Deseret News | How will mortgage bailout affect us?

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How will mortgage bailout affect us?

Time to redefine? | 5:38 a.m. Sept. 8, 2008

This is America. The land where anyone can become rich if you work hard enough....or if you charge high enough prices. Look at the two biggest economic issues we complain about: housing and medical care. The main beef? They have gotten so darned expensive that you have to really be confident or just plain stupid to buy a home anymore, and you can't survive financially in times of medical duress unless you are in bed with a good insurance policy with a mega-filthy-rich insurer. The market is demanding mind-boggling prices, and thanks to some "brilliant" financing strategies offered to financially ignorant Americans, the megawhopper price tags seem affordable....until you lose a job, get sick, or gas prices skyrocket. Too add insult to injury, then the Fed offers to come in and keep the fat cats from losing their precious, over-speculative and downright greedy company.

Anytime anyone talks about regulating the free market, the silence becomes deafening. No one wants to inhibit anyone else from becoming RICH!!!! After all, YOU might be the next Horatio Alger story, right? It's time to wake up, people. We can't eat our cake and have it too. The prices and profits need to deflate.

Time to redefine Pt II | 5:46 a.m. Sept. 8, 2008

Don't think of it as socialism or communism, bec ause it isn't. It's called intelligent survival. By nickel and diming each other for the sake of the almighty dollar, we are destroying the American dream for most of us and filling the pockets of a very, very few of us. Everyone treats the free market like a sacred cow that cannot be touched under any circumstance. ENOUGH!!!! We need to regulate, or else we're going to see more recession, possible depression, and inflation like nobody's business. Does that sound like fun to you? That dollar we worship is going to be worth less and less, prices will ciontinue to climb, and wages will continue to lag far, far behind. It is our economy to mold to our needs. The consumer really holds the reigns. We are the demand. We are the supply. We just need to curb our desire to out-profit everyone else and develop a desire to make basic needs such as healthcare and housing affordable for all but the truly destitute. Do we have the guts and decency to look the almighty dollar in the eye and say, "No, I choose the good of all over personal greed."

Bob G | 5:57 a.m. Sept. 8, 2008

You may call it hind sight now but things could be done to prevent further losses in the financial markets, the federal government should have frozen all supprime mortgage contracts and make them non transferable as assets. This would have and still could force all lenders to come to grips with the world of bad irrational and poor judgements in lending. Instead these loans where continually being shuffled around trying to avoid the inevitable, the collapse. If all these accounts had been frozen and mortgage payments put into recerivership it would have forced a renegoation and qualifying of home owners. Many home owners may not have requalified but the many that could have would still be living in their 'dream home'. Even with the Freddie and Fannie bailouts this was not done and they too become a part of the inevetible rupture. Renegotiation of contracts is the only fix that everyone has been avoiding hoping to force the buyers to remain true to these disreputable contracts. However none of governments attempts to enforce contracts has proven worthwhile. What ever continues to happen is the sole responsibilty of government and mortgage companies own attitude that disregards consumers and consumer efforts.

Comments continue below

Doodles | 6:17 a.m. Sept. 8, 2008

It sounds like, once again, that people who are careful not to overspend or extend their resources to the absolute max, are left losers in this morgage mess. Why do those who are frugal, carefully living within their means, have to get burned by the impulsive, the showy, the debt-ridden, ultra-consumer who always wants more, more, more, no matter who gets stuck paying for it?

I believe our financial system would work better if we rewarded the responsible and careful planners instead of bailing out the flamboyant spendthrifts.

Redefine Response | 6:54 a.m. Sept. 8, 2008

Why don't YOU start a lending or medical insurance company and show everybody how its done? YOU deflate the prices and profits and everyone will flock to your company. The theory that government operation will be less expensive because there will be no profit has been thoroughly disproven. Government has no incentive to cut costs, so they don't. The way to business success has typically been to charge less than your competitors. That is where the fortunes have been made.

RedShirt | 7:11 a.m. Sept. 8, 2008

Where are the liberals who constantly cry out that "big oil gets too much government welfare"?! We are about to do something worse than any tax break the oil company has received.

If I am stupid with my money will the government come in and take care of it for me? If you say no, and you agree with bailing out Freddy and Fannie, then explain why the government shouldn't bail me out?

Nell | 7:24 a.m. Sept. 8, 2008

Redshirt - our current financial situation is a result of greed and overall deregulation of the housing industry. You can throw out the dreaded "liberal" moniker all you want but the facts point out that giving free rein to big business and cutting any all protective regulations only hurt the 'little guy'. Yes, big oil has gotten government welfare in the form of tax breaks and now we are all paying to bail out the greed of unregulated big (real estate) business.
Satisfied?

Anonymous | 7:25 a.m. Sept. 8, 2008

I am not sure some of you people seem to really understand what this takeover is going to do. It is going to do very little to assist people that took out loans and now face foreclosure. This takeover will almost solely benefit the big mortgage companies that speculated that they could make big money shifting around these subprime loans. This is just another cooperate hand out. Funny how conservatives are so ready to hand out money to corporations that fail, and sad that they try to frame it as something else.

Another | 7:30 a.m. Sept. 8, 2008

Hey Republicans...another economic downfall creating even greater financial burden on generations to come. And on whose watch?

"On whose watch" ... | 7:48 a.m. Sept. 8, 2008

To "Another" and all the misinformed, liberal talking-point spewing people here:

When you ask "on whose watch" at the end of every story about bad economic stuff please try and remember that the answer is THE DEMOCRAT CONGRESS.

Another | 8:24 a.m. Sept. 8, 2008

To "On whose watch": watch who you are calling a liberal talking-point spewer. As a fellow Republican, I was pointing out just that fact. It is the Democratic congress! Chill out!

RBC | 8:26 a.m. Sept. 8, 2008

I understand all those who think that this bailout of bad lenders is wrong. I agree, except that if we don't do it we could send our entire country into a depression, with the entire world losing confidence in the U.S. financial system. As bad and wrong as this bailout is, it's better than doing nothing and allowing an economic collapse. That said, we had better change the rules so this won't happen again. Everyone who's made a fortune on selling overpriced homes (real estate agents, appraisers, home speculators, contractors, ect.) this past decade
are to blame for pressuring congress and the administration to turn a blind eye to irresponsible lending practices. All so they could retire young..........and greedy.

stevo | 8:28 a.m. Sept. 8, 2008

Socialize the loss. Privatize the profit, how neocon!

I'm a conservative | 8:36 a.m. Sept. 8, 2008

I borrowed cheap money in 2003, well before the take over of Congress by the Dems. This happened on OUR WATCH Republicans!!! What happened to the Contract with America - term limits, line-item veto...well, we got in power and we went to NO VETOES and now we have seen our terms ended - by the voters. Problem is the Dems have no clue either.

Wow | 8:39 a.m. Sept. 8, 2008

This a very poorly written article and doesn't really explain the problem or consequences. I would suggest calculatedrisk for anyone that would really like to understand the problems associated with the takeover.

Anonymous | 8:40 a.m. Sept. 8, 2008

GREAT COMMENT, STEVO!!!!

The Bush Administration......the biggest spenders in US history!

Great | 8:50 a.m. Sept. 8, 2008

Great, another step torwards socialism. This is not the answer. The answer is to let people suffer the consequences of their greed. Makes me sick.

Home Prices | 9:08 a.m. Sept. 8, 2008

They will continue to fall and fall.

Madden | 9:23 a.m. Sept. 8, 2008

Terrible news. Way to go Republicans, can I have my party back now? You've trashed the place enough.

This will only serve to hurt the market - not the stock market, the real one where the rest of us have to play. What kind of government would knowingly back up debt they know will never get re-paid? I didn't think it would be America, my how things have changed.

No person responsibility + no government responsibility = recipe for disaster.

what a joke | 9:36 a.m. Sept. 8, 2008

So I have a home on the east coast and to be responsible did not buy one here because I knew I couldn't afford it. And these other idiots are irresponsible and over-extend themselves and now I get to help bail them out? Disgusting.

Help! | 9:39 a.m. Sept. 8, 2008

Sounds like to me, I need to buy more gold and put a safe in my house. The banks or the government aren't worth much these days. It is coming to every man, woman, and child for youself. Sort of like the good old days. Pa get the gun!

Issue | 9:42 a.m. Sept. 8, 2008

This issue does not have much to do about politics, it's more about greed. Greedy mortgage brokers, greedy home buyers, greedy banks, and greedy lenders.

The mentality that everyone should have a home no matter what. You can blame that mentality on the liberals and the execution of the plan on the conservatives if you'd like.

The problem has been brewing for the past 15 years so to blame anyone party would be unfair.

awesome comment doodles | 9:47 a.m. Sept. 8, 2008

I also work hard and pay my bills and saw this coming and quickly did the paperwork and got into a fixed rate mortgage situation...yet i will ultimately be penalized! those who chose to ignore all the headlines and not work things out with their mortgage companies will probably get a government rebate with their tax refund for all their pain and suffering! I am sooo tired of paying into the system and see the lazy people benefit by my sweat...I know they are laughing at those of us who work hard...because the feds always, always bail those idiots out.

Doodles | 10:06 a.m. Sept. 8, 2008

"The feds always, always bail the idiots out".

Does that mean that "like" recognizes and encourages "like?"

Not a cheerful thought in an election year.

I'm a Conservative Also | 10:12 a.m. Sept. 8, 2008

That's why I have no use for EITHER party. We are getting the results the dumbed down sheeple have chosen and there's more to come.

Pop some popcorn and enjoy the show.

