patrick.net

Squatting in East CoCo says

Rent $1400 (average 2 br rent in Alameda & CoCo County $1402)
Live in a cheaper area in a 1 bedroom.

Food $500 (Eatin' cheap)
Eat cheaper. Clip coupons.

Power $100 (A little high for a 2br)
Turn off the air. I live in a house and my average bill is less.

Phones $100 (Home and Cells estimate could be low)
Gotta have a phone.

Gas $160 (30 mile round trip to work @ 15mpg $4/Gal)
15mpg? Dump the SUV. What's wrong with you?

Maintenance $300 (Car & personal)
Smaller cars cost less to maintain.

Med & Hygiene $200 (Work covers insurance)
OK. No choice here. Damn medical bills.

Entertainment $240 (all thats left!)
You can't afford it. Take a walk in the park...the best things in life are free.

Kids $0 (can't afford the time or money)
Total = $3000
Income - Expenses = ZERO. Not counting all of the expenses I left out.

Get a second job. It's not a crime.

Now redo the math.

Raw says

Get a second job. It's not a crime.

Now redo the math.

Or a third. Sleep is so overrated

how about credit cards and other debt PLUS you declare BK every 7 years like clockwork.

If both working people max out credit cards and declare every 7 years on schedule - thats every 3.5 years one is declaring BK and gets a 'fresh start on fresh cards' every 3.5 years.

I bet if done right, you can 'get' more than you 'pay' from cards even with high intrest rate cards. At least in theory. Plus no one can garnish your child support, alimony, or income from turning tricks on the side.

Do like some of the guys I know. Drive a rust bucket, or your dead grandma's old car you inherited, east pasta, don't date women that expect anything from you, stay home allot, live with roommates, and don't get sick.

New renter says

Raw says

Get a second job. It's not a crime.

Now redo the math.

Or a third. Sleep is so overrated

Don't laugh, I know people with two and three jobs. They also don't pay 1400/mth. They rent a room for 300-500/mth. The people getting paid $10/hr send a good chunk of that money back to their families in another country. You will be hard pressed to find someone making $10/hr that doesn't fit this profile.

Squatting in East CoCo says

The answer to my original question would be government subsidies, section 8, food stamps, tax evasion, illicit substance dealing, sharing house and rent with other families, etc.

you mean there are no private jobs to provide incomes and thus rents in the region.. seems that the landlord is overcharging and will go bust very soon...you dont need Govt assistance just let the market find equilibrium.

yes, thats happened before... Landlords go bust/bankrupt.

FortWayne says

When we lived in rent controlled building, our rent was approaching $500/month while new renters were paying over a $1000... that's why we ended up staying there so long, we couldn't get that kind of deal even if we were poor in section 8.

Kind of shoots down the notion that renters are mobile. If to keep your housing costs low, you have to stay put in your rental for years on end.. so much for job flexibility vs. a mortgage.

Because your math is not appropriate for fulltime adult employees.

My kids make $10/hr working part time while they are in school. That's kids working part time. For stuff like video games for the younger kid, saving up for a trip to Europe for the older one.
$10/hr?, -Not adults who work full time for a living.

Uncle Sam recently graduated Berkley and he has deep pockets.

oh please, there are plenty of adults working for ten buck an hour all over the country. they are just smart enough NOT to live in KANIFORNIKA..
sunny

It seems as though the housing system is being taken over by "investors" who try to get higher and higher rents until they can't

Why can't they? You see those here on patnet that play landlord, they just lobby for government assistance every step of the way. I guess they figure the government is just a tool for forcing others to fund their investments.

Seems like quite contradictory positions to have. To care so much about those that need more government help, and then make sure that you devour those handouts via rents

Squatting in East CoCo says

My real question is, given the underlying financial situation, how high can rents go before thay can't go any higher?

BUYERS (renters) make value. When tenants move to more economically feasible locations, landlords reduce rents to "What the market will bear". In the meantime, gubmint no longer allows mobile home park construction, increases building requirements, fees etc.
We are NOT living in the bay area on $3k per month, just surviving.
Will tenants keep coming ?

BoomAndBustCycle says

FortWayne says

When we lived in rent controlled building, our rent was approaching $500/month while new renters were paying over a $1000... that's why we ended up staying there so long, we couldn't get that kind of deal even if we were poor in section 8.

Kind of shoots down the notion that renters are mobile. If to keep your housing costs low, you have to stay put in your rental for years on end.. so much for job flexibility vs. a mortgage.

