What is Digg?124 Comments
- doiveo, on 10/20/2008, -0/+27Rent until you can buy within your means.
- chicagojack, on 10/20/2008, -1/+26rent?
- inactive, on 10/21/2008, -1/+19#1 Don't give loans out by the truck-load to people that have no means to repay them.
- uselessexpert, on 10/21/2008, -1/+16Don't buy that $650,000 4 bedroom/2 bath house when you only make $70,000 and you only put 3% down...
- odigity, on 10/21/2008, -1/+13You won my support by criticizing the Federal Reserve, then lost it by proposing that government continue to ***** with the market.
Dugg down. - odigity, on 10/21/2008, -4/+15"But why stop there? To protect taxpayers as well as the economy, the entire Department of Housing and Urban Development should be shut down. And, just to be on the safe side, the building should be razed and the ground covered with a foot of salt to prevent it from springing back to life and haunting future taxpayers. As I explained in my Monday post, housing is not a legitimate role for the federal government."
That would bring tears of joy to my eyes. But it won't happen. Governments never, never let go of power. They never voluntarily reduce themselves in size. It will just keep stumbling along, refusing to let go of the rains, until it goes down in flames, taking us with it.
My only hope is that after we clear the rubble, we will have learned our lesson... for a while. - odigity, on 10/21/2008, -3/+13Stop looking to the government to fix things. They can only make things worse. They only ever have. They create problems, like this mess, and then we turn to them for solutions, so they get involved again, and the cycle repeats, like a downward spiral to hell.
Get them the ***** out of the market and money and banking. Now and forever. Tie them down with the chains of the ***** Constitution like Thomas Jefferson said. - jmknsd, on 10/21/2008, -0/+9what? the prices are still overvalued, and if they ever go back up to what they were, something is wrong.
$500,000 for a 1 bedroom house isn't normal or reasonable. In Houston a 2-3 bedroom house sells for $110,000. It's got plenty of room to keep going down. - sanman, on 10/20/2008, -2/+9Here's an excellent column by Ben Stein:
http://finance.yahoo.com/expert/article/yourlife/1 ...
He's pointing out something that few people on Digg have been willing to consider so far. - zacharytelschow, on 10/21/2008, -0/+7"While it is true that the housing bubble was supported by Fannie Mae and Freddie Mac, that was only as a result of the deregulation of their home loan conditions. Those 2 organizations worked for 50 years without generating a bubble."
First you claim that the current crisis is the result of deregulation and then go on to rant about how its the result of the Fed printing too much money. Which is it? I can guarantee it isn't the former, as additional lending regulations (requiring lending to low-income borrowers who would never had gotten loans otherwise) are a root cause. Additional regulation, not lack of it, was a huge part of the problem.
"People owning homes is what defines the middle class."
I would absolutely agree. And what defines home ownership more than having ownership in your home? If it isn't your money that bought the house, your sweat that owns the equity, that's when things begin to not work out. Try giving a car to your kid, then try having them work hard to earn money to buy one. Which car is cared for, maintained, and driven cautiously? - odigity, on 10/21/2008, -0/+7But how will the politicians buy votes if they don't promise bread and circuses?
- brickbat, on 10/21/2008, -12/+19What a ***** *****. Talk about political propaganda *****. While it is true that the housing bubble was supported by Fannie Mae and Freddie Mac, that was only as a result of the deregulation of their home loan conditions. Those 2 organizations worked for 50 years without generating a bubble. Why? Because the bubble was cause by the liquidity being pumped into the market because money was cheap and plentiful. Money was not cheap and plentiful because of those organizations but because the fed was "printing" money like it was going out of fashion. Take a look at the M3 over the last 10 years. Saying that it was the fault of Fannie Mae and Freddie Mac is a massive bait and switch. It was the fault of the ***** Federal Reserve System which is neither federally owned not is it a reserve. But how the hell is someone from the ***** Cato Institute going to tell you that?
There are plenty of good ways to support people having homes without generating a bubble. The best is for the government to "lower the floor" of the market by building more low cost housing and to give tax breaks to support private building of low cost housing. That has the effect of lowering the bar at which new entrants can come into the market and maintains price stability of all housing. Oh but I forgot, according to the ***** Cato Institute, that's "Socialism".
People owning homes is what defines the middle class. ***** like the Cato Institute want a feudal system where only a small elite owns all the properly and everyone else is just a wage slave that must work their whole lives just to pay the rent and buy the groceries.
***** You Cato Institute Mother *****. - odigity, on 10/21/2008, -1/+7There's a reason for the cycle. It's artificial, and it's caused by the Federal Reserve:
http://www.youtube.com/watch?v=q519rt2sBLI - odigity, on 10/21/2008, -0/+6"I believe in individualism, but one person's freedom to prosper ends when it does so purely to the detriment of those around him."
If you believe that, then you have to stand for the free market. Government intervention is contrary to individualism, and only government intervention allows one to profit at the expense of the other. Government is a zero sum game. The free market is not. - warsongs7, on 10/21/2008, -0/+6Makes sense but common sense is not as common as it used to be when the term was invented.
