patrick.net

DennisN,

There are just SO many unintended jokes in that story that it's almost pointless to list them all!

How about falling in love in the subprime industry? That's got Lifetime movie of the week written all over it.

Or, two subprime "executives" with $10k in monthly payments (most of it mortgage and HELOC).

Or the boomer dude having to get rid of his HELOC-funded toys.

Or, the question that's gnawing at me, which is, how would two "execs" in the subprime industry really believe that their industry and careers were "rock solid?"

And Mysti is selling useless tchotchkes on-line. Now there's a solid business plan for success.

Kent and Mysti Cope were well-paid executives at subprime lenders who never thought the industry could disappear overnight.

I wonder what "subprime" means. Perhaps I should go eat some subprime ribs.

As a result, subsidized farms tend to overproduce some goods, such as corn, sugar and ethanol, while under producing other foods.

HARM, you have a point. Perhaps a strategic food reserve is an alternative?

Young Tibetans question path of nonviolence

http://www.csmonitor.com/2008/0401/p01s01-woap.html

Looks like they are becoming a Religion of Peace too!

Too bad nobody really cares about Tibet.

“Kent and Mysti Cope were well-paid executives at subprime lenders who never thought the industry could disappear overnight. Now they’re just trying to get by."

Nice Slate article re: off-budget military spending and how that budget is currently being mis-spent:

http://www.slate.com/id/2187616/

“Kent and Mysti Cope were well-paid executives at subprime lenders who never thought the industry could disappear overnight. Now they’re just trying to get by.

I hate it when that happens to a post.

If these people where so well paid, why not live on one salary and bank the other? Noone should pity a high earner who was too stupid/arogant/greedy to save for the future or build an emergency fund. Plus, who paid this guy so much in the first place? After all, his current job skills cause him to settle for a job as real estate agent.

SSOTW:

"It's almost like having "Enron" on your resume"

No Mysti that would not be accurate. Unlike subprime schlock shops, most of those employed at Enron were honest, hard working people that had no idea what level of fraud their bosses were pulling.

Be it the 2nd largest sub-slime shop or the 222nd your advancement is contingent on the amount of fraud you can personally generate. If your husband was a "supervisor" he TRAINED other people to commit fraud.

Thus... having New Century on your resume is like having.. New Century on your resume (and nothing else). It's amazing isn't it? Even when they've been completely and totally busted they insist on keeping the spin alive along with working off the assumption that anyone they're addressing MUST be a total idiot!

A nice piece on Socialism for the Rich:

http://www.newsweek.com/id/129681

Headset,

What's more is that he's looking to "cash in" on the growing number of foreclosures he helped to create! Like I say, they just refuse to give it up, they simply move on to the next logical step in the scam.

Thinking he was being frugal, Rick in 2003 opted for a diesel car, which gets 45 miles per gallon and needs little maintenance. At the time, he could get a gallon for $1.19, and a fill-up cost "maybe $19.
If ever there was a candidate for a WVO (waste vegetable oil) conversion kit, he would be it. One of my neighbors recently offered me his surplus WVO spoils, but we don't use enough fuel to justify a conversion.
BTW, "subsidized" biodiesel is now at parity with dino-diesel. This has never been the case during the time I have been using biodiesel (around 6 years).

DinOr,

I presume you mean refinancing from variable to fixed. This time though, he won't be able to roll the costs into the loan, and the monthly payment may go up compared to the teaser rate. Imagine the discourse:

"So Kent, to "fix" that loan you sold me a couple years back, I gotta shell out another couple grand out of pocket and then watch my payment increase?"

"Yep."

Headset,

Honestly I hadn't even stopped to think about that "interim screwing" in the shake down. Right, my bad, shake 'em down for a teaser loan, re-fi them into a FRM and THEN swoop in w/ your newly minted realtwhore's license and make a buck when the "client" goes into foreclosure!

EBGuy,

We're big on that in Oregon. They even have classes you can take. I want to re-power my boat w/ a 4-53 Detroit Diesel but didn't know how well it would work w/ a 2-Stoke engine (and marine application as well)

TIA

re Daniel Gross' article in Newsweek

I always suspected Gross was an idiot. Now I'm certain. Take a problem of Financial WMD and lax application of inadequate regulations and portray it as a class warfare issue. That'll really clarify things for the average Newsweek reader!

The problem is NOT having inadequate regulations.

The problem is over-regulation. When has moral hazard ever been associated with inadequate regulations?

skibum :

Or, the question that’s gnawing at me, which is, how would two “execs” in the subprime industry really believe that their industry and careers were “rock solid?”

While I have no sympathy for any of these mortgage SOBsters, I kind of get this sentiment.

Very few dot com guys thought that the world as they knew would simply vanish. When you are dreaming as being the enabler of endless prosperity it's easy to not wake up till it's too late. Every dot com CEO fancied himself to be the visionary and the next Steve Jobs. I have met a few who were all too busy trying to be charismatic and forgot about becoming profitable.

Why would anyone care about being the enabler of endless prosperity? Profit is about taking, not providing.

Why would anyone care about being the enabler of endless prosperity?

EGO

EGO is neither profitable nor edible.

I much rather be a hidden oilman than someone like Steve Jobs.

I am a strong proponent in military spending not in the form of salary to GIs or front troops, because you shouldn't need to deploy them that often. The modern warfare should be fought with least human involvement. Iraq war is the ultimate spending of how NOT to allocate one's military spending.