Not really. It's always been this way, some areas are just too expensive and families with certain incomes can't move into them. Place where we live it is not the case. But if you go north just 20 minutes on 101 you'll run into places that are too expensive for probably most Americans.

The point is that we should not have to work 2 or 3 jobs and give up having a family, having a pet or having a night out now and then. Incomes should reflect the current cost of living and allow at least a chance at an independent life free of government programs and hand-outs. We should not have to rely on anyone to help us pay our bills if we are working hard and often.

If those companies who took jobs out of the country would bring them back, it would be good for the country... but they don't care. They keep their fat bank accounts out of reach and don't even pay appropriate taxes. Our government made this possible. Lobbying for the rich is going to destroy our country. While a few lined their pockets with loads of pay-offs, the rest of us lost everything we had and worked so hard for.

I am not talking about lazy welfare-loving people with no ambition here. I mean people who paid into the system, worked their butts of for a good life and then lost it all due to the corruption in the banking and finance, real estate, and investment industries rush to profit.

If more jobs were in the USA that paid appropriately, then incomes would be more stable... then we could possibly buy some of the products those outsourced companies produced and the fate of our citizens would not be in the hands of corporate greed and banks who are well above their deserved profit margins.

Its easy for some one who has escaped a cut back or a lay off to tell another to 'get another job' when they are not feeling the sting of what is happening around them. It takes 6 to 12 months to get a job that pays even minimum wage ($7.65 per hour) where I am. Unemployment benefits are temporary and not what real working families need or want. We need to be able to take care of ourselves and our families. The current state of the economy has all but the wealthy in a state of emergency and hopelessness.

The example in this post does not include any type of emergency. Flat tire, new washer or dryer, renter's insurance etc. Anything can happen and any one of them could place the example household into complete failure. Its all broken and we need to fix it.

hj2222 says

The point is that we should not have to work 2 or 3 jobs and give up having a family, having a pet or having a night out now and then. Incomes should reflect the current cost of living and allow at least a chance at an independent life free of government programs and hand-outs.

That won't happen without tarriffs and protectionism. And the global banking elite won't allow tarriffs and protectionism.

hj2222 says

The point is that we should not have to work 2 or 3 jobs and give up having a family, having a pet or having a night out now and then. Incomes should reflect the current cost of living and allow at least a chance at an independent life free of government programs and hand-outs. We should not have to rely on anyone to help us pay our bills if we are working hard and often.

This is a reflection of:

a) The rich hoarding all the money for themselves.
b) People in other countries willingto do your job for less.
c) Increasing automation of meanial jobs.

I'm not concerned with the very poor.

Plus, my Randian Gospel tells me that they're poor for a reason, and my normal Gospel tells me that they're devil spawn.

hj2222 says

The point is that we should not have to work 2 or 3 jobs and give up having a family, having a pet or having a night out now and then. Incomes should reflect the current cost of living and allow at least a chance at an independent life free of government programs and hand-outs. We should not have to rely on anyone to help us pay our bills if we are working hard and often.

Communism failed. Forget it.
Income is earned, it does not come from thin air. So go to college, earn a skill, get a job and live within your means. That is what most people do.
The opportunities are there for everyone.

Raw says

Income is earned, it does not come from thin air.

Unless you've successfully enslaved most of the population via Crony Capitalism. Then income *does* come from thin air. Or more precisely, from the labor of others.

Did the big banks earn their bailouts? I didn't think so.

We made less then that for years and managed to save. But we did so making a few choices others probably wouldn't like.

1: Rent a room in a house with other housemates. Result: We never paid more than $600-$800 a month. Sure- you are sharing a house with other people. But that also reduces the cost.

2: Get a beater Honda or Toyota. 15MPG is pretty bad fuel economy. We've drive 30+ MPG beaters for years. Makes a big difference.

3: Shop at the discount grocery store: Some of them have pretty good food. Some of it is simply overstock from other stores. The prices are about 20-30% less.

4: Do your own maintenance. Wayyyy cheaper to do things like change your own oil, spark plugs, air filter, and other stuff. Buy a shop manual. It isn't that hard. and get yourself a basic set of tools. I changed the clutch myself on my small pickup for $300. Dealer or shop wanted $1,200.

5: Get a notebook or setup a spreadsheet to see exactly how much you 'reallllly' spend. Amazingly, a LOT of money you'll find goes for stupid stuff- like junk food, small things at the store, and so on. Find ways to eliminate those things.

