Obama Administration Pushes Banks To Make Home Loans To Borrowers With Weaker Credit

The Obama Administration is involved in a major effort to push banks to make home loans to people with weak credit and in the case of purchases, with little or no down payment.

According to the administration, this is going to help 'fuel recovery' and promote 'fairness, because, in the words of the linked WAPO article, "the nation’s much-celebrated housing rebound is leaving too many people behind, including young people looking to buy their first homes and individuals with credit records weakened by the recession."

So the administration is using the Justice Department and the Inspector General's office of HUD, (who are in charge of investigating claims of fraud and wrongdoing in the mortgage industry) to get lenders to grant home loans to riskier borrowers. They're especially leaning towards the idea of steer borrowers towards FHA, Fannie Mae and similar taxpayer guaranteed programs.

This seems like a good idea. I only wish we had some real life experience on how well it would work.

Oh...wait a minute..

Now that you've stopped laughing, here's a few facts to ponder.

First of all, there is no 'housing recovery', because the demand isn't there. People don't ordinarily take on large debt like a home purchase in uncertain economic times. New home starts are at historic lows, and I can take you to a dozen construction sites locally where someone started to do exactly that, and realized that finishing the construction would involve a new 'take out' loan to the bank and leave them seriously underwater with a property that was in the red.So the job sites are just sitting there, while the owners wait for the market to improve or for a sucker to come along and take the property off their hands.

What you're seeing instead, (because the rental market is strong) is private investors. property management companies and Real Estate Investment Trusts (REIT's)buying up homes at today's low interest rates, putting a little basic maintenance into them and renting them out at a profit.

Needless to say, the Obama Administration doesn't like this vestige of private enterprise. So they're leaning on lenders to make loans to riskier borrowers, promising them that if they go along, they won't be subject to investigation or penalties if the loans default.

I can tell you from personal experience that those guarantees are worthless. It's exactly what lenders were told during the last orgy, when they were pushed to do exactly the same thing.

Well connected Democrats like Fannie Mae and Freddie Mac executives Franklin Raines and Jamie Gorelick, among others, made millions in bonuses for pushing these bogus loans and the derivatives based on them through the system that brought on the last crash in 2008.

They were protected. It was the lenders who were used as political targets and vilified merely for doing what the feds demanded they do.It cost them billions, and in some cases saw profitable companies destroyed, along with thousands of jobs. Anyone remember Washington Mutual?

At this point, the taxpayers are already eating most of these toxic loans. Rather than let the market absorb these properties and gradually recover, the Obama Administration simply raised the dollar amount of the FHA refinance limits to over $800,000 and severely loosened the underwriting requirements to allow the banks to unload them onto the shoulders of the taxpayers.

What the Obama Administration is doing now is exactly what was done before and led to the meltdown. And the banks will go along, because they have little choice.

Police Bust Ends ‘Free Sex After Nine Car Washes’ Promotion!!

 

Ah, me...free enterprise takes it on the chin again...

It's a classic business tactic to increase sales. You offer something special to increase customer loyalty and leep 'em coming back.

In this case, you had a car wash that teamed up with a massage parlor to offer a unique proposition - free sex with the tenth wash. Th ecar wash promoted the massage parlor and told its customers abiout the promotion. At the massage parlor end, customers who visited the girls for a massage and and other extra services  received loyalty cards and a referral to the car wash. You have to admit, it's a step up from  "free car wash with oil change'.

For three months, it worked like a charm. But then the police  got suspicious after they found some of the loyalty cards. And then they noticed the some of the same cars repeatedly re-entering the car wash....

So  the cops moved in, raided the massage parlor, arrested nine women  and closed the massage parlor part of the partnership down.  I guess you could say they were a victim of too much success. Or something.

Unfortunately, I have to predict that this particular car wash will now see a decrease in sales.To say the least.

The New Head Of OPEC..A Senior Commander Of Iran's Revolutionary Guard

As Barry Rubin puts it:

"It’s not every day when a high-ranking official of a revolutionary Islamist group that seeks world revolution, wiping Israel off the map, the widespread use of terrorism, and the destruction of the United States becomes head of the world’s most powerful energy organization on whose supplies America is dependent.

The man he's talking about is Rostam Ghasemi, a senior commander of the Iran's Islamic Revolutionary Guard Corps who runs one of its big military-industrial operations. He's in charge of manufacturing armaments, some of which are sent to Iraq and Afghanistan to kill Americans an dothers which go to Hezbollah in Lebanon and Hamas in Gaza. He's also Iran’s oil minister and apersonal favorite of Iran's Supreme Leader the Ayatollah Khamenei. Ghasemi also has the distinction of being personally named in sanctions against Iran by the United States and EU because of his involvement in Iran’s illegal nuclear weapons program.

Ghasemi being named head of OPEC - no election was involved, it's simply Iran's turn - ought to give you a good idea of what those sanctions are worth.

