0
0

Mortgage Strike To Protest Paulson $700 Billion Theft


 invite response                
2008 Sep 24, 12:40pm   24,390 views  277 comments

by Patrick   ➕follow (55)   💰tip   ignore  

strike

One patrick.net reader suggested a simple antidote to Treasury Secretary Paulson's proposed theft of $700 billion from taxpayers: a mortgage strike.

Since Paulson is trying to steal more than $5,000 from every taxpayer and give it to the banks that blew all their money on bad mortgages, the obvious response from each mortgage-holding taxpayer should be a refusal to pay at least $5,000 of their mortgage.

Such a mortgage strike should start exactly when Paulson's $700 billion theft starts, and should continue until his theft is exactly nullified. The banks that wasted their money should fail. Customer accounts should be protected up to the promised FDIC limit of $100,000 per account, but there is no public obligation to protect foolish bankers from their own mistakes.

If Paulson's theft passes Congress in the face of nearly unanimous public shock and disapproval, then it is clear that representative democracy has failed and the strike is justified.

Such a failure of representative democracy would also mean that it is time to ammend the Constitution to entirely eliminate our corruptable Congress and establish direct democracy, with web-based, non-anonymous, verifiable voting by the public on all legislation. We do not need representatives who do not represent us.

Patrick

#housing

Comments 1 - 40 of 277       Last »     Search these comments

1   PermaRenter   2008 Sep 24, 1:20pm  

Though nobody is feelin’ groovy these days, voters want to tell Congress: Slow down, you move too fast. According to a poll released today by Marist College, more than two-thirds of registered voters, 68%, want Congress to wait on the $700 billion financial sector bailout, stating more time is needed to understand the costs and risks.

Just 26% said it’s more important Congress act to stabilize the financial industry this week. The Marist poll also finds that a majority, 54% overall, blame the economic crisis on Republicans while 25% blame Democrats. Further hurting the GOP: 22% of Republican voters and 56% of independents blame Republicans.

Barack Obama is favored to handle the current economic crisis by six points. When asked who has a better record on economic issues, however, survey respondents favored John McCain by a double digit margin, with 48% choosing McCain and 36% choosing Obama.

The survey was conducted on September 22-23, and 1,005 adults were surveyed, including 879 registered voters The poll has a 3.5% margin of error.

2   FuzzyMath   2008 Sep 24, 2:08pm  

I'm down for the strike. But I'll go way more than $5K.

How about I just stop paying all together? I'll go buy a CDS on my own mortgage first.

This whole thing is making me sick. It has nothing to do with housing anymore really. I want to swing a golf club into the tv screen when I see some bankster or politician trying to guilt the american public. Yes, people took out loans they couldn't afford. They already got fucked.

Now we are purely dealing with banks creative ways of making money. Their percieved risk on a default should have been PRICED IN to the interest rate on the mortgage. Instead, they virtually begged them to fail for how they were constructed. Then bought CDS's on them to hedge the failure they knew was coming. It is fraud, plain and simple. The only justice here at all is that no one can pony up par on the CDS's. They took their fraud SO FAR that no one can afford to pay their fraudulent bets.

This includes the tax payer. The $700 billion will turn into 1.4 trillion. Then 10, 20, etc. This week we are standing on the precipice that will determine our fate. If Congress votes in this garbage, we are clearly going to hyperinflate. There would be no other logical path. If they vote it down, many banks will fail, many leveraged companies will go under. Would it be armageddon though?

If you are a banker, yes. If you are an average american working for a company that actually produces something, chances are high you will be fine. People still need STUFF. And they will still work to get it. Oh, but you might want to get a gun to fend off hungry and desperate stock traders.

Either way, the right to bear arms is starting to sound like a pretty good fucking idea right about now, isn't it?

3   PermaRenter   2008 Sep 24, 2:13pm  

Bailout tests how much the American public will tolerate theft
Sean Olender

Tuesday, September 23, 2008

Treasury Secretary Paulson's edict to create a $700 billion fund to buy worthless mortgage securities from agitated wealthy bond investors is nothing short of a final step on the path to the end of the republic. The secretary claims he can only be effective if his decisions are beyond judicial review.

Our government and its owners appear to be testing how much the American public will tolerate. A few years ago, no one could have imagined that the silent majority would quietly accept thefts of this magnitude from a government that stopped tiny payments to single mothers with poor children in the name of welfare reform because the program's $10 billion cost was breaking the federal budget.

