mortgagemeltdownblog.com

I have been watching and reading a lot the past few months, holding my anger in.  No more.  It’s July 4th, independence day, and it’s time citizens take back this great country and throw / vote out the liberal social engineers that call themselves Congressmen, Congresswomen and President.  Plain and simple, it was idealistic liberal elites that caused the housing bubble, the subsequent mortgage meltdown and the ensuing and ongoing global meltdown and a U.S. recession that will most likely be relabeled as the 2nd Great Depression.  This is a very long post… I think you will find it quite informative.

In the July 3rd, 2009 Wall Street Journal, on page A13 is a ridiculous article by Stan Liebowitz, a professor of economics at the University of Texas at Dallas.  With all due respect, while this man has more education, degrees, accolades and publications than 1,000 non-academics have combined, it is apparent he is functionally clueless as to how the mortgage industry really works, or at least used to work before D.C. socialists mucked it up.

The graph that accompanies his article is self-explanatory and he does an excellent job of pointing out that in 2008, 285,305 loans that were foreclosed had negative equity, meaning they were “upside down” or “underwater.”  In layman’s terms, that means the amount owed on the mortgage was more than the value of the home.  When people who bought homes near or at the top of the housing bubble, mostly from 2005-2008, saw property values plummet almost from the very year they bought the home, Mr. Liebowitz concludes: “They find it easier to walk away from the home.”  Duh!

Mr. Liebowitz states correctly that the common belief is that SUBPRIME loans are what caused the mortgage / housing meltdown.  However he then states that it is homes with negative equity (upside down) that are the primary cause and further states these are prime loans (not subprime) and accounted for 51% of all foreclosed loans.

If all this seems too confusing, it is because an academic (Mr. Liebowitz) that has never been in the mortgage industry, is trying to explain the cause of the meltdown vs a mortgage industry professional who actually knows what he is talking about.  I suspect his inanity can be explained by two factors:

1. Mr. Liebowicz’ ignorance of real world knowledge having never been in the mortgage industry (vs reading textbooks and other business literature).

2. The liberal prism he views the world through that blinds him to the true causes of the mortgage crisis based on inescapable facts.

Let’s examine each one.

Prior to approximately 2002, we had only three types of mortgage loans:
1. Prime loans, also known as Fannie Mae & Freddie Mac loans, also known as conforming loans, also known as A paper loans
2. Federal Housing Administration (FHA) loans
3. Veterans Administration (VA) loans

Let’s take each one and examine who qualified for each loan type.

1. Prime (Fannie / Freddie, conforming, A paper) loans…
The essence of this category of loans is that borrowers who qualified were based on what the definition of “Conforming” is.  Conforming to what?  Fannie and Freddie guidelines is the answer.  What were those guidelines before the social engineering of liberals in Congress changed them in the now very failed guise of “affordable housing?”

FICO (credit) scores above 620
Debt-to-income (DTI) ratios no more than 36% for housing + all other installment and revolving payments (credit cards, car loans, student loans, etc.)
A downpayment of 20% or more.
Proof of income.
Job stability.

This was sanity also known as “relatively stronger underwriting standards, especially a requirement for relatively high downpayments.” (A direct quote from Mr. Liebowitz’ WSJ article today, stated as what was needed to have prevented the meltdown.)   Keep in mind that this was what was called PRIME loans until the liberals in Washington changed the rules.  More on this later in this post.

2.  FHA loans - affordable housing for people who couldn’t qualify under PRIME loan guidelines. Although the term wasn’t in vogue in 2002, FHA loans were by definition, SUBPRIME or “non-conforming” loans… loans to borrowers that didn’t meet PRIME (”relatively stronger underwriting standards”) guidelines.  FHA was the precursor to SUBPRIME mania only we called them FHA loans back then.  This was actually ok because only about 3% of all loans were FHA loans.  People with: less than 20% down, lower FICO scores (down to the low 500’s in some FHA loans), higher DTIs and less job stability.  (They still had to prove their income however.)  A high percent of these FHA loans were to minorities and many had not established a credit history so they were allowed to document payment histories never sent to the 3 credit repositories: landlords (rent payments), contractors who did work on their homes and were paid in installments, utilities and more).  FHA was a great program but contained these non-conforming / SUBPRIME loans to just about 3% of all homeowners.

3. VA loans - veterans of the Army, Navy, Air Force, Marines and the U.S. Coast Guard were allowed zero downpayment and up to 45% DTI’s. They had to document their income, job stability and had to have good credit, occasionally below 620 FICO’s at the discretion of the VA underwriter.  (If any small group of people deserve a relaxation of underwriting guidelines, it is our Veterans who served and many of whom put their lives on the line for us.)

So there you have the segments of the mortgage industry up until around 2002. Then the rules began to change and we’ll get back to why the rules changed in a minute.  BUT.. the fact that they did change renders Mr. Liebowitz’s article, well, naive and insanely ignorant.

Here’s why.  He states that negative equity (homeowners who are upside down on their mortgages) accounts for 51% of foreclosures in 2008 but that these are PRIME (conforming) borrowers, not the SUBPRIME (non-conforming) group that he claims is a misperception as the cause of the meltdown. Well, if people are upside down in 2008 and 2009, the vast majority of these people are upside down because they made little to zero downpayments when they bought the home and a HUGE number of them also used the so-called Alt A and Option ARMs that proliferated from 2004-2007!  Many of these borrowers had great FICO scores but FICO scores were just 1 of about 5 requirements to be so-called PRIME or conforming borrowers!  Based on “stronger underwriting standards” in use up to around 2002, these are SUBPRIME borrowers, and for the most part, had smaller downpayments across the board whether they used Fannie and Freddie (PRIME) loan programs, Alt A or Option ARM loan programs.  (Insanely, banks started offering “piggyback” second mortgages that allowed borrowers to borrow the 20% down payment and only have an 80% first mortgage, therefore obtaining a PRIME or Fannie Mae or Freddie Mac loan.  Although I cannot pinpoint the date these came into vogue, this was a back door way for high FICO borrowers to get a zero downpayment loan that was never allowed before the banks and Washington relaxed all the sane underwriting guidelines.  These loans allowed high FICO borrowers to get PRIME loans but were in essence the very definition of high risk or SUBPRIME loans!  Another loophole came into play by allowing private mortgage insurance (PMI) to guarantee “prime” loans with 5%, 10% or 15% downpayments, less than the PRIME (conforming) guideline of 20%.  These borrowers who used piggyback second mortgages or the PMI insurance to get around the 20% PRIME downpayment requirement guideline, all had very high FICO scores and DTIs that still met PRIME guidelines. You can see the lines between what constitutes PRIME vs SUBPRIME got very convoluted in the push by liberals to increase homeownership by people that couldn’t qualify under traditional, sane underwriting guidelines.)

