Stop Me Before I Vote Again

"Now I love to see the banksters in a dilemma"

banksters ???
hell they get bailed out
no matter what with their
insured endless lines of uncle credit

want a real dilemma
try under water job class home owners

wishing for the chrash of prices
is wishing for the financial
destruction of middle class american households

as a good updated jacobin
thats
too prole-lumpen-boho for me father S

"...mass "home" "ownership" .. means mortgage slavery "

paradox
the one thing worse
for job class welfare
then a big mortgage
is no nest egg at all
and its consequence
getting shut out of
the credit market entirely
nothing is more easily wage compressed
then a pure rental creditless job class
unless the social transfer system
is swedish robust

-------------------
"housing is the only commodity whose price everybody wants to go up.. "

its not as housing
but as a household investment
folks want housing prices
in their neighborhood at least
to go up

and properly speaking
that's because
its not the housing itself
which can never in itself
exceed its cost of reproduction

its a certain amount of housing in
a certain location
that can move up in price
as demand for that location moves up

a located house is more like a stock
then a pile of shoes
--------------------
from the article:

" a national moratorium on foreclosures would backfire by driving down prices even more......potentially creating more foreclosures as additional homeowners find themselves under."

nasty toxic gibberish

a foreclosure moratorium oughta
strengthen house prices

this ohbummer line is a cover line
prolly ghoulsby is the nasty nut ball carrier here

what's really going on ?
well i guess
so far at least
the banksters see no dilemma
they know they don't want a moratorium

and the WH is holding up the movement as best it can
with criminal lies about market dynamics

"...delaying the real estate shakeout "
is not in and of itself a bad move
what matters is what shake out occurs
in the mortgage structure
and if a slow down in foreclosures
lead to more write downs and other modifications of existing mortgages
that's a good outcome
down sizing existing mortgages
ought to be the order of the day
in a home owner majority society
that is also a democratic society
like ours tells itself it is

a foreclosure moratorium oughta
strengthen house prices
and actually appear to lift
marginal homes above the water line
but again
the focus must be on the mortgage structure
the stream of payments flowing from it
and the balance due
particularly the balance due
which is twenty to thirty percent
too high
in many locations

-------------

can't say i share the fathers sanguine joys here

the much beloved walk away movement
is in reality
synergistic with any foreclosure moratorium movement
if it got rally flying
it surely would among much else
trigger a bank sponsored universal moratorium to staunch the loses

the banksters need to shield
their pool of rentier suckers
from a big hair cut
rentiers are their base after all

a massive mortgage write down wouldn't effect these ceo's unless the rentier class takes the hit

uncle will need to nationalize any loses

a foreclosure moratorium opens the floodgates
to write downs

foreclosure rates vs walk ways rates
that's the real class duel
the banks don't foreclose until they can't squeeze out anymore payments

holding foreclosed units off the market
becomes easy once the payment flow stops why not take posssesion

OP nails it. I'm afraid many of us will be shut out of the rental market as well. foreclosure doesn't do a lot for credit ratings or the ability to rent quality housing.

I know, I know, I should be happy to end up in a converted motel unit. It's a "sin to want "nice" housing. Four bare walls and an operating toilet is the only morally appropriate choice. All else is commodity fetishism.

brian i thanx
but i hardy nailed it
its very complex
and frought with nasty trade offs

i just don't want folks to think this site is merely about the hair shirt
green-red good taste and judgement

father S is not against fetishism
if the commodity is right

http://guestofaguest.com/wp-content/uploads/2010/06/katy_perry_1.jpg

I AGREE WITH OP?!

I have no intention of ever owning a home (or a car, for that matter), but my parents own theirs -- and paying it off for good was one of their proudest moments. Personally, I don't think that makes them repulsive capitalist drones. (Their bonafides, because why not: My dad was part of the dwindling union presence in the coal mine where he worked for thirty years, and my mom, in her heyday, was an original recipe, war-protesting, government-hating hippie.) Although, you know, I might be positively prejudiced in their favor, seeing as they were totally amazing parents and I love them.

