Work At Home Resources

700 Billion Dollar Bailout, More Bailouts vs Property Taxes

Are we missing the outrage for being sold down the river by a band of numbskulls in the mortgage crisis? Even our choice for presidential candidates show heavily embedded lobby and financial interests for a Marxist socialist solution or a watered down free market solution. Both are sleepwalking in lobby money and favoritism.

Selling an expensive assets such as a homes to those who are unprepared financially to deal with making mortgage payments, insurances and property taxes is foolish. But that is exactly what president Jimmy Carter did by passing legislation encouraging such loans. This started the disconnect between reason and reality and utter foolishness. Political meddling into economic issues and sound lending practices kills the golden goose every time.

Along came Bill Clinton who put extra teeth in the law by disciplining mortgage and investment companies that did not extend credit to people who were bad credit risks. He put them into residences they couldn’t afford let alone deal with the property taxes. A further deregulating and credit risk was encouraged by mortgage companies; those that didn’t comply to lose lending practices were hampered from expanding their footprint in the community.

These foolish loans were bought up by Fannie Mae and Freddie Mac. They repackaged these loans and sold them on the open market to other financial institutions. They also gave hundreds of millions of dollars into political coffers to ensure this circus continued.

AIG and other insurance companies insured these loans. Their chief fuction is to evaluate and insure against debt risk. Their leverage was set at 12 to 1 meaning that they had to have one dollar in assets to cover 12 dollars or risk. They threw millions of lobby money to leveraging its recirculation rate at a reserve rate of more than 30-1. With such a high-risk and profit expansion levels, any big bump in real estate valuation put those assets in jeapordy.

This fraud was given the stamp of approval by chief economists Greenspan and Bernanke and the ship of fool’s balloon took off. Socialist organizations such as Acorn (Association of Community Organizations for Reform Now) and other kindred groups pressured banks into giving even more misguided loans.

Banking Committee Chairman, The House Finance Chief, SEC Chairman and other top-ranking government officials allowed this cancer to perpetuate because of the lobby money they received. The greed for lobby money twisted sound reasoning and perpetuated complete nonsensical thinking. The only solution for not tempting elected officials to sway their votes from socially responsible to sociopathic dimensions is to banish those accepting lobby money from government service as well as requiring prison terms.

When the hot air balloon runs out of fuel used to create the hot air, the balloon crashes. When the easy credit real estate market turned and foreclosures skyrocketed, the balloon was punctured and stopped climbing; it crashed. Humpty Dumpty and the 700 billion dollar bailout that was weighed down with pork project bought and paid for by additional lobby money show how corrupt these weasels are. Where is the ethical outrage?

The other news: Lower real estate prices has many towns raising tax rates to compensate for lower real estate assessment values. If you compare your home’s value to comparative values of recently sold homes there is a good chance you qualify for a property tax appeal. At least, you should look into whether you have a case.