Let’s recap because it can be confusing:
PRIME borrowers up to 2002:
20% or larger downpayment
FICO’s above 620
DTIs no higher than 36%
Proof of income
Job stability

SUBPRIME borrowers - anyone who didn’t meet all of the PRIME guidelines!

If you didn’t meet all the PRIME guidelines, you were a SUBPRIME borrower and either got an FHA loan (or VA if you were a veteran) OR YOU DIDN’T GET A HOME LOAN!  YOU WERE A RENTER until you could qualify to be a PRIME borrower.  Many people should have remained renters.  End of story.

So here’s my beef with Mr. Liebowitz’s article… he declares that it isn’t SUBPRIME borrowers in these ALT A, Option ARM and other SUBPRIME loans (known as 3/1, 5/1 ARMs, 2/28, 3/27 and others) that caused and continue to cause the high rate of foreclosures that is still accelerating.  He claims the cause is borrowers who made little to zero downpayments, many with high credit scores.  Hello!  Those are (prior to 2002) by definition, SUBPRIME borrowers!!!  Duh again.

The underwriting rules / guidelines for PRIME borrowers were “relaxed” around 2002 and we saw the advent of so-called Alt A guidelines. (These were also called “barely missed” Fannie / Freddie programs. What they “barely missed” were PRIME guidelines!!!) If a loan was not PRIME, it was SUBPRIME or non-conforming to the old “stronger underwriting standards” Mr. Liebowitz is now crying out for and clearly states would have prevented the meltdown!  If only we had adhered to those “stronger underwriting standards” indeed Mr. Liebowitz, we would not have had a meltdown!

Just because the PRIME / CONFORMING / FANNIE-FREDDIE guidelines were changed (”relaxed”), does not mean they are or were PRIME borrowers!  No!  It means Washington social idiots changed the rules (underwriting guidelines) so that Fannie & Freddie could now buy from banks what used to be called SUBPRIME loans!  The fact that Fannie and Freddie used to ONLY buy PRIME loans from banks has not meant since about 2002 or 2003 that they were buying safe, statistically predictable performing loans from PRIME borrowers, based on what we used to know as “stronger underwriting standards”!  NO!  It means they changed the definition of what PRIME and SUBPRIME loans are and then they (Washington, the banks and Wall Street) loaded up the balance sheets of Fannie Mae, Freddie Mac, banks, pension funds, retirement accounts and many other conservative investment vehicles the world over that were told by Standard & Poors, Fitch and Moody’s were all AAA rated mortgage backed securities or collateralized debt obligations (CDOs).  (Internal emails from  these 3 ratings agencies proved the subordinates who labeled the CDOs as AAA, knew they were NOT AAA but were told by managers basically to “shut up, stamp them and get them out of here.”)  The ratings agencies have not yet had their feet held to the fire over this farce but hopefully will be under “truth commissions” promised by Washington. (If you believe that will ever occur and really tell the truth about the who and what that caused the meltdown, I have some AAA rated CDOs in my 401k turned into a 201k I’d like to sell you at a great price.)

Mr. Liebowitz, in claiming that 51% of the 2008 foreclosures were not SUBPRIME loans, but rather PRIME loans, conveniently or ignorantly, ignores the irrefutable fact that today’s non-performing (delinquent) loans, whether foreclosed or headed to foreclosure, are indeed mostly SUBPRIME loans based on “stronger underwriting standards” that existed before the Washington liberals social retooling of the entire mortgage industry guidelines, rules and sanity that existed before 2002.  In fact, 73.8% of the categories of foreclosures shown in his chart would have been SUBPRIME loans under “stronger underwriting standards” he laments went away.  That’s pretty damn close to 75% of all foreclosed loans in 2008 that would have been classified as SUBPRIME loans 7 years or more ago.

So, if Mr. Liebowitz wants to pretend that the rules didn’t change he can paint a facade that makes it look like SUBPRIME lending practices did not cause the bubble and the attendant meltdown but that simply is not reality.  In order to point fingers at the appropriate people and policies, he must accept the fact that it was an expansion of the definition of PRIME (conforming) loans and therefore previously SUBPRIME (non-conforming) borrowers could use previously PRIME loan programs to own a home, all in the spirit of increasing home ownership by people who could not qualify for a mortgage loan under “stronger underwriting standards” that were used for decades and decades before 2002.

