Fortune: Hillary's modest proposal (to wreck the housing market)

[Vic]

Originally posted by: 3chordcharlie

Originally posted by: Rainsford
"anyone with even a basic understand of economics" is a pretty good red flag that what you're about to read is complete bullshit. Mostly because economics is a weird, pseudo-science that experts with lifetimes of experience don't really seem to understand...much less people who vaguely remember some supply and demand graphs from some college class they had to take to get their degree in Beer Pong.

It takes some major balls, and some major lack of intelligent thought, to suggest that the free market works much better than ANY kind of government regulation when the free market has so spectacularly blundered as it just did. Predatory lenders, coupled with ignorant, greedy people, created the perfect "free market" for the crash in the housing bubble...government intervention could hardly have resulted in a worse situation. Suggesting the perfect solution is to not touch the system that led to this disaster requires a level of faith that seems out of place even in a field as nebulous as economics.

I'm not sure Hillary has the right idea with the extent of the freeze, but the idea that "price controls are always bad" is even more ridiculous. More regulation of the market might have prevented the crash (or more accurately, prevented the rise that preceded the inevitable fall), and could certainly help the legions of homeowners facing foreclosure now. It's great to think about the future of "the market", but we're also talking about real people here. And in any case, the notion that interests rates for new mortgages will shoot up is silly. First of all, it's not like there are a lot of great investments at the moment...moving from the housing market to the stock market seems ill-advised. And secondly, the housing market is already heading down the drain...imposing price controls on future increases in the interest rate will help slow that decline. Sure, higher interests rates mean fewer people can afford mortgages...but the controls will also mean fewer desperate sellers, which should balance out.

It's a complicated problem, and more than anything, I think we need to stay away from absolutist stances from economic anarchists or pseudo communists looking for an easy fix which is really just a new stalking horse for their half-baked ideology.

Such an impressive weave of relativist BS.

How about some personal responsibility, and letting the market decide what happens next. If you think these irresponsible borrowers should be bailed out, go ahead and pay one of thier mortgages yourself. It's called private charity.






(just kidding, good post😉)

Actually, it's a terrible post. Full of "half-baked" ideological extremism and generalizations and unproven assumptions. Anyone who thinks that the current housing crisis was caused by some kind of unregulated free market hasn't been paying attention. Where do you suppose those "predatory lenders" got their money to lend in the first place? Eh? Thin air?
Obviously, regulation is always needed. You don't play a game without referees. But if you put the referees in the game as players, then you've just recreated the same problem as not having referees in the first place.
In other words, even if the "free market" assertion were correct, going from one extreme to the other would be no help.
Frozen interest rates would essentially equate to no more mortgages. You'd have the lending equivalent of the gas crisis of the 70s. So your "fewer desperate sellers" logic would disappear in light of the reality that there would be very few qualified buyers out there. With little-to-no qualified buyers, screw the adjustable rate, now homeowners would default and be foreclosed just because their employer re-located them.

Genius! Let me go back to my beer pong, Rainsford is doing such a great job from his armchair... :roll:

 

[Mxylplyx]

Originally posted by: Genx87

Originally posted by: LegendKiller

Originally posted by: Genx87
I got into the housing market nearly at the end of the boom. Am I whining to the govt to help me out? Hell I dont even know how they would help me anyways. Do I care? At this point no, because I dont plan on selling my property for years. So this housing bubble has no affect on me. Well I guess one nice side effect provided I can defeat those school bond issues is my property taxes essentially stay frozen. But living in a neighborhood full of young adults with children is like pissing into the wind when it comes to school bond issues
🙁

Yeah, who wants well educated kids for the future of this country anyway.

Just as soon as you find me a good correlation between money spent and a good education. Minnepaolis school district has the highest per capita spending in the state at about 12K per student. They also have the highest dropout and lowest end result for "quality" in the state. Public education is just a feel good blackhole for unions to rape the taxpayers in the name of the children.

Politicians can only really quantify their efforts by the amount of dollars they throw at a problem, and people have bought into it.

 

[theeedude]

Originally posted by: Pabster

Originally posted by: senseamp
Typical reflexive out of the context Hillary bashing article. How about reading the actual specific plan before commenting? Gotcha politics at its finest.