I am for increasing funding to NASA, national science labs with a focus on military aspects. Unfortunately I am seeing the opposite today, because lots of labs are laying off researchers left and right. I personally know of a couple of very promising military research projects that got cut due to lack of funding. If we are resorting to fighting with warm bodies, we are going to be no different from Argentina. And the sad thing is, all these cuts happened because of the stupid housing bubble which added no value whatsoever, unlike the internet boom, which did change our lives drastically one way or another. I feel a lot better with our collective financial loss in the Nasdaq than the housing bubble.

Wrt to corruption and wastage through buddy contracting, there's simply no way you can get around that. Blackwater is indeed a shame, because it doesn't build any knowhow nor expertise.

For the upcoming election, at least there's one piece of good news. Bush is going to be out of office.

For that "executive" couple at New Century, I feel completely vindicated to see them suffer. I'd like to see more stories like that for reading amusements.

What kind of "executive" are you if all you can think of in a jobless state is to sell useless crap over the internet? Yeah, like people are going to ramp up jewelery purchase after the housing bubble bursts. Great "executive" thinking.

They are just going right back to where they belong from the very beginning.

DinOR,

the key question for the couple is, what SKILL do they have? As far as I am concerned I see none.

Those guys deployed in the field right now are a HELL of a lot more than just "warm bodies". Besides it's awfully f@cking hard to have high tech responses to people that strap bombs to children.

WTF?

Cross posting from Zillow boards.

WARNING : Large 75 page PDF file with lots of statistics.

http://tinyurl.com/295kya

Ton of information and charts. Awesome.

Some snippets
Current: Assuming constant interest rates, borrowing power today has declined 39.4% vs. only nine months ago
•Scenario 1: If interest rates drop 100 basis points, then the decline is “only”28.9%
•Scenario 2: If interest rates drop 100 basis points and mortgages become fully amortizing, then the decline is 41.6%
•Scenarios 3 & 4: To maintain borrowing (0% decline) power the interest rate on fully amortizing mortgages would have to drop to 1.41%

Did anyone here read the Hitchhiker's Guide to the Universe?

There's a great part in the first book where a society had three groups of people: the thinkers, the do-ers, and the "useless middlemen". The thinkers and do-ers concocted an apocalyptic theory (shades of Global Warming) and sent the useless middlemen off in a spaceship to avoid said calamity. They told the useless middlemen that they had to go off in the first ship "because they are so important". :) The satire of the book is of course that the useless middlemen ended up colonizing Earth.

Hence useless middlemen like the Copes.

I am for increasing funding to NASA, national science labs with a focus on military aspects.

Can't that be privatized?

Replace Universe with Galaxy.

The City of Philadephia has just suspended sales of foreclosed homes.

Fed is meeting with Nordic finanical leadership in to explore how to nationalize our banks and minimize moral hazards such as occurred with Bear Sterns.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/03/31/cnfed131.xml

Dennis-

Excellent book and film, and timing of reference was perfect. :-)

I'm looking for some tax advice. If I replace my roof with a gildedgilded dome, when I sell my house, is the dome and said gilding considered a capital improvement that increases the basis of my house? Can I then claim the $500k capital gains exemption, or is a gilded dome considered a collectible? Also, can I refinance to the $1 million mortgage limit to fund this home improvement? Is this truly impractical and should I just go with the gold wallpaper reminiscent of the mid-seventies?

NVR, wow, those Scandanavians don't mess around!
While the responses varied in each Nordic country, there a was major effort to avoid the sort of "moral hazard" that has bedevilled efforts by the Fed and the Bank of England in trying to stabilise their banking systems.

Norway ensured that shareholders of insolvent lenders received nothing and the senior management was entirely purged. Two of the country's top four banks - Christiania Bank and Fokus - were seized by force majeure.

EBGuy
simply for reasons of vanity (since I'm only a renter), I too found myself in the same predicament. In the end I went with gold wallpaper as it achieved the exhibiting of ostentatiousness and moral poverty to those that matter (visitors to my rental, particularly "owners" who can't afford such luxuries), without unduly provoking those with weapons and a fancy for gold teeth and other bling.

I can't help you with the tax issues.

From NVA's article link:

Norway ensured that shareholders of insolvent lenders received nothing and the senior management was entirely purged.

No moral hazard here.

When has moral hazard ever been associated with inadequate regulations?

Haha! Very funny Peter Pan - even if you don't mean to :-)

Sorry EBGuy, we posted at the same time

Can we ask the Scandinavians to come run this country for a few years?

StuckinBA

thanks for that pdf. It's quite raphic!

Philadelphia info, I think this is a BIG deal.

http://www.reuters.com/article/gc03/idUSN2830318520080328?sp=true

Sorry for my haste, only have a minute.

Pace of things seems to be quickening to me now. Rice price is causing crisis all over, all net importers like Philippines. Third world economies that have started to life their populace out of poverty are about to submerge them right back.

Wish I had time to address evil AG subsidies. Saying you endorse them is equivalent of indicating you endorse nuclear weapons. Of course they result in much more than higher milk prices and death of family farms, which they certainly do, but they also actually directly drive death, rape, and misery the world over. Ever visit a 3rd World community that has been on the business end of world bank loans opening up their AG markets to subsidized corporate welfare products? Entire industries and cultures thrust into desperate poverty and resultant violence and exploitation. Isn’t pretty.

But like nuclear weapons AG subsidies are now a necessary evil. Always will be players gaming own interests and industry for trade advantage, so everyone must engage in this cutthroat game or simply lose.