Here’s the sequence of events and the people that caused the relaxation of sane underwriting standards that led to higher homeownership, the drastic lapse and changing of the underwriting standards, the real estate bubble, the housing / mortgage implosion and the toxic mortgages (CDOs) on the balance sheets of institutions, municipalities and in retirement plans the world over, causing the global meltdown:

• President Jimmy Carter signed the CRA (Community Reinvestment Act) calling for banks to make more loans to people who normally couldn’t qualify (SUBPRIME borrowers).
• President Bill Clinton creates quotas for the banks who he felt were not making enough CRA loans.
• President Bill Clinton commands Robert Rubin, his Treasury Secretary, to re-write the charters of Fannie Mae and Freddie Mac, allowing them buy SUBPRIME loans for the first time, providing the banks a secondary market to sell these toxic assets to and get them off the bank’s balance sheets as quickly as they made them.
• President Bill Clinton increased the quotas for Fannie and Freddie. In effect Clinton now set in motion a mandate to banks to make more and more of these loans and Fannie and Freddie an annually increasing requirement to buy them.
• As the momentum of making these very profitable loans escalated (loans that carried higher rates and fees to offset the higher risks of SUBPRIME borrowers), Wall Street chose to create CDOs and sell these ostensibly AAA rated securities to the world.  Along came a new breed of lenders, mostly not banks at first, that created the Alt A, Option ARM, 2/28, 3/27 loan programs that also saw the advent of pre-payment penalties and hidden fees to soak unsophisticated SUBPRIME borrowers.  A Harvard professor, Howell Jackson, did a study in 2002 (before SUBPRIME loans were around to much degree) that showed there were hidden fees on 80% of all loans and that these hidden fees amounted to 40% of the overall costs of a loan!  Someone should do a study on the era of SUBPRIME loans from 2003-2007 and see what percent of those had hidden fees.  It’s probably near 100%.
• As various conservatives in Congress saw the debacle that was to become the housing bubble, hearings were held to warn that SUBPRIME lending was out of control and should be stopped.  These hearings took place from 2003-2007 as the bubble built into an out of control bad lending practices leviathan.
• Maxine Waters, Barney Frank, Chuck Schumer, Chris Dodd (who was getting sweetheart loans at favorable terms U.S. citizens couldn’t get from Countrywide), Nancy Pelosi, Harry Reid and a host of others all recorded for viewing on YouTube and in the congressional records, defended Fannie Mae and Freddie Mac, stating that things were ok - “looking good going forward.”  Barney Frank made that statement on national television just a few months before the bubble burst and Fannie and Freddie had to be taken into receivership by the U.S. government.  Anyone who bought stock in Fannie and Freddie on Mr. Frank’s assurances of solid companies lost 100% within months.

So, Professor Liebowitz, crying in your academic milk that “stronger underwriting standards are needed” is correct.  It is also incredibly hypocritical to pretend that those standards didn’t exist before the social engineers in Washington totally destroyed a very effective mortgage mechanism that had worked quite well for decades and decades.

If you look back at the chart on page A13 of the 7-3-09 WSJ, add up all the categories that are SUBPRIME loans by the standards that existed before being dismantled and defended by Congressional liberals, you get:
Negative Equity - 285,305 loans foreclosed in 2008
Downpayment of less than 3% - 130,014 loans foreclosed in 2008
Subprime FICO score - 148,697 loans foreclosed in 2008

That’s 564,016 loans that would have been classified as SUBPRIME loans prior to 2002.
Divide that by a total of 763,405 2008 foreclosed loans.
That’s 73.8% of 2008 loans that are SUBPRIME by definition prior to 2002.

Anyone who tries to make claims that the housing / mortgage meltdown was not caused by SUBPRIME lending standards, SUBPRIME loans and SUBPRIME borrowers, per the “stronger underwriting standards” that existed prior to 2002, is simply a ‘”Don’t confuse me with the facts” idealogue.

The next thing you know, the banks and the government will coerce the FASB (Financial Accounting Standards Board) to change “mark to market” rules and allow banks who made these loans not have to perform impairment tests that would require a label of “impaired assets” and a hit to earnings and therefore be out of compliance with their debt to asset ratios.  Oh, wait, they did try to do that and it failed!  Perhaps, Professor Liebowitz can now switch horses and rail against the banks.  If he could get the banks to pay off (with lobby dollars of course… it’s the way of Washington), the right politicians, they could resurrect the movement to get that FASB change, get those toxic mortgages reclassified, tell the world how much better their “suddenly improved” balance sheets are and taxpayers could start feeling so much better about buying cars from Government Motors, insurance from AIG and Bank of America stock at 1/20th of the price it was at before the Fed strong-armed BofA CEO Ken Lewis to buy a rotting corpse known as Merrill Lynch, sinking like the Titanic due to SUBPRIME mortgages, CDOs and failed credit default swaps on their books.  Too big to fail has turned into just so much cronyism as usual.

The very banks, Wall Street companies and mortgage mavens that made billions while destroying the economy of the U.S. and infecting the world’s economy with toxic mortgages, all Madoff with their plunder, screwed shareholders and taxpayers and now our corrupt politicians will not hold them accountable for this travesty of epic proportions.  As far as most taxpayers are concerned, each one of these bit players is just as guilty as Bernie Madoff and should be in jail beside him.

Clueless, narcissistic, greedy and arrogant politicians and academics are ruining this great country.

Mortgage Economics 101 for idiots:
PRIME borrower = good credit, low DTI, proof of income, good job history, 20% downpayment = historically very low risk = high % of performing loans

SUBPRIME borrower = high risk, high % of non-performing loans
Zero Downpayment = high risk & SUBPRIME borrower regardless of FICOs
High DTI = high risk, high % of non-performing loans
No proof of income = high risk, high percent of non-performing loans
No job stability = high risk, high % of  non-performing loans

It is disingenuous at best to change the rules professor, then come in and claim that SUBPRIME loans aren’t the cause of most of the foreclosures when it clearly IS loans that would never have been made under the Fannie and Freddie parameters of common sense PRIME loans just a few years ago.  SUBPRIME does not mean only people with poor credit (low FICOs).  SUBPRIME parameters, for a host of reasons, is why banks didn’t make loans to these people until the government stepped in and forced them to with the CRA, quotas, high probability of default (SUBPRIME) underwriting guidelines and then rewrote the very charters of Fannie and Freddie to make certain that there was a very liquid secondary market to buy these loans from the banks so they would never run out of money to make more SUBPRIME loans!

Idiots!

