IrvineCommuter_IHB
New member
<p>This article seriously ticks me off. . .</p>
<p><a href="http://www.businessweek.com/managing/content/nov2007/ca2007111_215109.htm?campaign_id=yhoo">www.businessweek.com/managing/content/nov2007/ca2007111_215109.htm</a></p>
<p>"All the talk in Washington and New York these days is about the subprime mortgage collapse and the writedowns at financial institutions like Merrill Lynch (<a rel="ticker" href="http://investing.businessweek.com/research/stocks/snapshot/snapshot.asp?symbol=MER">MER</a>) and Citigroup (<a rel="ticker" href="http://investing.businessweek.com/research/stocks/snapshot/snapshot.asp?symbol=C">C</a>). Isn't anyone concerned about homeowners these days? More than one million Americans will lose their homes this year because they cannot keep up with their mortgage payments. So far only Treasury Secretary Henry Paulson seems worried about the homeowners who are being tossed out on the street. </p>
<p>I raised this issue in front of several thousand real estate developers on Oct. 26 in the course of presenting my book, <cite>True North</cite>. While most of the real estate folks were sympathetic to the plight of homeowners, the head of a large real estate investment trust was first up in the Q&A session. He described people who are losing their homes as "nothing but a bunch of speculators who falsified their mortgage applications." </p>
<p><strong>Not exactly, sir. These homeowners are common folks who got talked (might I say conned?) into home purchases with no-down-payment mortgages that offered low rates in the early years until they were adjusted upward. Those people are being forced out of their homes because they can't make the increased payments, and the value of their homes has sunk well below the amount remaining on their mortgages. </strong></p>
<p><strong>Mortgage brokers like Countrywide Financial (</strong><a rel="ticker" href="http://investing.businessweek.com/research/stocks/snapshot/snapshot.asp?symbol=CFC"><strong>CFC</strong></a><strong>), the nation's largest mortgage broker, have been aggressively pushing these offerings</strong>. They have been permitted to operate outside the complex regulatory system that governs our banks and the traditional mortgage companies. Now homeowners are paying a big price for the Bush Administration's lack of regulations to protect consumers...."</p>
<p>No where in this article is personal accountability mentioned. Where is "homeowners' are adults and are responsible for their own actions"? Where is "these people who took out the exotic loans knew full well that they could not afford their homes but bought them anyways"? </p>
<p>This is not a situation where companies put dangerous products out in the market and the consumer could not have known of the danger. No consumer protection is needed. People got greedy and now they are getting burned. This is no different that people buying stocks on margin. </p>
<p>This article reminds of my favorite product warning that was found on a stick of lip balm: "Do not use in or around eyes"</p>
<p><a href="http://www.businessweek.com/managing/content/nov2007/ca2007111_215109.htm?campaign_id=yhoo">www.businessweek.com/managing/content/nov2007/ca2007111_215109.htm</a></p>
<p>"All the talk in Washington and New York these days is about the subprime mortgage collapse and the writedowns at financial institutions like Merrill Lynch (<a rel="ticker" href="http://investing.businessweek.com/research/stocks/snapshot/snapshot.asp?symbol=MER">MER</a>) and Citigroup (<a rel="ticker" href="http://investing.businessweek.com/research/stocks/snapshot/snapshot.asp?symbol=C">C</a>). Isn't anyone concerned about homeowners these days? More than one million Americans will lose their homes this year because they cannot keep up with their mortgage payments. So far only Treasury Secretary Henry Paulson seems worried about the homeowners who are being tossed out on the street. </p>
<p>I raised this issue in front of several thousand real estate developers on Oct. 26 in the course of presenting my book, <cite>True North</cite>. While most of the real estate folks were sympathetic to the plight of homeowners, the head of a large real estate investment trust was first up in the Q&A session. He described people who are losing their homes as "nothing but a bunch of speculators who falsified their mortgage applications." </p>
<p><strong>Not exactly, sir. These homeowners are common folks who got talked (might I say conned?) into home purchases with no-down-payment mortgages that offered low rates in the early years until they were adjusted upward. Those people are being forced out of their homes because they can't make the increased payments, and the value of their homes has sunk well below the amount remaining on their mortgages. </strong></p>
<p><strong>Mortgage brokers like Countrywide Financial (</strong><a rel="ticker" href="http://investing.businessweek.com/research/stocks/snapshot/snapshot.asp?symbol=CFC"><strong>CFC</strong></a><strong>), the nation's largest mortgage broker, have been aggressively pushing these offerings</strong>. They have been permitted to operate outside the complex regulatory system that governs our banks and the traditional mortgage companies. Now homeowners are paying a big price for the Bush Administration's lack of regulations to protect consumers...."</p>
<p>No where in this article is personal accountability mentioned. Where is "homeowners' are adults and are responsible for their own actions"? Where is "these people who took out the exotic loans knew full well that they could not afford their homes but bought them anyways"? </p>
<p>This is not a situation where companies put dangerous products out in the market and the consumer could not have known of the danger. No consumer protection is needed. People got greedy and now they are getting burned. This is no different that people buying stocks on margin. </p>
<p>This article reminds of my favorite product warning that was found on a stick of lip balm: "Do not use in or around eyes"</p>