Anyway, we make a lot more then that now and recently bought a house. But we still do those things and as a result we save a lot of money. Its not just for people who make less money. All people could benefit from simple common sense practices.

edvard2 says

1: Rent a room in a house with other housemates. Result: We never paid more than $600-$800 a month. Sure- you are sharing a house with other people. But that also reduces the cost.

This is also quite dangerous. Housemates steal or move out suddenly with no notice, leaving the place a mess as they go (sometimes with your stuff in tow). If you have to have a housemate, you're usually too poor not to do so, and this creates a trajedy of the commons mentality about where you live. It was never yours in any legal fashion, so why care for it? No, living like Mexican and Chinese laborers isn't the answer. Some of the other ideas, like downsizing one's car and learning to change your own oil and tires is a good plan, but housemates are trouble.

Housemates or rental mates can be ok, learn to check crime records, it's free if you know how to do it. And, become a better judge of people. Go look at the place so you can see what they live like, see if you can handle it, check out the neighborhood, etc. I can often tell allot just by talking to someone on the phone, but everyone is different. If your living with room mates your usually to broke to own anything of value so don't worry to much about getting ripped off. I was going to get a room mate, but was to shy about it, instead opting for a very small living arrangement.

futuresmc says

This is also quite dangerous. Housemates steal or move out suddenly with no notice, leaving the place a mess as they go (sometimes with your stuff in tow). If you have to have a housemate, you're usually too poor not to do so, and this creates a trajedy of the commons mentality about where you live

I did it for almost 14 years. Never had anything other than minor annoyances ( like people eating my cereal) and whatnot occur. On average we paid 50% less for rent than those who chose to rent alone as a couple. Result: we saved a lot of cash. Now we own a house. Had we not shared a house.... probably would still be renting.

By the responses above, we can clearly see who understands what the 'other' people are going thru and who is completely separated from it.

@Raw said "Communism failed. Forget it.
Income is earned, it does not come from thin air. So go to college, earn a skill, get a job and live within your means. That is what most people do.
The opportunities are there for everyone."

Income is earned? Maybe for some, but not those who are banking $3m in bonus every year. Those bonuses came from citizens of the USA... the taxpayers paid those bailouts. They certainly did not 'earn' them.

Go to college? Really? Sure, we don't have 2 pennies to rub together, but hey... let me quit one of my 3 jobs and get loans to the tune of $20k or more, keep my other 2 jobs while I am at school and just not sleep for 2 or 4 years, and then apply to every company that would respect my new degree and then have to take my old job back at McDonald's because there ARE NO jobs available for new graduates with no experience. In reality, companies are still managing the downsizing from 5 years ago and have another large round of lay-offs to manage. Lets not forget they are eliminating retirement packages and pushing early retirement to those who have been there the longest and make more money. They see the $$ in letting those loyal long-term workers go so they can hire 4 new starving-for-work employees at a fraction of the pay.

Live within your means. Well I believe that was the topic of this thread to begin with. These are not poor people as a rule. We are talking middle to middle-upper who have been devastated because of the schemes and bailouts and payoffs orchestrated by the wealthy and powerful.

Opportunities are NOT there for everyone. They exist, sure, but you have to have money and/or connections to have access to them. Unless you are a tech guru and make a killing online, the opportunities are not within reach of most of those who are affected by the economy.

@Edvard2...Rent a room? That is assuming there is a room to rent. Most rents are out of touch for anything more than 1 bedroom.

Getting an older car? The people I am speaking of don't even have a car. A monthly bus pass is $40. Having a car means insurance, gas and possibly a car payment along with upkeep and maintenance.

Shopping at a discount store. Again, really? Those I am speaking of get leftover Sunday papers on Monday from the stores that will allow it and use all the coupons they can find then only buy items on sale or that have a discount.

Get a notebook and see exactly what was spent? I don't see how that is useful when all the money you make goes on rent, utilities and food. There really is not much left to write down.

I sat with my 22 year old son and tried to help him work out what he needs to survive. With the figures we came up with, after rent $650, power $120, Phone (cell only) $110, food, $300, bus pass $40, clothes for work $50, Incidentals (shaving, bath laundry soap) $75, laundromat $60, save $200 a month for medical emergencies (no one will hire ft so no insurance benefits) That is $1605 outgo bare minimum.

