By Patrick follow 2007 Mar 28, 7:08am 6 links 21,040 views 208 comments
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Why should everyone who was responsible and did not borrow too much for a house be asked to bail out the gamblers who did?
This is the worst kind of government interference with taking responsibility for your own actions. Sure, some poor old people will be trotted out to get sympathy for the proposal to bail out the cynical gamblers who were flipping properties until they got burned. But there are better ways to help than redistributing the tax money from the rest of us to everyone who speculated on housing.
Check out http://patrick.net/housing/contrib/nobailout.html and please make suggestions on how I can make it more effective.
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Then they will feel the futility and humility.
I sense your anger. Embrace the Dark Side!
New thread: Gallery of Unlikely Bubble Victims
"Make the scum bag lenders"
For what it worth many are already under and gone...
Office closed, employees laid off, office for rent sign posted by landlord.
Any receivable (loan) they had was already sold off to the next guy.
Embrace the Dark Side!
Fake P called me Darth Bubblehead.
Fact is many are not from the Bay Area and have not seen economic recessions like the one we had back in 1991 and 2001 or are prepared to understand anyone of the many in the future yet to come.
Most of the people I know where here for 2001. That doesn't really register to them. It was but a blip, and if anything indicated that that was the low point in the economic model. Right now is the midpoint. And once we get to full tilt, condos will start at $1mil.
Most firms will hire the guy with the college degree in the blazer before they hire the guy who never went to college wearing the Circle Jerks T Shirt and a kilt (even if the kid in the kilt will outperform the clean cut grad in the blazer)…
Most firms will hire the guy with a degree with no working experience over the guy who has 20 years of proven experience on the job no matter what either of them are wearing.
Mom will be fine.
She might lose her most recently bought FL condo (or not), but she can always move back into one of her other rentals or the house she owns outright in VA. ;-)
Anyone who can do the job without the degree is too open-minded and canthink for themselves which is dangerous for corporations.
That's why the ideal corporate hire would be a college grad who went through the Cupertino school system. They probably wouldn't mind life in a (shared) cubicle.
Probably true. But if I've got 20 years of experience, and I'm still competing for the same job as a new grad, then maybe something is wrong with me, and the firm is correct in their assessment of me & my abilities.
Probably true. But if I’ve got 20 years of experience, and I’m still competing for the same job as a new grad, then maybe something is wrong with me, and the firm is correct in their assessment of me & my abilities.
Say you are working for a company. You don't have a degree, You work for a company for 20 years and in that time you study on your own and develop many sucessful products for the company to become one of their best Engineers; then, one day the company goes under and you no longer have a job. You go out looking for a job, but everywhere you look you see that a certain degree is required. So just getting through the door is a challenge. It doesn't matter if you have the brain of a rocket scientist and the capability to outperform most other people with degrees.
It's the anal corporate empire that measures a persons intelligence by a piece of paper. These clipart clipping, paper shuffling, "human resource executives" as they call themselves don't know the difference between an Engineer and a cellphone and yet it is they who decide who's resume will be passed down to those who actually do the hiring.
I worked with a ton of 'no degree' people back when the internet bubble demanded bodies to fill seats and everybody who could breathe and write some HTML was a web-programmer.
99% of those non-degree holders blew goats. With degree holders, it was more like 30% goat blowers. So... hire a guy who's almost certainly going to fluff goats, or a guy who probably won't. Very hard decision there.
On the other hand, I know two 'no degree' people who are still in the business because they kick butt at their jobs. They are the 1 in a 100, and they both got 'in the door' because of the boom and personal recommendations. They stayed when the shake-out came. These guys would have been just as good of employees had they gotten degrees. Not having a degree was just another hurdle for them to jump to get in the game they wanted to be in.
Not having a degree is not an indication that you a free thinking awesome employee. It's more likely an indication that you're a shiftless underachiever. Not that there aren't shiftless, underachieving degree holders, it's just that having a degree cuts out a bunch of them.
Casey Serin doesn't have a degree. Why don't you hire him as your finanacial advisor? He's definately 'free thinking.'
I garnered no debt on my degree. Never took out a school loan. Had a scholarship for the first degree. I went back for a second degree because I enjoyed it. I got paid the second time around.
But in those 20 successful years, that high quality engineer should have developed a lot of contacts in the industry, many of whom have moved on to bigger and better companies, and some will be in decision-making positions. Just call them up and bam, you've got yourself a job.
Maybe I'm just naive, but that's how I see myself getting my next job.
because for most jobs you really don’t need any experience because 90% of corporate jobs are mindless paperpushing monkey tasks.
