Does anyone agree with the $700 bailout?

Obfuscate said:
SuperFreak obviously makes it up as he goes. I'm selling REO and know for a fact we're getting 50-60 cents on the dollar of previous values. Many times less in outline areas, 20-30 cents on land. I have to do year end evaluations for our banking partners and last December many areas were 30-50% lower and a year later we're worse off.

Old values IE the note amount were based on shady inflated appraisals. Everyone in the buisiness knows that. The 30 cents or whatever number is based on that appraised value.
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God you are fucking retarded. I also have stated that many of these mortgages are trading around 65-70 cents on the open market. But the worst is currently being marked to market at about 15-30 cents on the dollar.

I provide the NATIONAL average and you continue with your arbitrary 'i know many areas that are down 30-50%'... look at the fucking data dumbshit. The national average is not that bad. I could care less if you work with REO's. It does not change the basic math behind the buyouts of these loans.

Yes, there are SOME areas where real estate is down 50%... but it IS NOT the average for the country. THESE areas are where you are indeed seeing the worst mortgages... those pricing at 15-30 cents on the dollar. THAT is WHY they price lower.

I notice you have yet to dispute the numbers in the examples I provided. You instead cling to your 'well gee golly I know some numbers based on my personal experience and I will act like all mortgages are doing exactly the same thing'.

AGAIN....

Will the government make money off the equity in the banks? Or do you think the banks, once they clean their balance sheets, will go down in value?

THAT coupled with the ability to refi these loans, pump money into the market and unwind this bad debt and resell it...

this will MAKE money for the taxpayers.
 
How about I bet you $10,000 that the Government loses money, lots of money at that. Which isn't even near as bad as the precedent it makes and the power you're allowing congress and wall street to have over the public in the future.
 
KingCondanomation said:
You could be right and that is my fear.
But IF we do, it will be a far FAR higher chance of ending up with permanent nationalization with Dems in power, I'm sure you know that. Don't be so pissed at the Repubs that you set aside your good judgement in forgetting what ideology the Dems are playing for.
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Bullshit. If the Republicans were in power this thing would have been a done deal already. $700 billion to Paulson with no strings attached.

Maybe that would have resulted in no equity or warrants in favor of the government in consideration for the $700 billion, but I don't consider that a good thing. Neither should you.

The Democrats are playing for getting something in return for recapitalization of bankrupt companies whereas the Republicans are playing to loot the Treasury and recapitalize bankrupt companies for nothing in return.
 
Obfuscate said:
That shows a 25% drop and was from earlier this year. It's got much worse since then and will continue to get worse when all these investors start walking on their homes, there are many more foreclosures to come and lots and lots of inventory to be sold before prices stop declining. But somehow you think that they will make a profit and this will be temporary. Please.
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Again.... are you suggesting that 100% of these homeowners walk away? If not, what percent do you think will do so?

These are not ALL going to go into foreclosure. The national average is under 2%. For subprimes as of May it was about 25%. For arguments sake, say it has increased to 35% since May. Then if you pay 65 cents on the dollar the probability that you break even on the loans alone is 100%. Which does not include any gains from the sale of equity positions. AND it assumes that the credit problem stays the same rather than improves.
 
Superfreak said:
God you are fucking retarded. I also have stated that many of these mortgages are trading around 65-70 cents on the open market. But the worst is currently being marked to market at about 15-30 cents on the dollar.

I provide the NATIONAL average and you continue with your arbitrary 'i know many areas that are down 30-50%'... look at the fucking data dumbshit. The national average is not that bad. I could care less if you work with REO's. It does not change the basic math behind the buyouts of these loans.

Yes, there are SOME areas where real estate is down 50%... but it IS NOT the average for the country. THESE areas are where you are indeed seeing the worst mortgages... those pricing at 15-30 cents on the dollar. THAT is WHY they price lower.

I notice you have yet to dispute the numbers in the examples I provided. You instead cling to your 'well gee golly I know some numbers based on my personal experience and I will act like all mortgages are doing exactly the same thing'.

AGAIN....

Will the government make money off the equity in the banks? Or do you think the banks, once they clean their balance sheets, will go down in value?

THAT coupled with the ability to refi these loans, pump money into the market and unwind this bad debt and resell it...

this will MAKE money for the taxpayers.
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You assume that the government would gain equity in exchange for the capital. That wasn't the original plan. And I suppose it depends on the price of the shares or warrants the government ends up with. If the price is overinflated, then no, it is not necessarily a given that the government will make money on this.
 