I don't think anybody ought to be allowed to build or buy a McMansion until every human on the planet has a safe, temperature-controlled, watertight place to stay, but I'm also not convinced that allowing 20% of current mortgage-holders to lose their homes is the yellow brick road leading to that particular Oz.

the 'sell high' part of this brigandry confuses me. we're still blessed w/ ridiculous overstock of units meant for mortgage mayhem. so the buy price would have to be pretty lower than usual maybe.

"as a good updated jacobin
thats
too prole-lumpen-boho for me father S"-OP

Not for me. A home is SHELTER and that is what it should remain, not an investment vehicle. The sooner we return to the standard of investment in productive activity the better. But NOTHING will change if the bubble prices don't return to reality.

"OP nails it. I'm afraid many of us will be shut out of the rental market as well. foreclosure doesn't do a lot for credit ratings or the ability to rent quality housing."-Brian

Nonsense. In today's economic environment renters with challenged credit histories are the new normal and property owners (like myself) will have to adapt to that fact or find themselves in foreclosure. It really is that simple.

Coldtype:

Just like "clothing" is protection from the elements...yet I still don't want to be "allowed" (per the poster up thread) (there is that authoritarian, almost religious and monastic aspect of leftism again) only to possess (note I avoided using the word "own") one Mao suit.

I'm still not sure denying some people the ability to live in a single family home will result in a peasant in the jungles of Ecuador to have perfect shelter. Besides...who defines what the adequate shelter is? The homeless alcoholics in my neighborhood have plentiful bridge underpasses.

Not that I disagree entirely with your dismissal of home ownership as investment vehicle.

Still...is a home ONLY shelter? No room for pride, for customization, for decoration, for cultural aspects? Is there only room for the dire necessities? Is indoor plumbing a horrble bourgeoise affectation that must be abolished until every person in the world has full access to modcons?

Seems to me that houses stand so tall in people's minds because, in a corporate capitalist society where almost everything else one must buy is an item of planned obsolescense and rapid net loss, a house, by virtue of its construction and use still lying mainly in the hands of the resident, retains much of its original structural and financial value over time. Hence, for those who can get into the game, it is a form of forced saving, in a society where everything else is a vehcile of maximal forced dis-saving.

Of course, our culture (read: our capitalist media system) ideologizes this forced saving into something that's somehow entrepreneurial and capitalist, even though it is no such thing.

Of course, thanks to the tax deduction for mortgages, people tend to buy above their means, hoping to squeak out a bit of a profit at the end. Add in the overclass, which is always willing to play any speculative game that looks viable, and you get the housing bubble and the expectation that houses ought by rights to carry more than their stick value.

But, bottom line, I don't think it's evil to want to own one's own place of dwelling.

What's really evil is that we have the mortgage interest deduction, rather than a universal citizen stipend, and that the public is not a major player in building houses and apartments and financing their purchase.

Also: Feudalism! Too.

"A home is SHELTER and that is what it should remain, not an investment vehicle."
the home isn't the investment vehicle
the house lot is
if you don't understand this
get out of the deep end of the pool
if i were maximum leader the lot value would be taken up by a 100% ground rent tax
nothing nothing is nastier then the lot bubbles conjured by our credit system

however none of this matters
the real choices of any job class household
is buy or rent and that has no universal answer however if the system now has half of all job class folks as owners
own a mortgaged house lot and home
we are in a social context where
house lot values are crucial to welfare
and a cave in of lot values is a source of broad misery

one might think twice
about capering around over
at least if one's plain of struggle
includes middle income mc-job holding amerika

OP:

one might think twice

about capering around over

at least if one's plain of struggle

includes middle income mc-job holding amerika

Okay, I've thought twice. Actually, more than twice> But I still come up with the same answer. Is it really in the interest of the McJobblers you mention to take up real-estate speculation on a short purse, and depend on that strategy to support them in their old age? Seems utterly crazy to me.

If the current lot bubble deflates down to zero, or less, there'll be a lot of disappointment and angst. But there would be anyway.

If the bubble had kept bubbling -- is there any doubt that our masters would have found some other way of expropriating the surplus? Gutting social security? Privatizations of one kind or another? Fees for this and that? Higher local property taxes -- pegged, of course, to the absurdly inflated notional values of these house lots?

Experience keeps a hard school, as the man said, but a fool will learn in no other. He might have added that we're all fools.