TWO PT job 32 hours a week. All we have seen as far as job offers start at min wage. The jobs are announced and filled within hours.

$7.65 x 32 x 4=$979.20 - 25% (average taxes) =$734.40 x 2 = $1468.80

Still $136 shy but I guess he could eat less. So as you can see, this is working 2 jobs 64 hours a week and not even have enough left over to see a movie much less date or have a pet. Forget having a family.

My children are trying to live through this. My husband and I have been through it. I see it every day with my neighbors and the friends of my children. The setup is to fail. College is out of reach for most... and frankly its not realistic any more. That is now a privilege for the well connected and wealthy. The American dream is gone for all but the 'haves'. The 'have-nots' are stuck in an endless cycle of who to pay this month and what to give up so they can eat. Open those eyes and take a look around. How many times do you see entire families on corners begging for money? How many times do you see lines at the pawn shops with people selling anything they can just to pay the rent? You may not notice it in your personal life and in your circle of friends, but the rest of the country is SUFFERING and its only going to get worse.

I have no idea how to fix it. I don't want hand outs. My kids don't want welfare. My friends don't want to have to ask for help. We just want to be able to make a living without dying for it.

I blame:

Banks
Wall Street
Real Estate
Corporations
USA Government

I am frustrated with the comfortable people in this country who can't see past their noses even though they spend most of their time looking down them. This holier-than-thou, disrespectful and condescending banter is insulting. We work just as hard as those with money... and in most cases a lot harder. Large corps dont pay the same taxes. They dont pay the same fees. They get away with lies and schemes that cost people their entire life savings and they dont even get a hand-slap. Underhanded and deceitful. Selfish and greedy. THAT is why we are in the mess we are in.

So don't tell us to go to school because we cant afford it. Dont tell us to rent out a spare room because we dont have one. Dont tell us to get a cheaper or older car because we dont have one to begin with. Dont tell us to watch how we spend money because we pay the same 3 bills every month (rent, utilities, food). Do you understand?

See? That's the problem right there. You expect too much!

Americans don't feel comfortable living in squalor, doing their own car maintenance on a vintage pos, and eating crap food while working three shitty jobs. What's wrong with them!?!?!

Maybe the answer to high prices and the declining standard of living is some system of private group owned coops where goods are produced but cut out the wall street middleman rip-off profit. Imagine a group owned oil company that sold gas to its members for what it cost to produce... and so on. The coops would directly compete with corporations, most of which have little or no competition now.

hj2222 says

By the responses above, we can clearly see who understands what the 'other' people are going thru and who is completely separated from it.

@Raw said "Communism failed. Forget it.
Income is earned, it does not come from thin air. So go to college, earn a skill, get a job and live within your means. That is what most people do.
The opportunities are there for everyone."

Income is earned? Maybe for some, but not those who are banking $3m in bonus every year. Those bonuses came from citizens of the USA... the taxpayers paid those bailouts. They certainly did not 'earn' them.

Dear Hj2222,
I am truly sorry for your misfortune, but you really need to stop whining.
We live in a country that has one of the highest standards of living in the world. Everyday there are people risking their lives for a shot at the American dream. Would you want to trade places with them? If you cannot get optimistic and do what it takes to get your piece of the pie, then you have only yourself to blame.
I have known doctors who were dead broke in terms of net worth, and a garbage collector who had his little home almost paid off. How did he do it?
It's not how much you make, it's how you use what you make.
You need to change your lifestyle, save up some money

Lol. I see that emotionally unstable people are not exclusive to cancer postings.

I'm just imagining the furious hand and arm waving going on during these rants.

@dodgerfanjohn and @raw, You both are mistaken. My husband and I have managed to work it out, but we were lucky. We are far from where we should be at this point in our lives, but we are in better shape than those I speak of above. This should be evident since it is after library hours and I am clearly on the internet. This would be a frivolous extra expense if in the situation I am discussing.

My mother lost all of her retirement due to the fallout of Wall Street schemes and the investment company the hospital she worked at for 20 years chose. She is now living on $700 Social Security a month when she should be doing much better with all of her savings over the years. We are, of course, helping her.

We have several friends who were completely ruined by the banks and their packaged mortgages. Two lost their homes due to inflated prices and increases in mortgage payments every month. Another family is living in a home that they owe over twice as much as the value of the home. Also a Wall Street and Banking greed result.

I have several more examples, but I am hoping you get the gist of it.

What you are clearly missing is that its not just how you use what you make. Millions of people did the responsible thing and played the game as instructed. They were lied to. So, it is also what you have already worked hard, slaved, saved and earned that has been STOLEN from you.

That garbage truck person... he may very well be in the same boat as my friends are. Does he not deserve the same consideration? People work their entire lives and save for things that the wealthy toy with. We are all played and taken advantage of and the only ones who are not upset about it are the ones who came out of it without a scratch.

For so many of these families and individuals, it is too late to go back and start over. Their time is over. Either they are too old and can't possibly work and recoup what they lost, or they have simply lost too much and have no way to get back to where they were. For others they did the college thing, had a job, a home, a family and were doing just fine until corps took jobs away and Wall Street and banks played with our homes. They made SO MUCH MONEY! SO much! But at the cost of people who did the right thing.

"If you cannot get optimistic and do what it takes to get your piece of the pie, then you have only yourself to blame."

How about making the companies and organizations responsible for stealing millions of Americans' pies? I have no issue with taking a hit and standing back up, but when it is so blatantly unfair and underhanded to every person in this country... and benefits certain connected and wealthy groups.. it really makes me angry that people, like you, just stand back and basically say,

"yep little girl, you got gang raped by a bunch of huge fat rich men. Get over it. Be optimistic. Only you are to blame if you can't survive this."

What happens to this country when apathy gets the best of us? At some point, it will not matter who has money or what companies have the best products because there will be no one left that can afford to buy what the wealthy are selling! Our entire country is at risk and you want to tell people to stop whining?

I dare say that if you had lost your entire nest-egg and your home, you may be seeing things a little more clearly. Obviously you have not had the loss and have not been fired/laid-off and lost everything. Your credit has not been ruined and you still have a few extra dollars to go out on the weekend with your significant other. You still have those freedoms. NOT everyone has fared as well. Just because I am not living on a dirt floor and eating mac and cheese every night does not mean that what has happened to millions of others is OK. Not by a long shot. Those who have gained and profited by destroying American lives and families need to be held accountable.

Zakrajshek says

Maybe the answer to high prices and the declining standard of living is some system of private group owned coops where goods are produced but cut out the wall street middleman rip-off profit. Imagine a group owned oil company that sold gas to its members for what it cost to produce... and so on. The coops would directly compete with corporations, most of which have little or no competition now.

If this could be done, it might save the rest of us. If we could take control and say 'ENOUGH ALREADY" and take back our country, that would be optimal. Unfortunately, it would take an enormous amount of organizing and talent... and I am sure a lot of defending. The last thing the wealthy want is for us to do to them what they did to us.

It would sure be a powerful example of the resilience and determination of the 'other' American classes.

I would be in for sure.

hj2222 says

We have several friends who were completely ruined by the banks and their packaged mortgages. Two lost their homes due to inflated prices and increases in mortgage payments every month. Another family is living in a home that they owe over twice as much as the value of the home. Also a Wall Street and Banking greed result.

This sucks, for sure...I'd hate to find myself in that situation (unlikely), but what I don't understand is why it matters in the short term. If they bought a house they could afford to pay the payments on, and it tanked in value...they should still be able to afford the payments, right? I get it that in the long term they end up paying more than the house is worth, so it's a net loss to their net worth...but it shouldn't affect their situation now. Yes, they made a bad decision (and maybe were lied to), but they have 30 years to recover from it. Unless their payments went up when they were told they wouldn't...or something crazy like that.

hj2222 says

I dare say that if you had lost your entire nest-egg and your home, you may be seeing things a little more clearly.

Again, that would suck, for sure. But how did it happen? How is it that you lose your entire nest egg? Do you invest in the company stock where you work or something [really insane] like that? Yeah, my shit took a big hit when the economy tanked...but I mostly recovered...lost several years, but I was reasonably well diversified, so it's not that big of a deal -- certainly nothing _close_ to losing my whole nest egg...

Again, the losing of the house...I suspect they made some bad decisions along the way, and if they hadn't...maybe they'd be in a lot better shape today. It may not be fair, but some people are better at making complex financial decisions than others. It usually doesn't matter too much -- you overpay for a car by $2,000 because you got tricked into some fancy financing scheme...or whatever...but with a house, the stakes are very high indeed -- especially when you are buying something that is 5x your income (bad idea)...that's a lot of dough for almost everyone. If you screw it up, well...it's gonna hurt. Nobody made them buy the house at the inflated price, right?...Sure, the bankers and RE agents etc were happy to watch the prices get pumped up, but no one was forced into buy a house...