Anyone who doubts what I have written here should go to: www.aei.org  (American Enterprise Institute) and use the search button for:  The True Causes of This Financial Crisis dated 2-19-09.  This is an excellent article by senior fellow Peter J. Wallison.  This man is a brilliant scholar, not blinded by politics and trying to hide the true causes of the financial crisis.  He lays out who, what, when and how all the policies I spoke of above came to be and the irrefutable fact trail that leads right back to Washington’s liberal elites.  Yes, the banks and Wall Street got very, very greedy and we failed to have in place a regulatory mechanism that could have spotted and stopped this, but all that was after the fact.  It is simply irrefutable that the policies, rule changes, laws and enforcement (quotas) were all put in place by Democrats and enforced ruthlessly by left wing social engineers masquerading as Senators, Representatives and Presidents.

Ted Krager
America’s Homeowner Advocate
tkrager@gmail.com

The latest on Cap and Trade…  To citizens of the 5 states whose 8 supposed conservative elected officials voted for this tax, remember this when their re-election comes up in 2010 or 2012.  Vote out the psuedo-conservatives so we can escape the onerous tax structure Obama and the other far-left zealots are systematically putting in place.  It’s classic Washington style smoke and mirrors, using not-so-veiled taxation bills like Cap-and-Trade, that will cost ALL taxpayers far more than their usual “underestimates” for this!

NEWS RELEASE:
President Barack Obama and House Speaker Nancy Pelosi scored a major victory with the House’s approval of a landmark climate bill thanks to a little help from a handful of Republicans.

Friday’s vote was 219-212. The legislation was supported by 211 Democrats and eight aisle-crossing GOP members: Reps. Mary Bono (Calif.), Michael Castle (Del.), Mark Kirk (Ill.), Leonard Lance (N.J.), Frank LoBiondo (N.J.), John McHugh (N.Y.), David Reichert (Wash.) and Christopher Smith (N.J.). Forty-four Democrats voted against the bill, making the eight GOP votes all the more crucial.

This is the biggest job-killing bill that’s ever been on the floor of the House of Representatives. Right here, this bill, House Minority Leader John Boehner said after the vote.  And I don’t think that’s what the American people want.

The 1,200-plus-page bill now goes to the Senate, where it faces an uncertain future.

According to The Associated Press, the “cap-and-trade” legislation places the first national limits on emissions of heat-trapping gases from major sources like power plants, refineries and factories. It requires:

This was sent to me by a friend and I think the world needs to see and know Barack Obama for the true person he is.

Subject: David Borden Jr. meets his Commander in Chief

For those who do not know Dave Borden, he is a former Black & Decker employee.  His son Dave Jr was serving in Iraq and was badly injured from a bomb explosion.  Dave Jr has had over 38 surgeries to date.  The email below is from a recent visit from President Obama, the email speaks for itself.

Bryan McDaniel
Product Service Division
DEWALT, Porter-Cable, Delta

Since Dave Jr. has been injured he has met and been overwhelmed by many, many political and military “celebs”.  The list includes Bob Gates, Sec. of Defense, who came into his room and told him 3 or 4 times that if Dave Jr. had any issues to call his cell phone number.  It includes General Petraeus who sat and talked with Dave Jr. for almost 45 minutes.  The General recalled vividly all of the circumstances around the events that led to fighting that Dave was involved in.  It includes Sen. McCain who arrived late on a Saturday afternoon during a thunder storm, unannounced and talked to Dave Jr. about how similar their experiences with fate.  It includes George Bush when Dave Jr. was invited to attend the very last Christmas party at the White House for the White House Staff.  President Bush and his wife entered the ballroom and immediately went to Dave Jr… President Bush knew Dave Jr.’s name as well as when and how he was injured.  Dave Jr. had a picture taken with Laura and the President that he has framed and will cherish forever.  The list goes on and on of people coming in to meet Dave Jr. and the other wounded warriors at Walter Reed and Bethesda .

Yesterday. Dave Jr. was ordered to be at the National Naval Hospital with another 12 soldiers and Marines to meet with Obama.  Obama was supposed to arrive at 11:30 AM.  He finally got there at 3:00 PM.  He entered the room with the wounded warriors and quickly shook each of their hands.  He never asked their names, where they were from or how they were injured.  Then he left.

Dave Jr. has met the people who really care about the military.  All he remembers from Obama is a weak handshake.  The others in the room, younger and less exposed to the people that Dave Jr. has met, were so disappointed.  Word about Obama’s  ”insensitive” visit has spread to the MATC (the rehab facility) at Walter Reed and throughout Bethesda.  The military sees through his phoniness.

All I can say is that it is such a disappointment that this man is Commander-In-Chief of our Armed Forces.  He is a coward and an embarrassment to our nation in many ways.

Regards,
Dave

Ted Krager
America’s Homeowner Advocate

It’s on YouTube if you want to see the 17 second replay of CA Democrat Barbara Boxer’s arrogant exchange with a U.S. Brigadier General.  Each paragraph below is a response from bloggers.

Chris Matthews said this on his June 18 program: “I guess the question is this: Had he said “sir” to a male senator, would that senator be correct in correcting the general? There is a history, however, and let us not forget, of male-female condescension in the U.S. Senate.  Just recall the Anita Hill testimony of not too long ago. That just might encourage a woman senator to insist on the title, senator.  That being said, an Army spokesman later today says “sir, ma’am, or senator” are all deemed appropriate under the protocol when addressing a U.S. Senator. That’s their story.”  (It’s the truth you idiot liberal not wanting to be confused with the facts.  If you were a true journalist, some quick research would have proven that.  Someone below did that research for you, you dolt.)

So the General is clearly guilty of male-female condescension, Mr. Matthews?  Maybe you should do what I did and actually research the story before commenting.  I checked out more of the hearing at http://epw.senate.gov/public/index.cfm?FuseAction=Hearings.Choose&Hearing_id=c7026be1-802a-23ad-4fa3-4c8ed0b6d074.  Was the General treating her Highness differently and more deferentially than the other senators?  I randomly started at about 46.00 and ended around 1.09.00.  In that time period Gen. Walsh addressed Sen. Vitter as “sir” 14 times and as “Senator” twice; he addressed Sen. Landrieu as “ma’am” 6 times and as “Senator” twice (and once as “sir” which he quickly corrected to “ma’am”).  Neither Sens. Vitter nor Landrieu apparently had a problem with the polite and respectful way they were addressed – even though they had ‘earned’ the same title as her Royal Senatorness.  The only thing Boxer and her blind lackey Matthews have earned is my sincere contempt. Alex.