This could actually trigger a certain amount of dissension in OPEC. Iran has severe econ0mic problems, is spending massive amounts on its military and on supporting proxies like Hezbollah, Hamas and the Mahdi Army and other Shi'ite militias in Iraq and need the price to be as high as possible. Also, Iran's output is decreasing by about 12-15% each year because of corruption, inefficiency and antiquated facilities, and lowered production not only helps the regime stretch out its supplies but increases prices.

The Saudis and the Gulf states, on the other hand, want to see more moderate prices and increased production because they have a financial interest in keeping western economies healthy because of their investments there, and to fulfill their inherent bargain with the West, especially America - they keep the oil flowing and the US protects them.

Or at least we did. As they see President Obama's weakness and fecklessness demonstrated almost daily, that protection becomes worth a lot less to them.

Another factor worth mentioning is that thanks to the Saudis and the Gulf States, the international oil trade is conducted in dollars, which means the oil producers import our inflation. The Iranians, among other OPEC nations have been screaming for years to end this practice, and if they get their way it will result in sharply higher oil prices and less leverage over OPEC by the US.

Of course, the reason we're so dependent on Persian Gulf oil is because our president refuses to allow us to drill for our own oil, plain and simple. Ghasemi is not going to just be able to do whatever he wants, but in view of the situation President Obama might want to reconsider that particular bit of stupidity on his part and make a few changes.

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Introducing The Barack Obama SEAL Action Figure!

Well, you knew this was coming....The Barack Obama Seal Team Six Action Figure!

No joke, it's being made by Hero Builders, a company in Connecticut and has been dubbed 'Rambama'. I'm sure most of the on-air lineup at MSNBC have already placed rush orders.

Never mind - it's curiously appropriate somehow that what we have here is a phony stuffed plastic dummy playing dress up with a toy gun and a 'Punisher' tee. And that it's being marketed by an American company but was likely made overseas by a subcontractor.

The Sniper has an amusing piece comparing how President Obama handles certain situations compared with real Navy SEALs.

(via Memeorandum)

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Wikileak's Julian Assange Gets 7 Figure Book Deal On Autobiography

A new low in the publishing industry..

Wikileaks' boss Julian Assange has revealed that he's getting an advance of $502,000 (£325,000) from U.K. publisher Canongate Books Ltd. and $800,000 from U.S. publishing house Alfred A. Knopf, a subsidiary of Random House,( which is in turn owned by Germany's Bertelsmann AG) for writing an autobiography.

Assange told the UK's Sunday Times that he sold the memoir because he needs the money to pay legal fees to keep WikiLeaks afloat. "I don't want to write this book, but I have to," he said.

The book is expected out sometime next year and Knopf and Canongate are to be commended, if that's the right word, for reminding us that some people will wallow in anything for money, no matter how dirty:





(The famous final scene from The Magic Christian..unfortunately part of the sound track's been deleted because it contains Thunderclap Newman's 'Something in the Air')

Some suggested titles fopr Assange's new opus?.."Stealin' it"...."Bareback Riding"..."The Parasite King"..

Your thoughts?

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A Small Anti-Jihad Victory

A few days ago, I was notified by someone I unfortunately do not recall(and if you read this, please remind me so I can give proper credit) about an absolutely abhorrent ad by HSBC bank touting it's investments in Iran.

After locating the company's US advertising officials, I sent the following To Diane Bergan, listed as their Senior Vice President in charge of Public Affairs US:

Dear Ms. Bergan;

In view of its stance on civil liberties and how Iran treats women, homosexuals, Jews, and Baha'is, I was surprised to see a major Western bank endorsing the Iranian regime with an advertising campaign, let alone boasting about investing there.

Tell me, does that 25% mentioned in the ad refer to female filmmakers or the percentage of Iranian women who have been beaten and/or raped by the basij in places like Evin Prison?

Needless to say, I will out of principle refuse to have my company fund any construction or investment through HSBC in the future.

Sincerely,
Rob Miller

I then alerted my e-mail list. Today, I received the following:

Dear Mr. Miller:

Your email correspondence directed to Diane Bergan, Senior Vice President – Public Affairs, regarding an “Unlocking the World’s Potential” campaign advertisement has been forwarded to the Executive Offices of HSBC Bank USA, N.A.

First and foremost on behalf of HSBC Bank I apologize for the concern which our advertisement in Greece caused. The advertisement was part of an HSBC global campaign and one of many which identified simple but surprising facts as a way to facilitate a conversation about unlocking the world’s potential.

So while our aim is to encourage debate and discussion we certainly have no intent to cause offense or be insulting, in fact quite the opposite.
Given the clear level of offense that this advertisement has caused the decision has been taken to remove it from our global campaign.

We respect your position and thank you for taking the time to raise your concerns with us.

Yours sincerely,

Margaret Moog
Senior Vice President
Head of Customer Experience

Note two things...first, while HSBC may not curtailing its investments in Iran just yet, they recognize the hypocrisy and inappropriateness of the ad they used and took action. That's an important first step.

Second, even a huge corporation like HSBC are very conscious of their public image, as they should be. Point out something like this to them, and they notice. Realize that you can make a difference, and such small differences add up over time.

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