Ah, typical apologist senseamp runs in to defend his hero. :roll:

Typical Clenis obsessed Hillary basher Pabster weighs in with his usual tripe. Nothing to see here, move along :roll:

 

[MonkeyK]

Originally posted by: Genx87

Originally posted by: LegendKiller

Originally posted by: Genx87
I got into the housing market nearly at the end of the boom. Am I whining to the govt to help me out? Hell I dont even know how they would help me anyways. Do I care? At this point no, because I dont plan on selling my property for years. So this housing bubble has no affect on me. Well I guess one nice side effect provided I can defeat those school bond issues is my property taxes essentially stay frozen. But living in a neighborhood full of young adults with children is like pissing into the wind when it comes to school bond issues
🙁

Yeah, who wants well educated kids for the future of this country anyway.

Just as soon as you find me a good correlation between money spent and a good education. Minnepaolis school district has the highest per capita spending in the state at about 12K per student. They also have the highest dropout and lowest end result for "quality" in the state. Public education is just a feel good blackhole for unions to rape the taxpayers in the name of the children.

Sticking Feathers up your butt does not make you a chicken
Minneapolis does better in math, worse in reading, and has to deal with a significantly more diverse student population than most of Minnesota. But yes, they do spend significantly more than the rest of the state.

 

[Rainsford]

Originally posted by: Vic

Originally posted by: 3chordcharlie

Originally posted by: Rainsford
"anyone with even a basic understand of economics" is a pretty good red flag that what you're about to read is complete bullshit. Mostly because economics is a weird, pseudo-science that experts with lifetimes of experience don't really seem to understand...much less people who vaguely remember some supply and demand graphs from some college class they had to take to get their degree in Beer Pong.

It takes some major balls, and some major lack of intelligent thought, to suggest that the free market works much better than ANY kind of government regulation when the free market has so spectacularly blundered as it just did. Predatory lenders, coupled with ignorant, greedy people, created the perfect "free market" for the crash in the housing bubble...government intervention could hardly have resulted in a worse situation. Suggesting the perfect solution is to not touch the system that led to this disaster requires a level of faith that seems out of place even in a field as nebulous as economics.

I'm not sure Hillary has the right idea with the extent of the freeze, but the idea that "price controls are always bad" is even more ridiculous. More regulation of the market might have prevented the crash (or more accurately, prevented the rise that preceded the inevitable fall), and could certainly help the legions of homeowners facing foreclosure now. It's great to think about the future of "the market", but we're also talking about real people here. And in any case, the notion that interests rates for new mortgages will shoot up is silly. First of all, it's not like there are a lot of great investments at the moment...moving from the housing market to the stock market seems ill-advised. And secondly, the housing market is already heading down the drain...imposing price controls on future increases in the interest rate will help slow that decline. Sure, higher interests rates mean fewer people can afford mortgages...but the controls will also mean fewer desperate sellers, which should balance out.

It's a complicated problem, and more than anything, I think we need to stay away from absolutist stances from economic anarchists or pseudo communists looking for an easy fix which is really just a new stalking horse for their half-baked ideology.

Such an impressive weave of relativist BS.

How about some personal responsibility, and letting the market decide what happens next. If you think these irresponsible borrowers should be bailed out, go ahead and pay one of thier mortgages yourself. It's called private charity.






(just kidding, good post😉)

Actually, it's a terrible post. Full of "half-baked" ideological extremism and generalizations and unproven assumptions. Anyone who thinks that the current housing crisis was caused by some kind of unregulated free market hasn't been paying attention. Where do you suppose those "predatory lenders" got their money to lend in the first place? Eh? Thin air?
Obviously, regulation is always needed. You don't play a game without referees. But if you put the referees in the game as players, then you've just recreated the same problem as not having referees in the first place.
In other words, even if the "free market" assertion were correct, going from one extreme to the other would be no help.
Frozen interest rates would essentially equate to no more mortgages. You'd have the lending equivalent of the gas crisis of the 70s. So your "fewer desperate sellers" logic would disappear in light of the reality that there would be very few qualified buyers out there. With little-to-no qualified buyers, screw the adjustable rate, now homeowners would default and be foreclosed just because their employer re-located them.

Genius! Let me go back to my beer pong, Rainsford is doing such a great job from his armchair... :roll:

You keep using the word "extreme"...perhaps you should look it up first, because I don't think it means what you think it means. Or perhaps you should actually read my post before getting your panties all bunched up. Or something...because having a debate with someone who just wants a convenient straw man to go after is a little tiresome.