I do feel sympathy for the people who got ruined in the whole mess...but at the same time *they* are the ones that drove house prices up as to make them unaffordable for me. If they hadn't been making stupid financial decisions, the demand wouldn't have been there, and I could have bought a nice house by now. There is plenty of blame to go around, for sure, but I believe a meaningful portion of it falls on the home buyers. Sorry.

everything says

Housemates or rental mates can be ok, learn to check crime records, it's free if you know how to do it. And, become a better judge of people. Go look at the place so you can see what they live like, see if you can handle it, check out the neighborhood, etc. I can often tell allot just by talking to someone on the phone, but everyone is different. If your living with room mates your usually to broke to own anything of value so don't worry to much about getting ripped off. I was going to get a room mate, but was to shy about it, instead opting for a very small living arrangement.

Many people have good experiences with housemates, but many do not. 'becomet a better judge of people' is not something you can just do. Some people read new people better than others. People lie, so background checking is not always effective, and just because you're poor doesn't mean you don't have things that a roomate could steal. When you're that poor, replacing a $100 TV set can be a financial hardship, as can staying up all night to clean their mess and worrying whether or not you'll get a new roomate in time for next months rent.

If you know the person beforehand, or get a reference from somebody you know and who has known the person for years, housemates can be a good thing. Strangers always bring uncertainty.

bgamall4 says

Wall Street set up the easy money that drove the prices up.

It takes two to tango.

Wall street set up the easy money for me, too. My mortgage banker told me he could easily qualify me for 2x (if not 3x) the house I was looking at. I knew better, and bought something within my means.

Again, there is plenty of blame to go around on this mess, and the bankers deserve their share, too. The way they understand mistakes is when they pay for them, and they should. I don't know if letting them fail was the right path, but if they are TBTF, then they have to be subjected to meaningful regulation.

Back to the main point...they did enable the situation, but they still had to have willing borrowers. They supplied the crack, but they didn't make anyone smoke it. There has to be some responsibility/accountability with the borrower.

swebb says

They supplied the crack, but they didn't make anyone smoke it.

Actually, there are documented instances of them making people smoke the crack. So to speak, of course.

There was more than just sub-prime predatory lending. There were forged documents and outright sleight of hand as well.

dodgerfanjohn says

On $40k income a family of four doesn't pay federal or state income tax

They still pay payroll taxes, which, before the crisis, made up something like 34% of tax revenues. Incidentally, that's more than the corporate income taxes which presently make up 14.4 percent.

swebb says

hj2222 says

We have several friends who were completely ruined by the banks and their packaged mortgages. Two lost their homes due to inflated prices and increases in mortgage payments every month. Another family is living in a home that they owe over twice as much as the value of the home. Also a Wall Street and Banking greed result.

This sucks, for sure...I'd hate to find myself in that situation (unlikely), but what I don't understand is why it matters in the short term. If they bought a house they could afford to pay the payments on, and it tanked in value...they should still be able to afford the payments, right? I get it that in the long term they end up paying more than the house is worth, so it's a net loss to their net worth...but it shouldn't affect their situation now. Yes, they made a bad decision (and maybe were lied to), but they have 30 years to recover from it. Unless their payments went up when they were told they wouldn't...or something crazy like that.

Yes, fortunately he did not lose his job and they can afford the payments... which went up as the tax assessments increased, but that has leveled off for them finally. They are in better shape than the other 2 families, but as you stated, it has decreased their net worth which affects a lot of their financial options. Refinancing, auto loans, home improvement loans, credit reports etc. They look like they are a high risk now and can not look forward to any relief for at least 15 years. So, they are seriously affected by this.

Also I would like to note that in 1995 when I bought my first home, the guidelines and qualifications were in place to prevent the buyer (me) from getting in too deep. They took a good look at my finances, qualified me for a home I could afford and I was gently guided along the way to a perfect 30 year fixed mortgage. Alternatively, during the stampede that we all saw in 2005, the agents and mortgage companies took every applicant they could find and put them into the largest loans they could get the buyer to agree on. They lied and told the buyers that houses were going up and that they better buy now and they should buy large so that they can make a large profit on resale. They did not check incomes, they did not check jobs, they did not verify references. They used scare tactics and emotional tactics to make buyers feel like if they did not buy now, they could never afford a home. Meanwhile, the loan brokers were being paid huge bonuses for every loan and the bigger the loan, the more money they made. The Real Estate agents were getting huge commissions and the mortgage companies were making bank packaging these loans and selling them on Wall Street. Remember, these are new home buyers who relied on the Real Estate and Mortgage industry to guide them... as they were told by their parents they would be. The blame is clearly set on the agents, brokers and mortgage companies. They swindled buyers and lied to them. I know this first-hand because I was with one of my friends when they purchased. I was at the showings and the signing of the contract. I heard it all. Heck I was even drawn into the urgency of it. It was very well played.

