Comments on: Banks Doing Little to Solve Housing Crisis http://donklephant.com/2009/02/13/banks-doing-little-to-solve-housing-crisis/ Big Teeth. Huge Ass. Surprisingly Reasonable. Sun, 22 Nov 2009 05:46:37 -0800 http://wordpress.org/?v=2.8.4 hourly 1 By: gerryf http://donklephant.com/2009/02/13/banks-doing-little-to-solve-housing-crisis/comment-page-1/#comment-436547 gerryf Fri, 13 Feb 2009 18:11:30 +0000 http://donklephant.com/?p=13512#comment-436547 As long as the banks are too big to fail--ie, failure means worsening an already terrible economic picture, the banks will sit back and do nothing because the government will eventually bail them out. And as much as I would love to see the banks and every other over consolidated industry broken up, now is not the time to do it. We are paying for the lack of foresight exhibited by our leadership for the past 30 years. As long as the banks are too big to fail–ie, failure means worsening an already terrible economic picture, the banks will sit back and do nothing because the government will eventually bail them out.

And as much as I would love to see the banks and every other over consolidated industry broken up, now is not the time to do it.

We are paying for the lack of foresight exhibited by our leadership for the past 30 years.

]]> By: kranky kritter http://donklephant.com/2009/02/13/banks-doing-little-to-solve-housing-crisis/comment-page-1/#comment-436542 kranky kritter Fri, 13 Feb 2009 17:32:48 +0000 http://donklephant.com/?p=13512#comment-436542 Amen brother. To the tenth power. Why'd we bail out the banks if they weren't going to help re-stabilize the real estate market by fitting both new and existing homeowners into loans that are sensible and realistic based on <i> current circumstances</i> of income and property valuation? Giving money to the banks may have "stabilized" them, but it sure didn't give them any incentive to help out borrowers that they have on the hook for underwater mortgages they can't afford. I'm inclined to think the gov't would have been better off from the start letting these banks fail, buying up the assets and mortgages at a fraction of the cost, and then renegotiating the terms. The RE market needs to restabilize around the old boring way of doing things, providing mortgages to people who can afford to pay them back, based on slow appreciation of home value. As is, banks are acting like obstacles, making the restabilization of the real estate market unfold in slow motion, while we all twist in the wind. I have a hard time figuring out how we get banks not to battle each borrower over every penny. Can I assume you watched "House of Cards" on CNBC last night? I'm still smoking. Amen brother. To the tenth power.

Why’d we bail out the banks if they weren’t going to help re-stabilize the real estate market by fitting both new and existing homeowners into loans that are sensible and realistic based on current circumstances of income and property valuation?

Giving money to the banks may have “stabilized” them, but it sure didn’t give them any incentive to help out borrowers that they have on the hook for underwater mortgages they can’t afford.

I’m inclined to think the gov’t would have been better off from the start letting these banks fail, buying up the assets and mortgages at a fraction of the cost, and then renegotiating the terms. The RE market needs to restabilize around the old boring way of doing things, providing mortgages to people who can afford to pay them back, based on slow appreciation of home value.

As is, banks are acting like obstacles, making the restabilization of the real estate market unfold in slow motion, while we all twist in the wind. I have a hard time figuring out how we get banks not to battle each borrower over every penny.

Can I assume you watched “House of Cards” on CNBC last night? I’m still smoking.

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