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shargash

I'm certainly not going to defend walking away from one's morgtage. However, one of the benefits of a recession (maybe the main/only one) is that it destroys debt that is choking off growth.

If Americans are going to have any money to save, invest, or spend, they are going to have to unload their crippling debt burden. Bankruptcy used to be a way to do that, but the financial lobby was able to get Congress to make sure that you can never get out from under your debts.

That is going to drive us to (at least) a recession, and it is going to make it nearly impossible to get out of it once we're in it. We need a change to the laws to make it possible for people who made foolish decisions (or were unlucky) to restructure and get on with their lives. Until we have that, we're going to have impromptu and destructive means of doing it, such as just walking away.

EEngineer

Elaine, I like your point on atomization. I think the trends of suburbanization (crowd dispersal) and careerist job hoping have essentially dissolved the community bonds of a large percentage of the US middle class. This normally politically active segment has thus been rendered apathetic and voiceless. The result is a national discourse that now closely resembles a TV game/reality show.

EEngineer

At least we haven't yet descended to the point where you have to sell yourself into slavery to clear your debts. Yet.

JSmith

Well, I'll be damned: an article I agree with! (In substance...)

"This isn't 'walk away'---this is SKIPPING OUT OF TOWN."

Business will be good for Skip Tracer, Private Eye.

"I think the trends of suburbanization (crowd dispersal) and careerist job hoping have essentially dissolved the community bonds of a large percentage of the US middle class."

I think that trend has been apparent for 30 years.

Canuck

Hmmm, Declining car ownership...

Hey look a solution!

http://www.zipcar.com/

Elaine Supkis

Hi, Canuck. Long time, no see ya. Winter warm here. I suspect where you are, too. Weird, isn't it? My road in January has been mostly mud.

Smith, you win a lollipop for being agreeable. Good boy. Heh.

Elaine Supkis

Shagrash, bankruptcy has some good factors but only if rarely invoked. When Trump was allowed to stiff everyone and go belly up, he should have been SHUNNED.

Instead, he got more money and even had the chutzpah to start a stupid TV show, 'You are FIRED!' He should be in prison. He set a very, very bad example. All of his sort should suffer some slings and arrows as punishment when they do these things. It is the only way to keep a nation from going on bankruptcy binges.

I hear so often people gurgling with joy over the idea of cheating the hard working Chinese or the Arabs who own oil out of the money we pay via going bankrupt. Shame, shame, shame. If we don't want them to get wealthy, all we have to do is not buy their stuff!

Not cheat them. This psychology leads to riots, looting and mayhem. I have lived through this.

Canuck

Oh I've been lurking all along, not much to say really.

Bitch'n cold up here now.

Recent Edmonton conditions, these are not normal are but seasonal temps. I've seen at least 7 semi-trucks broke down from cold in the middle of the road over the last 3 days. That's unusual even when it's this cold.

Outlying rural areas hit -44 C night before last.

Sky cond., Temp(C), Humid, Dewpnt(C), Wind, Windchill(C)

29 January 2008
8:00 Cloudy -35 64 -39 S 4 -40
7:00 Cloudy -35 63 -40 calm
6:00 Mostly Cloudy -35 62 -39 WSW 4 -40
5:00 Clear -34 66 -38 calm
4:00 Cloudy -35 63 -40 SW 5 -41
3:00 Clear -33 58 -39 SSW 5 -39
2:00 Clear -32 64 -36 calm
1:00 Clear -32 66 -36 calm
00:00 Clear -32 65 -36 calm
28 January 2008
23:00 Clear -32 65 -36 WNW 4 -37
22:00 Clear -32 67 -36 NW 4 -37
21:00 Clear -32 60 -37 WNW 13 -43
20:00 Clear -31 58 -37 WNW 8 -39
19:00 Clear -31 59 -36 NW 8 -39
18:00 Clear -31 56 -37 NW 11 -41
17:00 Sunny -31 53 -37 NW 18 -44
16:00 Sunny -30 53 -37 NW 18 -42
15:00 Sunny -30 54 -37 NW 21 -43
14:00 Sunny -30 55 -37 NW 26 -45
13:00 Mainly Sunny -31 57 -36 NW 26 -46
12:00 Mainly Sunny -31 55 -37 NW 32 -47
11:00 Cloudy -31 56 -37 NW 26 gust 37 -46
10:00 Cloudy -31 58 -37 NW 26 -46
9:00 Cloudy -31 58 -36 NW 28 -46
8:00 Light Snow -30 58 -36 NNW 26 gust 39 -45

And I don't feel one little bit bad about thawing my truck out for 15 minutes.

This is our first week of wicked cold, stay tuned for at least one more before March.

http://www.nationalpost.com/rss/
story.html?id=271864

http://canadianpress.google.com/
article/ALeqM5i2ZnJwTC7ZRe554Fr
87a8tDTOKLQ

Enjoy the mud, it's better than this.

