It wasn't necessarily about the mathematics. People in over their head often didn't pay more for their house, the value of their house just dropped signifigantly after they purchased it. While you can blame them I guess for making a bad investment and not foreseeing the huge financial collapse, it wasn't about the math. At the time, it was a good investment.

Now if you're talking about people who took out mortgages on properties they couldn't afford, that's a different story.

Just because the market collapsed doesn't make it a bad investment. It's only a bad investment if you sell the home and don't reinvest in a new home in the same market or if you were speculating on a short term basis. The people I'm talking about are just people who purchased homes to live in. They'll still be fine, but most of them would be helped quite a bit (as would be the economy) if they had the option to refinance their underwater loan at current rates.

Umm ... didn't you just devalue the assets of every lender who loaned at rate X in good faith? Sounds like a prime case about to be made (not by you) for a bailout to recoup those losses.

Understood. I'm not sure there's even a good way to do that. I'm just thinking there must be an option to do that. Of course, as you note, it may end with a large payout of government money to banks to make that happen once they lobbyists are finished with it, which would be something I would be opposed to.

I'd also add that many of these people likely relied on mortgage and bank professionals that told them they could afford it (and hid the fact their payments would balloon after three years). I have a little more compassion than to simply say "buyer beware" (which is a bit of myth anyway-it's not really the legal standard). Finance is complicated for many people-it doesn't strike me as all that unreasonable for people to be able to rely on doctors, bankers, lawyers, etc. for unbiased, objective advice in highly complex and technical matters.

Anybody who didn't notice a balloon payment/escalation clause/ whatever is too fucking stupid to own a house in the first place. I'm sorry but those aren't people I can waste any sympathy on.

I think that's a common misperception regarding off the wall mortgage options. Most of those people have already defaulted or sold their property. If you purchased a home in the 2003-2006 timeframe before the bubble burst with a fixed loan, you're likely underwater even if you paid 10-20% down. We've seen property lose nearly 1/3 of its total value over that time. It's not likely that those loans have been paid down enough over that 5-8 year time period to avoid being underwater. The lousy loans have already been flushed out. The real issue now is the deflation of value for those who bought just before the bubble burst at a price they could (and still can) afford. Their money is tied up in interest that doesn't reflect the current market with no way to refinance.

Regarding the balloon/escalation, I'm assuming it's usually sold as a case where you get your foot in the door with the first mortgage. By the time the balloon comes you refinance, this time from a better position because your house would have appreciated. They just don't always tell you that the house could depreciate, leaving you hosed.

I'll take a little bit of "unfair" if it helps fix the economy before we go through a full lost decade.

Who exactly do you waste your sympathy on?

But isn't it just part of the problem? Propping up an industry to artificial levels. Isn't that what we did by giving loans out to everyone who could sign their name?

I try not to waste any, it's a somewhat limited commodity. If I use it, I'm pretty sure you deserve it.

There's a difference between propping up an industry and using refinancing to lower household debt and hopefully spur demand. I'd also be in favor of allowing bankruptcy judges to cramdown mortgage debt and allow people to stay in their homes. The run up to the crash wasn't "fair" and now an obsession on making sure no recovery measure is the slightest bit "unfair" is cutting off our nose to spite our face.

Amen. Bought our house for 145K with 6.5% fixed. Never missed a payment. Went to refinance and was told we don't have enough value in our house as they put it at 120K. Why? Three foreclosures (along with their crap resales) on our block coupled with all the other stuff in the industry. We're screwed because of what everyone else did and we did absolutely nothing wrong.

But 145K is more house than anyone could dares to afford! ;)

(I love how there's this narrative that poor people were getting into 300K or 500K homes and that's why we're in this mess. It's so ignorant and yet people keep believing it. If you're "poor" and got into a 100K-150K home, you're still likely paying less than you would if you were renting- my wife and I made the decision to continue renting because we have moved a couple of times but we're annoyed because we could buy for less on a fixed 30 year loan so we've just been throwing away money. But suddenly your house is now worth 20% less than you paid for it, too, and your problems are the same as the people who went for a 500K home when you should have stopped at 300K only smaller in actual numbers.)