Thank you for writing this. I wish people would point out to “Senator” Boxer that she has the ability to be called Senator, to go to work every day, to hold such a “prestigious” position simply because Brigadier General Michael Walsh and thousands of others are willing to sacrifice their time, their own freedoms, and even their lives to protect people everyone, even people like Barbara Boxer who are less than worthy…

Just goes to show how little the Senator knows about the military.  Of course she professes to know just as little about other government branch operations and protocols… especially when something goes wrong.

His address was appropriate. Her request, through appropriate, shows just how petty S. Boxer is.  Just like many other Cali politicians she concentrates on the small stuff at the expense of the big stuff.  She should just get stuffed.  I hope the citizens who elected her send her packing.  She obviously fails to consider herself a servant of the people and is a high and mighty member of the governing elite.  HA! She is a low browed commoner standing on a stump claiming to be equal to the queen (which we fortunately do not have).

If she wants to be referred to as Senator, that is fine. But does she really have to be so b****y about it? She could have easily made the same request in a respectful manor.  I mean, earning the title of General isn’t a friggin’ walk in the park either!!!  I sent her an email telling her what I thought about the whole deal, hope she reads it!

I did use that other title in my email.  Told her if that’s what they called her she should answer promptly and properly.  I really hate pompous people, especially our elected elitists.

20 years of Military Service and sacrifice makes you a hero, not being an elected official, supposedly there to represent the people.  Also, Military protocol dictates use of ‘Ma-am’ and ‘Sir’.  This arrogant Senator put her disdain for the Military on full display.  The same Military that provides her comfort and freedom to be a woman in the Senate.  It was a moment reminiscent of the scene in the movie, ‘A Few Good Men’.  Barbara Boxer taking issue with a Brigadier General referring to her as a ‘ma-am’ is ludicrous.  If a Brigadier General wants to call her ‘Babs’, or ‘Your Bitchness’, she would be wise to thank him and keep her arrogance to herself.  Tired of the likes of her, Nancy Pelosi, Harry Reid, Chris Dodd, Chuck Schumer, Maxine Waters and all the other cogs in the wheels of Freedom, that take their deplorable shots at our Military, while running to it’s Flag for cover and protection. I’m going to quit here before I really get on a roll, because ‘hate’ isn’t a strong enough word to describe my feelings.  ‘Traitors’ and ‘thankless’ come to mind.

It’s good to see a unified disapproval here for the incredible stupidity and supreme arrogance exhibited by this waste of good oxygen, occupying the Nation’s Senate.  Happy Father’s Day, Six… and THANK YOU for your Service to this great nation, in spite of what Obama clearly feels is a nation that should be ashamed of its history.

OBAMA = One Big Ass Mistake America!

God Bless.

Printed verbatim and in its entirety courtesy of Ted Krager.  This is a MUST read!

Tuesday, June 2, 2009

Wake Up America!!!!!!!!!! By Pam Geller

I am a student of history. Professionally, I have written 15 books in six languages, and have studied history all my life. I think there is something monumentally large afoot, and I do not believe it is just a banking crisis, or a mortgage crisis, or a credit crisis.Yes, these exist but they are merely single facets on a very large gemstone that is only now coming into a sharper focus.

Something of historic proportions is happening. I can sense it because I know how it feels, smells, what it looks like, and how people react to it. Yes, a perfect storm may be brewing, but there is something happening within our country that has been evolving for about 10 - 15 years. The pace has dramatically quickened in the past year or two.

We demanded and then codified into law the requirement that our banks make massive loans to people whom we knew could never pay back! Why We learned recently that the Federal Reserve, which has little or no real oversight by anyone, has “loaned” two trillion dollars (that is $2,000,000,000,000) over the past few months, but will not tell us to whom or why or disclose the terms. That is our money. Yours and mine. And that is three times the $700B we all argued about so strenuously just this past September.

Who has this money? Why do they have it? Why are the terms unavailable to us? Who asked for it? Who authorized it? I thought this was a government of “We the People,” who loaned our powers to our elected leaders. Apparently not.

We have spent two or more decades intentionally de-industrializing our economy. Why?

We have intentionally dumbed down our schools, ignored our history, and no longer teach our founding documents, why we are exceptional, and why we are worth preserving. Students by and large cannot write, think critically, read, or articulate. Parents are not revolting, teachers are not picketing, school boards continue to back mediocrity. Why?

We have now established the precedent of protesting every close election (now violently in California over a proposition that is so controversial that it wants marriage to remain between one man and one woman. Did you ever think such a thing possible just a decade ago? We have corrupted our sacred political process by allowing unelected judges to write laws that radically change our way of life, and then mainstream Marxist groups like ACORN and others to turn our voting system into a banana republic. To what purpose?

Now our mortgage industry is collapsing, housing prices are in free fall, major industries are failing, our banking system is on the verge of collapse, Social Security is nearly bankrupt, as is Medicare and our entire government. Our education system is worse than a joke… (I teach college and know precisely what I am talking about.) The list is staggering in its length, breadth, and depth. It is potentially 1929 x 10. And we are at war with an enemy we cannot name for fear of offending people of the same religion who cannot wait to slit the throats of your children if they have the opportunity to do so.

And now we have elected a man no one knows anything about, who has never run so much as a Dairy Queen, let alone a town as big as Wasilla , Alaska All of his associations and alliances are with real radicals in their chosen fields of employment, and everything we learn about him, drip by drip, is unsettling if not downright scary. Surely you have heard him speak about his idea to create and fund a mandatory civilian defense force stronger than our military for use inside our borders No?? Oh, of course. The media would never play that for you over and over and then demand he answer it. Sarah Palin’s pregnant daughter and $150,000 wardrobe is more important.