I am not in fact suggesting we "go from one extreme to the other", I was responding to ProfJohn's suggesting that regulation is always bad and the implied suggestion that the best thing we can do is let the market work itself out. I am not suggesting the alternative is strict price controls and mounds of government regulation, in fact I said right in my post that I'm not sure Hillary's plan is the way to go because it might be going too far the other way. Not only that, but I said at the end of my post that we need to AVOID extremist stances one way or the other...and that the solution will probably be found by looking at the whole board instead of trying to push our individual economic ideologies. Tell me again where in there I'm being an "extremist".

So far as I can tell, the current market's problems are developing because various kinds of borrowing were based on assumptions about the future of the housing market and interests rates that turned out not to be true. The housing market was in a period of rapid growth, with prices going up by an enormous amount in a short period of time, so many lenders and borrowers structured mortgages to take maximum advantage of the situation...the only problem being that these mortgages didn't take into account what would happen if the housing market didn't continue its rate of growth. Freezing interest rates may not be the appropriate solution, but some further government regulation of mortgage practices may help in the future by introducing moderating factors that slow both growth and decline of the market as much as possible. I also think there needs to be some serious limitations on how much and how quickly the rate can adjust in an ARM.

The only reason I'm discussing this is because I just purchased a house a few months ago, and I spent a lot of time looking at the market and my choices in terms of mortgages. I don't claim to be an expert, but I certainly have given it more thought than the typical armchair expert analysis. After all, it's my money at stake here 😉

 

[palehorse]

Originally posted by: LegendKiller

Originally posted by: techs
Fortune magazine was rooting on the sub-prime mortgage lenders.
So taking advice from them is idiotic.

Who wasn't rooting them on during the boom?

People can change their mind you know.

Trust me, Techs is very familiar with the concept of changing your mind -- his candidate does so on almost a daily basis!

 

[Vic]

Ah... okay.
Yes, the problem with the housing market is that the participants in it on all sides assumed a momentum that didn't exist. An "irrational exhuberence" if you will. A lot of this stems from a pervasive attitude in America that the real estate market can never go down. This attitude is especially strong in the older generations, many of whom simply cannot believe that home values are declining right now. So as home values kept going up and up, these people saw it as a sure thing. And considerations in both borrowing AND lending became based on the assumption that this sure thing would last forever.
I've watched this from inside for almost 15 years, and trust me, it was nuts IMO. And I still get people calling me wanting to buy homes they can't afford because they want to get a piece of all mad money being made in real estate. Still. I'm not kidding.

 

[Fern]

1. If Hillary's & Edward's plan means freezing ALL home mortgage rates that strikes me as using a bazzoka to kill a flea. Only a small portion of home mortgage loans are in trouble, no need to freeze ALL home mortgages. And although it doesn't say so, I'm assuming that they are NOT talking about commercial r/e loans.

2. IMO, a better approach is something much more focused on the specific problem properties.

3. I do not see how the US gov can mandate a restructure of existing (of heretofore legal) contracts between 2 private parties (lending institutions and individuals). This is a power I do not believe exists within it's ability, not should it.

4. It's in the best interest of all parties to try to work things either prior to or in forecloser. Dumping any number of properties on the market simultaneously is a disaster for the banks and owners as we saw in the 80's (S&L problem and gov liquidation efforts - I'm forgetting the name of the agency that was created). In my area banks etc have been working with buyers to avoid foreclosure.

5. My recommendation is gov issued guidelines to be followed in the foreclosure proceedings - i.e., commonsense "workouts" such as a write-down of a portion of the principle balance, lowering of interest rates to reasonable levels or moving to an interst only type mortgage (freeze on principal payments) for a period of time. Etc.

The lenders and borrowers got themselves into the mess. They should be helped by guidance and advice, but not mandates nor big gov "rescue plans".

And teaser-type loans should outlawed or highly regulated.

Fern

 

[Vic]

Originally posted by: Fern
1. If Hillary's & Edward's plan means freezing ALL home mortgage rates that strikes me as using a bazzoka to kill a flea. Only a small portion of home mortgage loans are in trouble, no need to freeze ALL home mortgages. And although it doesn't say so, I'm assuming that they are NOT talking about commercial r/e loans.

2. IMO, a better approach is something much more focused on the specific problem properties.

3. I do not see how the US gov can mandate a restructure of existing (of heretofore legal) contracts between 2 private parties (lending institutions and individuals). This is a power I do not believe exists within it's ability, not should it.

