Do you think there could be a second Great Depression?

[Marc Chevalier]

I agree with Carebear. Information is power, and the information is out there -- and so are a lot of protections. This country offers so much power to people, but most folks have no idea of what that power is or how to wield it; and so it lies on the floor, waiting to be picked up by someone. News flash: the person who does pick it up could well have interests that are opposite to your own. Too bad you didn't grab it while you could, eh?


I'm involved in an organization that, among other things, educates low income renters about rights and services that ALREADY exist for their benefit. Our goal is introduce people to the information that can help them. How they use this information is ultimately their choice.

.

 

[jamespowers]

Nope, bad analogy. Medical diagnosis take years of training, all financial planning takes is the ability to add and subtract 4-5 digit numbers, (not even multiplication and division) which just requires an elementary school education.

If you are so ignorant you are mathematically unable to, or are so lazy that you lack the willingness to, create a budget based on your actual income and monthly expenditures, something I have my lower income borrowers do so they can see what they truly can afford versus what they might, on paper, qualify for, then I refuse to feel sympathy when you get yourself, open-eyed, into a hundred-thousand dollar plus loan and can't make the payments.

All the information you would ever need to figure out every facet of the loan process is available for free, including mortgage calculators and the index rates to figure out payment schedules on adj. rate mortgages and the like. The tax history for your area and individual properties is public knowledge, as are local utility rates and costs.

Every facet of the loan and its payment consequences are available in the loan paperwork, and we are required by law to go over it. If folks just glaze over and sign where they're told by some shyster, that's their problem. They could have taken the loan docs home and read them in detail prior to signing. Heck, lenders are competitive, instead of jumping on the "too good to be true" 1% loans that pop up in email, or signed on that "miracle ARM" that person could have gone to a reputable banker or lender and asked them to explain the details.

A lot of these folks crying about being "misled" are "victims" in the same way as any idiots who answer the Nigerian email scam or buy snake-oil, they let their greed and their apathy override their common sense. They thought, against common knowledge and their own experience, that there was a free lunch. If you decide to live as a sheep, be sure there are folks out there just waiting to shear you.

Blaming any lender, predatory or otherwise, for the financial problems of borrowers is shifting responsibility from the one person who could have avoided the whole problem by either being aware of their financial situation and not taking the loan in the first place or by using the good sense G-d gave a goose and doing roughly the same amount of research (and time) as would be required to write a 5-paragraph essay in 6th grade.

I can more or less agree with most of that except for property tax being available. It may be available for people who live in Proposition 13 type states where property tax rates are set and predictable but in some areas they vary wildly from property to property. It is a huge crap shoot. You could buy a property and the tax could escalate 100% or more in some areas of the country and the increase is not capped from year to year. :eusa_doh: You know the old past history is not indicative of future results disclaimer.
Other than that---carry on.

Regards,

j

 

[jamespowers]

Living in South America was an education. "The economy, stupid" has been Chile's mantra for decades. Chilean economists with U.S. Ph.Ds are worshipped like rock stars there. Technocrats, not lawyers, tend to become Chile's presidents and ministers.


Interestingly, we haven't had a technocrat as president since Herbert Hoover. He left a sour taste in people's mouths.

.

Yep, third world countries tend to have all the economic examples magnified.
Lawyers as presidents. Hmmmmm... That could be the problem.

 

[carebear]

I can more or less agree with most of that except for property tax being available. It may be available for people who live in Proposition 13 type states where property tax rates are set and predictable but in some areas they vary wildly from property to property. It is a huge crap shoot. You could buy a property and the tax could escalate 100% or more in some areas of the country and the increase is not capped from year to year. :eusa_doh: You know the old past history is not indicative of future results disclaimer.
Other than that---carry on.

Regards,

j

I meant previous and current property taxes for a particular property. The information is there, when coupled with a little bit of attention paid to local and state politics, to determine a trend at the very least. My point is that none of the information is "hidden", even if it may change a bit.

Again, it is your responsibility as a borrower to not leverage yourself so finely that you cannot absorb a forseeable increase in taxes or insurance.

For example, our tax rate has been fixed, but the assessed value and thus actual tax cost has been skyrocketing. My property was assessed at $320K two years ago, $360K last year and $422K this year. An increase in my tax burden of about $1,500. But I had an idea it was coming based on the past few year's numbers and the passage of school bonds and the like.

 

[jamespowers]

I meant previous and current property taxes for a particular property. The information is there, when coupled with a little bit of attention paid to local and state politics, to determine a trend at the very least. My point is that none of the information is "hidden", even if it may change a bit.

Again, it is your responsibility as a borrower to not leverage yourself so finely that you cannot absorb a forseeable increase in taxes or insurance.