Mr. Obama’s winning platform can be boiled down to one word:? Change…radical change. Why?

I have never been so afraid for my country and for my children as I am now. This man campaigned on bringing people together, something he has never, ever done in his professional life. In my assessment, Obama will divide us along philosophical lines, push us apart, and then try to realign the pieces into a new and different power structure. Change is indeed coming. And when it comes, you will never see the same Nation of Freedom, again.

And that is only the beginning.

I thought I would never be able to experience what the ordinary, moral German felt in the mid-1930s. In those times, the savior was a former smooth-talking rabble-rouser from the streets, about whom the average German knew next to nothing. What they did know was that he was associated with groups that shouted, shoved, and pushed around people with whom they disagreed; he edged his way onto the political stage through great oratory and promises. Economic times were tough, people were losing jobs, and he was a great speaker. And he smiled and waved a lot. And people, even newspapers, were afraid to speak out for fear that his “brown shirts” would bully them into submission.

And then he was duly elected to office, with a full-throttled economic crisis at hand [the Great Depression]. Slowly but surely he seized the controls of government power, department by department, person by person, bureaucracy by bureaucracy. The kids joined a Youth Movement in his name, where they were taught what to think. How did he get the people on his side? He did it promising jobs to the jobless, money to the moneyless, and goodies for the military-industrial complex. He did it by indoctrinating the children, advocating gun control, health care for all, better wages, better jobs, and promising to re-instill pride once again in the country, across Europe , and across the world.

He did it with a compliant media - Did you know that?? And he did this all in the name of justice and…change. And the people surely got what they voted for. (Look it up if you think I am exaggerating.) Read your history books. Many people objected in 1933 and were shouted down, called names, laughed at, and made fun of. When Winston Churchill pointed out the obvious in the late 1930s while seated in the House of Lords in England (he was not yet Prime Minister), he was booed into his seat and called a crazy troublemaker. He was right and everyone would know that eventually.

Don’t forget that Germany was the most educated, cultured country in Europe at this time. It was full of music, art, museums, hospitals, laboratories, and universities. And in less than six years - a shorter time span than just two terms of the U. S. presidency - it was rounding up its own citizens, killing others, abrogating its laws, turning children against parents, and neighbors against neighbors.? All with the best of intentions, of course. The road to Hell is paved with them.

As a practical thinker, one not overly prone to emotional decisions, I have a choice: I can either believe what the objective pieces of evidence tell me (even if they make me cringe with disgust); I can believe what history is shouting to me from across the chasm of seven decades; or I can hope I am wrong, close my eyes, have another latte and ignore what is transpiring around me.

Some people scoff at me; others laugh or think I am foolish, naive, or both. Perhaps I am. But I have never been afraid to look people in the eye and tell them exactly what I believe - and why I believe it. I pray I am wrong. But, I do not think I am.

About the author via Google…

Pamela “Atlas” Geller began her publishing career at The New York Daily News and subsequently took over operation of The New York Observer as Associate Publisher.? She left The Observer after the birth of her fourth child, but remained involved in various projects including American Associates, Ben Gurion University and being Senior Vice-President Strategic Planning and Performance Evaluation at The Brandeis School. After 9/11, Atlas had the veil of oblivion violently lifted from her consciousness and immersed herself in the education and understanding of geopolitics, Islam, terror, foreign affairs and imminent threats the mainstream media and the government wouldn’t cover or discuss.

***************************************************************

Since many of you enjoy senior citizen status or will sometime in the not too distant future, I thought you might be interested in this information.

Most Seniors know by now that the Senate version (at least) of the “stimulus” bill includes provisions for extensive rationing of health care for senior citizens. The author of this part of the bill, former senator and tax evader, Tom Daschle, was credited by Bloomberg with the following statement.

Bloomberg: “Daschle says health-care reform will not be pain free. Seniors should be more accepting of the conditions that come with age instead of treating them.”

If this does not sufficiently raise your ire, just remember that our Senators and Congressmen have their own health care plan that is first dollar or very low co-pay which they are guaranteed the use of for the rest of their life and which is not subject to the new law…

Please use the power of the Internet to get this message out. Talk it up at the grassroots level. We have an election coming up in one year and nine months. We have the ability to address and reverse the dangerous direction the Obama administration and its allies have begun and in the interim, we can make our voices heard! Let’s do it!

If you disagree, don’t do anything.

Presented by Ted Krager
America’s Homeowner Advocate

My friend went to hear Charles Krauthammer.  He listened with 25 others in a closed room.  What he says here is not second-hand but first-hand.

Subj: Charles Krauthammer Speech/Comments on the ‘New Economy’ and Barack Obama

To my friends & associates:

Last Monday was a profound evening, hearing Dr. Charles Krauthammer speak to the Center for the American Experiment.  He is a brilliant intellectual, seasoned and articulate. He is forthright and careful in his analysis, and never resorts to emotions or personal insults. He is NOT a fear monger or an extremist in his comments and views.  He is a fiscal conservative, and has a Pulitzer prize for writing.  He is a frequent contributor to Fox News and writes weekly for the Washington Post.  The entire room was held spellbound during his talk.  I have shared this with many of you and several have asked me to summarize his comments, as we are living in uncharted waters economically and internationally.

A summary of his comments:

1. Mr. Obama is a very intellectual, charming individual.  He is not to be underestimated. He is a ‘cool customer’ who doesn’t show his emotions. It’s very hard to know what’s ‘behind the mask’.  Taking down the Clinton dynasty from a political neophyte was an amazing accomplishment.  The Clintons still do not understand what hit them.  Obama was in the perfect place at the perfect time.

2. Obama has political skills comparable to Reagan and Clinton.  He has a way of making you think he’s on your side, agreeing with your position, while doing the opposite.  Pay no attention to what he SAYS; rather, watch what he DOES!

