EppsNet Archive: Mortgages

EppsNet Book Reviews: The Big Short by Michael Lewis

I worked in the information technology department of a mortgage bank in the run-up to the 2007 implosion of the subprime mortgage market . . . Given that it was fairly evident at the time that complicated financial instruments were being dreamed up for the sole purpose of lending money to people who could never repay it, it’s remarkable that very few people foresaw the catastrophe and that even fewer actually had the nerve to bet on it to happen. Long story short, the major rating agencies — Standard and Poor’s and Moody’s — were incompetent in their rating of subprime mortgage bonds, giving investment-grade and, in some cases, triple-A ratings to high-risk instruments. A lot of people took the ratings — which implied that subprime mortgage derivatives were no riskier than U.S. Treasury bonds — at face value and acted accordingly. But there were also some interesting psychological factors in play, not… Read more →

Herman Cain’s 9-9-9

By slashing the income tax rate, effectively, in half, he makes it that much more worthwhile to get up in the morning, take risks, work hard, take chances, and invest in progress. By eliminating the capital gains tax, he rewards investment and ownership and makes it possible for people to move up the economic ladder, not through phony teaser Fannie Mae mortgages, but by smart purchases and skillful investment. . . . Herman Cain would establish America as a beacon for investors, entrepreneurs, inventors, creative business people, and all manner of upwardly mobile, ambitious men and women. He would give the U.S. the lowest personal and corporate tax rates in the world, and the only place where investment earnings are tax free. In the process, he and his plan would kindle decades of robust economic growth. He would make the next few decades a continuation of the American Century. —… Read more →

The Chicago Tea Party

This is America! How many of you people want to pay for your neighbor’s mortgage? President Obama are you listening? How about we all stop paying our mortgage! — Rick Santelli (video), CNBC Chicago I’m rolling over in my grave, as the gentleman from Chicago has already noted. Count me in for the Chicago Tea Party! A little revolution now and then is a good thing; the tree of liberty must be refreshed from time to time with the blood of patriots and tyrants. I’ll bring Samuel Adams along. Not the beer, you yahoos, the patriot! He has experience with this sort of thing. P.S. Medary.com has provided a Chicago Tea Party broadside, or whatever you call them nowadays. Read more →