Dirty little secrets

As Housing Panic correctly points out, whenever the homedebtor pays only the monthly “minimum payment” on their NegAm loan:

GAAP allowed the holding bank to recognize the shortfall in what was owed every month as NONCASH INTEREST INCOME.

And thus a nominal loss shows up as profit. Alchemy lives!

I wonder if it would be a worthwhile undertaking: identify and add up all the slanted or bogus metrics that are used in the calculation of executive bonuses [See: Enron, Worldcom, Tyco, Global Crossing, KPMG, Arthur Anderson, United States of America]?

From Wikipedia:

It outrages a lot of folks that the neg am balances, which represent interest that has been earned but not paid, is considered noncash interest income.

Fungible is as fungible does
And if you are in the CDO market, it doesn’t.

Nothing like a frozen system of debt investing in the middle of winter to bring on a case of the blues. Pass the sauce! I need me a Bergie(tm)!

Wagers now being accepted
Odds are 10:1 that lame-duck Bush will be “convinced” to bailout the banks exposed to risk.

So much for autonomy; they want their mommy’s teat <sniff>.

Jess Unruh’s said it first: money is the mother’s milk of politics.  Truer words, and a new slant on them too.

Separation anxiety
Who knew so many Americans were addicted to the mother’s milk of home equity lines of credit?

All winners, to a man/woman.

“I didn’t know they could do that. I thought I was too smart to have something like this happen to me.”

Statistics
Lies and damn liars

Ever get the feeling you’re being cheated?

By lying about the CPI by conveniently changing the metrics to suit (Richard Feynman warned about this dd he not?) the gummint gets to show how good a job they aren’t doing, and the payout to social security recipients means less not more dog food.

Job’s a good ‘un -or- I smell trouble’s afoot lads?

Stealthy is unhealthy
With all this stealth activity- greedy corporate goons conducting deals in the shadows with government dupes to save their own FUCKED asses- who do you suppose is being hung out to dry, d’ya think? Hmmm? The little guy? Joe Middle Class? You? Me? Our feeble parents and grandparents who played by the rules and now get their pooches screwed and asked to love it?

I didn’t ask for any goddamn $300 check to buy my vote. And I didn’t hear the public clamoring for this buyout – but what else would you expect a politician to come up with when they run out of ideas but turn to the corrupt practices they are most familiar with?

If you endorse that check, BTW, you are signing away you’re rights (and hope) to seeing effective governance in your lifetime.

Don’t sell out so cheaply! Hold out for more!

It all goes downhill from here!

“It is easier to rob by setting up a bank than by holding up a bank clerk.” – B.Brecht

Advertisements

3 Responses to Dirty little secrets

  1. John M. says:

    I count at least three categories of borrowing money: stupid, dumb, and dangerous.

    A dumb way of borrowing money is carrying a balance on your credit card. Yeah, you needed the new washing machine (or whatever), and you should have been saving, but you’re likely to learn the lesson and start putting more aside.

    A stupid way of borrowing money is taking out a loan against a 401(k), even if it’s the kind of loan where you’re paying yourself interest. I’m being stupid myself, but the funds I borrowed sit untouched in CDs and I’m using them to help me accrue a larger nest egg. I hope that mitigates some of my stupidity.

    A dangerous way of borrowing money is hitting the HELOC for this ‘n’ that. Consolidating credit card debt is one way you’re on the path to perdition if you use a HELOC like this. A HELOC is a way of pulling a *reasonable* amount of cash out of the equity you hold to make major repairs which you couldn’t carry any other way. I’m looking at ours right now with an eye to fixing some cracks appearing in our fireplace which are ominous and which may require foundation work.

    HELOCs are great tools at the right time, for the right reason, in the right market, and under the best possible index rate. Otherwise they’re the Devil’s Tools.

  2. John M. says:

    Tanta quoting the 02/23/08 NYT:

    “To prevent that, Bank of America suggested creating a Federal Homeowner Preservation Corporation that would buy up billions of dollars in troubled mortgages at a deep discount, forgive debt above the current market value of the homes and use federal loan guarantees to refinance the borrowers at lower rates.”

    And Bank of America is in negotiations to buy WHO? Countrywide? What the hell is going on here? They must be smoking something other than that wacky-terbaccy in BofA’s headquarters in North Carolina to have come up with a sweetheart deal this juicy.

    Anyway, Numpty, I thought of you as I read the original in this morning’s paper over coffee. Hope you didn’t choke when you saw it. It got posted so apparently you didn’t.

  3. Paco Bell says:

    Profits are privatized. Losses are dumped on the public. That’s ‘capitalism’ US-style.

    Since I don’t have kids, they won’t have to pay for them. Reeee-sult!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: