In a recent post I quoted USC professor Raphael Bostic, economist Jack Kyser and mortgage broker Jeff Lazerson speaking mostly in support of the Federal Reserve’s commitment of $800 billion to support markets for mortgages, consumer loans and business loans. Read the post HERE.
I received a rebuttal to their comments from reader Jeff Oviedo, owner of Costa Mesa-based JOA Group, a project management firm. Here’s what he wrote:
Confidence
(From my blog) Jack Kyser…”You have to restore confidence.” Bostic also said restoring confidence is essential
Restoring confidence is a common buzz word that politicians, economists and financial experts point to regarding our crisis. One of the main reasons they state that is because they don’t know what the real problem and solution (or they don’t want to look at reality) are. So they point at confidence. If you insert an out-of-shape teenage kid in a NFL pro football game at quarterback and say all you need is confidence, then you’re not looking at life realistically.
Proactive Policy
(From my blog) In recent weeks, companies that issue credit cards have reduced credit lines…the government acted before credit card companies started failing
People used credit cards to purchase vacations, flat screen TVs, clothes, etc. That’s ok if they have the money. But they didn’t. Now the federal government, using our taxpayer money, is swooping in to ’save’ these credit companies. I really don’t get it.
Bottom of Market
(From my blog) Lazerson said first-time homebuyers who have sat on the fence are finally being rewarded; “They will buy at the bottom of the market with super cheap money.”
Isn’t this what got us in trouble in the first place (super cheap money)? Also Mr. Lazerson’s statement that it’s the bottom of the market is only a ploy to drum up business for Mortgage Grader. We don’t need to encourage people to dig our economy deeper in a pit. Let’s use sound principles; purchase a home you can afford and provide a significant down payment.
That’s it. Interesting points from a reader.
And some related topics…
- Fed plan should stem credit-card crunch
- Group calls for 180-day foreclosure moratorium
- O.C. mortgage rate drop a “miracle”
- Fed to pump $800 billion into credit markets
- Downey Financial to file for bankruptcy after government seized assets
- Citigroup bailout “an outrage”
- Citigroup gets a bailout
- Wells Fargo to cut mortgage jobs in Irvine
- Downey Savings seized by regulators
- A ‘good’ borrower these days is someone who…
- Happy holidays: Freddie, Fannie halt foreclosures till 2009
the fed– ha– its because of the fed that were
in this predicament- and now we are putting the
same geniuses that helped create this mess
in charge- geithner has been on the fed for years
and voted along with greenspan to drop rates–
summers was the treasury secretary under clinton
and helped create the sub prime programs and
lax lending standards that allowed the housing
bubble to be possible- both are “students” of robert rubin
who was the head of citi group- who just received 25
billion taxpayer funded bailout dollars to prevent BK
and now the idiot has the nerve to deny that he has any
culpability for that company needing bailed out– obama is
now putting the inmates in charge of the asylum—
and wheres our dumbed down media been while all this
is going down? where were all the expert economists
while this was transpiring right before their IVY league eyes?
where is the outrage? why did we allow this to happen?
everyones either SOS or in denial
http://globaleconomicanalysis.blogspot.com/2008/11/rubins-arrogance-and-denial-is.html
http://globaleconomicanalysis.blogspot.com/2008/11/rubins-arrogance-and-denial-is.html
Am I not understanding things correctly?
Doesn’t the whole government/fed/treasury reaction support ‘more of the same’ that has collapsed world economies?
What’s the matter with all those high-falutin people?
No common sense. Get them out of there and get someone who, like a lot of bloggers out here in ‘regular life’, already has figured out that if government and fed keep doing the same things that caused the problem, the problem will continue as long as they keep doing the same things.
Pursuing bankrupt ideas isn’t the way to a sound future, for any country. Hooray for the Germans who said “NO”. Let’s hear more “NO”.
I saw one Ron Paul sign as I drove through Laguna Niguel on my way to the In’N'Out burger, last time I visited the OC (prior to election). I was sad every time I drove by it, because I thought that guy (and others like him) might have been able to make a *real* difference. Obama is going to be much better than Bush, he’s going to do what feel like popular things, but in the end he’s simply caving to the printing press and the applause meter. The concern begins the day that foreigners realize the game is rigged, they stop buying US treasuries and the news-media / govt label them “economic terrorists” for failing to buy our bonds. Our interest ratres will go up to 7-9% (or more) and the government will realize it can no longer afford to pay the interest on 11.6 trillion of national debt @ 9% because that would basically equal all income tax revenues. Some around then we’ll formally default as a Country, which will basically be sold as a reorganization at home but a bankruptcy in the rest of the world’s press. Then I’m not really sure what happens.. does China sue us in DC for the state of California? Does Saudi Arabia stop selling us oil? Do foreigners accept the new currency we create and absolutely promise not to debase? It’s really nebulous. I expect the fear we all feel in the market is ‘that one’ .. What happens after we default? What kind of new sustem will we create and how uncomfortable will that time of global recalibration be?