Friday, September 26, 2008

Bailout Blues

This mortgage bailout plan is very complex. Bush once again is siding with the progressives, just as he has with the illegal alien problem and deficit spending. Typical RINO thinking.

Only conservatives are putting the brakes on the plan at the moment (and McCain so he can display some authority in the matter).

As for the public, we’ve decided it is beyond our comprehension and have left it up to the experts in Washington to sort it all out. The lead story on the news in Chicago (all three national networks) was Mayor Daley’s proposal that Chicago taverns halt beer sales from the 7th inning to the end of the game for Cubs playoff games.

But lets dissect that $700 BILLION bailout.

The median value of a home in the United States is $185,200 (2006 US Census ACS).

That means that $700 BILLION would BUY 3,779,697 houses in the US. (Not just assume bad loans at 40 cents on the dollar, but buy nearly 4 MILLION real homes at full price.)

There are 51,234,170 houses with a mortgage in the US, so the $700 BILLION would BUY the homes of 7% of all mortgage holders in the nation.

Since “We the people” are going to assume an equity position on these mortgages I would really like to express my concern about some of the things that have not been explained.

1) I am concerned about the urgency on the part of the liberals. Where does all of this fit with the Democrat view of affordable housing for everyone? Just how much of this mess is a result of selling homes to people who couldn’t afford them? What about loan redlining? What about selling homes to the undocumented? Where are the controls?
2) Where is the $700 BILLION going? Will it all be used to buy up bad paper? Or are we paying fees and salaraies?
3) Who is assuming the risk? Investors should. Flippers should. People who bought homes they couldn’t afford should. How do we know these people are being “persecuted” as Bush calls it?
4) What does Obama mean when he says the bailout should benefit main street?
5) What constitutional authority does the Unites States Government have to buy up bad loans?
6) When will we get back our $700 BILLION? Will it be with interest?
7) Can I get a job with this new agency that will keep track of all this?

And by the way, with WaMu failing and J P Morgan picking up the deal, is that a good thing or a bad thing?

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