Elaine Supkis

Ouch. I have been in -40 before, while in a TENT. Heh. It was weird. When it is that cold, the chickens have to move into the house.

Back then, I had lovely scottish sheep. The chickens lived with the sheep and slept on their backs, burying their legs in the wool. But tat winter, the -40 weather killed their combs which never grew back.

Canuck

Killed the combs!

Maybe that explains my receding hairline :)

Elaine Supkis

No combs but lots of brushes....

Greg

A message to other ruling elites: YOU BASTARDS. LOOK AT WHAT YOU ARE DOING, YOU ARE DIGGING YOUR OWN DAMN GRAVES! My family has a long institutional memory. We know that if we screw up, the price will be paid by our heads in revolutions, riots, wars and insurrections. Heads can roll. The need for the rulers to set a good example ..

Ok LOL........"A message to other ruling elites"........the supposition then is that this is a message from ONE RULING ELITE TO ANOTHER???? is this correct?

The need for the rulers to set a good example...Elaine, are you one of these rulers that is setting a good example????

Elaine Supkis

I am a bad example. HAHAHA.

And I wrote that for dramatic effect. The elites are not all rich. But letting things get out of control like it has lately is a bad idea, very bad. Maybe they imagine private guards will protect them.

EL JOHNNY

Oh EMS,

I wish I had that nice warm tent of yours that night I slept in -10 with only an axe, 2 sleeping bags, and some matches.I lived in Alaska in the 1970s. It was frosty to exist like as Survivor Man.

Right now, its 68 degrees here in Brownsville, Tx. and it is very nostalgic to hear people comment on the cold. It gives me a warm feeling.

Many of the towns and cities here in Texas were found by speculators from New York; the city of Houston being its greatest example. It succeeded. Many were total failures. Products of boom and bust economies, or victums of the unforgiving environment.

We have this tradition in our history of building and abandoning our towns, villages and farms. Often times, the land was free. All it took to be rich and make the towns and farms work, was work. If it did not work you, could walk or ride to the next town.

The principal is timeless and is still the same.

Who among us would turn down free land?

Do not blame the walk away Renes, blame the foolish lenders who made the loan, using someone else's money from someone else's country....as you point out.

Just because someone is a loner does not necessarily mean that he/she is a bad person.

In 18 century America, solitary figures would push out into the wilderness looking like flowing figures from the bible, alone.

They would hunt, trap, and trade with the Indians. Soon, the settlers would be right on the loner's tails. When the loners felt the settlers moving in, the loners would head west, pushing further out. They disliked the rules and social constructs the emerging community was bringing with them. They lived free. They needed space. They sought companionship once a year at the
round-de-view, and eros with natives and maybe a lost ewe or two.

When they grew old and moved to town, their journals indicate an utter sadness from not being out there alone.

They made positive contributions to their century by supporting themselves alone, without trashing their community, too much.

Today, we loners have electronics where communities can be built at long distances. Connected to each other by the wind and the electro magnetic waves,our E community can be just as enriching, satisfying and challenging to the inhabitants as those of yesteryear.

EMS...connecting to this blog for me is participating in the community I need and want but is not available on this Mexican border town. Gracias for being so civic minded.

It is always a pleasure being with you townies.

OC

So u think u can just walk away after pissing off the communist and terrorist Sopranos without payback???

Really, that easy huh???

Elaine Supkis

I grew up on top of high mountains and had to survive in the desert. At one point, we lived in Death Valley before airconditioners were available.

Loners: the land was NEVER 'free---it was violently stolen via using armies with guns fighting barely armed stone age natives. The death toll was terrible.

Greg

LOL sorry Elaine i should rephrase the question.....

Are you one of the ruling elite??????????

EL JOHNNY

NOTICE TO ALL SEEKERS OF FREELAND


DUE TO THE GENEROUS EFFORTS OF MR SEWARD,

FREE LAND IN THE AMOUNT OF 200 ACRES IN THE

PRISTENE WILDERNESS OF ALASKA IS NOW

AVAILABLE WITHOUT REGARD TO RACE, RELIGION,
OR ETHNICITY,FOR IMMEDIATE OCCUPANCY TO ANY
MAN,WOMAN, OR CHILD WHO CAN STAKE THEIR
CLAIM AND MAINTAIN CONTINUOUS OCCUPANCY FOR
2 OF THE MOST CHALLANGING YEARS IN YOUR SHORT LIFE. FEE SIMPLE WARRANTY DEED WILL BE ASSIGNED TO ANY AND ALL HOMESTEADER UPON SUCESSFUL, CONTIGUOUS, COMPLETION OF 2 YEAR 0CCUPANCY.

JSmith

I had some time this AM to read this article in more detail...

"It is the only way to keep a nation from going on bankruptcy binges."

The revised bankruptcy code will help there!

I saw that 60-Mins that "Mish" was writing about. One Kevin Depew was quoted in Mish's article as saying, "But [a person interviewed on "60" who plans a walk-away] is outlining a perfectly rational economic argument for exiting the mortgage contract and is willing to accept the full penalty - credit impairment - for her actions."