For example, our tax rate has been fixed, but the assessed value and thus actual tax cost has been skyrocketing. My property was assessed at $320K two years ago, $360K last year and $422K this year. An increase in my tax burden of about $1,500. But I had an idea it was coming based on the past few year's numbers and the passage of school bonds and the like.

Maybe if you have lived in the area for a while but if you just moved in, you have no idea.
Future tax is really up in the air in some states because their property tax rate is not fixed. Its like playing cards with shifting rules. Capricious ass-essors. Not really a deal breaker or cutting something close---just an unpleasant surprise when it goes up 100% in the following year after you buy it.
I don't know about what schools do there but here they sell bonds with an "average" cost to a homeowner not specifically yours. So what is average for the city is 1/4 of what I would pay---1/8 of what my neighbor pays. :eusa_doh: I do stay on top of that stuff though. It helps when I fight against them.

Regards,

J

P.S. I just realized your property tax went up 15% in one year!?

 

[PrettySquareGal]

Nope, bad analogy. Medical diagnosis take years of training, all financial planning takes is the ability to add and subtract 4-5 digit numbers, (not even multiplication and division) which just requires an elementary school education.

If you are so ignorant you are mathematically unable to, or are so lazy that you lack the willingness to, create a budget based on your actual income and monthly expenditures, something I have my lower income borrowers do so they can see what they truly can afford versus what they might, on paper, qualify for, then I refuse to feel sympathy when you get yourself, open-eyed, into a hundred-thousand dollar plus loan and can't make the payments.

All the information you would ever need to figure out every facet of the loan process is available for free, including mortgage calculators and the index rates to figure out payment schedules on adj. rate mortgages and the like. The tax history for your area and individual properties is public knowledge, as are local utility rates and costs.

Every facet of the loan and its payment consequences are available in the loan paperwork, and we are required by law to go over it. If folks just glaze over and sign where they're told by some shyster, that's their problem. They could have taken the loan docs home and read them in detail prior to signing. Heck, lenders are competitive, instead of jumping on the "too good to be true" 1% loans that pop up in email, or signed on that "miracle ARM" that person could have gone to a reputable banker or lender and asked them to explain the details.

A lot of these folks crying about being "misled" are "victims" in the same way as any idiots who answer the Nigerian email scam or buy snake-oil, they let their greed and their apathy override their common sense. They thought, against common knowledge and their own experience, that there was a free lunch. If you decide to live as a sheep, be sure there are folks out there just waiting to shear you.

Blaming any lender, predatory or otherwise, for the financial problems of borrowers is shifting responsibility from the one person who could have avoided the whole problem by either being aware of their financial situation and not taking the loan in the first place or by using the good sense G-d gave a goose and doing roughly the same amount of research (and time) as would be required to write a 5-paragraph essay in 6th grade.

Your point is well taken about a medical degree versus accessing some online calculators and free content.

 

[carebear]

Lest I appear more of a "personal responsibility", "to heck with the stupid", pitiless ogre than I actually am, my heart breaks when I hear the stories of folks who allowed themselves to be led into poor loans, especially when kids are involved.

But it partly breaks in frustration, because they could have avoided all the problems by just making better choices. Especially when you are a parent you HAVE to take off the rose-colored glasses and become a hard-nosed realist. That's where my sympathy becomes frayed, their problem was 100% avoidable with very little effort.

I have folks come in to my office in tears asking for help in getting out of loans the've gotten themselves into, asking me to help them keep their house. Often though, they don't act soon enough and they allow their credit to decline and their reserves (if they had any) to be eaten up before asking for help and there's nothing I can do.

Heck, most folks don't even do the obvious thing and notify their lender the second it looks like there might be financial problems. Nobody makes money on foreclosures, especially not on high loan to value loans, any semi-reputable servicing company will work with the borrower if they can. Those that won't? Well, they are usually the "too good to be true" loan guys who should have been avoided in the first place.

I would gladly strangle the realtors and lenders who aren't upfront about what they offer, but, in the end, all the borrower had to do was read the documents. They aren't even written in legalese, it's just numbers.

 

[PrettySquareGal]

Lest I appear more of a "personal responsibility", "to heck with the stupid", pitiless ogre than I actually am, my heart breaks when I hear the stories of folks who allowed themselves to be led into poor loans, especially when kids are involved.

But it partly breaks in frustration, because they could have avoided all the problems by just making better choices. Especially when you are a parent you HAVE to take off the rose-colored glasses and become a hard-nosed realist. That's where my sympathy becomes frayed, their problem was 100% avoidable with very little effort.