That's something I agree with. So if I ever have a company, I will only have positions that require mindful paperpushing monkeys.
moderate infidel Says:
I own one of those companies and I offer health benefits and above average salaries.
Got any openings? :) j/k
I've come to the conclusion that entrepreneurs are just a whole different breed of people. Doubt higher education contributes much to their success or lack thereof. What's education, really, but a collection of knowledge you take in. I posit that you can learn anything any school teaches at any halfway decent library. What someone does with that knowledge is up to them.
"Most of the people I know where here for 2001. That doesn’t really register to them. It was but a blip, and if anything indicated that that was the low point in the economic model. Right now is the midpoint. And once we get to full tilt, condos will start at $1mil."
LOL! Its a pity they didnt experience the early 90s recession. It was a long drag out painful one... many locals left California altogether.
So when you say ...Condos will start at $1M ....surly you jest sire...
Like I said eburb ...
'The current high prices are in fact forcing many employers out of the state to cheaper costing areas, because we are competing in a global
markets where our goods and services are undercut by cheaper rivals.’
Why is it we dont manufacture microprocessors in the Bay Area anymore?
Its not a brainless job! You can make or break $1M worth of product in an hour.
Moderate I. :
See... I'd be happy to generalize about frat boys. I've only really met one who was worthwhile, degree or no.
But in those 20 successful years, that high quality engineer should have developed a lot of contacts in the industry, many of whom have moved on to bigger and better companies, and some will be in decision-making positions. Just call them up and bam, you’ve got yourself a job.
Not if the company they work for has a policy that states the applicant must have a degree.
Randyman - where in the video were they touting gold - the one I watched never mentioned going back to the gold standard and gave the impression that metals as monetary commodity was a bad idea and unsustainable. Did you actually watch it?
About 4-5 minutes into it they begin the standard "all the trouble began when..." stuff about how feudal monarchs and goldsmiths began spending more than they had in reserve.
Since both situations relate to gold as currency-backing, show multiple cartoons of guys in robes with crowns and big piles of shining yellow stuff in piles, I guess I might have jumped to conclusions.
I did not watch all 45 minutes, admittedly. I watched about 25 minutes, and lost interest after the fifth time the narrator recounted the evils wrought by fiat currency.
I'm pretty non-conforming, but anybody who shows up in an interview with a kilt or greasy hair demonstrates contempt for people who are interviewing. It's bloody easy to get a college degree in this country, people without a degree better supply a good excuse for not having one. I'm friends with a few brilliant dropouts - awesome people, terrible employees.
Goat blower...I must remember that one...maybe expand it to "blow great big fat tail goats".
Maybe voluntary sterilization in return for debt relief...
I've done my constructive part. Thanks to Patrick, I've sent the message to my representative and senators Boxer and Feinstein.
As mentioned by Peter P, a degree is a screening tool. If you can't be bothered with college, it is highly likely that something is wrong with you.
If I were an employer, I would be happy to accept experience (demonstrating responsibility, reliability, knowledge and a certain broadmindedness) in place of degree. But I find these characteristics to be quite rare amongst non-college educated people, especially in white collar job situations.
It is fine to forgo a degree if you have something better to do, especially with the escalating costs. The challenge of going through college is strictly financial anyway. How difficult can classes be?
BTW, I judge people by instinct only.
Again, the most successful people in world do not have degrees. One notable exception is Warren Buffett (MS Economics) though.
Maybe you're equating all degrees with MBAs or something, but most of the jobs I'm interested in having require extensive training beyond what you can get in highschool. I have degrees in Comp Sci and Biophysics and the jobs I'd get hired for with those degrees are not doable by people with no training.
My theory: if at all possible, one should pay for the child's education in full. Otherwise, the kid will have to work through college doing low-paying jobs in school.
Here is the twist: there are other relatively lucrative, full-time semi-careers (like waiting tables, selling electronics, etc.) out there; it is just too easy to be tempted away from school.
I am not saying that sidetracking from school is necessarily bad, but one must have enough discipline to make the next leap or he will be stuck in semi-careers for life.
I have degrees in Comp Sci and Biophysics and the jobs I’d get hired for with those degrees are not doable by people with no training.
Training is over-rated. I have a degree in Computer Science and I am certain there are tons of HS kids out there with 10 times my technical knowledge.
Passion is more important.
I do not receive my degree in CS, but self-trained and obtained industry certifications later as an adult. And most of what I learned is already obsolete. Working in IT field requires constant retraining and new learning. It's the career equivalent of being a shark --keep moving or die.
No degree will ever teach you everything you need to know. However, any good college or university should be able to at least show you HOW to educate yourself and think more critically --skills that are broadly useful in life (and woefully lacking among the general populace). That ability alone will help set you apart from non-grads, though is far from a guarantor of success. As Peter P likes to say, the rest is mostly luck.
