http://www.americanthinker.com/2011/04/h..._fall.html

Hadn't thought much about this. I don't think it's the whole cause, as the article suggests, but it did play a role.

Interesting read.

I think it may be a bigger factor than most people realize, particularly in some of the markets that have been highest hit. It almost certainly incentivized speculation, and speculation is how you get bubbles like this. I don't think this was much of a factor at the CRA end of the sale, but I think it was a huge factor at the nouveau riche, buy more house than we can afford end.

I always thought the previous carryover approach was entirely reasonable. I would certainly favor going back to it.

Quote:Thank you President Bill Clinton for your 1997 action, applauded by the banks, the realtors and all citizens in search of half-millionaire status from an investment they could understand and self deceptively believe to be low risk; thank you for fueling the mother of all housing bubbles; thank you for enabling so many of us who bought second or third homes, and homes before construction began, which we then sold to someone else who dreamed of riches from owning homes long enough to sell to another fool.

Is the top graph's index inflation adjusted? It must be I guess.

Gee. How did I know this was going to be a "blame the lefty" article?

Btw, I don't understand how anyone can even say they didn't realize they couldn't afford a $500,000 house on $30-40,000 a year. A lot of it probably comes down to greed and "keeping up with the Jones'". I think it is kind of funny though. You guys on the right preach to us that "greed is good" and you bash these people for being greedy.

Btw II, did you guys ever see the piece on comparing todays tv programs to those in the past? It is VERY telling how differently we look at things. This started pretty much in the early '80's(conveniently-or not so conveniently) roughly about the same time Reagan was elected to office. It was about housing and pointed out that in todays shows they show people who work low income or middleclass jobs(or not even working) living in Mc Mansions(ie. houses and apartments that are beyond what they can actually afford) but back in the 50's, 60's characters working similar(ie low to moderate income bracket) living in homes that actually represent what could actually be afforded-the Honeymooners for example.

(04-14-2011 01:21 PM)RobertN Wrote:  Gee. How did I know this was going to be a "blame the lefty" article?

Btw, I don't understand how anyone can even say they didn't realize they couldn't afford a $500,000 house on $30-40,000 a year. A lot of it probably comes down to greed and "keeping up with the Jones'". I think it is kind of funny though. You guys on the right preach to us that "greed is good" and you bash these people for being greedy.

Btw II, did you guys ever see the piece on comparing todays tv programs to those in the past? It is VERY telling how differently we look at things. This started pretty much in the early '80's(conveniently-or not so conveniently) roughly about the same time Reagan was elected to office. It was about housing and pointed out that in todays shows they show people who work low income or middleclass jobs(or not even working) living in Mc Mansions(ie. houses and apartments that are beyond what they can actually afford) but back in the 50's, 60's characters working similar(ie low to moderate income bracket) living in homes that actually represent what could actually be afforded-the Honeymooners for example.

Huh?

(04-14-2011 02:15 PM)SumOfAllFears Wrote:  

(04-14-2011 01:21 PM)RobertN Wrote:  Gee. How did I know this was going to be a "blame the lefty" article?

Btw, I don't understand how anyone can even say they didn't realize they couldn't afford a $500,000 house on $30-40,000 a year. A lot of it probably comes down to greed and "keeping up with the Jones'". I think it is kind of funny though. You guys on the right preach to us that "greed is good" and you bash these people for being greedy.

No, that's the left that says that.

Quote:Btw II, did you guys ever see the piece on comparing todays tv programs to those in the past? It is VERY telling how differently we look at things. This started pretty much in the early '80's(conveniently-or not so conveniently) roughly about the same time Reagan was elected to office. It was about housing and pointed out that in todays shows they show people who work low income or middleclass jobs(or not even working) living in Mc Mansions(ie. houses and apartments that are beyond what they can actually afford) but back in the 50's, 60's characters working similar(ie low to moderate income bracket) living in homes that actually represent what could actually be afforded-the Honeymooners for example.

I didn't see any show, but I've discussed this for many years. It's not just TV shows, but even commercials as well. Very telling that the Hollywood left plants these seeds of discontent.

(04-14-2011 01:21 PM)RobertN Wrote:  Btw, I don't understand how anyone can even say they didn't realize they couldn't afford a $500,000 house on $30-40,000 a year.

