Is Bush an "Idiot" or .... ?

[Don Penguinoini]

When bushey went hinting, did he shoot himself in the brain?

 

[Reverend Rick]

The Dollar is worth just over half what it was eight years ago compared to the Euro.
People can't be doing that well on average as you suggest. except by relying on credit.
and it seems that that is about run out for the sub prime market... and very restricted and expensive for everyone else.
That is like throwing away Half of what the country is worth in just 8 or 9 years.
I don't suppose your Governments shouts too loud about that though.

Terry, when a person is invested in foreign funds, the dollars decline translates to a bigger return. The real problem will be when China quits devaluing their currency.

Unless you are going to buy a BMW or a Mercedes, the Euro does not affect the average American.

The credit crunch for home buyers has presented opportunities for some folks. Take the average home price of 225,000. In a stable economy the difference between a normal home and a half million dollar home was 275,000. With a 20% correction the average home is worth 45,000 less, but the half million dollar home is worth 100,000 less making the difference between the homes 220,000.

People who wanted to upgrade saved 55,000 this year. Well qualified buyers have a chance of a life time, not to mention some homes fell below the jumbo mortgage amount offering additional savings on the interest rate of their home loan making something out of reach before more affordable.

 

[Terrywoodenpic]

Terry, when a person is invested in foreign funds, the dollars decline translates to a bigger return.

Un fortunately the usa has a negative balance of investment now... so is bleeding dollars. Though some individuals will always do well at the expense of their country.

The real problem will be when China quits devaluing their currency.

Who told you that .... It is the other way around....they hold so many Dollars that is actually what the USA who wants them to do; so that America can get more goods for the dollar.

Unless you are going to buy a BMW or a Mercedes, the Euro does not affect the average American.

When Wilson was prime minister we devalued the pound... he said the pound in your pocket is the same as it always was. That is the same financial fallacy you have just given.

The credit crunch for home buyers has presented opportunities for some folks. Take the average home price of 225,000. In a stable economy the difference between a normal home and a half million dollar home was 275,000. With a 20% correction the average home is worth 45,000 less, but the half million dollar home is worth 100,000 less making the difference between the homes 220,000.

That is totally academic when you can no longer get the credit.
the only winners will be the extreme wealthy who can buy up repossessed property and wait it out.
When we had a house slump 20 years ago, I had a work related move, but could not sell my house...
fortunately I was in the position to sit and wait ... I rented it out at a profit ... and sold it ten years later. Many lost everything who were not so fortunate.

People who wanted to upgrade saved 55,000 this year. Well qualified buyers have a chance of a life time, not to mention some homes fell below the jumbo mortgage amount offering additional savings on the interest rate of their home loan making something out of reach before more affordable.

Unfortunately the sub prime and middle class market are finding that mortgages are not available with out excellent collateral. so your theory will not now work.

I do not think you understand the international Bank relationships. For instance even British banks are showing many Billions of dollars of losses on your housing markets.
And have withdrawn their input to your financial lending markets. It seems the banks of Britain and Europe were supporting almost 50% of your own Banks housing loans.
It will take a massive return to confidence and an equally large hike of interest rates for them to return.

In the mean time the weakness of the dollar is effecting all international finance and trade. It is this that may lead to a major world slump. America will be hit first but it will filter down to us all.

My shares in one of the safest British banks, who only have a small exposure to American funds have fallen by 15% in the last six weeks. Ok. I will wait it out but those who have to sell will not be very happy.

 

[Terrywoodenpic]

On the financial news yesterday it was mentioned some 50,000 American pensioners living in Britain have seen their dollar pensions devalued by between 40 and 60% over the last three years.
one who was interviewed is only doing his laundry once a week to save cash and limiting his heating to a few hours a day. He was on a full colonels American pension.

 

[Smoke]

who is the real idiot, Bush, or those who voted for him twice!

Both. Evil, too.

 

[Smoke]

Though some individuals will always do well at the expense of their country.

We used to call such individuals traitors; now we call them Traditional Values Republicans.

 

[Quagmire]

That's really interesting!

I used to hear such a thing from non-americans alot.

I wish I were kidding Truth.

 

[Mathematician]

He stuck lit fireworks down frogs' throats and watched them explode. If you were to ask me, which I know many people try not to do, that's a sign of a sociopath. Contrast it with Kucinich who watched frogs as a boy and noticed their care-free nature.

 

[Reverend Rick]

Un fortunately the usa has a negative balance of investment now... so is bleeding dollars. Though some individuals will always do well at the expense of their country.

How can investing in world funds translate into doing well at the expense of their country? I have a 401K fund for my employees and the foreign fund made a 28% profit last year. My employees have a more secure retirement future because of foreign investments.