"the home isn't the investment vehicle
the house lot is
if you don't understand this
get out of the deep end of the pool"-OP

I understand this perfectly but our ass-backward system in no way reflects the sensible desires of your mythical maximum leader. Our happy house-flipping "economy" of the past 15 years was certainly no mystery to you nor were the BS valuations of those homes which inevitably blew up in '08 so why the wistfulness for houses no one can afford to purchase?

I would like some details of the 100% ground rent tax idea. Is the idea that the government drains off 100% of 'house/home/lot' price appreciation each year? Doesn't that get tangled up with general price inflation? A heated square foot of a newly constructed house costs more around here than it used to, maybe $25-$50 more. This change cannot be attributed to the price increase of the building lot.

Staying in the shallow end, so OP can't drown me.

On the broad source of misery, there are the home equity loans. They're the backstop funding for medical care. People go bankrupt over that anyway, but the line of credit buys them some time.

"the wistfulness for houses no one can afford to purchase? "
the wishfulness is for preserving the
jobbler household's equity
now trapped in the house

two ways exist here
A )reduce the principal on the attached mortgage or
B) increase the resale prices

notice i suggest route A

however if prices fall to the same extent
and at the same time
the result is nullified
one is just exacerbating
the lost equity problem
----

yes its jacobin to guard
petty nest eggs like that
but so be it
of course i prefer we our energies
such as they are
into raising wages by job site organizing
but
by raising petty equity
positive welfare outcomes are obvious here eh ??

------------------
affordability is really the devil's game
applied to home ownership
in that i agree with father S

to use the distinction well made above

our social objective over all
ought to be affordable shelter
not afforbale ownership
solution as suggested above
affordable rentable public housing

al has the essence of it here
equity becomes a back stop a safety nest

boink:

as to the inflation of housing construction costs
no they aren't part of appreciating ground rent

btw
the calculations here shouldn't prove much more treacherous then present asseesment systems

obviously a citizen credit line is better policy class wise eh

but dream on

"obviously a citizen credit line is better policy class wise eh

but dream on"

Well I guess that's basically where I'm at.

I think I have to side with MJS on this one. Keeping asset prices up is one way to prop up household balance sheets and support aggregate demand, but it is not a very good one, compared to writing down debt, increasing income or access to credit. You have to at least acknowledge the trade-off, that this policy harms low income people in order to help middle income people.

I'd rather see them walk away, with some sort of moratorium on defaults being registered in credit histories. then they could repair their balance sheet by renting somewhere cheap or buying a cheap house. Again though, this is another "dream on" idea.

" asset prices up is one way to prop up household balance sheets and support aggregate demand "
yup
but AD considerations are macro
and oughta be thrown out
since we have more direct means to manage AD

so far as social engineering is concerned
Al's buffer equity is a right on dimension
of assessment de facto
despite many better alternatives
not on the agenda in washington

" it is not a very good one, compared to writing down debt, increasing income or access to credit."

damn straight poke !!

"writing down debt " is obviously better
and the other two alters
more wage income and bigger credit lines
border on belaboring the obvious eh ??

i like your notion of a "moratorium on defaults being registered in credit histories"
in fact the entire relm of personal credit rating oughta be public utlity time

and mods based on macro conditions
would be de rigour
a right to borrow eh ??
and then the whole regulation of credit ratings might pre figure a citizen credit line

"You have to at least acknowledge the trade-off, "
there are several
but "that this policy harms low income people in order to help middle income people"
is not best countered by butt fucking
the middle income strata

low income oughta mean more public housing
adequate shelter as a human right

letting lot values collapse
as an anti poverty campaign
is really crazy

beyond vickrey hyper employment
i tend to neglect poverty pimping

i leave that to the haute rentier goo goos
that love
altruistic generosity
and measured self sacrifice

the link in house prices and rents seems badly broken

so i'm unclear just how a lot value collapse
how far lower resale prices pushes
lower leasing costs
in particular
once one factors in bankster
supply control of foreclosure resales
its not too clear how the system lowers resale prices if banks decide to hold back inventory

gets complex eh ??

There's two kinds of people being foreclosed upon.