3. Obama has a ruthless quest for power.  He did not come to Washington to make something out of himself but rather to change everything, including dismantling capitalism.  He can’t be straightforward on his
ambitions, as the public would not go along.  He has a heavy hand, and wants to ‘level the playing field’ with income redistribution and punishment of the achievers of society.  He would like to model the USA to Great Britain or Canada .

4.  His three main goals are to control ENERGY, PUBLIC EDUCATION, and NATIONAL HEALTHCARE by the Federal government  He doesn’t care about the auto or financial services industries, but got them as an early bonus; the cap and trade will add costs to everything and stifle growth. Paying for FREE college education is his goal.  Most scary is his healthcare program, because if you make it FREE and add 46,000,000 people to a Medicare-type single-payer system, the costs will go through the roof.  The only way to control costs is with massive RATIONING of services, like in Canada .  God forbid.

5.  He’s surrounded himself with far-left academic types. No one around him has ever run even a candy store.  But they’re going to try and run the auto, financial, banking and other industries. This obviously can’t work in the long run. Obama’s not a socialist; rather a far-left secular progressive bent on nothing short of revolution. He ran as a moderate, but will govern from the hard left. Again, watch what he does, not what he says.

6.  Obama doesn’t really see himself as President of the USA , more as a ruler over the world.  He sees himself above it all, trying to orchestrate and coordinate various countries and their agendas.  He sees moral equivalence in all cultures.  His apology tour in Germany and England was a prime example of how he sees America , as an imperialist nation that has been arrogant, rather than a great noble nation that has at times made errors.  This is the first President ever who has chastised our allies and appeased our enemies!

7.  He’s now handing out goodies. He hopes that the bill (and pain) will not ‘come due’ until after he’s reelected in 2012.  He’d like to blame all economic meltdown problems on Bush from the past, and hopefully his successor in the future.  He has a huge ego, and Mr. Krauthammer believes he is an extreme narcissist.

8.  Republicans are in the wilderness for a while, but will emerge strong. We’re ‘pining’ for another Reagan, but there will never be another like him.  He believes Mitt Romney, Tim Pawlenty and Bobby Jindahl (except for his terrible speech in Feb.) are the future of the party. Newt Gingrich is brilliant, but has baggage.  Sarah Palin is sincere and intelligent, but needs to really be seriously boning up on facts and information if she’s to be a serious candidate in the future. We need to return to the party of lower taxes, smaller government, personal responsibility, strong national defense and states’ rights.

9.  The current level of spending is incredibly irresponsible & outrageous. We’re spending trillions that we don’t have. This could lead to hyper-inflation, depression or worse. No country has ever spent themselves into prosperity. The media is giving Obama, Harry Reid, Nancy Pelosi, Barney Frank, Chris Dodd and a host of other far-left Dems a pass because they love their agenda. But eventually the bill l will come due and people will realize the huge bailouts didn’t work, nor will the stimulus package. These were trillion-dollar payoffs to Obama’s allies, unions and the Congress to placate the left, so he can get support for #4 above.

10. The election was over in mid-September when Lehman Brothers failed. Fear and panic swept in, we had an unpopular President, and the war was grinding on indefinitely without a clear outcome. The people are in pain and the mantra of ‘change’ caused people to act emotionally. Any Dem would have won this election; it was surprising is was as close as it was.

11.  In 2012, if the unemployment rate is over 10%, Republicans will be swept back into power.  If it’s under 8%, the Dems continue to roll.  If it’s between 8-10%, it’ll be a dogfight. It’ll all be about the economy.

I hope this gets you really thinking about what’s happening in Washington and Congress. There’s a fervent left-wing revolution going on, according to Krauthammer, and he encourages us to keep the faith and join the loyal resistance. The work will be hard, but we’re right on most issues and can reclaim our country, before it’s far too late.

Ted Krager
America’s Homeowner Advocate
www.homeownerIQ.org  /  tkrager@gmail.com

The Spin never stops…

SLOWER JOB LOSSES LIFT HOPES

That is the headline on most of today’s newspapers.  Non-farm payroll dropped another 345,000 jobs in May, compared to 504,000 in April.  The effervescent, eternal optimists who want to force people to feel better in spite of bad news, say this is a good sign.  They tell us that because the pace of the layoffs is slowing, we should all feel better.

Unemployment rose from 8.9% in April to 9.4% in May, exceeding projections it would be “only” 9.2%.  So far, every forecast of the past year has been exceeded so we are now supposed to believe their positive spin is accurate?  “You have to classify it as a weak unemployment report, but it’s like everything else right now - it’s less bad than it was and there are some signs things could get better down the road.”  Joseph Carson’s take on yesterday’s numbers.  (Carson is an economist at Alliance Bernstein.)  What time frame does “down the road” portend?  3 months?  6 months? a year?

345,000 people lost their jobs in May alone.  Over 6,000,000 people have now lost their jobs since the recession began in December 2007.  That is the highest number of unemployed people in the U.S. in over 25 years.  Try telling those 345,000 or 6,000,000 people that their hopes are lifted!

Considering that it was the U.S. government’s policies that fostered and then fueled the subprime mortgage crisis that caused the housing meltdown that then caused the global economic implosion, American’s who have lost their jobs and / or their homes ought to be getting pretty angry by now.

Obamanomics isn’t working at all.  Consumer spending, which Obama is counting on to spur the economy, is still falling rapidly.  In fact, household savings rose by $132 billion and personal consumption fell.  So far, zero of the stimulus money was sent.  None.  So, to pay for his stimulus bill that didn’t stimulate, Obama borrowed so many trillions that long term interest rates have almost doubled since he took office.  Higher rates forced abandonment of business expansion and hiring across the board.  But boy did the debt ever start piling up.  The deficit quadrupled and rates soared as Obama borrows enough to spend enough to stimulate the economy which isn’t happening which was predictable with numerous lessons from history.

As history told us would be the case (Japan’s stimulus in the 90s and Bush’s in 2008), scared consumers sat on / saved their money and Keynesian economic theory failed again.  The Obama stimulus package is a total failure.  None of his massive spending has done anything to help the economy.  It has had no positive economic effect.  Zero.  Zilch.