Who told you that .... It is the other way around....they hold so many Dollars that is actually what the USA who wants them to do; so that America can get more goods for the dollar.

Yes, we are able to buy more cheaply made dangerous Chinese goods right now because China is propping up the dollar. They will have to quit devaluing their currency some day and the dollar will not be worth very much. As you mentioned, with shrinking equity in the homes market and Americans not saving much money, all that will happen is inflation will run rampant. The folks who have saved dollars will find their money worth less, but the folks who have no money to begin with will have lost nothing. The smart investor can make money in any market.

When Wilson was prime minister we devalued the pound... he said the pound in your pocket is the same as it always was. That is the same financial fallacy you have just given.

If you buy foreign goods you are right.

That is totally academic when you can no longer get the credit.
the only winners will be the extreme wealthy who can buy up repossessed property and wait it out.
When we had a house slump 20 years ago, I had a work related move, but could not sell my house...
fortunately I was in the position to sit and wait ... I rented it out at a profit ... and sold it ten years later. Many lost everything who were not so fortunate.


Unfortunately the sub prime and middle class market are finding that mortgages are not available with out excellent collateral. so your theory will not now work.

Now is the time to own more real estate, it will ride the inflation train and will still be worth more than money in the bank will. My theory works just fine as long as you have 10-20% to put down on a loan and your DTI ratio is acceptable. This housing slump is a golden opportunity for investors to hedge the falling dollar and pay low interest loans back with inflated dollars.

I do not think you understand the international Bank relationships. For instance even British banks are showing many Billions of dollars of losses on your housing markets.
And have withdrawn their input to your financial lending markets. It seems the banks of Britain and Europe were supporting almost 50% of your own Banks housing loans.
It will take a massive return to confidence and an equally large hike of interest rates for them to return.

I understand that investing in foreign countries who deal with currency other than the dollar is not a bad idea right now. I realize the world is smaller, if that is what you mean and if the dollar sees a sharp decline, it will trickle down to other currencies. Timing is everything and it will be necessary for me to get out of foreign funds at some time and buy American bonds that will pay higher interest than the rate of inflation. Remember, I never said I was an investment banker, I just am a southern reverend farmer who worked hard all his life and saved and invested. I don't know it all, but I have lived through times of double digit inflation and know where my money should be and where it should not in troubled times. Most of us could handle a recession, but a depression would hurt everyone.

In the mean time the weakness of the dollar is effecting all international finance and trade. It is this that may lead to a major world slump. America will be hit first but it will filter down to us all.

My shares in one of the safest British banks, who only have a small exposure to American funds have fallen by 15% in the last six weeks. Ok. I will wait it out but those who have to sell will not be very happy.

Why do people sell after a stock drops? That is the time to buy. I am an investor, not a trader. In the long haul things will get back on track. We may have to move things around a bit, but there is some serious money to be made during changing times. I don't wish these things to happen, but I know how to survive bad times. People addicted to credit cards and buying the latest fashions will be in for a rude surprise however.

 

[yossarian22]

Devaluing currency is not as bad as some people make it out. It can be beneficial to many people, especially those with large debts.
Not that I particularly enjoy having my buying power decrease.

 

[Reverend Rick]

Devaluing currency is not as bad as some people make it out. It can be beneficial to many people, especially those with large debts.
Not that I particularly enjoy having my buying power decrease.

That should be temporary. Most people just get a raise when inflation strikes.

 

[yossarian22]

That should be temporary. Most people just get a raise when inflation strikes.

Wages lag behind inflation rates by a few years. It takes time to respond. Especially for people in minimum wage jobs. Company won't pay them more unless they are required by law, which can take a very long time.
Cheapened debt is good though, unless you happen to be a bank.

 

[Terrywoodenpic]

Wages lag behind inflation rates by a few years. It takes time to respond. Especially for people in minimum wage jobs. Company won't pay them more unless they are required by law, which can take a very long time.
Cheapened debt is good though, unless you happen to be a bank.

You are right in one way... provided you are in a position to settle up and have a good Job. periods of high inflation allow you to borrow, preferably over as long a period as possible, and pay it off with de valued money. I once had a fixed interest mortgage during high inflation, when the situation improved my payments seemed like peanuts.where it had been about 30% of my salary at the start it ended up at less than 5%, and not only that the house had increased in value manyfold.

Don't worry about the Banks they do very well out of repossessions during these times, they also clean up buying in devalued stock... and sell it later when things get back on track. They also call in loans and take the payment in real assets.

 

[Terrywoodenpic]

Purex, I believe you and I might vote on principle rather than money issues, but most people won't. I don't know of anyone who does not consider voting these days as a lesser of two evils.

That is very sad

 

[Reverend Rick]

You are right in one way... provided you are in a position to settle up and have a good Job. periods of high inflation allow you to borrow, preferably over as long a period as possible, and pay it off with de valued money. I once had a fixed interest mortgage during high inflation, when the situation improved my payments seemed like peanuts.where it had been about 30% of my salary at the start it ended up at less than 5%, and not only that the house had increased in value manyfold.

Don't worry about the Banks they do very well out of repossessions during these times, they also clean up buying in devalued stock... and sell it later when things get back on track. They also call in loans and take the payment in real assets.

Yeppers Terry, in the good ol days you had to save up a down payment and bought the biggest house you could afford and made sacrifices to meet your mortgage payment each month until you grew into your payment. A young man made more money later on and the payment became easier each year to make all the while he improved the property and made it more valuable. Later on, you discovered that "principal only payments" could save you years of payments down the road and being out of debt was a goal in life.

Not so today with sub-prime lenders letting anyone with a pulse have a 100% loan and then let the owners refinance ever several years and remove the equity from the home. That coupled with variable interest rate loans enabling a person to buy way more house than they could afford in the first place was building a house of cards.

When you have no equity in a home, or worse yet upside down with your mortgage, many people just walk away. People just ran up their credit cards living beyond their means and refinanced their home every few years and paid the cards off just to run them up again.

Lenders have become no more than brokers and had no real concerns about the chances of repayment, they were just interested in making the money off closing costs.

Who is buying all this paper? Investors who manage retirement accounts. The real estate they hold is over valued because an appraiser that makes a correct valuation of a property is never employed for being truthful.

The bottom line, the sub-prime borrower, lender and appraiser is robbing folks pensions.

And folks wonder why a correction was necessary.....

 

[dawny0826]

Those who voted for Shrub twice have proven the axiom: YOU CAN FOOL SOME OF THE PEOPLE ALL OF THE TIME! For the most part they are still defending their selection as if electing a REAL war hero would have been bad for Iraq! WE WOULD NOT HAVE HAD AN IRAQI WAR!!! There is NOTHING wrong with that.

Gee, thanks.

 

[Terrywoodenpic]

Yeppers Terry, in the good ol days you had to save up a down payment and bought the biggest house you could afford and made sacrifices to meet your mortgage payment each month until you grew into your payment. A young man made more money later on and the payment became easier each year to make all the while he improved the property and made it more valuable. Later on, you discovered that "principal only payments" could save you years of payments down the road and being out of debt was a goal in life.

My mortgage at the time was fixed for 30 years at 3 1/2 % The interest rates went up during the high inflation to a high of 17% ever since no one has offered such a low mortgage. It would have paid me to keep it going as they were in effect paying me to borrow... however no one wants to live in the same place for ever... renting out is profitable but a huge hassle. I have not had a mortgage since.

Not so today with sub-prime lenders letting anyone with a pulse have a 100% loan and then let the owners refinance ever several years and remove the equity from the home. That coupled with variable interest rate loans enabling a person to buy way more house than they could afford in the first place was building a house of cards.

When you have no equity in a home, or worse yet upside down with your mortgage, many people just walk away. People just ran up their credit cards living beyond their means and refinanced their home every few years and paid the cards off just to run them up again.

we have a lot of people like that, I had a secretary who was in that boat. It went from bad to worse and destroyed her marriage.

Lenders have become no more than brokers and had no real concerns about the chances of repayment, they were just interested in making the money off closing costs.

We have very few of your sort of lender as it is heavily regulated and the Building societies and banks always send in their own valuers... so when things foul up they never loose.

Who is buying all this paper? Investors who manage retirement accounts. The real estate they hold is over valued because an appraiser that makes a correct valuation of a property is never employed for being truthful.

The only company who worked that way, Northern Rock, would have failed with out Bank of England loans... It is now in the process of being sold.

The bottom line, the sub-prime borrower, lender and appraiser is robbing folks pensions.

Pension money can not be invested like that here (also regulated) they are only allowed to invest in certain guaranteed stocks.

And folks wonder why a correction was necessary.....

It could get bad here ... but it sound far worse over there.

 

[Reverend Rick]

It could get bad here ... but it sound far worse over there.

It will get worse, but it will get better again as well. Corrections never last too long. The true investor just hangs on and over time comes out just fine.

 

[Don Penguinoini]

Even Dick Cheney learn from bush, bush shot himself in the head (hence the stupidity) Dick went and shot someone else... Geroge Bush is just a really crazy person, he said paki...

 

[yossarian22]

When bushey went hinting, did he shoot himself in the brain?

So, were you trying to be ironic?