SI

People who bought homes back in, say, the 70s (like my parents) are cringing at you being "screwed" with a 6.5% mortgage. If you had ever paid a double-digit mortgage, you would not feel "screwed" just because you can't refinance down a percent or two.

My wife and I bought a house 4 years ago and we were offered all kinds of bubble payment options for houses that were simply outside of my budget range (She was not able to work at the time due to medical reasons). So we decided to go for a house roughly $85k less than the one that we really wanted because mathematically the money just wouldn't be there for the more expensive house without some kind of voodoo magic.

Fast forward back to the present, and thanks to what all of the bozos did to the house market, I am pretty confident that I owe a good $50k-$60k more on the house than it is now worth. However with my wife working now that she is better health-wise, the end result is that while we are paying more than the house is worth, we have a comfortable mortgage payment and are not in any danger of running into problems with it. The only other big negative for us is that we likely won't be able to move for quite a long time without taking a huge loss.

Yeah, the refinance bankers will remind you of this information when you get turned down for a refinance. It doesn't take the sting out of the situation. :)

Discussion on actual tax percentages paid by income level.........

FACT CHECK: Are rich taxed less than secretaries? - Yahoo! News

Except it completely fails to address any sales taxes and fees, which are regressive. (EDIT: It only speaks to federal income taxes and federal payroll taxes, which are not inclusive of taxes paid.)

SI

Most of which go to local / state governments, not federal.

Nowhere in this statement did I see the words federal or Washington or US government:

"Middle-class families shouldn't pay higher taxes than millionaires and billionaires," Obama said Monday. "That's pretty straightforward. It's hard to argue against that."

So, I'm saying that it's not checking the right facts in said fact check.

SI

As a general rule the AP piece is correct. I think, but I haven't read it closely, that Obama's proposal is basically a new version of the AMT that would impose a limit to the amount of deductions/credits those making above one million could claim. The point isn't that all millionaires pay less than all secretaries, but that some millionaires do and this proposal would attempt to change that.

Agreed.

No solution is fair in all of this. Even inaction is unfair as it will lead to more & more defaults from people who simply have no other options, and further devaluation of their neighbors home (which will continue to add more people to the "underwater" list).

They lose their job, they look for a new one, they don't find a new one in their current area, they use up their savings paying the mortgage & other bills while they look for a job, they try to sell their home so they can pursue a job elsewhere, they then realize they can't sell it for what they owe & don't have enough in savings left to cover the difference, they try to short sell the property & the bank refuses to allow them because they never missed a payment. So they do what they feel they have to do...they default on the loan, mail the keys to the lender, and move on with their life so they can work & feed their family. This scenario then reduces the value of their neighbors' properties who were already underwater (or close to it) and further depresses their values.

This isn't "fair" to their neighbors who continue losing more of their property value but it keeps happening due to the inaction we are taking. And if you think about it...the real "crime" in my mind is that we are getting to the point where if you had defaulted on your loan in 2006/2007 because you did buy too much home for your income...if you have been spotless with your credit since then, and still have a job, you could be financed for one of your neighbor's homes at a 20-50% off discount from where you had defaulted. Pretty darn "fair" I suppose for that neighbor who stayed & paid, just so they could get their number called for the guillotine once their number was called for the "you gotta find a new job and it aint located here" problem our country has. And lets be honest...if you were an accountant before your job went away, while going to work part time at McDonalds is better income than nothing, it is not enough to support a family of 4 on.

This is why I think we can do a few things...and as others have suggested, there can be timelines of being phased into action.

1) Reduce the mortgage interest deduction over time to zero. (This will help offset part 2 & 3's impact)
2) Allow people who have maintained solid payment history to refinance their mortgage to current market rates (this will help spur "other" local economic activities rather than continuing to enrich banks)
3) Create a housing "exchange" registry program which allows people with solid payment history to exchange their home for another home on the exchange registry at current market value. This would be intended to help those who have maintained their expenses properly over time and allow them to get out of their home if relocation is necessary for employment purposes.

This "exchange" would need quite a lot of rules & stipulations and require some level of out of pocket contribution when/if a home has an underwater mortgage compared to market value. But the key is that the home be exchanged for market value rather than the 10-40% under market value that it drops to once foreclosure or short sale is the option (and the home sits & rots while waiting for a buyer, which only makes it worth less than before...thus perpetuating the deflation cycle).