I have folks come in to my office in tears asking for help in getting out of loans the've gotten themselves into, asking me to help them keep their house. Often though, they don't act soon enough and they allow their credit to decline and their reserves (if they had any) to be eaten up before asking for help and there's nothing I can do.

Heck, most folks don't even do the obvious thing and notify their lender the second it looks like there might be financial problems. Nobody makes money on foreclosures, especially not on high loan to value loans, any semi-reputable servicing company will work with the borrower if they can. Those that won't? Well, they are usually the "too good to be true" loan guys who should have been avoided in the first place.

I would gladly strangle the realtors and lenders who aren't upfront about what they offer, but, in the end, all the borrower had to do was read the documents. They aren't even written in legalese, it's just numbers.

fftopic: Glen Garry, Glenn Ross is one of my favorite films.

 

[Marc Chevalier]

... in the end, all the borrower had to do was read the documents. They aren't even written in legalese, it's just numbers.

Yes. The information is out there. It hasn't always been, and folks fought long and hard to get it out in the open.
The sad thing is, those folks' efforts have been wasted if people today don't see, read, understand, and heed the information.

.

 

[carebear]

Maybe if you have lived in the area for a while but if you just moved in, you have no idea.
Future tax is really up in the air in some states because their property tax rate is not fixed. Its like playing cards with shifting rules. Capricious ass-essors. Not really a deal breaker or cutting something close---just an unpleasant surprise when it goes up 100% in the following year after you buy it.
I don't know about what schools do there but here they sell bonds with an "average" cost to a homeowner not specifically yours. So what is average for the city is 1/4 of what I would pay---1/8 of what my neighbor pays. :eusa_doh: I do stay on top of that stuff though. It helps when I fight against them.

Regards,

J

P.S. I just realized your property tax went up 15% in one year!?

Yep, welcome to a boom town. Saloon's up the street.

I see your point, but if you move to Anchorage you can go to the Muni website and type in any address and get the past 3 years tax bill. Taxes are the only really "variable" part of a payment. The loan is per contract and thus absolutely predictable and homeowner's insurance usually only changes when you tell the insurance company your house is worth more and you want more coverage.

I was just trying to point out taxes aren't a complete mystery. If you see that they have increased the past few years (which you can do prior to buying, it's the sort of thing your realtor should be able to estimate and calculate for you on demand), you then shouldn't get a loan thinking "I can afford this if nothing changes".

That's where I was going.

 

[carebear]

fftopic: Glen Garry, Glenn Ross is one of my favorite films.

Get them to sign on the line which is dotted.

At a sales job a few years back my buddy and I put that, Tin Men, Big Kahuna and Used Cars in the "Corporate Training Library". The boss didn't notice until a client pointed it out.

That was fun. lol

 

[Paisley]

A person must allow himself some margins (read: live well below his means). Illness, layoffs, accidents, pay cuts and other emergencies are facts of life.

Real estate agents make their money from commissions, which is based on a percentage of the value of the property. All realtors might not push people to spend as much money as possible--but there is a motivation there for them to do so.

 

[Small Town Girl]

Very good. You have been studying economics and coming around.
Even if the debt were called, countries usually get out of it by nationalizing the debt. Foreigners essentially get nothing then. Countries hold the gun to your head regarding debt. [huh]

What would you suggest???? How do you think that we should help to get America out of debt?[huh] When I think about getting out of debt I would dissolve the United Nations and the Federal Reserve(which is not actually a federal agency, but rather a private corporation of big bankers. In a nut shell, the big bankers actually print and sell the money [which is unconstitutional because the Constitution states that"Congress has the right to coin and regulate money"] to the government with added interest. The interest is paid in turn by the American people in the form of taxes. President Woodrow Wilson had this to say about the Federal Reserve: "A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the world - no longer a Government of free opinion no longer a Government by conviction and vote of the majority, but a Government by the opinion and duress of small groups of dominant men."
(Just before he died, Wilson is reported to have stated to friends that he had been "deceived" and that "I have betrayed my country." He was referring to the Federal Reserve Act passed during his Presidency.)There is actually a really good book called The Secrets of the Federal Reserve.It was written by a man that used to work in the Library of Congress.(He was asked to write the book by the poet Ezra Pound.If you're interested check it out.)
So,in answer to the question about Argentina and such ...well,I would have to say that I agree that everything is so inter-woven and tangled that we would really go into global depression.In this case I really wish that we would have had Henry Jones around to teach us some "self reliance" lol I'm glad that there are some people on here that are willing to listen and talk back

 

[jamespowers]

Yep, welcome to a boom town. Saloon's up the street.