- marcabminion, on 10/21/2008, -2/+8How to avoid all bubbles = no goverment and no FED intervention
Market oversight on and transparency in transactions/inter-action/balance sheets.
Let the bad decisions fail
Let the good decisions win
Back the money to real value like gold, silver or cats. - UmbillicalEd, on 10/21/2008, -0/+6how about... learn basic math
- netant, on 10/21/2008, -0/+6You think that's bad, get this:
There are financial players that want the government to arrest the drop in housing prices. Translation: We know that cheap credit caused a housing price bubble, but now we want the government to maintain the bubble. *****. - norman619, on 10/21/2008, -0/+5Greed often overrules common sense. It's part of the reason we are in this mess.
- zippy757, on 10/21/2008, -4/+91 - Everything works in cycles. This too will pass
2 - We're not going into never never land.. we're going into 1 to 2 years of flat, then slow growth
3 - Fannie worked for a zillion years until the 'rules' on it were changed to allow bad loans. Fix those, and Fannie is fine
4 - Virtually everyone who 1st buys a house has it financed via Fannie, even if they got mortage from local bank, but they simple didn't know that...
5 - Don't spend more than 25% of your after tax income on housing. If you can't afford that, then don't buy.
6 - They are great investments now, in virtually every city. Wish I had more money to buy.
7 - Housing is traditionally a 15+year investment. You need to look at it that way. They're not stocks. - Pres, on 10/21/2008, -0/+4Live in moms basement until you can buy within your means.
- zacharytelschow, on 10/21/2008, -0/+4I couldn't agree with you more. If you live in a country that heeds your words more than the US, let me know (that's an honest statement; I can see the writing on the wall and would love to live somewhere that's prosperous and free. If liberals have Congress and the presidency, that won't be here for much longer).
- ryanschmidt, on 10/21/2008, -1/+5Will we last until the next housing bubble?
- digghasnoethics, on 10/21/2008, -2/+6As Kenny Everett would say:
Round up all the bankers, put them in a field and bomb the b*stards. - odigity, on 10/21/2008, -0/+3You don't have to leave the US - and it doesn't make sense to, because as bad as we are, the rest of the world is no better. But you can find greater liberty right here:
http://freestateproject.org/ - zacharytelschow, on 10/21/2008, -0/+3You, and others, continually cite greed as the cause of our current financial problems. Bankers are intelligent people. You honestly believe they thought there was money to be had in lending to people who couldn't repay their loans?
- inactive, on 10/21/2008, -0/+3Common Sense is looked down upon nowadays as being an ignorant simpleton or uneducated.
Sad but true. - zacharytelschow, on 10/21/2008, -0/+3You'll still get drilled. The more expensive a property is to own, the more the owner has to charge to rent it. You do avoid losing money on real estate investment, though (which I'm sure was your point).
- norman619, on 10/21/2008, -4/+7Sorry but no. You can't ignore the buyer's hand in their own mess. If people didn't buy houses they couldn't realistically afford they wouldn't be in trouble. You going to blame the auto-manufacturers for people who are irresponsible with their cars? The banks never forced any of these people to take loans they couldn't afford. Now they ARE to blame for not having higher loaning standards but that does not mean they are entirely to blame for this. They also don't control the cost of houses. That is set by the market. Houses are only worth what people are willing to pay for them. Try to remember that.
- Syraxis, on 10/21/2008, -0/+3Welcome to politics, not everyone is going to agree with your views. Doesn't make them anymore or less of a "sheep" than you.
- qXdc, on 10/21/2008, -0/+3Be more like Hong Kong with no minimum wage and a true free-market. Obama will never take us to a free world like that.
- motters, on 10/21/2008, -0/+2It's amusing that many pundits are asking why nobody foresaw the end of the current housing bubble. It was completely obvious to me and many people over the last several years that the rate of increase in house prices was unsustainable, since prices were going far beyond what average earnings could sustain and eventually something has to give. Although it means negative equity for some, I'm quite happy that house prices will have to become more realistic over the next few years.
- insanebrain, on 10/21/2008, -0/+2Yeah right.
Only buy a home when you can afford one. Forget that slogan "Every american should be able to own his own home". More than half of the western world is RENTING. .. so why shouldn't you ? - TexanRudeBoy, on 10/21/2008, -0/+2They could have ended it in the first point. Without the Fed making money so easy, it won't be so vastly malinvested. You can regulate the housing industry till the cows come home, if there is an excess in credit it will end up inflating a bubble somewhere else. Sound money is the only answer.
- LloydDobbler, on 10/21/2008, -0/+2Greed is right...but if you believe in individualism", I would think you would believe in personal responsibility, too?
Last time I checked, no one FORCED people making $1500/month to take out a hybrid 5/1 ARM loan on a $400,000 home. They saw the opportunity, and decided to go for it. I know it sounds cold, but their bad choice is the bed they made, and they should have to lay in it.