Fortunately or unfortunately as the case may be... it's not that easy, and "credit impairment" isn't the full penalty. The implication is that you walk away, the bank forecloses, done and done. However... after foreclosure, the house is sold at auction and the sale price at auction (if any!) is used to defray the original mortgage. If the auction price is lower than the mortgage - which is very likely, these days - the spread, called a "deficiency", is treated as an unsecured debt and the bank has the same right to go after you as they would on a credit card debt.

So I expect that many of these "walkers-away" will learn to their chagrin that the banks still own their ass.

(But if you were dumb enough to pay $350,000 for a 1200-sq-ft house like the people on "60" did...)

DeVaul

I saw the 60 Minutes show that finally talked about the subprime mess. It vindicated Elaine in stating that the housing bust occurred in 2005. Wow! They finally admitted it.

There were two couples shown. The black couple claimed total ignorance and said they signed the papers as a way to get out of the neighborhood they were in. I can actually believe that to some extent.

The white couple claimed they knew what they were doing all along and had a "plan", but it didn't work out because the economy and interest rates did not go the way they expected them to. They planned to walk away as a "business decision" in the same manner as Trump and his friends always do. (I wonder if there are any deficiencies hanging over Trump's head?)

I found the white couple to be somewhat cold-blooded and very calculating. I think that despite the attempt to enslave everyone via that bankruptcy law, it will not work in the end. If someone is upside down 100 grand with no way to pay it back in their lifetime, they are not likely to be worried about any deficiences that may be left over after foreclosure.

As millions walk away from their homes, the banks that would inherit the "deficiencies" will probably go under and never get the money back that they created out of thin air in the first place.

Regarding the morality of the white couple, there is an old saying: what goes around, comes around. Our leaders have shown us how to live, and so now we live like them.

Elaine Supkis

Correct, DeVaul. You are a moral person who knows the downside to life. We learn harsh lessons!

Yes, if the leaders are amoral wolves ravaging the land, everyone wil imitate them. This troubled our Founding Fathers who right off the bat, got into trouble over the issues of handling the natives [kill them or chase them out was the hideous solution] and slaves [our nastiest and most brutal war was over that issue].

CK

Stalin's Law ( restated )
If one couple walks away from an upside down mortgage debt, it is an immorality.
If 10,000 couples walk away it is an community disaster.
If 3,000,000,000 walk away it is a statistic.
If a nation of 300,000,000 million walks away from its debts it is a victory.

JSmith

"They planned to walk away as a "business decision" in the same manner as Trump and his friends always do. (I wonder if there are any deficiencies hanging over Trump's head?)"

Why... no. Not "in the same manner" at all.

If you're Donald Trump (or Trammell Crow, before he died), or someone else for whom real estate is your business... you do business under a corporation so that your liability is limited. The corporation may be a few hundred million in the hole, but the creditors aren't going to come after you, peersonally (unlike these people who have signed mortages personally, and are making a so-called "business decision". Them, they'll go after... big time.)

JSmith

Correction... it appears that Trammell Crow is still alive, at age 94.

DeVaul

I've worked on countless litigation where the owner signed as personal guarrantor in addition to the company he owned or ran. The result was always the same. No liability if the person was rich or connected.

I'm sure Donald signed some personal guarranties throughout his career, and I am equally sure he never had to pay up.

DeVaul

BTW, Donald made a career out of doing this. You cannot blame people for imitating him when he is idolized all his life for losing millions on bogus deals.

Elaine Supkis

Gads. Der Trump worked in NYC when I and others were trying to drag that city out of the gutter of bankruptcy. And he was the Clown. We all despised him.

What a jerk. And I never, ever went bankrupt. He did. So who ends up on the cocktail circuit and on TV? And what are the masses who watch him?

BAAAAAAA.....

Elaine Supkis

And note his married life. A wreck. The poor people imitating him don't know how he stays afloat. Connections within the Community/clan helps a lot.

Most Americans don't have multimillionaire cousins to lend a hand and forgive. Indeed, these same people will go after the average deadbeat hammer and tongs, in spades.

Elaine Supkis

And I can tell stories of people who tried to stiff the wrong clans. Both Italiano and Jewish. Accidents happen. You never know when you might fall off a bridge or get eaten by alligators.


This is why playing deadbeat isn't wise in the long run. Eventually, you end up owing the Mafia or someone.

JSmith

"You cannot blame people for imitating him when he is idolized all his life for losing millions on bogus deals."

Yes you can. They're not "imitating" him because they didn't structure the deal in such a way so they're not on the hook if things went in a southerly direction. They're just, as Elaine says, skipping town.

Skip Tracer will be hounding them for years to come.

"And I never, ever went bankrupt."

Were you playing on the "midtown brownstones" level, or the "skyscrapers and office parks" level?

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There are no trails of the wings in the sky, while the birds has flied away.

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