4. It's in the best interest of all parties to try to work things either prior to or in forecloser. Dumping any number of properties on the market simultaneously is a disaster for the banks and owners as we saw in the 80's (S&L problem and gov liquidation efforts - I'm forgetting the name of the agency that was created <Resolution Trust Corp>). In my area banks etc have been working with buyers to avoid foreclosure.

5. My recommendation is gov issued guidelines to be followed in the foreclosure proceedings - i.e., commonsense "workouts" such as a write-down of a portion of the principle balance, lowering of interest rates to reasonable levels or moving to an interst only type mortgage (freeze on principal payments) for a period of time. Etc.

The lenders and borrowers got themselves into the mess. They should be helped by guidance and advice, but not mandates nor big gov "rescue plans".

And teaser-type loans should outlawed or highly regulated.

Fern

I agree with most of your post, except that last bolded part. First, they've already been off the market for close to a year. Second, many consumers demand them, educated and knowing full well what they are doing. And there's already a mountain of regulation and disclosure surrounding them, it begs the age-old question, how do you protect the uneducated consumers without harming the educated ones?

 

[Fern]

And teaser-type loans should outlawed or highly regulated.

What I mean here is that they should be available to borrowers with a high credit rating and good liquidity (plenty of avalable/discretionary cash flow, not just high net worth).

I'm thinking that these are mostly used by the banks as a marketing tool to attract lenders when competing.

I'm also suspecting that the wrong type borrowers have been taking advantage of them. I.e., they have problems and are, or were, using these loans to help in the short-term in spite of the longer-term risks, or were speculating.

As a CPA I've seen a couple of mistakes consistently repeated by otherwise rational/intellgent people:

1. When in some financial trouble, will accept much higher levels of risk in the hopes of avoiding immediate problems. Often to the extreme. Let's say that they are in a hole and don't know when it's time to stop digging.

2. R/e speculation (spec homes and the like) without fully understanding the consequences and extended period lapsing before the sale occurs. The interest eats them alive.

Anybody who "smells' like they are in the above two categories shouldn't be offered teaser loans. If the banks can't develop the discipline, then the gov outta regulate it for them (if they don't already) since it's habit is to rescue them.

Fern

 

[ProfJohn]

I wana thank Vic and Legend for doing a wonderful job against the Hillary lovers.

Only one thing to add...

Bush's plan has been embraced by the market as a good idea, Hillary's is viewed as a huge disaster waiting to happen.

Let me explain why Hillary's plan is bad in simple language.
Banks loan out money so they can make a profit, take away that profit by freezing interest rates and the banks will take their money some place else. With less money in the market it will be harder and harder for people to get loans. The people at the bottom, the ones Hillary wants to help the most, will be the ones to suffer the most.

It is still amazing how little play this plan of Hillary's is getting. Although I am sure it will resurface in the fall election if Hillary gets the nomination.

 

[Vic]

Don't thank me. Bush's plan is just as bad. Cutting rates and flooding the markets with money is a sure-fire way to spur rampant inflation and send bond yields through the roof. Already we're seeing muncipal bond insurers getting their ratings cut. So sure, you'll still be able to get a mortgage under Bush's plan... but at 70s-era double-digits %.

 

[Jhhnn]

it begs the age-old question, how do you protect the uneducated consumers without harming the educated ones?

The educated ones are being harmed anyway, as an aftermath of the whole feeding frenzy. Rates must increase so that the banks won't go under, so that they can cover their losses to some extent, and attract investors. Meanwhile, the Fed pumps out money to maintain banking liquidity, increasing inflationary pressure, and the value of the dollar falls because of the low to negative rate of return for investors holding dollars.... because the Fed is holding rates low in order to hopefully avoid too many mortgage defaults.

And if the situation deteriorates into a bailout scenario, we'll pay even more, in a variety of hidden ways. We all pay in the end, so why bother to allow the possibility for more of this down the road?

Teaser rates are very much like the whole predatory nothing down and no interest for one year purchases on appliances or furniture- yeh, sure, some people do fine with it, others get screwed, but it's not so much money that they're buried, forced into default. That's not true with housing, usually the biggest purchase in any consumer's lifetime... vanishingly few people can pay off a mortgage before their teaser rate expires. They were snakebit before the ink dried, and didn't even feel it at the time.