This isn't socialism, it's fascism.

If the public allows this theft, then it will signal to powerful forces that they can essentially do anything, because the American public has become so mushy-headed that it will stand up for nothing. When power discovers that those from whom it would exact payment are powerless, its viciousness increases infinitely.

Our politicians appear on television and say, this is an emergency, so we have to do this now and talk about it later. And then later is too late.

It is not just a $700 billion bailout, it is a $700 billion fund that can have no more than $700 billion in liabilities at any one time. Maybe Goldman Sachs can sell mortgage-backed securities to the fund at 80 cents on the dollar and then the fund will liquidate the securities by selling them back to Goldman for 50 cents on the dollar. Then Goldman can sell them back to the fund for 85 cents on the dollar. That would be a good business, especially if no court can review it.

Our enemy has revealed itself, and it is our own government. The concentration of such outrageous power in government - the power to take the equivalent of half our annual federal budget and give it to anonymous investors - is nearly reaching the point at which it may not be revoked.

It is only natural that we, dreaming of the possibility of our own riches, acquiesced in some of these financial schemes. Of that, we should not be ashamed. Many Americans may now be thinking, "But suppose someday I am a wealthy bond investor worth $50 million?" But you are not a wealthy bond investor and the value of your house and stock investments is going to drop, regardless of how much tax money the government gives to wealthy bond investors. This bailout is essentially the federal government saying to creditors, "Because the American consumer appears to be refusing to pay his debts, we will buy your claims on the consumer, and exchange them for money created by issuing Treasury bills, which is our promise to extract that money from American consumers using our taxation authority."

Some day our children will call on us to explain how our republic was lost. I cannot imagine the shame of facing a grown child to explain, "Foolishly, I thought I would get some of the money, too."

Because the American public has not been introduced to methods for controlling its government for generations for generations, I will suggest one called a general strike. This fundamental democratic power is where everyone decides to send a message to the government by not going to work, to school, shopping, nowhere.

At this point in our history, very bad things are going to happen regardless of what we do. There is no government action that can alleviate the discomfort we must endure because of the wild speculation and reckless borrowing that ensued. What's coming is inescapable. This is the critical time when charlatans among us will promise they can save us from the inevitable if we only allow them the power they need to save us. They are lying. It is time to earn our freedom. It is time to remind the government that we are Americans and we have a history of subjecting tyrannical governments to unpleasant consequences.

4   FuzzyMath   2008 Sep 24, 2:13pm  

I'm starting to think there might be something behind surfer x's boomer rants. I remember Randy H posting months ago about some generational theory, where they laid out a cycle that has been going on for hundreds of years.

Might have to look into it.
The more I learn about the exploits of the boomer generation, the more ridiculous it gets.

5   PermaRenter   2008 Sep 24, 2:14pm  

Paulson's $700 Billion Bailout of Wall Street is Economic Fascism, Says Richard Viguerie

Last update: 2:44 p.m. EDT Sept. 24, 2008
MANASSAS, Va., Sept 24, 2008 /PRNewswire-USNewswire via COMTEX/ -- The following is a statement by Richard A. Viguerie, Chairman of ConservativeHQ.com:
"Treasury Secretary Henry Paulson's $700 billion bailout of Wall Street is economic fascism, pure and simple.
"Section 8 of the proposed plan says: 'Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.'
"This is incredible! Paulson, who came to the White House from Goldman Sachs, wants to be dictator of the bailout to Goldman Sachs and his other buddies on Wall Street. He's telling Congress, 'Just give me the money and then butt out.'
"The future of our nation and our form of government is on the line.
"Not only does Paulson want dictatorial powers, he wants to make taxpayers pay for every bad mortgage in America and he wants to make welfare queens out of his Wall Street cronies. This is a marriage of Wall Street and politicians that would make Benito Mussolini proud.
"Tell the Paulson-Congress-Wall Street axis of corruption: No deal. The bucks stop here, and they aren't going to Wall Street.
"And conservatives must stand up and say, loud and clear, to their Senators and Representatives: We will not tolerate any bailout of Wall Street millionaires.
"This is going to be hard for almost every member of Congress, given the culture of corruption that prevails in Washington. Since 2002, the financial industry has given more than $1.1 billion to congressional candidates. And that's not including the hundreds of millions spent on lobbying. Now Wall Street is saying: It's payback time.
"Let's put our Senators and Representatives between a rock and a hard place. To counter the pressure they're getting right now from Wall Street's lobbyists and shrills, I urge every conservative to call their Senators and Representative and say: "NO bailout for Wall Street millionaires. Period."
"Please do this immediately, as the Bush Administration is trying to ram this through Congress this week despite overwhelming public opposition. This could be one of the two or three most important actions you take this year as a voter and citizen."