I see your point, but if you move to Anchorage you can go to the Muni website and type in any address and get the past 3 years tax bill. Taxes are the only really "variable" part of a payment. The loan is per contract and thus absolutely predictable and homeowner's insurance usually only changes when you tell the insurance company your house is worth more and you want more coverage.

I was just trying to point out taxes aren't a complete mystery. If you see that they have increased the past few years (which you can do prior to buying, it's the sort of thing your realtor should be able to estimate and calculate for you on demand), you then shouldn't get a loan thinking "I can afford this if nothing changes".

That's where I was going.

I can understand that. I was just pointing out that property tax to the well informed is a real pain. I can just imagine how it would be to those who have no idea where to start. I really wouldn't consider property taxes part of the loan. Why pay interest on taxes?! :eusa_doh: Just pay the property tax on your own so you can see the local and state government do crazy things like raise the tax 15% in one year. :eusa_doh: I guess I am spoiled because property tax can only increase 2% per year here---maximum. 15% and higher yearly increases in the 1970s prompted the change here---Thank God.

Regards,

J

 

[Marc Chevalier]

I can just imagine how it would be to those who have no idea where to start.

And this is where property owners' rights/interest groups and organizations step in to help. Their job is to sift through all that information, clarify it, and efficiently convey it to owner and potential owners. If they're doing their work well, they'll make it easy for folks in need to find them, and vice-versa. Hard work, but it makes a difference.

.

 

[kindofblue]

I think it is a real possibility.

If you have read anything about the Peak Oil theory, that is exactely what will happen as the supply of oil peaks and begins to decline through the years. At some point, the decline in oil supply will cause massive reprecussions through the world economy.

 

[Dixon Cannon]

Well, of course not!

Our Big Brother has taken care of that! What with the SEC, the Federal Reserve, the FDIC, HUD, Homeland Security, INS, Dept of Labor, Health and Human Services, and, of course, Social Security, our government would never let us suffer the consequences of inflation, fiat currency, consumer credit and massive government over-spending. Come on!...Happy Days Are Here Again, remember?!!

-dixon cannon

 

[jamespowers]

What would you suggest???? How do you think that we should help to get America out of debt?[huh] When I think about getting out of debt I would dissolve the United Nations and the Federal Reserve(which is not actually a federal agency, but rather a private corporation of big bankers. In a nut shell, the big bankers actually print and sell the money [which is unconstitutional because the Constitution states that"Congress has the right to coin and regulate money"] to the government with added interest. The interest is paid in turn by the American people in the form of taxes. President Woodrow Wilson had this to say about the Federal Reserve: "A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the world - no longer a Government of free opinion no longer a Government by conviction and vote of the majority, but a Government by the opinion and duress of small groups of dominant men."
(Just before he died, Wilson is reported to have stated to friends that he had been "deceived" and that "I have betrayed my country." He was referring to the Federal Reserve Act passed during his Presidency.)There is actually a really good book called The Secrets of the Federal Reserve.It was written by a man that used to work in the Library of Congress.(He was asked to write the book by the poet Ezra Pound.If you're interested check it out.)
So,in answer to the question about Argentina and such ...well,I would have to say that I agree that everything is so inter-woven and tangled that we would really go into global depression.In this case I really wish that we would have had Henry Jones around to teach us some "self reliance" lol I'm glad that there are some people on here that are willing to listen and talk back

Wilson did betray his country but it wasn't over the Federal Reserve---it was the income tax. :eusa_doh:
American Debt ebbs and flows. It just depends on what the goal is. There will likely always be debt but we have to define what it is and what we want to get rid of. Do you want to get rid of bond indebtedness, trade deficits and/or American securities in the hands of foreign investors? I am not too worried about any of these because it is in their best interest to make sure our best interest is served as our interests become intertwined. In other words, they won't kill the goose that lays the golden egg.
I can agree with getting rid of the UN. Sell the property and pay off part of the National Debt before the politicians get their hands on it and spend it frivilously---as usual. :eusa_doh:

Regards,

J

 

[jamespowers]

And this is where property owners' rights/interest groups and organizations step in to help. Their job is to sift through all that information, clarify it, and efficiently convey it to owner and potential owners. If they're doing their work well, they'll make it easy for folks in need to find them, and vice-versa. Hard work, but it makes a difference.

.

Yes indeed. Thank you Howard Jarvis! :eusa_clap :eusa_clap :eusa_clap

 

[jamespowers]

I think it is a real possibility.

If you have read anything about the Peak Oil theory, that is exactely what will happen as the supply of oil peaks and begins to decline through the years. At some point, the decline in oil supply will cause massive reprecussions through the world economy.

Yep, then we would actually start drilling for oil in our own country.

Regards,

J