So in the name of greed, in 10 years, the entire industry went from responsible and caring... watching out for the buyers, to completely destroying them in the name of greed.

swebb says

hj2222 says

I dare say that if you had lost your entire nest-egg and your home, you may be seeing things a little more clearly.

Again, that would suck, for sure. But how did it happen? How is it that you lose your entire nest egg? Do you invest in the company stock where you work or something [really insane] like that? Yeah, my shit took a big hit when the economy tanked...but I mostly recovered...lost several years, but I was reasonably well diversified, so it's not that big of a deal -- certainly nothing _close_ to losing my whole nest egg...

It was not me who lost it. It was my mother in the example above. She was divorced late in her life and knew nothing about money. She trusted the Investment Company that the hospital had hired to handle retirement plans. She knew nothing about diversifying and just let the fund grow. She did very well for a long time. Then the investment company went risky and put a large chunk of everyone's retirement into some type of stock. Some fine print somewhere said it was OK. So everyone there lost all of their retirement. What was not lost in the investment was lost covering negative balances from the stock investment. I am not sure how that all works, but they all lost everything. The investment company was not punished and made no excuse. They did what they did with other people's money. They had their butt covered with some clause. So again, the wealthy toying with us in order to increase their own wealth. This did not work out for the investment company, but they did not lose anything. It was other people's money they invested. I think that there should be accountability for this type of behavior. Causes should not be found in 20 plus pages of summaries and legal speak. These people were billing agents, janitors, x-ray techs, receptionists etc. They did not go to college to learn the ins and outs of financing. The expert is the one who should be watching out for the client. It should be an inherent responsibility.

swebb says

I do feel sympathy for the people who got ruined in the whole mess...but at the same time *they* are the ones that drove house prices up as to make them unaffordable for me. If they hadn't been making stupid financial decisions, the demand wouldn't have been there, and I could have bought a nice house by now. There is plenty of blame to go around, for sure, but I believe a meaningful portion of it falls on the home buyers. Sorry.

You are incorrect. Do we blame the student for what the teacher teaches? Do we blame the sick patient for the Doctor giving the wrong advice? This is an industry that has been backed by the government and has historically taken care of both buyers and sellers. Strict rules and qualifications to prevent foreclosure and default. THEY did this. Not the buyers or the sellers. The industry saw an opportunity to make a ton of money and they all jumped in.

bgamall4 says

CL says

See? That's the problem right there. You expect too much!

You would say that. That is a moronic thing to say. People need to have some expectations or they won't try harder. And it sounds like this person is trying and hustling. It is the fault of big business if this nation goes down because of a greedy 1 percent who cannot see the importance of a middle class.

Gary Anderson strategicdefaultbooks.com

CL was being sarcastic :)

bgamall4 says

Without securitization, the easy money would have stopped. You don't get it.

Yes, I get it...I just don't buy into it 100%. Sure the bankers planned it, so what? The used car salesmen plan "it" too...but the buyers still have a choice in the matter.

swebb says

The used car salesmen plan "it" too...but the buyers still have a choice in the matter.

This is a great analogy. Except that the used car salesman doesn't take insurance out against the lemon he sold you, which pays a tidy premium when the car has brake failure descending a steep hill. Also, the used car salesman doesn't have a big red hand in drafting policy designed to make the playing field uneven for the non-elite classes, tempting the larcenist in all of us. The behavior at the upper tiers of American industry abetted by the nonfeasance of our lawmakers creates a criminogenic environment in the rest of society. Larceny begets larceny.

hj2222 says

What happens to this country when apathy gets the best of us?

I'll tell you what happens: we become a bunch of Ayn Rand-reading, technocratic, antipathetic automatons pushed through our ruts by psychotic systems managers.

It's hot in Victorville tonight, and Jody's letting off some steam...