Dungheap said:
You assume that the government would gain equity in exchange for the capital. That wasn't the original plan. And I suppose it depends on the price of the shares or warrants the government ends up with. If the price is overinflated, then no, it is not necessarily a given that the government will make money on this.
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SF this post reminds me, I had asked you earlier if you had any speculation at all as to why the bushies tried to do this to the country?
 
Dungheap said:
You assume that the government would gain equity in exchange for the capital. That wasn't the original plan. And I suppose it depends on the price of the shares or warrants the government ends up with. If the price is overinflated, then no, it is not necessarily a given that the government will make money on this.
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you are correct in that it was not a part of Bush's original plan. But direct equity and warrants ARE a part of the deal that Congress is promoting. Which is good. Because it takes puts the hit to the shareholders rather than the taxpayers. You are correct also in stating that if they accept over-inflated values for the equity/warrants that they could lose money.

Personally, given the attitude we are seeing from Congress, I don't see that happening. But will have to wait until we see the actual deal done to determine.
 
Superfreak said:
Again.... are you suggesting that 100% of these homeowners walk away? If not, what percent do you think will do so?
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Yes, close to 100%. These are people that don't have the income or credit to pay for them, that's the whole point and why we're in this mess. Plus now their houses are worth close to half what they bought them for. They will never be able to sell them unless the Mortgage holder discounts to make the short sale at the discounted LOSS. Where is this gain coming from?
 
Darla said:
SF this post reminds me, I had asked you earlier if you had any speculation at all as to why the bushies tried to do this to the country?
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I had responded. I don't think anyone TRIED to do this. I am willing to listen to your reasoning as to why you think this was deliberate. Thus far I have only heard something to the effect of 'it gives them an excuse to privatize everything'. But I haven't seen an explanation as to HOW it does this.

Not saying that it is/isn't true... but I simply don't understand how you get to that point.
 
Dungheap said:
Bullshit. If the Republicans were in power this thing would have been a done deal already. $700 billion to Paulson with no strings attached.

Maybe that would have resulted in no equity or warrants in favor of the government in consideration for the $700 billion, but I don't consider that a good thing. Neither should you.

The Democrats are playing for getting something in return for recapitalization of bankrupt companies whereas the Republicans are playing to loot the Treasury and recapitalize bankrupt companies for nothing in return.
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That actually could possibly be true, based on the corporate favor Repubs of this decade have shown.
But you are missing my point, we are talking about permanent nationalization versus temporary, the Dems I would trust far far less on being able to let go and allow a free market once more without government ownership.

And no I do not consider the bailout a good thing.
 
Superfreak said:
I had responded. I don't think anyone TRIED to do this. I am willing to listen to your reasoning as to why you think this was deliberate. Thus far I have only heard something to the effect of 'it gives them an excuse to privatize everything'. But I haven't seen an explanation as to HOW it does this.

Not saying that it is/isn't true... but I simply don't understand how you get to that point.
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It's money grab for wall street types. They want out of their own mistakes. There is no way anyone can make money these shit assets, despite your fictive and hallucinatory scenarios.
 
Obfuscate said:
Yes, close to 100%. These are people that don't have the income or credit to pay for them, that's the whole point and why we're in this mess. Plus now their houses are worth close to half what they bought them for. They will never be able to sell them unless the Mortgage holder discounts to make the short sale at the discounted LOSS. Where is this gain coming from?
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Bullshit. The national default rate on subprime was at 25% in May. You are pulling shit out of your ass to suggest it will jump to 100%. Again, the national average did NOT decline by 50%. Either back that up with ACTUAL data or quit spouting off that bullshit.
 
AssHatZombie said:
Don't ignore me, sf, you lying piece of shit bastard. You explain how these investments turn a profit when people in the business of recognizing profit do not want to touch them with a ten foot pole.
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How did the S&L things turn a profit? How did the Sweden debt turn a profit?

They don't touch them because they don't have the capital. They don't work for the public good.
 
Superfreak said:
Bullshit. The national default rate on subprime was at 25% in May. You are pulling shit out of your ass to suggest it will jump to 100%. Again, the national average did NOT decline by 50%. Either back that up with ACTUAL data or quit spouting off that bullshit.
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So if it was only 25% why the panic ?
 
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