The big R

You can't really compare the 50's to today for one very important reason, IMO. At the end of WW2 we had bombed everyone flat. England, Germany, Russia, and Japan were all about 10 years into their rebuilding infastructure and industry and we were the only manufacturing power in the world. Now there is way more world competition on the world market to build and sell goods. So you can't really compare today with the 50's as it is a totally different economic climate. As for Reagaomics, it isn't being practiced today. Reagan was pretty big on spending cuts and tax cuts. We only see tax cuts occasionally these days. Until someone wants to get really serious about reforming government spending and revamping the tax code, we will continue to have deficit spending.

Webo has hit on something in his previous posts pertaining to the mortgage crisis being the fault of predatory lenders but there is a bigger reason for the current credit crunch then unscrupulous mortgage officers. Most of the major banks do not use standard real estate appraisals for a large percentage of their residential loans. In the last 10 years or so, most large lenders have gone to a system called an AVM (Automated Valuation Model). In a nutshell it is a computer generated value for your home and the banks love them because it saves them about $400 per loan. That's a lot of cabbage. Another habit the banks got into was ordering what we call a 2055 Drive By appraisal. In this appraisal there is no interior observation of the home, it is from the street only. So in their attempts to save money the banks have probably cost themselves more in the long run.

Most of the major banks do not use standard real estate appraisals for a large percentage of their residential loans. In the last 10 years or so, most large lenders have gone to a system called an AVM (Automated Valuation Model). In a nutshell it is a computer generated value for your home and the banks love them because it saves them about $400 per loan. That's a lot of cabbage. Another habit the banks got into was ordering what we call a 2055 Drive By appraisal. In this appraisal there is no interior observation of the home, it is from the street only. So in their attempts to save money the banks have probably cost themselves more in the long run.

Thank you for that DB. I was under the impression that the Estate agents and their agents were just raking in the money. I had heard of some bad apples but not what you have just explained. If what you say is true then the banks have bought this on themselves. Over here not every bank is a morgage lender but they do buy up morgages and hope to make money on them. An old lady took out a loan on her house to see her thro to her old age, the house already was hers, but she thought that if she remorgaged it then she would have spare cash. The firm she borrowed from went bust after failing to pay the true loanee the money the old lady was paying them each month. The true loanee called in the courts and she was evicted. The TV company traced the loan and the old dear was surprised to find out the true loanee was a little bank in the Mid West.

The house went to auction and the bank ended up with less money than it first forked out. Multiply this by the number of foreclosures and you can then see how they lost out big style.

But like I have said before folk got greedy and tried to live upto their neighbours way of living.

Webo said:

If it TRULY were... WHY would the economy now be the number one thing on voter's mind's this election cycle... JUST like it was in 1992?

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Well for one thing the Clinton's are running again. light: Don't you remember the last time they were trying to get into the White House back in '92 their mantra (that WORKED btw) was, "It's the worst economy since the Great Depression"? Remember, "It's the economy stupid!"?

Even though there was hardly a hick-up in the economy in '92 the Clinton's and their allies in the liberal media saw an opportunity to seize power by scaring America into thinking the sky was falling. We've seen this movie before. wink:

We're doing even better now and the few things that need attention to keep the train on her track are being addressed.

Our economy has been so red hot with growth in both home values and in the stock market for so long that a slight cool down was inevitable. This slight cool down is the mole hill that's being made into a mountain. light:

When I studied economics in college they taught us that a recession was two consecutive quarters of negative growth in the GDP. We haven't even had one but the media is constantly screaming the R word (right before the election). light: Remember this is the same media that constantly tells us how great things were in the 90's under Clinton, but when you compare unemployment rates, percentage of home ownership, stock market performance etc... we've actually done as good or better under Bush 43 but they conveniently leave that part out. Tdown:

If Iraq could be made into an issue that helped get a Democrat back in the WH then that would be all over the 'mainstream media's' agenda driven coverage--but thankfully it's starting to go our way and we're making real progress (that's why there's hardly a peep about it the news). wink:

95% of home buyers are making their mortgage payments on time, but if you listened to Hillary Clinton and her comrades in the media like Tim Russert and Chris Matthews you'ld think 95% of home owners were in foreclosure, getting kicked out on the street having to get their families next meal from a soup kitchen. conf:

The so called crisis in the mortgage industry is really only effecting a relatively small portion of borrowers (sub-prime) and the underwriting guidelines that got a little creative are being adjusted accordingly--The majority of borrowers who have their ducks in a row can still qualify for A paper loans that are at some of the lowest fixed rates we've ever seen. clap:

Wall Street really wants to see the Bush tax cuts made permanent and business taxes lowered. The very real possibility that anti-business pro-tax increase Hillary or a Hillary-lite John Mclame might get in the WH with both a democrat controlled Senate and House has investors rightfully scared.

American families are having a problem with fuel and food costs, but those increases can be directly attributed to the Environmentalist Wackos who won't let America drill for or process her own abundant oil supplies or develop clean and safe Nuclear power. They (EW's) are also mandating the abortion that is Corn Ethanol be put in our gasoline---this is driving up the cost of corn (which is either in or fed to almost everything we eat) and thus driving up food cost$. So until Americans wake up and realize what the Al Gores of this country are doing to the cost of their of fuel and food--those prices are only going to get higher~They can either do something about it or just grin and bare it.

The King has a good point about the 'I want everything yesterday mentality' that has some people living beyond their means but that's a problem on the micro level right now and not on the macro level of the over-all economy.

So to all the Chicken Littles I say relax and don't believe the agenda driven media's hype....take some deep breaths and these small hick-ups will be over before you know it IF we keep taxes low and encourage (not penalize) EVERYONE to go out and make money .....Unless of coarse we elect Hillary or Hillary-lite John McLame, then the sky really could fall and this moe-hill could become a mountain.

Durka Durka

Reality is a tougher target to hit when your right eye's closed.

When Iraq started to turn for the better and the Liberal media could not use it to harm the political aspiration of Republicans or the Bush administration they turned to the housing market the sub-prime loans and the--- LOOMING RECESSION (say it with a deep dark voice MUUHHHAHAHA). :mrgreen:

It's real simple.

WHAT'S GOOD FOR AMERICA IN IRAQ IS BAD FOR THE DEMOCRATS.

WHAT'S GOOD FOR THE DEMOCRATS IS A RECESSION SO THEY CAN BLAME BUSH.

WHAT'S BAD FOR THE DEMOCRATS IS VICTORY BECAUSE THEY ARE INVESTED IN DEFEAT ALL THE WAY UP THEIR EYEBALLS.

WHAT'S BAD FOR THE DEMOCRATS IS A GOOD ECONOMY.

THE LIBERAL MEDIA HAS BEEN IN THE TANK SHILLING FOR THE DEMOCRATS SO LONG EVEN GOOD DECENT FAIR MINDED PEOPLE HAVE BEEN CONDITIONED NOT TO SEE THROUGH THEIR LIES AND DISTORTIONS...
sick: