Moreover, their is no regulation concerning those people selling mortgages and those building houses. A big selling point of mortgage companies selling adjustable rate mortgages has always been well you can refinance in a couple of years when the rates adjust. However, when real estate values tank because of over building and a loss of jobs, you cannot refinance.

The solution to the current problem is to encourage people to keep their homes by re-modifying the loans to reflect fair market value of the loans. The government would then back up any loss to loan company. There also needs to be regulation controlling the amount of new construction as well as tax incentives offered to keep jobs here.

Here’s a good reference to understand what has happened:
http://online.wsj.com/article/SB122212948811465427.html

The problem is really simple. Some politicians with power insisted that banks give loans to people who couldn’t afford them. The two FMs were set up to take over those loans, and people like Barney Frank were in charge of oversight, which they did not give. I remember a time when banks would actually _check_ to make sure you had the income to cover your loans. Those times, apparently, are long gone, because that would be “discrimination.” The result is what we see today.

-Jon

My grandparents built a house during the depression, and had a $2000 mortgage with the local bank. They took in tenants, and worked very hard. When they both of them lost their jobs in 1929, they asked the bank to foreclose. Instead the banker accepted $1 (one dollar!) per month from them until they found jobs again, it took two years. My grandmother found a job first, they paid $5 for a year , then went back to their regular payment. It’s called “forbearance” and the bank took a hit. But my grandparents kept their house, and the bank got it’s principal back, minus a little profit. No bailout required, just person to person, check the greed at the door. A little common sense can go a long way.

When I get to Heaven I want to meet your grandparents and their banker.

Everywhere you turn they’re telling you one thing - the main problem now is that NOBODY’S LENDING MONEY!!

The credit market is dried up and it is almost impossible to get a loan. Why? there’s too much bad debt floating around in some very large lenders’ balance sheets.

If that bad debt isn’t dealt with, that credit will stay where it is - in the owners’ pockets. What happens next? Will those lenders go out of business?

No, but a lot of other folks that NEED that credit will. Folks you do business with - folks you work for - folks that buy the goods you sell. Maybe the one that folds is YOU, because you can’t get the short term loan you need to pay your workers. Or it’s your boss, cause he can’t get that short term loan to pay YOU!

Have you got more than 100,000 bucks in the bank? FDIC won’t pay you if your bank fails because of this.

That’s quite a nose you’re cutting off there! In spite of your face.

Come on, stop thinking shallow and think about the overall situation. The bill, as written, won’t bail out the fat cats, they are forbidden from getting any of the federal money to pay their golden parachutes. The taxpayers also are to get stock in the companies we bail out, so we get paid back when the market picks back up. - and that 700 Billion isn’t slated to go out the door all at one time, either.

Perhaps your clue should be that the solution was supported by a bipartisan group - and most of the ones that killed it were backers of McCain.

Stop choosing the left or the right. Choose AMERICA! Choose FREEDOM!

Stop whining America, YOU caused this, YOU wanted this, You did NOTHING to avert this. Be at least big enough to stand up and take ownership.

And don’t be dumb, nobody forced the banks to get into this mess, it was pure unadulterated greed on their part.

Yours truly
The World

The problem is really simple. Some politicians with power insisted that banks give loans to people who couldn’t afford them. The two FMs were set up to take over those loans, and people like Barney Frank were in charge of oversight, which they did not give. I remember a time when banks would actually _check_ to make sure you had the income to cover your loans. Those times, apparently, are long gone, because that would be “discrimination.” The result is what we see today.

-Jon

Is there any language in the bill that says these loans will be purchased at (more or less) par? My understanding is that they would be bought at ‘current’ valuations which at this point in time means cents on the dollar. I don’t think a bank that is sinking from the weight of toxic mortgage-backed assets is in a position to demand much in the way of concessions.

We are so quick to demonize our leaders, myself included, but as much as I hate what Bush has done to the country these last eight years, I am with him on this. (And just saw pigs fly on my backyard) I don’t think anyone is looking to rescue these so-called fat cats. Just look at the pound of flesh that Paulsen extracted from AIG. There was nothing concessionary in that deal.

Gentlemen, these protestations about rescuing idiots from the consequences of their own bad choices is truly just cutting off our nose to spite our face.

The problem with the letting the markets correct themselves approach is that why should innocent investors like myself have to pay for the lack of government regulation and corporate greed? I didn’t invest in the housing market, yet my stock is tanking when if the market was operating as it should my stock would be going up. I am 25 percent poorer today then last week not because of reasonable anticipated investment risk but because of a hidden problem that has nothing to do with my area of investments.

The proposed bail out forgives the failed polices of these greedy and inhumane corporations. Don’t get me wrong, some sort of bailout might be necessary to stabilize the market. However, Congress should require companies to be more flexible in their dealings with Americans who are victims of poor government oversight and greed. I met at least ten people a day who are forced to file bankruptcy because companies will not work with them to pay the debt back on terms they can afford. The bailout proposal changes none of that.

if we say we believe in a free society then why should i give my money to people who have proven that they cant take care of there own. if my daughter plays with her food than that means she isnt hungry or is done i dont then give her more. LET THE MARKETS CORRECT THEMSELVES. why will i give people money credit that have a proven record of bad credit worthiness. if wall street had a fico score it would be -500 by now they gets nothing from me and you should demand the same.THEY GOT CAUGHT and should pay the consequences. i would rather go into the next year with incertaincy and no debt than to have the ladder.