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| Economy |
| Time Bomb in US Banking System |
| 2010-03-20 |
| Just a reminder that bad home loans are a huge problem, that this is not going away and is not being dealt with in any substantial way by the powers that be: if banks really accounted for all the losses in the home loan market, they'd all be insolvent. Diane Olick report 8 March 2010 The current strategery/shuck-and-jive is to keep the defaulted mortgages off the books of the banks and the defaulted homes off the real estate market (aka "shadow inventory") in the (most likely foolish) hope that the economy and the housing market will grow its way out of the debt basement we're in. |
| Posted by:Anguper Hupomosing9418 |
| #15 Yeah. When I bought maps of most of the habitable caves east of the Mississippi River back in ’94, from the USGS “Map Store” in Reston, I knew this was bound to happen…I now need to buy the latest revisions to them all. Also, as a resident of S. Maryland these days, I’ll also need to warn my Amish neighbors that they’ll soon be forced into a 24/7 food production & supply-chain logistics nightmare. “Don’t look now gentle, self-sufficient folks, but you’re on the hook to feed the whole damn Nation (think “small N”). So, “Snap those suspenders and look lively”—‘cuz nobody else can do it like you little guys. |
| Posted by: Asymmetrical Triangulation 2010-03-20 21:56 |
| #14 OK, I see remote controlled insect brains in Berkeley. Show me something new. |
| Posted by: Grunter 2010-03-20 20:52 |
| #13 Lex old mate, something tells me you'll be among the survivors who brew your own Guinness, gain weight and thrive. |
| Posted by: Besoeker 2010-03-20 20:08 |
| #12 I was on leave that day and the wife yelled at me to come look at the teevee. I no sooner sat down that the second plane hit. I jumped up, pulled on my BDU's and headed for post. I will never forget that day and seeing those people leap to their deaths from the top floors. Afghan Hearts and minds strategy my aching arse. |
| Posted by: Besoeker 2010-03-20 20:04 |
| #11 How will you keep the roving gangs of armed predators from stealing your crops? With cyborg beetles. |
| Posted by: lex 2010-03-20 20:03 |
| #10 Beso, mine came 9-11-2001, and most things since have just made it worse. |
| Posted by: Glenmore 2010-03-20 19:58 |
| #9 Diaspora it may well be, and not the first. |
| Posted by: Besoeker 2010-03-20 19:41 |
| #8 Actually I was thinking of doing a reverse of my great-grandfather's situation and being an absentee landlord in County Mayo-god-help-us. With a 21st c. spin-- you know, arugula, free-range radicchio, dairy farming for devonshire cream, etc |
| Posted by: lex 2010-03-20 19:27 |
| #7 Already had several famiuly & friends who lost their farms to the tax man (not the bank!) so I know how that goes. Ask the farmers in Zimbobland. |
| Posted by: Glenmore 2010-03-20 19:24 |
| #6 Buy farmland you say? How will you pay the state's tax levy on it? What if you are old or disabled and can't plow a row. How will you keep the roving gangs of armed predators from stealing your crops? Hobby farming or subsistance living may work in some remote areas, but unfortunately everyone can't move to Remoteville. |
| Posted by: Besoeker 2010-03-20 19:21 |
| #5 Buy farmland. When hyperinflation hits, essential commodities will do very well. |
| Posted by: lex 2010-03-20 19:10 |
| #4 Blue funk? You as well? Mine came on just prior to midnight, 4 Nov 2008. |
| Posted by: Besoeker 2010-03-20 18:46 |
| #3 I'd be delighted if someone could convince me I am wrong and shake me out of my blue funk. |
| Posted by: Glenmore 2010-03-20 17:48 |
| #2 If the banks were actually accounting honestly they would virtually all be bankrupt. The government regulatory bodies are fully aware of this, and have been for two years or more, but are actively abetting the deception, hoping for a long, soft decline (like Japan's for the last two decades) rather than a catastrophic crash. All that has been addressed so far (and incompletely, at that) is the sub-prime home loans. The various second mortgages are mostly valueless (to the banks.) A lot of balloons and 'investment' home mortgages are seriously underwater. Judging by the number of vacant storefronts and office buildings I have to believe the commercial mortgage market is in serious trouble. Two more homes went up for sale on my little two-block street this week - and I am in one of the better real estate markets. Only one property has sold, and several have been pulled back after not finding buyers. Somebody is going to end up holding the bag on this mess - and it can only be the people who have behaved responsibly and lived within their means. Whether they pay via inflation or deflation or taxes, THEY will pay, and THAT will crush honest development and investment for a generation. |
| Posted by: Glenmore 2010-03-20 17:45 |
| #1 I used to work developing software for bank lending. It was obvious to me that any significant fall in real estate prices (around 15% to 25%) would bankrupt basically every bank in the world. The bankers of course treated me as some kind of leper for even raising the possibility. |
| Posted by: phil_b 2010-03-20 14:42 |