Saturday, February 28, 2009

Sex Offender Hysteria

I noticed recently that I received nice comments and might have picked up a few more readers, not that I'm counting. But it's encouraging to see that other people find this of interest.

More and more we're seeing media articles cutting into sex offender hysteria and wondering where it will lead, such as these collected from Sex Crimes (WBAY Channel 2 Wisconsin) blog, Residency Restrictions don't work (Syracuse dot com); Rights Must be Observed, (Tufts Daily student paper); No Homes (Wall Street Journal); and Massachusetts Struggling (Herald: federal AWA requirements difficult to implement); this is change in the sense that more attention is being given to the ineffectiveness of residency restrictions, banishment, and throw away the key mentality. This is change in the sense that more in the media seem to be showing an interest in this issue, and seem less willing to just go along with stupid legislative proposals designed to serve one purpose, that of seeming to be tough on crime in order to further the politicians political career. Who could be that cynical?

I see that Rep. Sensenbrenner wants to impeach Judge Kent to keep him from receiving his 169 thou and change retirement pay now that he's pleaded to obstruction after being charged with sex crimes.

Tuesday, February 24, 2009

Getting Down to Business

Reviewing some posts from Doc's place I could not help thinking that here is where we are (the greatest prison nation), and unfortunately, here is where we are going (same direction).

Just One More, Reduce Rates to 4% and Let's Everybody Do The Refi!

I forgot to mention this solution, as I see more talk about nationalizing big banks that are set to lose more money this year and become insolvent. The good news is, they are already insolvent, and always insolvent, according to their debt to equity ratios. The bad news is they still don't know how insolvent because they haven't yet resolved their "computations" respecting those "bad mortgages" no doubt hoping they could unload all the worst "investments" on the feds, or get more money because of them.

Instead, write these down immediately to zero (creating certainty over the amount of the loss), suspend the capital requirements (to ensure lending without running afoul of federal rules) and federally insure all deposits under 250 thousand (in case there is a run for cash). That should cover most of us working stiffs.

Am I a genius? Or what?

Wednesday, February 18, 2009

A Fourth Crazy Bad Mortgage Scenario

Moratorium on Foreclosures for one year, to be extended if necessary based on events on the ground.

Sunday, February 15, 2009

Two Bad Mortgage Scenarios

Case Study in the Market for Homes with Bad Mortgages

Link to BW "How Banks are Worsening the Forclosure Crisis"

P 1:

Home owners in bad mortgages don't deserve to be rescued.


a. let the banks foreclose, and the sooner the better. Homeowners take their earnings assuming they have jobs and rent until they reestablish credit to purchase another home.

b. new prospects need to be found to take foreclosed homes off the market.

c. work is created for realtors, movers and people who clean up and fix homes (and credit) for resale.

P 2:

Plenty of people with money will come forward to purchase these homes at the right price.


a. the market will be readjusted asap. This is the best case.

b. many homes remain vacant and neighborhoods deteriorate.

c. homes are leased/rented at market and neighborhoods deteriorate at a slightly reduced rate.

Compare Alternative Case A

P 1 Saving the homeowner is necessary condition for economic recovery.


a. bankruptcy courts readjust mortgages to a reasonable market rate.

b. mortgage holders do so on their own initiative.

c. market will be readjusted asap.

Alternative B

Homeowners walk.

White knight purchases homes at short sale and resell/release to the original homeowner.

See P 2, above.