A) They used their home as collateral during the speculative bubble. They got a bit greedy and when the big shitpile turned to, well... shit, then they got burned. And since they don't own their own politicians to get them a bail out like our bankster friends on Wall Street, they lose. Bad move on their part. Don't play the market on margin in this country unless you have some bought and paid for politicians to bail your ass out when the bubble pops. I have little or no sympathy for these folks.

B) Other folks had standard mortgages that they were faithfully paying. Not refinancing. Not flipping homes and betting on the speculative value of their homes. Just wanting a place to live and taking advantage of government rules that made home ownership advantageous under the tax rules. You might not like those rules, you make think they're unfair or stupid, but those are the rules. We're just the rubes that live under them. Then, because of all the greedy bastards on Wall Street who destroyed the economy lots of these folks found themselves without a job. Now they can't find work and they're being foreclosed upon and will lose everything they ever put into their house. Their equity, their dignity, their shelter. Everything. I feel badly for these people. When they get bounced they'll be so badly in debt that they won't be able to afford even a rental. They'll move in with relatives or, like some I know of, end up living in their cars. God Bless the USA.

Now I know well there is no justice in this world and I'm not so sure there is a next one in which folks might find some but if there was any justice in this world we'd find some way to help the folks in category B and not belittle them or second guess them or knock them for wanting to have their little piece of the pie. Oh, and we'd hang the folks on Wall Street and their bought and paid for politicians too.

My $0.02, FWIW, YMMV, etc. etc. etc.

"Now I love to see the banksters in a dilemma"

They have no dilemma. They have no moral hazard. They have no consequences for their actions. They can't lose.

Your tax dollars will make sure of that and the protection racket known as the US Government will make sure of that.

http://www.globalresearch.ca/index.php?context=va&aid=21263

The unelected members of the European Central Bank (ECB, independent from democratic politics, not from control by its commercial bank members) has taken over planning power from elected government. Beholden to its constituency, the financial sector, the ECB has had little trouble in convincing the EU commission to back the new oligarchic power grab. It threatens to fine euro-area states up to 0.1% of their GDP for failure to obey its neoliberal recommendations - ostensibly to "correct" these imbalances. But the reality, of course, is that every neoliberal "cure" only makes matters worse.

Rather than seeing rising wage levels and living standards as a precondition for higher labor productivity, the EU commission will "monitor" labor costs on the assumption that rising wages impair competitiveness rather than raise it. The broad spectrum of neoliberal junk economics is being brought to bear. If members of the euro cannot depreciate their currencies, then they must fight labor - but not tax real estate, finance or other rentier sectors, not regulate monopolies, and not provide public services that can be privatized at much higher costs. Privatization is not deemed to impair competitiveness - only rising wages, regardless of productivity considerations.

anon

icey nice narrative

it's a clip from the linked rant.... Michael Hudson, author.

anon
gotta laff
from hudson i give it a not so super
given his position
he gets paid
to notice all this shit
example
i'd pass an amateur on
but flunk a pro
"It threatens to fine euro-area states up to 0.1% of their GDP for failure to obey its neoliberal recommendations "

peanutz !!!
but this is excellent
"If members of the euro cannot depreciate their currencies, then they must fight labor "
and this ain't bad
"The unelected members of the European Central Bank (ECB, independent from democratic politics, not from control by its commercial bank members) has taken over planning power from elected government"

"letting lot values collapse
as an anti poverty campaign
is really crazy"

I may be wrong but the price of "lot values" can only be kept aloft by compelling new buyers to purchase real estate at a premium that susidizes prices at the current level or above. Paradoxically, it's high rates of credit flows to real estate (now maintained through Fannie and Freddie) that drives up prices. What is the interest rate elasticity of real estate prices?. This may not be possible for much longer without trade surplus countries to buy GSE paper.

When can ordinary people get off the debt treadmill that is a byproduct of unbalanced trade flows? Can't we begin our adjustment now?

db its a matter of relative rates of inflation
from here on out

nominal wage increases acommodated
by credit driven
product price inflation
ie
the fed accelerating wage rate change
not squelched it
while lot prices stagnate

relative price movements
in the context of say 5 % product price inflation
is the policy path
that can reset product prices
to lot prices
without resorting to nasty disinflation
in either case