Of course there's nothing wrong with non-college graduates if they're motivated enough to do something with their life.
Hell, even non-motivated non-college graduates are fine, so long as they don't expect SUVs, 3,000 sq ft homes, and brain dead $150,000/yr job to be waiting for them.
Perhaps things will return to normal once realt-whores are out of the running.
The market needs to crash and crash hard. Homes are not investments, they are consumables akin to cars. Logically, they should depreciate, as they age and things start falling apart. They are places to live, not things to profit off of.
The sooner that "investors" and "speculators" get hit hard, and the sooner they are kicked out of housing, the sooner real people can afford to live in reasonable homes. I have no sympathy and little compassion for those who profit off of destroying the middle class.
NO BAIL OUT, AND HERE IS WHY. About 3 years ago my wife and I had finally saved 20% of the average home value where we lived. I was in my mid forties and it had taken that long to save the money. Then we went home shopping. We had excellent credit and both worked for legimitate employers, with good paying salaries. However, in the 2 consecutive cases we tried to buy a home, we were shut out at the last minute by speculators, because they paid FULL CASH and WAIVED THE HOME INSPECTION. I was extremely bitter, especially because I recognized that "our" real estate agent was encouraging a bidding war. At that point, I realized what kind of dirty game it was. I was also aware that many people elected to take out riskier loans, and were willing to buy homes with little or no money down. I'm sympathetic to anyone gullible enough to believe that such decisions do not carry high risk, but that does not mean I am willing to pay for their bad judgment. Bailing them out will only reinforce their perception that they did the right thing (buying with no money down, with a variable rate, bidding up the price, etc). That in turn will encourage more predatory lending and predatory real estate agents, who will simply resume targeting hopeful but gullible people.
this is ridiculous. My family income is over 110k year in LA but cannot afford a good size of home for my two new borns. Using our tax dollar to bail out those flippers that make us homeless. I will vote against those supporting bail-out.
Any effort to make houses more "affordable" (including the Mortgage Interest Deduction) simply causes house prices to rise. Even though I personally have benefited from the Mortgage Interest Deduction, I would love to see it eliminated.
The thought of a bailout for people with mortgages they can't afford makes me want to cry. It's the most obscene thing I've ever heard of.
How about a refund of excess property tax because my house was overassesed? My little florida shack that I spend 1/4 of my time in isn't worth its valuation. But because flippers with fraud mortgages pumped what was essentially printed money into the area, myh property taxes go up every year. And nobody cares about me.
I've been a Democrat since I first registered to vote. These proposals will have me switching parties and allegiances.
THere's a very simple point that we should all be writing letters to every representative about:
Anyone who put a "stated income" on a government-backed mortgage application needs to pay their federal income tax on that "stated income". Or go to jail.
Wait... how about just the poor out there? Like me. Who did not lie on any application. Who selected the cheapest house. We are getting screwed. The pricing on houses is through the roof. What I paid in LA for mine, I could have 3x's the house in TX... Lenders suck big. They lie to and cheat everyone.
Give it up! A bailout is inevitable. But it's the investment banks and financial institutions that will be bailed out. Otherwise, credit in this country would disappear, and you would never be able to sell your house, or maybe even use your credit card. Yes -- you would be hurt without this bailout!
There will be some home buyers that will get a deal, and that's not fair. But who guaranteed you that life was fair? About 10% of the mortgages in the US are in trouble. The really lousy creditors, and the house flippers still stuck with houses, have already gone. The next group, if they can hang on, will get a deal from this. No, not fair.
What's really not fair is my children and grandchildren getting stuck with the resulting Federal debt payments. At least this will hopefully be the death of the Republican belief in unfettered free markets.
If you don't understand the loan papers then don't sign. If you cann't make the payments then don't sign. What is hard sbout those questions.
No excuses and no bailout.
I would like to know how many members of congress and the white house had personal investments in the banks and businesses bailed out? Was George Soros invested in any?
He's been kicked out of several countries for trying to overthrow their economy. Has he been investigated for stock market manipulation, insider trading or illegal hedge funds?
If we're going to clean up the corruption in our government we need full financial disclosure. Who is watching these people to make sure they are doing their job and following the law?
The foreign national brochure says, "The ban on political contributions and expenditures by foreign nationals was first enacted in 1966 as part of the amendments to the Foreign Agents Registration Act (FARA), an "internal security" statute. " I can't find the numbers from the candidates or the parties.
Forum Necromancy at it's finest :) This thread is almost 2 years old and it has been brought back to life.