6   LowlySmartRenter   2008 Sep 24, 7:23pm  

A couple of gripes about the bail out under consideration:

1. No one ever mentions the nearly 1/3 of the tax-paying population that is RENTING. As far as I know, our US tax dollars are as worthy as the landed class. Why are we left out in the cold by this f*cked up plan?
2. Dems want to add provisions to "protect" those in foreclosure and keep these god loving Americans in their homes. WHY? We don't have a housing shortage people. They can just rent like the rest of us grunts. Why should we pay mortgages for individuals who cannot afford their loan, and thereby support higher prices which keep us renters out of the market. Renters are doubly-screwed under this plan (if Dems get their way).

7   sivam   2008 Sep 24, 10:21pm  

Thank you for the valuable service.

I wonder whether we can seek justice through the judicial procedure by filing public interest law-suit, sine the money involved is so huge and not many representatives seems like where and what they are getting into. They talk about the people who already own thier house, and facing foreclosure. How and what about the people who did not get in to the bubble and fiscally responsible patiently waiting on the sidelines to buy their first house. Do they get any thing?

8   justme   2008 Sep 24, 11:36pm  

It just occurred to me what was the intent of the original Paulson plan: He wanted to make permanent the temporary loans that the FRB has been making, at face value, against suspect collateral.

9   OO   2008 Sep 24, 11:59pm  

I asked this question a couple of days ago and I am going to ask again.

WTF is the wording of .....outstanding $700B at any one time. That sounds like a banking revolving credit line.

Why didn't he word it as a total of $700B, period? What are the loopholes that bankers can take advantage of with outstanding balance at any one time? If we are committed to letting him print to a total of $700B at any one time, does it really mean that we are printing $700B ONLY?

10   SP   2008 Sep 25, 12:07am  

From the New York Times:
"Around the country, Republican and Democratic voters are rising up in outright opposition to the White House plan or, at the very least, to express concern that it is being pushed through Congress in haste.

Lawmakers, in turn, are agonizing over what to do."

Really? Agonizing, huh?

I thought that as a _representative_ of the _people_, this would make it absolutely a no-brainer. They are in Congress as a proxy for their constituents, so if the majority of their people are against the bill, should they not vote NO with confidence?

Why this conflict? :-)

11   justme   2008 Sep 25, 12:21am  

TOB,

So Denninger is claiming that Bernanke is purposely recalling the Fed loans to make things look worse than they are? That is one possible explanation.

A slightly less sinister explanation is along the same lines as what I said above: That they are calling back or voluntarily getting repaid on the e Fed loans in preparation of making them "permanent" (buying the assets) using "new money" allocated by Congress through the imminent bailout bill.

Perhaps it is no coincidence that the number is $700B. It is not too far above the fed's currently outstanding balances on the various lending facilities.

12   justme   2008 Sep 25, 12:29am  

Plus of course the rescue plan is an interest free loan, with the taxpayer taking the risk.

13   justme   2008 Sep 25, 12:32am  

If this is the case, it means that the whole rescue plan is just a reset of the terms on the temporary lending. There is no imminent crisis, rather Wall St is using the threat of impending doom to negotiate a sweet deal for themselves. They are holding an axe over orr collective taxpayer head, although the temporary lending is in fact sufficient. Now they just want higher profits.

14   FuzzyMath   2008 Sep 25, 12:38am  

Hey I have an idea. Why don't they pass a bill that makes the Treasury buy houses off anyone who wants to sell them for 20% more than the current market price?

Cumon. If we don't do it the world will end.

15   FuzzyMath   2008 Sep 25, 12:40am  

actually, might as well make that 20% more than whatever the house was bought at. Don't want anybody losing money here.

16   Billiam   2008 Sep 25, 1:24am  

Great idea Patrick.

