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quasigovy
494 Posts |
 Posted - 10/15/2008 : 10:08:39 PM
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I know this sounds a bit crazy... but it is now a possibility.
Ben Bernanke, in reference to our banking system, was quoted as saying "we do not have a solvency issue, we have a liquidity issue."
If he believes that, then he believes all the loans/banks the government is throwing money at are priced way below value. I believe a solvency issue is EXACTLY what our banks who hold major mortgage exposure have.
We are talking about the 750 billion in bail out money, the 40 billion per month in bad loans the GSEs have been ordered to buy PER MONTH, the money being used to buy shares in banks, and you know there will be more.
If he is wrong, and most people who truly understand the situation the banks are in and how bad the loans are do, this will be a huge mistake.
Throw in a huge yearly trade deficit and the war in Iraq to that potential error in judgment and this could get out of hand in a hurry. Not to mention the lost tax revenue from a recession/depression.
I hope I am wrong about this one, but the rest of my predictions (all posted on this site) were correct.
I give it less than 10 years.
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Tsnyder
8256 Posts |
Posted - 10/15/2008 : 10:42:25 PM
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Bad news... the U.S. government has been bankrupt for decades.
No... I'm not being facetious.
Tsnyder |
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quasigovy
494 Posts |
Posted - 10/15/2008 : 10:50:16 PM
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Decades????
That seems a bit over the top. |
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Tsnyder
8256 Posts |
Posted - 10/15/2008 : 11:03:07 PM
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quote:
Originally posted by quasigovy
Decades????
That seems a bit over the top.
Not at all... study the history of our monetary system.
Tsnyder |
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rtrefflich
3400 Posts |
Posted - 10/15/2008 : 11:13:02 PM
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| Although the US govt has been bankrupt (what do you think our deficit and national debt are, they are debt that we cannot pay back) for a long time all this is a a liquidity problem. The percentage of toxic loans in the mess is not that much, and the percentage of those that have gone bad is not that high, it is the perception that there is something toxic out there. The US Govt will be buying these debts at roughly .55 on every dollar, indicating that 45% of ALL the mortgages in this pool have to go bad for the US to lose anything at all, in addition, if 45% of the mortgages go bad, that indicates that they are worth nothing. The FC home still has some value, although it is much less than is owed on it, it still has value. Banks and businesses don't want to lend because they are unsure of what could befall them. When the govt. picks up all these bad loans it will free up the lending atmosphere and it will be back to business as usual. |
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quasigovy
494 Posts |
Posted - 10/15/2008 : 11:31:38 PM
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| By business as usual, are you under the impression that guidelines will loosen?? |
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rtrefflich
3400 Posts |
Posted - 10/15/2008 : 11:41:39 PM
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Not to where they were two years ago, but they will loosen. You will have qualified people, who can show their income being able to buy homes with relatively low down payments. You will not have the stated W-2 products out there, but there will be stated products for qualified SE borrowers who cannot get financing today. I think guidelines will go back to where they were before they got too crazy, kind of like mid 2002 or so.
quote:
Originally posted by quasigovy
By business as usual, are you under the impression that guidelines will loosen??
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LoanPro71
2676 Posts |
Posted - 10/16/2008 : 12:20:06 AM
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quote:
Originally posted by Tsnyder
quote:
Originally posted by quasigovy
Decades????
That seems a bit over the top.
Not at all... study the history of our monetary system.
Tsnyder
That's true. America is BANKRUPT, and has been for a long time.
Here's a primer on the subject.
"It is an established fact that the United States Federal Government has been dissolved since the Emergency Banking Act of March 9th, 1933."
copy and paste this link to learn more
http://www.planetaryascension.net/Darkworkers/the_bankrupcy_of_the_United_States.htm
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Mandyvilla
3405 Posts |
Posted - 10/16/2008 : 02:51:48 AM
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True, my father was was an Asst. Director of one of the Army agencies and while growing up that's all I heard at the dinner table in between the Watergate hearings.....Oh, the good old days, corruption, racial tensions, war protests, 70's music.....
Things haven't changed much....these are the good old days. |
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homebroker@sbcgl
3435 Posts |
Posted - 10/16/2008 : 10:41:39 AM
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California may be the first state to go Bankrupt.
http://www.thetrumpet.com/index.php?q=5601.3919.0.0 |
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rtrefflich
3400 Posts |
Posted - 10/16/2008 : 10:49:22 AM
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That's because socialism doesn't work. That is virtually what we have in CA.
We have had two huge unexpected tax revenue sources come in over the past 8 years, the fist was the dot com boom and the second was a huge increase in property taxes. Both times the legislature implemented these into long term projects and out budget, which was $70Bil when Arnold took over is now at $110 Billion, we are doomed.
quote:
Originally posted by homebroker@sbcglobal.net
California may be the first state to go Bankrupt.
http://www.thetrumpet.com/index.php?q=5601.3919.0.0
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homebroker@sbcgl
3435 Posts |
Posted - 10/16/2008 : 10:53:18 AM
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I found this scary..
California, if it was a stand-alone country, would have one of the largest economies in the world. After the federal government, states are considered the safest loans out there. If California couldn’t get a loan, what would that mean for companies like General Motors, the airlines and thousands of other big businesses across America? Unless something rapidly changed, it could literally signal the end of corporate America as it is known today
quote:
Originally posted by rtrefflich
That's because socialism doesn't work. That is virtually what we have in CA.
We have had two huge unexpected tax revenue sources come in over the past 8 years, the fist was the dot com boom and the second was a huge increase in property taxes. Both times the legislature implemented these into long term projects and out budget, which was $70Bil when Arnold took over is now at $110 Billion, we are doomed.
quote:
Originally posted by homebroker@sbcglobal.net
California may be the first state to go Bankrupt.
http://www.thetrumpet.com/index.php?q=5601.3919.0.0
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rtrefflich
3400 Posts |
Posted - 10/16/2008 : 11:29:20 AM
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I wouldn't worry too much, GM, the airlines, and thousands of other big businesses across American are run much better than CA. Those companies have a desire to get back on their feet. CA has proven time and time again that they do not want to be fiscally sound, they want to provide social services to anyone who wants them, regardless if them, or us (CA) can pay.
quote:
Originally posted by homebroker@sbcglobal.net
I found this scary..
California, if it was a stand-alone country, would have one of the largest economies in the world. After the federal government, states are considered the safest loans out there. If California couldn’t get a loan, what would that mean for companies like General Motors, the airlines and thousands of other big businesses across America? Unless something rapidly changed, it could literally signal the end of corporate America as it is known today
quote:
Originally posted by rtrefflich
That's because socialism doesn't work. That is virtually what we have in CA.
We have had two huge unexpected tax revenue sources come in over the past 8 years, the fist was the dot com boom and the second was a huge increase in property taxes. Both times the legislature implemented these into long term projects and out budget, which was $70Bil when Arnold took over is now at $110 Billion, we are doomed.
quote:
Originally posted by homebroker@sbcglobal.net
California may be the first state to go Bankrupt.
http://www.thetrumpet.com/index.php?q=5601.3919.0.0
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msancheznj
2242 Posts |
Posted - 10/16/2008 : 1:48:50 PM
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| So CA actually is The Peoples Republic of California. |
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