Deadbeat nation
in [Design]
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From: Sure,Not on 4 Jun 2010 16:48 On Jun 4, 12:39 pm, dagmargoodb...(a)yahoo.com wrote: > On Jun 4, 8:58 am, "Sure,Not" <bamberb...(a)gmail.com> wrote: > > > > > > > On Jun 2, 3:01 pm, dagmargoodb...(a)yahoo.com wrote: > > > > On Jun 2, 12:48 pm, "Joel Koltner" <zapwireDASHgro...(a)yahoo.com> > > > wrote: > > > > > "Spehro Pefhany" <speffS...(a)interlogDOTyou.knowwhat> wrote in message > > > > >news:vl4d06ttpkggskohj2jq4gpuhmi7hqfjig(a)4ax.com... > > > > > > It would be a business decision if the person went bankrupt and had to > > > > > liquidate basically all their assets, if necessary, in order to repay > > > > > as much as possible of the money owed to the lender. > > > > > If we held businesses to the same standard I'd tend to agree... but it's very > > > > standard business practice that, if one of your divisions is underperforming, > > > > you close it down, defaulting on any outstanding loans, and keep on going -- > > > > even if strictly speaking the ovreall company is in generally good health and > > > > could have afforded to keep the company around with, e.g., one division > > > > propping up the other. > > > > > > So-called non-recourse states have distort the market with legislation > > > > > limiting or obstructing lender's rights to go after the deadbeat for > > > > > ALL the money owed. > > > > > There's likely some reform needed there that I'd readily vote for, but as-is > > > > such laws have to be viewed just as the cost of doing business. > > > > > This sort of issue is very messy to deal with legally since pretty much any > > > > protection you give to people who had every intention of meeting their > > > > obligations can also be abused by people out to defraud others. (And of > > > > course it's very common that incomptence gives the appearance of malice and > > > > vice versa...) > > > > > ---Joel > > > > The original article in the NYT said if you were underwater in yourmortgage, you should bail so you could stick it to the bank. That's > > > roughly a quarter of America. > > > > It had a number of people explaining the best strategies, that you > > > could count on about a year living rent-free before being evicted, and > > > could save up all that money. > > > > So, that's welching, then stealing. > > > > The "Yes we can's" in the comment section were chilling. The > > > taxpayers ultimately absorb it, since Freddie and Fannie have > > > guaranteed so much of it. > > > > -- > > > Cheers, > > > James Arthur- Hide quoted text - > > > > - Show quoted text - > > > It's not welching if they honor the agreement and walk away when they > > stop making themortgagepayments. > > Sure it is. Suppose you want to buy a house, the bank helps you by > lending you the money, and you promise to pay them back. Then you buy > it, and the appraised value falls, so you decide not to pay. That's > the bank's fault? > > If we retroactively change mortgages to mean "If the value rises I'll > take the gain, if the value falls then you take the loss," then no one > will lend money. Socially, that's a great harm. We're kind of there > now. > > Twenty years ago my brother stretched very hard and bought a house. > It turned out it was at a price peak and he promptly was underwater, > for a decade. What did he do? The honorable thing: he paid hismortgage, every ... single ... month. No whining, no complaining. > > Sometimes people default for reasons beyond their control. That's > still a default, but at least it's partially understandable. You > belly up, take your lumps and society eventually forgives you. > Bailing because you're underwater, to skip out on money you borrowed > and owe? That's welching. > > > It is stealing, if they stay there > > knowing that they aren't paying themortgage. > > True. > > -- > Cheers, > James Arthur- Hide quoted text - > > - Show quoted text - The contract specifies the conditions. It is an unsecured load, and if you don't pay, the bank takes the property. Simple.
From: Sure,Not on 4 Jun 2010 16:55 > California, even more so. But for the ultimate example, we have to > look to the federal government: Social Security. Will they welch? > You bet--they've got no choice. Hope it happens soon. If however, that day does happen, Gov't best be willing to end retirement benefits for all of it's current and former employees. But they won't do that.
From: Sure,Not on 4 Jun 2010 17:09 >California, even more so. But for the ultimate example, we have to >look to the federal government: Social Security. Will they welch? >You bet--they've got no choice. The Fed will hold this off as long as possible. But when this eventually happens, it's pretty much over.
From: dagmargoodboat on 4 Jun 2010 17:15 On Jun 4, 2:01 pm, "Joel Koltner" <zapwireDASHgro...(a)yahoo.com> wrote: > <dagmargoodb...(a)yahoo.com> wrote in message > > news:702917af-522d-4a7f-b0ae-fb4fce419c5b(a)x27g2000yqb.googlegroups.com... > On Jun 4, 12:03 pm, "Joel Koltner" <zapwireDASHgro...(a)yahoo.com> > wrote: > > >> Hopefully you hold businesses to the same standard... > >Sure, and historically, we did. The difference today is that the > >lender sues businesses, but is letting consumers default scot-free. > > Interesting point, certainly. I would think lenders aren't suing consumers > because they figure it's like trying to squeeze water out of a rock, but > perhaps "big bad rich banks" being perceived as "beating up" on "little > helpless consumers" plays into it as well. "Moral hazard" is a main reason--the banks have insurance, so they aren't the one ultimately taking the risk. We are. Hence Freddie, Fannie, and friends' on-going hemorrhage. That's us, paying peoples' mortgages. Another more complicated reason is: banks can't afford to. To do so means they'd have to recognize losses which Mr. Obama has said they can otherwise hide. It's called "mark-to-model." To take the losses would overwhelm their reserves. If you wonder that 2 million foreclosures brought down the system, yet it's "fixed" today with three times that number, you might want to reconsider the premise. Third, even if they wanted to, the government's restraining them, and the government has usurped unto itself ample power to do so. > I don't see the culture of our country moving radically back towards greater > responsibility (in the "less welching" sense) any time soon. > It'll be > interesting to see what the November elections hold. I wouldn't be surprised > if you're going to be voting for more Tea Party candidates than republicans? > :-) Yep, though remember: the Tea Party movement is a movement, not a party, so they could well endorse candidates of all stripes. To me it's about spending responsibly, within our means, on things that make a difference. That makes government more affordable, creates jobs, and pulls millions up from the ditches. We all gain. Following the Constitution would be nice, since it assures most of that. Presently we're spending irresponsibly, far beyond our means, on things that make problems worse(!). We have to stop. Or, like Greece, we'll be stopped. There's no need for that--let's fix it. -- Cheers, James Arthur
From: Sure,Not on 4 Jun 2010 17:22
> Its not like corporations haven't filed for bankruptcy get out from under > pension or retiree healthcare obligations. They unload their responsibility > on the public (Medicaid or the Pension Benefit Guaranty Corporation). They > come out the other side of the process with a nod and a wink from Wall > Street. And a clean credit rating. Simple solution. Allow a company to raise the price of it's product and demand that everyone pay for it. You can opt out, but you have to go to prison. Doesn't quite work in the private sector, does it? |