Here is why this is sooooo good:

1) We can all do this without taking off work to protest or flying to Washington to sock someone in the eye.

2) We take back the power.

3) There is nothing they can do about it. Are they going to ding all of our credit ratings and not give anyone loans anymore? NO, they will die in that environment.

17   Patrick   2008 Sep 25, 1:32am  

Yes, it turns out we DO have power.

Instead of a crowd of bleating sheep begging Congress=banksters not to eat them, we can simply cut them off.

18   cb   2008 Sep 25, 1:33am  

The Dems are pussies, once the bail-out was proposed. They immediately started thinking about adding provisions, they don't even think maybe we shouldn't pass this thing at all (even when their constituents are against it).

19   justme   2008 Sep 25, 1:43am  

cb, neither did the Republicans that hated the plan.

20   Nate   2008 Sep 25, 2:01am  

The best protest...change your tax withholdings to exempt. This money will not come entirely from SWF. Every country is going to do the exact same thing to save their own as***.

21   Billiam   2008 Sep 25, 2:05am  

Senator:
Why can’t we pay these banks the actual value of these toxic assets so maybe the tax payer may be able to recoup some of this money?

Paulson:
Can’t do that. We need to pay way more than these assets are actually worth. If we don’t, banks may choose to not participate.

Senator:
Can we put in a clause that reduces CEO pay of failed companies and multimillion dollar golden parachutes for CEOs of failed companies?

Paulson:
Can’t do that. In order for this to work we need them to want to participate. If they do not get those multi-million dollar bonuses they may choose to not participate.

American wage slave:
If this is such an emergency how can Wall Street still be in a position to “choose” and hold out for a sweetheart deal? This stinks!

22   StuckInBA   2008 Sep 25, 3:29am  

This is really terrible. The rule of fear is trumpeting logic.

Even if something needs to be done - why this plan ? Instead of simply adding provisions - why are we not discussing alternatives ? Why is the congress is in such a hurry ?

Paulson scared the sh1t out of these congressman. No one wants to be blamed for the imminent depression. Every puppet is declaring - "We need to act fast and act decisively". Wow. What a circus.

There is no outrage. Nothing to the scale needed. There are no marches, no demonstration. Seems like American people have resigned to fate. The fate of getting raped by the PTB whenever the the PTB gets an erect1on.

23   justme   2008 Sep 25, 4:15am  

EBguy,

What is the current balance outstanding for the various Fed credit facilities? How much did it change the last few days?

24   triplec   2008 Sep 25, 4:22am  

Ok.. "Don't fight them.. Just join them"!!!!

They are determined to "help people stay in their homes" I guess this means foreclosure forbearance and loan modification. Obviously this is not fair at all and can drive a prudent person nuts. My money is on the prudent person slowing slipping into imprudent ways. The prudent people still paying their loans which were obtained in the last 5 years in addition to putting 5 to 20 percent down and yet still underwater what will they do?

I think these people should stop paying their mortgages and qualify for the forbearance because they will be able to squeeze a good year of living for free in the house. The downside is simply a 3 year credit hit but who cares. Right?

Can someone walk me through this scenario in theory? For example in Southern California with a purchase money loan.

25   FuzzyMath   2008 Sep 25, 4:22am  

I called my Rep, and emailed him.

The public is clearly pissed about this one. If it gets through it is quite simply the final failure of our democratic system.

They're already on a knife edge regarding monetary policy and financial structure. If they stay on this path, they are going to lose all support from the public.

26   FuzzyMath   2008 Sep 25, 4:30am  

Triplec, you are absolutely right. The people who have continued to pay their mortgage even though their asset has been declining are about to jump ship.

Why the hell wouldn't they?
We've only just begun on the defaults.

And who in their right mind would BUY a house right now? You have to watch 5 seconds of tv these days to figure out that's a terrible idea.

So after things drop another 20%, and the foreclosures exponentially rise,
Then what? The FED asks us for $7 trillion instead of $700 billion?

27   EBGuy   2008 Sep 25, 4:31am  

What is the current balance outstanding for the various Fed credit facilities? How much did it change the last few days?
The TSLF increased by around $11 Billion to ~$197Billion total. Bid to ask on yesterdays $37.5Billion TSLF auction was 1.63.
TAF has not increased in ages and is holding steady at $150Billion. Will be interesting to see what the H.4.1 numbers look like later today.