Consumers are not the idiots Obama and the left wingers presume they are.  Meanwhile, Obama has most likely and fatally killed our currency, our personal solvency, our financial stability and our country’s solvency.  Some news commentators are always harping on Obama’s keen intellect… book smarts maybe…  real world intelligence?  Zero.

We have an idealistic, rookie CEO at the helm of the US of A and he is being counseled, handled and wagged by the likes of Nancy Pelosi, Barney Frank, Chris Dodd, Charles Schumer, Harry Reid and a litany of so far left socialists that it makes Obama seem like a centrist!  They are the idiots and tax cheats, thieves and corrupt career politicians that have learned how to live off the public dole and game the system against taxpayers.

God help us.

Ted Krager
America’s Homeowner Advocate
www.homeownerIQ.org

Intellectually bright but tax law challenged tax cheat Timothy Geithner, President Obama’s politically awful choice for U.S. Treasury Secretary, is in China.  He is there in talks with Chinese leaders including President HuJintao.

Geithner reports back to Obama and the U.S. press that “he found strong support among Chinese officials for U.S. strategies to combat the global meltdown.”

However, Geithner spoke earlier at Beijing University and insisted that Chinese investment in U.S. treasuries was safe.  His comments were reportedly met with loud and continued laughter and Geithner was noticeably chagrined at the podium.

China is the largest holder of U.S. debt through their long and continued purchase of our treasury bills, notes and bonds.  In effect, China is the U.S.’ largest bank and could be left holding the bag if the U.S. defaults on its obligations.

Isn’t it comforting to know that policies of the Obama administration’s issuance of trillions of dollars of debt and stimulus packages is being sneered at by our nation’s largest debt holder?   Obama’s policies are known by the world to be exactly what they are… extremely dangerous and carry a high probability of causing hyper-inflation in the years to come.  This is no different than an individual that gorges on cheap, abundant credit and gets in over his / her head.  As the perception and likelihood of default rises, the cost of borrowing goes up and higher rates increase the probability of default.

The ratings agencies, Standard & Poors, Moodys and Fitch, criminally labeled all Collateralized Debt Obligations (CDOs) as AAA investments in the run up to the mortgage meltdown, causing institutions and governments the world over to buy toxic mortgages that continue to blow up balance sheets the world over.  There has been chatter in the press that these same ratings agencies might have to lower U.S. treasuries down from AAA to some lower credit rating for the first time in history.  That of course would be catastrophic and would cause yields on U.S. treasuries to ratchet upwards to offset the perceived risk.  It is highly improbable a downgrade will occur even when merited because no doubt the Obama administration would bring to bear severe pressure for the ratings agencies to “stand down.”  After the abomination of labeling all CDOs as AAA (internal emails show they knew CDOs were not AAA but subordinates were told by management to issue them as such anyway) during the subprime mortgage bubble buildup, we know just how trustworthy these three companies are anyway.

This brings to mind a famous TV quote:
“Once you lose your integrity, the rest is easy.”
J.R.Ewing from the series Dallas after he had corrupted a Dallas sheriff.

The world is watching.  The world no longer takes for granted that the U.S. is the most economically secure nation.  The world knows our dollar will suffer and that rates will go up, most likely demonstrably in the years to come.  People are now laughing at Tim Geithner when he says things like he said at Beijing University and it isn’t just the Chinese that are laughing.  Understand this is nervous laughter because if their fears prove to be founded and the U.S. defaults on its debt, the world will be forever changed especially inside the U.S.

The more General Motors / AIG / bank / Wall Street / UAW / stimulus / dollars that Obama gives away, the higher the probability of hyper-inflation, higher rates and U.S. defaults.  Not since the Carter administration have we seen a President with such intellectual capacity exhibit such fiscal stupidity.  Not since the Nixon administration have we seen a President exhibit such arrogance by ignoring history’s lessons learned from pushing protectionist policies and fostering class warfare.

The nervous laughter around the world is growing and could become a din.

Ted Krager
America’s Homeowner Advocate
www.homeownerIQ.org  /  tkrager@gmail.com

author of Dirty Little Secrets of the Mortgage Industry and
Scams, Shams and Flim-Flams of the Mortgage Industry

Much of the chatter around the GM bankruptcy has highlighted the loss of the bond holders.  However, U.S. taxpayers are the most at risk according to bankruptcy expert and NYU business professor Edward Altman.

“The bill is now up to $50 billion or more, which is what we said would be needed, but the government should be first in line” among creditors, he told Bloomberg TV.  The government will now have stock in the company, more than 72%.  It is a big uncertainty if the company will do well.  The potential biggest loser, unfortunately, is the U.S. taxpayer,” Altman says.

The government already has extended $19.4 billion of loans to GM and is expected to provide another $50 billion in GM’s reorganization.  I railed against the GM bailout in posts as far back as October 2008 because the government’s track record shows it is not capable of running a business ethically or profitably.

The U.S. Treasury is slated to receive 72.5% of GM’s equity and GM intends to turn more than $50 billion of Treasury’s debt into common and preferred stock and warrants.  Altman further says bankruptcy reorganization will not begin to solve all of GM’s problems.

“There are a disturbing number of Chapter 22s, where they have to file again within five years because it did not work, and they either have too much debt or haven’t fixed the operational problems,” he says.

This is yet another rabbit hole down which U.S. taxpayers money will never see a return.

The lesson for entrepreneurs in all of this is to grow recklessly, borrowing shamelessly from anyone you can without worrying about the bottom line until you are too big to fail.  Business 101 and par for the course for the hackers in D.C. who fancy themselves as business capable rather than the incompetent dolts that they are.

Ted Krager
America’s Homeowner Advocate
www.homeownerIQ.org  /  tkrager@gmail.com

author of Dirty Little Secrets of the Mortgage Industry and
Scams, Shams & Flim-Flams of the Mortgage Industry