Sure I would. I can't do something not because of something I've done but something other people have done.

Tomorrow at the same time I get off from work, Georgia will be killing an innocent man.

Fixed that bullshit you just posted.

Sure, I can understand wanting to see a worthless cop killer put down. I just disagree that man is Troy Davis. At the very least, there is no where near enough certainty in the current evidence to execute him.

Let's see here, tried & convicted. Appeals to the ends of the earth all rejected. How much more is needed to put an end to this piece of shit?

So if I'm understanding your philosophy correctly, government is completely useless and incompetent. Except of course for criminal justice, in which it is 100% infallible?

Watched MSNBC Morning Joe today (btw - I think this is the best morning show during the week) and they had the Palestinian ambassador on regarding the pending UN proposal/vote.

The guy was a little bit on edge but communicated well.

I was thinking how far the Palestinians had come. I remember in the mid 90's Arafat's mouthpieces were so unprofessional (especially that one woman, have to look up her name) and so irrational that I had a negative reaction.

Today, although I did not agree with everything he said, the ambassador was plain spoken, had good counter points etc. and I listened to what he had to say.

I saw the same segment and had a similarly positive impression of the guy as well.

I was thinking "Gee, they finally understand how to interact with civilized society". Whether they actually understand how to do that, or if this guy is just the outlier of the administration there, could be a completely different thing.

Love these types of comments. The problem many of us have with the government is that it gets involved in things way beyond its mandate. Public safety is one of the key areas that is well WITHIN its mandate.

Thanks for covering this, I've been busy trying to unfuck FB this morning.

Maybe for 7 of the 9 people who testified against him to not recant their testimony? Or maybe a ballistics expert who didn't say there was no evidence to suggest the bullets came from the same gun.

I agree that he's most likely a POS and certainly assaulted people, but I would hope we could at least make sure people are the killers before we kill them. He could have done it, but if he's convicted based on testimony that is later proved coerced and incorrect, should the same punishment stand? I mean, is the world a different place with him in jail for life instead of underground? I would reckon if he was commuted to life in prison and you never heard from him again, everything in your world would still go on.

But you have to admit there's a general argument among small government folks that the government is also corrupt and incompetent. There is a contradiction there.

Not particularly. By limiting the scope of government services, you limit the amount of bloat, mission creep, and general waste that can be accrued.

Construct the endless Three Letter Agencies, Committees, Czars of Sparkly Things That Begin With The Letter I, and all of a sudden you've got an entity so bloated that waste and corruption is inevitable.

Public safety being within its mandate doesn't mean it does it well. One of the main arguments for limited government is that in trying to do too much, government fails to do an adequate job in the areas it's supposed to. The justice system, I think, is a prime example of that. It's underfunded and overburdened with crap that has nothing to do with public safety.

It's also subject to the same problem that occurs in other areas of government: officials are more concerned with being re-elected than with obtaining the correct result. The Duke lacrosse and Martha Stewart prosecutions are examples of prosecutors grandstanding rather than seeking justice. Legislators fall all over each other to pass new laws without stopping to consider the consequences (CPSIA) or if a new law is even necessary (numerous gun control laws).

I guess I'm overly cynical, but I've found that when a politician's mouth is open, they're lying almost 100% of the time. Judges and prosecutors are politicians too.

With further diminished faith in the system (or society) to do what needs to be done. I'd rather that not reach zero, I'd just as soon not find out what that does to my mindset.

This. When you have this much turmoil in the case, when the case is based on eyewitness testimony and 7 of the 9 people who were used to convict the guy come back and recant, it is unconscionable to go ahead with the execution.

Now, I'm an anti-death penalty guy (& I have been since I accepted Jesus a couple years back), but even if you are for the death penalty, don't you want to make sure that you are 100% certain before you kill someone? I mean didn't Illinois halt their DP because something like 50% of the people on Death Row in the state were actually innocent due to DNA testing?

I'm only for the death penalty where there is irrefutable DNA evidence of the persons guilt and or irrefutable eyewitness evidence (photographic or video evidence of the crime). With the technology we have these days, there's absolutely no excuse to execute an innocent person or a person convicted without the two things I mentioned above.

