The reason that you and most of us here don't know of anyone that lost their house is because we only move in elite circles. We take vacations to places like Aspen and Vienna, drink the finest wines, and drive Ferraris. We sail on our yachts and fly in our private jets. We don't go bowling nor do we hang out at the local bar drinking cheap beer.
Subprime - Not an issue?
- Thread starter Bogan7
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The reason that you and most of us here don't know of anyone that lost their house is because we only move in elite circles. We take vacations to places like Aspen and Vienna, drink the finest wines, and drive Ferraris. We sail on our yachts and fly in our private jets. We don't go bowling nor do we hang out at the local bar drinking cheap beer.
So the only ones losing their houses are the poor? No. Many people losing their houses are losing their second house, not their primary residence. Many people are taking losses on speculation homes.
As far as credit and the consumer, well you obviously aren't an American citizen or live in another America than I because the American consumer has been tapped out now for the past decade. Americans live a consumerism lifestyle and mortgage their lives away to pay for it. This is the reason there are 70 year old grocery clerks in Florida.
Your obsession with subprime and alt-A mortgages is nothing more than a ripple in the pond. As far as pension funds, well they've been in trouble for years and most employers are phasing them out due to the fact that they know they're underfunded. New workers are being offered less and less pensions everyday. It's a relic and most people that have been in the job market for the last 15 years or so never even factor them into retirement proceeds.
BTW, most of the Boomers I know that are working aren't even eligible for pensions because they're on their second career. I know more Boomers that built spec. homes to supplement their money than take in pension money. And you know what, they're just going to have to keep working longer and harder.
I would agree with all the subprime worries if there were people being tossed out into the streets, but that just isn't happening.
I come from a very well off suburb in Chicago. Average price homes are from 1.3 million and up. And there are houses for sell on every street. I have never seen anything like it. Therefore anyone who thinks that this is just an issue for the poor are wrong. There are wealthy people that are way overlevered in real estate.
Yes, I'm an American. The problem you don't seem to understand is that rather than an expansion of credit, this is the first time in a long time that there has been a big move towards tightening lending. Expansion of lending helped cause this RE boom that is deflating now....research how many Alt-A and subprime loans were written 5, 7, or 10 years ago vs. in 2004-2007. Those Alt-A loans were creative financing for people who would likely not have bene able to afford the homes they bought were they qualified properly.
Credit tightening coupled with deflating RE prices don't mean consumers can keep on spending the way that expanding credit methods have in the past.
You said it, Americans mortgage away their life...this credit tightening that lenders are being forced to enact WON'T ALLOW Americans to those credit facilities anymore.
LOL, you don't even know what tight credit is. LOL, you're killing me.
Seriously how old are you? You can still get a 30 year mortgage under 7% all day long. Hell 8% isn't even tight in my book.
Get a clue. Do you even know what the interest rates were during the last expansion. I'll give you an idea, I applied for my first mortgage when I was 26 years old. I applied for special bond money in my area that was availble to first time home buyers assistance. The "special bond money" at that time was at 7.45%. Oh yeah, you actually had to have a FICO score back then also. Hell I had student loans over 8% when I graduated college.
LOL.
Good Luck!
18% I remember them Jimmy Carter days, I was on 18 but do remember.
Quote from Algorithm:
LOL, you don't even know what tight credit is. LOL, you're killing me.
Seriously how old are you? You can still get a 30 year mortgage under 7% all day long. Hell 8% isn't even tight in my book.
LOL.
Good Luck!
Times are different. Home prices are totally disproportionate to income unlike they were in times past. You don't know that? Lending is much different now than it was.
Do you think lenders were giving away loans at ridiculous rates for no reason the last 3 years?
They were relaxing credit requirements because the market didn't have enough borrowers who would qualify for traditional loans. You're being childish now. I'm surprised you have the nerve to ask how old I am.
They relaxed credit requirements because they had more money to lend. Money was cheap and they took on more risk.
And yes, I still want to know how old you are. Nothing childish about acknowledging your age or putting the discussion into context. I'll even bet you have a fresh new economics degree and are putting all that knowledge to work as well.
You're Cassandra calls have been in the markets now for the past 5 years. Just another brick in the wall of worry.
The consumer will continue to spend because they still have a job and their wages are going up. Don't you see the employment reports? Wages are growing at the upper end. Now if we were having this discussion against a backdrop of a recession, that would be different. But you see the yield curve predicted this last recession that failed to materialized you have to move onto something new to obsess about.
Now go ahead, like I've already said earlier in this thread, tell me how the unemployment numbers are faked and I'll know for sure that you are really out of touch.
Again, Good Luck!
And yes, I still want to know how old you are. Nothing childish about acknowledging your age or putting the discussion into context. I'll even bet you have a fresh new economics degree and are putting all that knowledge to work as well.
You're Cassandra calls have been in the markets now for the past 5 years. Just another brick in the wall of worry.
The consumer will continue to spend because they still have a job and their wages are going up. Don't you see the employment reports? Wages are growing at the upper end. Now if we were having this discussion against a backdrop of a recession, that would be different. But you see the yield curve predicted this last recession that failed to materialized you have to move onto something new to obsess about.
Now go ahead, like I've already said earlier in this thread, tell me how the unemployment numbers are faked and I'll know for sure that you are really out of touch.
Again, Good Luck!
Who said anything about unemployment numbers being "faked?"
No econ degree...keep guessing.
"You're" is a contraction of "you" and "are" genius. I think you meant to use "your" instead.
You don't just give away money to people who don't qualify by traditional standards because you have it. That's ridiculous.
No econ degree...keep guessing.
"You're" is a contraction of "you" and "are" genius. I think you meant to use "your" instead.
You don't just give away money to people who don't qualify by traditional standards because you have it. That's ridiculous.
Okay, whatever you say.
BTW, those lending rates were from the year 1997. Not really that long ago.
Not surprised it isn't an econ. degree since it's obviously in English.
Now who's being childish. It wasn't meant as a slight to you to point to your youth, but hey if you want to take it as that, oh well.
So if I've got it all wrong and only poor people are losing their homes, then tell me why Wal-Mart is reporting robust SSS? I guess all those poor homeless people are still buying. Or is it that the Tiffany customer is now having to take a step down and go to Wal-Mart?
Thought all those consumers were tapped out.
Again, Good Luck!
BTW, those lending rates were from the year 1997. Not really that long ago.
Not surprised it isn't an econ. degree since it's obviously in English.
Now who's being childish. It wasn't meant as a slight to you to point to your youth, but hey if you want to take it as that, oh well.
So if I've got it all wrong and only poor people are losing their homes, then tell me why Wal-Mart is reporting robust SSS? I guess all those poor homeless people are still buying. Or is it that the Tiffany customer is now having to take a step down and go to Wal-Mart?
Thought all those consumers were tapped out.
Again, Good Luck!