Sunday, September 7, 2008

Cousin Fannie, Cousin Freddy, Go Live With Uncle.

So the government (that would be you) has decided that taking on an additional few billion dollars of bad debt wouldn't hurt, since we're already anywhere from $4T to $90T in the hole, depending on how you count your debts. From Yahoo!.

Alrighty then, let's review, shall we?

1) Poor Poor Pitiful Poor People (whose lifestyles and bad money management choices made and kept them poor, by the way) can't get a loan for a house. Somehow, this is a Bad Thing and also Racist.

2) Democrats in Congress * muscle lenders into making loans that, according to the rules of common sense and good lending practices, will go bad in a few years.

3) "Investors" see that more people are buying real estate, and that (duh) prices are skyrocketing, and jump on the bandwagon. The amount of fraud involved in getting houses to flip for a quick profit is turning out to have been astonishingly high (25% and higher, some places, and that's just at the first reckoning, people that lied on applications about being able to afford it...folks who lied and said it was their main residence will be adding to this number).

4) The bad loans start to rot

5) The people with bad credit who didn't read their contracts, are astonished when their mortgage payments triple

6) Housing all of a sudden stops selling. People start getting foreclosed on in larger numbers for defaulting on loans. The vastly over-inflated price on "investment" homes falls dramatically.

7) "Investors" start walking away from their investment homes, in a national display of lack of honor that The Good People find breathtaking. Defaults on loans go even higher.

8) Mortgage based securities firms are in hard times, and one of the biggest goes pop.

9) People get distracted, the economy picks up a little

and now 10) The people who bought most of the crappy loans from banks who made crappy loans because they could sell them, facing dire financial straits, are taken over by the government.

So you are now going to be the one bailing out all the [expletive deleted] [expletive deleted] [expletive deleted] people who bought houses they couldn't afford. What a bargain. When your taxes are higher next year, if you even pay attention to your return, remember this little boondoggle. And if you know someone who defaulted on the loan, borrow $5 from them so at least your share of their debt will come out of their own pocket.

Of course, they will have $5 to give you, because the things they really need, as well as the things they want, and the things that are nice to have and will be cluttering up their garages and storage facilities, are being financed at 15% interest on credit cards.

Next up: credit card companies in the same shape as mortgage companies. Coming soon to a real news agency near you!

If your panties are in a twist because I just stepped on your toes, keep reading. Everybody else have a nice day.

If you are buying things you don't need on credit, and can't afford the payments, you are a fool. If you are buying things you DO need on credit (gasoline, groceries), not only are you a fool, you are headed for a very ugly version of bankruptcy in the near future, and then you will be forced to figure out how to live within your means. If you find an even higher-interest-bearing credit source, you may be able to dig yourself a few layers deeper in debt before it happens, but it will happen.

UNLESS you ditch the expensive car and house you are struggling to pay for, and start living a lifestyle that your paycheck(s) will support, with enough left over after gas, groceries, and bills, to service your debt.

We are doing this right now in my home, and trust me it sucks but it's better than being out on the street, or living with your parents when you're 35 and married with kids.

If you can't figure it out on your own, you are NOT stupid. The government school system failed you, and you are figuring out how to swim after being kicked off the back of a ship in the middle of the ocean. Go to somebody like the Consumer Credit Counseling Service if you need some help getting started. If your counselor tries to get money from you, you went to the wrong place; it should be free

Which I know you like.

********

*Democrats, you know, the ones looking out for the working man? Yeah, remember this when you push the button for Democrats in the polling booth this December.

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