 

[LegendKiller]

Originally posted by: Vic
Don't thank me. Bush's plan is just as bad. Cutting rates and flooding the markets with money is a sure-fire way to spur rampant inflation and send bond yields through the roof. Already we're seeing muncipal bond insurers getting their ratings cut. So sure, you'll still be able to get a mortgage under Bush's plan... but at 70s-era double-digits %.

That's the reason why Buffet is entering the market.

Nobody's plan is good. The best plan will be the plan that lets things run its course.

 

[Vic]

Originally posted by: Jhhnn

it begs the age-old question, how do you protect the uneducated consumers without harming the educated ones?

The educated ones are being harmed anyway, as an aftermath of the whole feeding frenzy. Rates must increase so that the banks won't go under, so that they can cover their losses to some extent, and attract investors. Meanwhile, the Fed pumps out money to maintain banking liquidity, increasing inflationary pressure, and the value of the dollar falls because of the low to negative rate of return for investors holding dollars.... because the Fed is holding rates low in order to hopefully avoid too many mortgage defaults.

And if the situation deteriorates into a bailout scenario, we'll pay even more, in a variety of hidden ways. We all pay in the end, so why bother to allow the possibility for more of this down the road?

Teaser rates are very much like the whole predatory nothing down and no interest for one year purchases on appliances or furniture- yeh, sure, some people do fine with it, others get screwed, but it's not so much money that they're buried, forced into default. That's not true with housing, usually the biggest purchase in any consumer's lifetime... vanishingly few people can pay off a mortgage before their teaser rate expires. They were snakebit before the ink dried, and didn't even feel it at the time.

Someone needs to explain to you that the universe's biggest paradox is that generalizations are always wrong.
ARMs have their time and place. That most people tend to make the wrong decision with their mortgages is because they are arrogantly uneducated.

Anyway, please... the Fed lowering the Funds rate is keeping mortgage rates up, not down, because it increases inflationary fears. It's doing that to bailout Wall Street, not homeowners or banks. In fact, the only reason bond yields are still low even after the Fed has lowered the Funds rate is because the market is doing so badly, and investors are running scared flight-to-safety into bonds even though they know that they're not yielding enough right now to cover the the inflationary risk.

 

[Vic]

Originally posted by: LegendKiller
That's the reason why Buffet is entering the market.

Nobody's plan is good. The best plan will be the plan that lets things run its course.

I agree. The irony is that the danger to the overall economy declines the farther away we get from the peak of the bubble. Weather the storm and it's gonna be a great buying time ahead. But... as you and I so often argued about in the housing thread, I don't believe the Fed, govt., and Wall Street are going to let that happen, because they're the big losers who bought in at the top, spurred the bubble on at least a year longer than it would have, and have the most to lose. IMO they want inflation to carry their loses away.

 

[Slew Foot]

Originally posted by: Vic

Originally posted by: LegendKiller
That's the reason why Buffet is entering the market.

Nobody's plan is good. The best plan will be the plan that lets things run its course.

I agree. The irony is that the danger to the overall economy declines the farther away we get from the peak of the bubble. Weather the storm and it's gonna be a great buying time ahead. But... as you and I so often argued about in the housing thread, I don't believe the Fed, govt., and Wall Street are going to let that happen, because they're the big losers who bought in at the top, spurred the bubble on at least a year longer than it would have, and have the most to lose. IMO they want inflation to carry their loses away.

Wow, me, LK, and Vic all agree on something. Kill me, I must be dreaming.

 

[blackangst1]

Originally posted by: Slew Foot

Originally posted by: Vic

Originally posted by: LegendKiller
That's the reason why Buffet is entering the market.

Nobody's plan is good. The best plan will be the plan that lets things run its course.

I agree. The irony is that the danger to the overall economy declines the farther away we get from the peak of the bubble. Weather the storm and it's gonna be a great buying time ahead. But... as you and I so often argued about in the housing thread, I don't believe the Fed, govt., and Wall Street are going to let that happen, because they're the big losers who bought in at the top, spurred the bubble on at least a year longer than it would have, and have the most to lose. IMO they want inflation to carry their loses away.

Wow, me, LK, and Vic all agree on something. Kill me, I must be dreaming.

Add me too 😛

 

[Jhhnn]

Interesting bit of contradiction on your part, vic-

Someone needs to explain to you that the universe's biggest paradox is that generalizations are always wrong.
ARMs have their time and place. That most people tend to make the wrong decision with their mortgages is because they are arrogantly uneducated.

I think your generalizations there are much more sweeping than my own...