Did investors contribute by causing prices to raise? Well, they did help drive up prices. But again, no one said anyone HAD to buy at those inflated prices. And most of the investors out there are the ones who used interest-only loans wisely...then found someone to sell to. Know what determines a piece of property's value? What someone will pay for it.
I kept renting during the crazy bubble, because I knew that the killer rate on a 5-year ARM would only last 5 years. But I accept responsibility for my own choices, which I guess makes me part of the minority. - nezroy, on 10/21/2008, -0/+2Same as in the US.
- cquinnd, on 10/21/2008, -0/+2Translation: "Don't accept the best offer you get from a mortgage broker".
Those deals only existed because someone else was willing to dig around until they could find a bank foolish enough to buy the loan from them after they made commision on the sale. - gator2000, on 10/21/2008, -0/+2When asked why they were doing it at the time "...but that's what they cost"
- zacharytelschow, on 10/21/2008, -0/+2Agree completely, other than the possibility of cat backed currency.
- inactive, on 10/21/2008, -5/+72 words... Ron Paul... you people had the choice, the RP bury brigade did their job, the main stream media did their jobs for the 2 puppets you will vote for. Thanks sheeple. Maybe in 4 years we will have someone like Ron Paul fixing this economy/govt. McCain/Obama are not going to do ***** for you, same game, same people, different words.
- zacharytelschow, on 10/21/2008, -0/+2kookbutt is absolutely right. Saving money to put down on your home? Oh, how cute, old fashioned, and traditional. How condescending of those now upside down on their homes. Oops.
- roodammy44, on 10/21/2008, -1/+3Just because someone is offering a radically different view, it doesn't mean that it's a good one.
Ron Paul's tax policies were quite simply mad. - odigity, on 10/21/2008, -0/+2I appreciate the digg, but I won't be guilt tripped into returning it.
I respect that you have good intentions, that you believe you are doing the right thing. But I believe that the initiation of force is wrong. That using violence is evil. When you support the government interfering with the market, with the voluntary actions of adults, using the force of a gun - because let's not pretend... all laws are enforced at the point of a gun, or they wouldn't be laws - you support what I consider evil.
I can't compromise on that. - sodade, on 10/21/2008, -0/+2Yep, me too. I cashed out on the trophy house two years ago and put my money into a small, cheap fixer that I will own in 10yrs.
- inactive, on 10/21/2008, -4/+6Sure glad it was just the bankers fault, and that the stupid idiots taking loans out that they couldn't afford are blameless in this.
- thecoolestguy, on 10/21/2008, -0/+23) Fannie was a inevitable corruption pool. Whenever you have a multi-billionaire dollar program where politicians appoint its CEO's, it's inevitable politicians are going to start making millions off of their political connections.
e.g.
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Freddie Mac pays record $3.8 million fine
Settles allegations it made illegal contributions between 2000 and 2003
WASHINGTON - The home loan giant Freddie Mac has agreed to pay a record $3.8 million fine to settle allegations it made illegal campaign contributions.
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e.g.
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Conflict of interest
Further information: Countrywide financial political loan scandal
In June 2008, the Wall Street Journal reported that two former CEOs of Fannie Mae, James A. Johnson and Franklin Raines had received loans below market rate from Countrywide Financial. Fannie Mae was the biggest buyer of Countrywide's mortgages. [33]
Fannie Mae and Freddie Mac have strategically given contributions to lawmakers currently sitting on committees that primarily regulate their industry: The House Financial Services Committee; the Senate Banking, Housing & Urban Affairs Committee; or the Senate Finance Committee. The others have seats on the powerful Appropriations or Ways & Means committees, are members of the congressional leadership or have run for president.
Barney Frank has been a member of the House Financial Services Committee since 1991 (and is currently the chair). The HFSC is one of two government entities responsible for oversight over Fannie Mae. From 1991 to 1998, Barney Frank had a lover, Herb Moses, who was an executive at Fannie Mae. While at Fannie Mae, Moses helped develop many of Fannie Mae’s affordable housing and home improvement lending programs. Other lawmakers have called this a "clear conflict of interest." [34]
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Remember, once a big government program is created, then over the ensuing decades, lobbyists and political insiders go to work on it to shape it for their benefit.
It is inevitable, and this is why proponents of good government urge keeping size of government small, and favoring local government over unaccountable federal government.
The more people under a government, the smaller the voice of each person in shaping political policy. The federal government needs to be scaled back and power returned to local governments. - roho76, on 10/21/2008, -0/+2Buy houses when the market hits bottom. Duh.
- zacharytelschow, on 10/21/2008, -2/+4Yes, I'm sure the "greedy bankers" were jumping with glee to make loans they knew were unlikely to be repaid. That's the best way to make big bucks.
- roodammy44, on 10/21/2008, -1/+3Ahh, you mean like anarchism?
Smash the state indeed. - splinter09, on 10/20/2008, -7/+9Avoid the next? Not another one.......... The stupid rich bankers make all this mess and is left to us, poor tax payers to clean all the mess they made, with our tax money.
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