Marc | 10:32 a.m. Sept. 8, 2008

Communists and socialists are very opportunistic and patient as they look for opportunities just as this to step in and to tighten their grip on a nation. They use the "benevolent rescuer" approach because it seems the logical and most reasonable thing to do. However, they are not as interested in saving the "little guy" as they are in gaining power and control. The real problem with this is not a lack of regulation and not the free market. The real problem is pride and greed. Greed of the "little guy" who wants what the "rich guy" has. Pride of the "rich guy" who wants to keep up with and out do his neighbor. And pride of the "ultra rich guy" who wants to use the rest of us to get gain. The solution is not to have increased socialism which absolves us of our responsibilities and of being accountable for our mistakes. The more that happens the greater the risk that greed and pride increase because we don't have to face the consequences of such greed and pride. I am very concerned with the direction of our nation.

Consequences | 10:45 a.m. Sept. 8, 2008

Why can't we let people take the consequences of their actions!!!!?? I don't want to pay for their foolishness. In most cases, people deserve to foreclose!

wrz | 11:22 a.m. Sept. 8, 2008

Another | 7:30 a.m. ----

"Hey Republicans...another economic downfall creating even greater financial burden on generations to come. And on whose watch?"

On whose watch? The Democratic Congress, that's who.

Before the Dumbocrats took over Congress two years ago things were humming along fairly nicely. Since then we had the sub-prime debacle hit us as well as high gas prices. Now unemployment is on the rise. And they now want to control the White House as well? We can't afford them.

wrz | 11:52 a.m. Sept. 8, 2008

Great | 8:50 a.m. ----

"Great, another step towards socialism. The answer is to let people suffer the consequences of their greed."

You don't understand. Fannie and Freddie were entities created by the Federal Government. Their function was to buy up mortgages to free up private bank funds and for other reasons. The government is just taking back control of what the private sector was given to manage but screwed up.

Reason for the screw-up? Same as with the Savings and Loan debacle in the seventies... Lack of and/or poor regulation control over lending institutions... And greed.

Regulation is an absolutely vital function needed to rein in greed. Always has been and always will be. The powers that be in government, seem to never get this through their heads. Nor does the American people. We the voter always give the nod to the candidate who propounds, "I will decrease the government size. I will get the government off the backs of the people." We need the government to control financial institutions because there are very smart thieves out there who can and do game the system. But, alas, government is only as bright as the people who elect them.

say what? | 11:57 a.m. Sept. 8, 2008

Wow, marc that was a real mouth full to say nothing. By the way communist and socialist are not the same thing and what you call communism is actually fascism. I know no one here cares about the definitions but it is important if you want to have an intelligent conversation.

Re "Another | 7:30 a.m. | 1:35 p.m. Sept. 8, 2008

Another | 7:30 a.m.,
You guys love to play the "On who's watch" blame-Game, but you consistently side-step the fact that CONGRESS approved this bail-out NOT THE PRESIDENT!

Now, Do you want to discuss what a great job the Democrat controled Congress is doing? Didn't think so.

Time To Redefine Pt. III | 5:23 p.m. Sept. 8, 2008

I probably didn't explain myself well enough.

I DO NOT support the government taking over private institutions and I DO NOT support a bailout in any form.

I AGREE WHOLEHEARTEDLY with wrz and Marc.

Which leaves us with the big question: How do you control the greed?

Most people say we leave the free market approach to healthcare and housing alone.

We pretty much have, and we are now all reaping the dubious benefits of the unchecked greed and waste involved with these two important sectors.

The answer is regulation, which does not necessarily have to eaquate with "let's have the government run healthcare or housing finance."

Instead, I advocate making basic rules and laws that put restrictions on what the private companies and lenders can do. That is all it takes. A few pieces of well planned legislation, that put some checks and balances in place so that greed isn't able to make things spiral out of control, and I don't give a hoot if you are Republican or Democrat or Independednt: we all can plainly see that things are getting bad in housing and healthcare.

samhill | 5:56 p.m. Sept. 8, 2008

I think the most telling part of the entire article is contained in this phrase by Kevin Iverson, "The government has stepped in to make their backing of Fannie and Freddie MORE EXPLICIT."

Those words, "more explicit", convey the fact that this action was simply the outward expression of the governmental part of the "quasi" government-sponsored enterprise (GSO) organizational scheme of both Freddie Mac (FHLMC) and Fanny Mae (FNMA). It was the result of the governmental aspect failing to properly -govern- the private aspect of the firm. So, essentially, in failing to function as it was supposed to, we are simply witnessing yet another example of a failed GOVERNMENT program.

Lest we forget, this program was a product of our beloved CONGRESS. Fanny in 1938 as part of FDR's "New Deal" and Freddy in 1970. As the country's CEO, Pres. Bush is merely in charge of trying to clean up the mess.

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