When are ARM's beneficial to more than a very small % of borrowers? And why should the rest of us allow such risk-taking in general when we all have to pay up when turns out badly? What's in it for us?

And this seems contradictory, as well-

the Fed lowering the Funds rate is keeping mortgage rates up, not down, because it increases inflationary fears. It's doing that to bailout Wall Street, not homeowners or banks.

So you're saying that if the Fed wasn't propping up Wall Street and the big investment houses (basically, the banks, because they're all heavily leveraged) that mortgage rates would fall? Why?

 

[Vic]

Originally posted by: Jhhnn
Interesting bit of contradiction on your part, vic-

Someone needs to explain to you that the universe's biggest paradox is that generalizations are always wrong.
ARMs have their time and place. That most people tend to make the wrong decision with their mortgages is because they are arrogantly uneducated.

I think your generalizations there are much more sweeping than my own...

When are ARM's beneficial to more than a very small % of borrowers? And why should the rest of us allow such risk-taking in general when we all have to pay up when turns out badly? What's in it for us?

And this seems contradictory, as well-

the Fed lowering the Funds rate is keeping mortgage rates up, not down, because it increases inflationary fears. It's doing that to bailout Wall Street, not homeowners or banks.

So you're saying that if the Fed wasn't propping up Wall Street and the big investment houses (basically, the banks, because they're all heavily leveraged) that mortgage rates would fall? Why?

There's no contradiction. You're just making the gross assumption that ARMs are responsible for the housing bust, and thus the rest of us are "paying for them." The media might want you to believe that, but it's not true. The housing boom is responsible for the housing bust. Even those getting fixed rates were frequently getting more than they could afford.

The 2nd part is not contradictory at all. Short and long term rates frequently move in opposite directions. When speaking of Fed actions, people often make the mistake of saying the Fed raised rates or lowered rates, etc. When that's not how it works. The Fed sets its target for the Funds rate, and then seeks to meet that target through the monetary supply. The Fed does not control mortgage rates. And if the Fed quit pumping so much money into the economy, inflationary pressures wouldn't be so bad. Lower inflation would make bonds more attractive to investors (which are already attractive for "flight to safety" reasons as I noted above, but that unsustainable), bond yields would go down and thus long term rates, like fixed mortgage rates, would go down.

 

[Fern]

Originally posted by: Jhhnn
When are ARM's beneficial to more than a very small % of borrowers?

Personally, I feel that ARMs are terribly usefull under the appropriate circumstances.

Even though I favor fixed interest 15 yr term loans on my real estate I've taken advantage of ARMs before.

We all rates tend to cycle up and down, I was forced to purchase a home (relocation, wife pregnant etc) during a period of high rates. I used a 5yr Arm (low initial rate for 5 yrs afterward it was adjustable).

I was betting that somewhere before the expiration of the 5 yr period rates would come back down and I could refi at a much lower fixed rate. That's exactly what happened.

(And no, the ARM rate would not have been lower even given low interest rates due to mechanism of adjusting the rate under the terms of the ARM).

Those who choose ARMs in a time of low rates because the ARM is even lower are fools, IMO. Buy the time the period of low rates expires and the adjustment kicks in they'll likely find themselves in a period of high rates and no good options for refi'ing.

Fern

 

[Jhhnn]

Interesting article here, if a bit long-

http://www.prospect.org/cs/art...cle=the_bubble_economy

Which, I think, addresses the root of investor fears more than vic's inflation theory- it's the fear of loss, not fear of inflation that's driving investor behavior. and they have good reason to fear a debt deflation scenario, particularly wrt real estate.

If it were just fear of inflation, investors would seek high returns to counter the effects, but it's not- institutional investors are seeking safety in Bonds- they have to put their money somewhere, and bonds are the safest thing they can find ATM... even if yields suck.

The subprime and hedgefund problems are just the point of the spear that poked the hole in another bubble economy...

 

[First]

I really don't know where to start, and frankly won't bother. Either Clinton is monumentally misinformed or she mis-spoke. Freezing interest rates on general bank loans for five doesn't have any precedent in modern U.S. history. It's dangerous. Either way I won't vote for her no matter what.

 

[Jhhnn]

Not to defend Hillary's position, but I think she has merely sought a freeze on existing ARM's that would expire within the next 5 years- not an interest freeze on all mortgage lending...

 

[Vic]

I'm pretty sure I mentioned "flight-to-safety" investments in bonds more than once in this thread.