28   FuzzyMath   2008 Sep 25, 4:35am  

Amen Bap. My blood is fucking boiling over this one.

29   justme   2008 Sep 25, 5:18am  

Thanks, EBguy,

I found the "slosh report" that tallies the OMO at the Fed,

http://www.gmtfo.com/reporeader/OMOps.aspx

If you have time, can you explain how this related to the numbers you are getting from the Fed website spreadsheets? I admit being lazy here, but as everyone else I am a bit stressed about the goings on.

30   justme   2008 Sep 25, 5:21am  

>>I’m voting for Chaves and Putin. and then moving to Oz. F this place.

Haha, Bap, I knew you would come around ;) How about Obama?

31   SP   2008 Sep 25, 6:32am  

They might as well put Ahmedinijad and Chavez on the ticket. Those guys couldn't do much more harm than the criminals we currently have running the place.

32   apostasy   2008 Sep 25, 7:20am  

Keep calling, faxing and emailing everyone. It is clearly rattling the cages, and at worst it is buying us time.

If this passes, it is a clear signal to me that the terms of my tax-deferred accounts won't mean a thing when it comes down to it: just manufacture a convincing enough, large enough crisis, and seizure can be justified on the flimsiest grounds. That tells me all I need to know to take the immediate penalty and tax hits, and pull the plug on every dollar-denominated investment I have, as well as start moving my business offshore. I don't even trust Paulson and his crew to not monkey around with foreign exchange rates so I won't even bother with ADRs and the like. At that point, it is either completely booked and traded in a non-dollar currency, or I'm not interested in the investment. I'll even settle for adding to my physically possessed precious metals in the absence of other options. The egregiousness of the violations won't happen right away, but I'm sure as hell not going to stick around without a bolt hole outside of the country.

The rules of the game are you need to call/fax/email each representative, each day. They look at the figures day-by-day, and as long as you are not part of some organized spam, each day's contact is legit in their eyes.

Figure out what you will do if this passes, because chances are it will.

33   FuzzyMath   2008 Sep 25, 7:27am  

apostasy or OO,

what is the best way to buy physical gold? I want physical delivery of it to me. I'm not talking about an amazing amount of it.

Are there dealers you would suggest? Should I try to find one locally?

34   StuckInBA   2008 Sep 25, 7:46am  

At least some street protests are happening.

http://biz.yahoo.com/cnnm/080925/092508_bailout_protests.html

Is anyone aware of street protests in Bay Area ? I would definitely join.

35   OO   2008 Sep 25, 8:50am  

Fuzzymath,

for small amount buy locally, find a coin dealer that has been in business for many years. Find the largest one.

Buy gold ONLY with cash when you are doing so locally, leave no paper trail, no address, no contact information.

36   StuckInBA   2008 Sep 25, 8:56am  

Looks like the bailout deal is in some trouble.

http://biz.yahoo.com/ap/080925/financial_meltdown.html

AP
Bailout deal breaks down; Bernanke back to Capitol
Thursday September 25, 7:49 pm ET
By Jennifer Loven and Julie Hirschfeld Davis, Associated Press Writers
Bailout deal breaks apart; Bernanke, Paulson head to Capitol for late-night negotiations

WASHINGTON (AP) -- Urgent efforts to lash together a $700 billion rescue plan for the national economy broke apart Thursday night, hours after key lawmakers had declared they had reached a deal.

Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke sped to Capitol Hill to try to revive or rework the proposal that the administration says must be quickly approved by Congress to stave off economic disaster.

ADVERTISEMENT
Congressional leaders were to meet with the economic chiefs into the night.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

37   StuckInBA   2008 Sep 25, 9:03am  

Another shotgun wedding.

JPM is buying WaMu branches. WaMu stock is down over 50% to 75 cents after hours.

38   thenuttyneutron   2008 Sep 25, 9:03am  

Breaking News....

WaMu is about to be bought by JP Morgan. I hope this thing falls apart before Congress can screw things up more.

40   Richmond   2008 Sep 25, 9:06am  

All we have to do is buy only what we need; not what we think we need. If we did this for a very short time, the real economy would be forced to come through and jack up gummymans plans. Would that work?

Comments 1 - 40 of 277       Last »     Search these comments

Please register to comment:

api   best comments   contact   latest images   memes   one year ago   random   suggestions