he can stay in the house he should not have been allowed to buy.

If you don't it will prove that living honestly in the US will never go unpunished.

Tonto said...

Amen Keith. Great post.

"A nation of laws and contracts and free markets, which just changes the rules in the night.."

I love it. Well said.

mike a realtor said...

Mccain is so clueless.He looked reckless last night.I would not let him manage my 401 keg plan.Obama is the answer for real change.

Peter T said...

McCain knows he is loosing and he tries now everything to get back into the game. Since Paulson announced the 700 billion bailout, the Republicans are disoriented, because their leaders have admitted defeat. I don't know the polls well, but the "60 option" could become reality in November: President, House and 60 senators are Democrats and can govern without the Republicans. It would be a well deserved loss for the party who reigned essentially since 1980. If the Democrats would govern wisely, I am not so sure.

Anonymous said...

"And if EITHER candidate or party calls for the taxpayer to pick up the tab for failed housing gamblers' and fraudsters' mistakes and behavior, then a rebellion unlike anything we've seen since the 1960's should commence.

If one penny of your money - people who made rational financial decisions and didn't gamble on obviously overpriced houses, people who didn't commit mortgage fraud, people who lived within their means - IF ONE PENNY OF TAXPAYER MONEY IS GIVEN TO FRAUDSTERS, GAMBLERS AND FAILED FLIPPERS, THEN REVOLUTION THEY WILL HAVE."

Keith. Pull your head out man. Your buddy Obama voted for the 700billion dollar bailout (and yes so did MCain). What is the difference? But you are so quick to defend Obama.

Adam SlowHand Smith said...

Freakin' amazing.

The irony here is McCain's plan to interfere with the free market and make the gov't renegotiate the loan terms is so incredibly SOCIALISTIC as to be laughable!

People would be screaming "why, that amounts to COMMUNISM or SOCIALISM!" if Obama suggested it!

The funny thing is, apparently McCain thinks it's HIS original idea, when he actually voted for the bail-out bill which ALREADY CONTAINS similiar language (when lenders are 'encouraged' to play along with attempts to renegotiate)!

HOWEVER, McSame admitted he hadn't read the ORIGINAL version of the bill, as submitted by Hank Paulson (and you can see why: it was too lengthy, about 3 pages, LOL!). So the odds of him actually having read the final 400 page version? Seems pretty slim, indeed.

BESIDES, there's a little something called "securitization" that makes "HIS" plan more impossible than he thinks: these loans have been 'sliced and diced' and repackaged into CMOs, and untying that Gordian Knot for the sake of renegotiating terms of the loan is a tad difficult, when you have no idea who holds or services the loan!

McSame actually had it right a few months ago when he publicly admitted that economic policy was not his strong suit: maybe he should just shut up, sit down, and let someone with more brainpower on his team handle the task.....

But even there, how can he supervise the work of an economic panel when he really has no idea what they're talking about?

Like McCain himself said during the debate (paraphrased), "the office of the Presidency is NOT the place for on-the-job training". Well said.

Anonymous said...

I heard him say "And remark the value to the new lower price". Sounds like mark to market, or a move in that direction.

Afterthought said...

There won't be a revolution until people are totally destitute.

How we get there won't matter. Whether through government stupidity or individual stupidity or both, the Average American is so entitled that they would never lift a finger until it was too late and the checks stopped flowing.

Mike Hunt said...

There is one other big factor at play that puts pressure on this situation.... counter party default risk!

The banks and institutions made bad bets selling credit default swaps to entice the buyer to buy the CDO. If the underlying mortgage backed security went into default by the price crashing and the FB'er not paying then the seller of the swap must pay out the terms of the credit default.

Remember the market for credit defaults is about 60 trillion dollars or just over the value of the WORLD GDP. Of course this won't be paid out if there was no default.

You may ask, why don't the payee's of the CD get the shaft? Well then they should get their premiums returned, right? A lot of the payee's are foreigners who hold a lot of US debt and the pressure will be to make these MF'ers whole... therefore the powers that be will do anything and everything possible to put a floor under house prices.

Hence the pressures to place a floor on FB'ers defaulting and having the gov't pick up the bill. The people in power know this and will try every trick (inflation, principle reductions, god knows what else) to prevent these defaults to preserve the greater good.

Nick is right, the criminals will win. I played by the rules and lived frugally and don't feel like I should pay taxes so I can be made whole like all the FB'ers.

There is a lot of injustice to go around for everyone.

Keith, mark this post for posterity. I know I'm right on this one!


Anonymous said...

With those comments, McCain lost my vote. He doesn't deserve to win.

gutless and lazy said...

Unbelievable isn't it? McCain, a GOPer, is making the most ardent Soviet communist blush.

Basically, McCain, and any McCain voter, is willing to sell out any personal or GOP fiscal conservative "principle" they have for a 300 billion dollar bribe to vote for him. Just to buy one election.

Then, THEN, he has the nerve to puts on his campaign poster "Country First".


Anonymous said...

That did it. I can no longer vote for McCain.

The only question now is whether I vote for Bob Barr or write in Ron Paul, or if I actually vote for Obama. That is, whether McCain's, in effect, lost one vote or two. I don't support Obama, but McCain should not be President.

As a first time Florida voter, it's nice to finally live in a state where my vote counts.

Anonymous said...

don't kid yourself. obama is pissed he didn't announce it first. Obama will do the same thing once he is in office. It is the natural progression of this meltdown. it will be the last gasp, the hail mary pass. Mccain is just trying to be maverick by beating obama to announcing it.

Anonymous said...

There won't be a revolution until people are totally destitute.

rarely to revolutions result in something better, especially when the are born out of desperation.

for some reason, the revolutions in the est during the 18th and 19th centuries resulted in something better. I worry that we will not get something better if it gets to that point now.

tater said...

McCain's "plan" is one dumb plan. "Reward the deadbeats" seems to be the politically-correct bullshit of the day. Just shows how far this country has sunk.

DAve said...

I BELIEVE that the most important idea behind Mc Cain’s refi program is that it makes these loans (most of which are not right now) into RECOURSE loans… which therefore would tend to stabilize the housing market as people wouldn’t be so highly motivated to walk away, an action which now we keep hearing over and over just makes “business sense” but puts all the rest of us in utter peril.
I know I choked when I heard him introduce this idea too but now I’m seeing that there could be important advantages that aren’t readily apparent.
As I’ve heard it said before just ‘cuz someone starts a fire in his room you don’t let the whole house burn down to teach him a lesson.
Even if we HAVE paid all of our bills on time and live within our means we can’t use that as an excuse when we’ve allowed our spouse to run up hundreds of thousands of dollars of debts through gambling and reckless spending just because we were too busy to monitor and regulate THEIR behavior as well as our own. That’s just an obligation of being in a situation TOGETHER.
If we had been more vigilant about what our government and our neighbors were doing we wouldn’t be in this mess.
And you probably don’t like hearing it anymore than I like writing it-