You realize, of course that this is exactly what CRA did... Housing reform originally passed the Republican controlled senate on a party-line vote. Clinton threatened to veto it unless it included incentives/mandates for "affordable housing"... noting that affordable housing meant putting someone who made 40,000 into a 500k home and NOT about building trailer parks in McLean, VA.

To the original topic...

The BIGGEST problem with CRA is that it created a new market for low down payment, high leverage, questionable income verification loans. Half the shows on TV were about someone with $10,000, no job (other than buying and selling houses) and no credit buying ten properties for $1mm, getting a second loan for 250k, fixing them up and flipping them for 400k in profits. Guess what that huge demand did for the prices of 100k fixer-uppers? It was self-fulfilling.

You can't create a loan package so that a guy making 40,000 from a variety of on and off-the-books sources can afford a 500k loan and then stop someone who makes (or in the example above can claim to make) 400k from similar sources from getting $5mm in identical loans. It's called discrimination and is illegal.


While I'm sure Robert will point to the second person as the problem, and he is right to a degree... but that is exactly what happens when the government tries to force things to happen. The poor man is getting something he can't afford... and the scammer is too. The SOLUTION is to deny the loan to BOTH of them, not to try and figure out how to discriminate better

(04-14-2011 02:23 PM)DrTorch Wrote:  

Quote:Btw II, did you guys ever see the piece on comparing todays tv programs to those in the past? It is VERY telling how differently we look at things. This started pretty much in the early '80's(conveniently-or not so conveniently) roughly about the same time Reagan was elected to office. It was about housing and pointed out that in todays shows they show people who work low income or middleclass jobs(or not even working) living in Mc Mansions(ie. houses and apartments that are beyond what they can actually afford) but back in the 50's, 60's characters working similar(ie low to moderate income bracket) living in homes that actually represent what could actually be afforded-the Honeymooners for example.

I didn't see any show, but I've discussed this for many years. It's not just TV shows, but even commercials as well. Very telling that the Hollywood left plants these seeds of discontent.

You mean like well known right-wing mouthpiece Alec Baldwin in Working Girl where the rough kid from the bronx (or was it brooklyn?) finally gets the boat loan after boppin Doreen DeMoochean, and the rough girl, who envies the rich woman schemes her way to the top?

Seems pretty obvious that LOTS of people bought into it. Meanwhile, those shows that Robert seems to want to return like Sanford and Son, Good Times and Archie Bunker got pushed to the side. Wow, talk about RACIST, Robert

(04-14-2011 02:49 PM)Hambone10 Wrote:  

(04-14-2011 02:23 PM)DrTorch Wrote:  

Quote:Btw II, did you guys ever see the piece on comparing todays tv programs to those in the past? It is VERY telling how differently we look at things. This started pretty much in the early '80's(conveniently-or not so conveniently) roughly about the same time Reagan was elected to office. It was about housing and pointed out that in todays shows they show people who work low income or middleclass jobs(or not even working) living in Mc Mansions(ie. houses and apartments that are beyond what they can actually afford) but back in the 50's, 60's characters working similar(ie low to moderate income bracket) living in homes that actually represent what could actually be afforded-the Honeymooners for example.

I didn't see any show, but I've discussed this for many years. It's not just TV shows, but even commercials as well. Very telling that the Hollywood left plants these seeds of discontent.

You mean like well known right-wing mouthpiece Alec Baldwin in Working Girl where the rough kid from the bronx (or was it brooklyn?) finally gets the boat loan after boppin Doreen DeMoochean, and the rough girl, who envies the rich woman schemes her way to the top?

I don't really watch TV (except for cartoons) but some examples from some years back include:
A simple AT&T ad advertising some regular service, only the family was in a gorgeous $800K house.
The E-trade ad where the father is at his home office, wheeling and dealing w/ his on-line broker, and then has his "secretary" send Emily in, and it's his 3 y.o. daughter.
Or the NYT ad, w/ the YUPPIE couple and their perfect baby spending a relaxed Sun morning in their HUGE apartment.

As far as TV goes, I did once read about Desperate Housewives, that most of them would be making about $30K in their jobs and no way would they be able to afford their homes.