According to the prosecutor's rebuttal on CNN, these 7 weren't used to convict him as there were concerns about their testimony back on the original case.

No, I haven't followed this case to have an opinion, just mentioning one tidbit.

At least two jurors have come out and said they would not have convicted Troy Davis with the recantations.

Based on what I'm hearing on the radio here in Atlanta, there were actually 34 witnesses against him, including 3 Air Force members that saw him shoot the cop from a van and were all able to identify him.

Again, I wasn't there, just passing on what I have heard.

I wonder if we'd have all these recantations if the death penalty wasn't coming. Who knows, and I don't know all the details of the case, but I've heard a lot of examples of aggressive investigators pressuring witnesses into recanting years after the fact. Are they all valid, are some of them valid? Courts definitely look at them with suspicion. And it's tough to get a new trial under the law.

Another thing to keep in mind is that the prosecution, unlike the defense, isn't allowed to try the case in the media during the appellate process. It's pretty easy to get the public on your side when no official dissenting voice is really possible.

I do think the cons of the death penalty outweigh the pros. I've been on the fence for a lot of years on that, but I think it's time to let it go. It will mean less guilty pleas in murder cases (because prosecutors have nothing to offer them anymore except for the recommendation of a light sentence), and probably, less aggressive innocence project-type movements (I wonder how many people would be yelling about this guy's innocence if he was just locked up forever - that execution date gives that innocence movement a ton of momentum and pr.). But at the end of the day, the risk of executing an innocent person is really unacceptable, the costs and manpower dedicated to these decades of appeals is better allocated elsewhere, and really - I don't think a nice peaceful quiet death is all that much of a punishment anyway. I'd rather see tougher prisons, with smaller populations.

Again, I have no clue what really happened, but I will say that at least the recent coverage of this issue has been awful. What I haven't seen anywhere is:

1) What evidence was presented in the original trial.
2) What information was recanted.
3) If Davis claims he wasn't even there or if he was there but someone else did it.

I've also only seen a very minor mention of the earlier shooting in the day that he was also convicted in.

Seems like for a case getting such national and even international attention, someone might have tried to put out some decent level of coverage.

You asked, here's an answer ... but it isn't wasted.

"A mother's vigil *| ajc.com

So would you feel just as sympathetic for the family of a person that was put to death over a crime they didn't commit? If he was truly guilty he could have had another trial and another jury would have sentenced him to death as well. There is plenty of proof that there have been innocent people on death row so what about their families and the innocent people that have died, do they deserve no sympathy?

Every court that ever saw the case reaffirmed his conviction by a properly seated jury. How much more time would you propose to waste? You can whine until hell freezes over but this SOB got a small taste of what he deserved & should have gotten years ago.

The only pity here is that he wasn't executed years ago.

My views on the death penalty are not as strong as Jon's, but the anti-death penalty people are really stretching the truth. There were a lot more witnesses than the supposed nine. There were some witnesses that had incredible views of the crime and detailed the exact shirt he was wearing. Some of these witnesses were people who knew him personally. And the recants weren't all recants either. Many of these things were known at the trial and some weren't recants but instead "not totally sure" type deals.

It's worth noting that two of the recantations were also witnesses that Davis refused to put on the stand to recant. They had an affadavit but refused to put the person on the stand because they knew it wouldn't hold up under cross-examination.

Then there is the part where he fled from the scene. Avoided apprehension for days and eventually had to negotiate his surrender to police. Not exactly the things an innocent man does.

And the race issue being pushed? Well the majority of the jurors and witnesses were black.

There is a ton more in the rulings here if you care to read through them.

http://www.gasd.uscourts.gov/pdf/409cv00130_92part1.pdf
http://www.gasd.uscourts.gov/pdf/409cv00130_92part2.pdf

I'm not going to jump out and say he definitely did it because I didn't sit through a trial and don't have every bit of evidence at my fingertips. But this has been through countless judges at almost every level of the judicial system. Not one of them felt he had a case.

The thing that bothers me is where were all these people for 22 years? Where were they when he sat on death row all these years? All of a sudden he's up for execution and everyone with an internet connection immediately "nows" he is innocent. I have no doubt that our judicial system has many flaws and has likely convicted innocent people. But this one doesn't seem to be an example to support that theory.