AMERICAN credit card debt is growing at the fastest rate in years, a fact that may signal coming trouble for the banks that issue them.
The Federal Reserve reported this week that the amount of revolving consumer credit that is outstanding hit $937.5 billion in November, seasonally adjusted, up 7.4 percent from a year earlier.
The annual growth rate has now been over 7 percent for three months running, the first such stretch since 2001, when a recession was driving up borrowing by hard-pressed consumers. . . .
. . . The holiday sales data indicated that consumers cut back in late 2007. But the consumer credit numbers would seem to indicate that they wound up further in debt anyway. Those are not good signs for the economy as 2008 begins.
Rather suddenly, not that it's primary season, Bush and Congress are making noises about a stimulus package. But, but, they've been spending more than the income from tax collections, etc., for decades. Looks like the U.S. "economy" is addicted to deficit spending.
Well, yes, and a difference from the past is that something has changed. Every time they do a stimulus package - a.k.a. on the 'internets' a 'helicopter drop' - the dollar will tank some more and the psychologically all-important gasoline and diesel dollar prices will leap. Decades ago, the oil-import share was not yet enough to really close this nasty little feedback loop. The upcoming multi-trillion-dollar election-year giveaway of free mega-houses to irresponsible borrowers, who wished on stars and will have their dreams come true, will surely further 'stimulate' the loop.
That's the Rush Limbaugh meme. I think there is more problem here than a few desperate blue-collar workers and single moms who greedily thought they could improve their situations.
How about the felonious -- not to mention greedy -- white collar criminals who sold them this mess?
American workers are victims in the sense that their pensions will lose value because the trustees bought the garbage paper from the investment banks. Unions, states, etc. They sold their people out for trinkets, golf club memberships and visits to the dollar ballet.
The sub prime people that entered into the liar mortgages are co conspirators with the brokers, they well understood how each was going to make his money for nothing. They didn't think the music would stop.
The government policy of forcing banks to give loans to sub prime people or "expanding the home ownership experience" is what started the whole mess.
It forced many working people into more expensive housing in order to gain access to halfway safe schools for their children. For the most part, middle class people didn't move into upscale neighborhoods to make a buck, they just saw the degeneration of their old neighborhoods and wanted their children safe.
Government policy started the whole ball rolling and then all sorts of opportunists took advantage, but the root of the problem was left wing government policy to force banks to lend to people financially unfit to be home owners.
Could you give a precise reference to the government acts that forced banks to lend to unfit people? My understanding is that the major driver was the individuals wanting the loans and an inappropriate incentive structure for those doing the selling: mortgage brokers/bank staff make their monthly quota/qualify for a bonus based on how many mortgages they sell and don't get penalised for how many default after two years, with similar incentives applying to those higher up the food chain into CDOs, etc.
Certainly in the UK most of the problems have centred around incentives encouraging inappropriate selling behaviour (eg, encouraging people to fake NINJA mortgage applications). This isn't to excuse the individuals engaging in either stupid long term planning or even outright fraud, but to point out that if you give workers an incentive not to detect lies (and maybe encourage them), well, guess what? They will tend not to detect the lies. I keep waiting to see anything in the financial news about any company restructuring their bonus programs to encourage long-term goals, but I haven't seen anything yet and I don't really expect to.
The program was called HOPE, something like Home Ownership Participation for Everyone.
If you Google it there are many pages of references.
This is what started the massive lowering of lending standards, first to make unfit people qualify, and then little by little the standards were lowered for everyone.
Just one LINK to get the feel of it, goes way back if you want to study it.
Your understanding is correct for the most part if you just look at what happened at the end of the cycle.
What started the cycle is the lowering of standards.
That's how everything goes to hell. Look at the school system. Once anything goes away from a pure meritocracy and standards are lowered for one segment of the population, it is human nature to follow the path of least effort and pretty soon everything works to the lower standard.
This is why countries like Germany work much better, citizenship is determined by the status of the parents or mother and not by place of birth or geographic accident, and if immigrants or minorities want to live there they damn well comply with German standards. It works just as well in the military here. No one gets a break, comply with high standards, leave or be kicked out.
Your understanding of Germany is not quite correct, though the framework has been in flux for a number of years now. In part, because of how ineptly many of the challenges have been handled.
If you can prove that your parents/grandparents were ethnic German, you can become a German citizen. Which is why in my region, Russian is often heard among teenagers, because a lot of Aussiedler live here. Their citzenship had nothing to do with 'place of birth or geographic accident,' nor does it have anything with if they 'want to live there they damn well comply with German standards.' In another words, in the name of 'Germanness,' ten of thousands of people who speak no German and have no connection with Germany except that this is the place they were able to escape to after the end of the Soviet Union now live here, often supported by German taxpayers.
Ironically, many of those taxpayers are second or third generation Turkish workers, who in the past had little right to become German citizens, though they were born in Germany, were schooled in Germany, work in Germany, and pay taxes in Germany. In the mid 1990s, something like 110,000 of these Turkish-Germans applied for citizenship - something around 10,000 were approved during that same time. You may draw your own conclusions why such a low percentage of often German schooled and German born Turkish citizens were not fit for German citizenship, especially in light of the fact that according to general German belief, Turkish-Germans have no interest in German citizenship.
I can give a hint, though. It is very hard in Germany to change your name, unlike in the U.S. (If you convert to Islam, you can pretty much forget changing your name, for example.) However, I do know people who have had that happen, without any problem at all - it was when they lost their 'false' Czech name for a proper German one.
Broadly speaking, Germany is not a model for the U.S., and there is little here to emulate - edit - in terms of immigration. What is sad is watching yet another part of the Constitution die, as so many Americans (who themselves are only American citizens generally because they were born in the U.S.) now reject the idea that children born on American soil are American citizens - since that has been the only requirement for determining who is a true American citizen since the founding of the United States. Parentage had nothing to do with it, unless you live outside of the U.S., where it is possible to have a second birth certificate provided by the State Department, proving a child's citizenship to the satisfaction of the United States. (Though technically, they can never become president - just like all the children born overseas of parents serving in the U.S. military.)
As a side note - if my Germany born children do not live in the U.S. as adults (five years, I believe), and in turn have children born outside of the U.S., those children will not be American citizens. American citizenship is based on shared values and was never intended to be hereditary. It is a truly revolutionary idea, and much like the absolute rejection of torture by anyone serving their nation, something which has faded over time. Sic transit gloria.
My wife is an Aussiedler. My kids speak all three languages and have two passports US/German and could probably get Russian passports. In turbulent times when entire civilizations could collpase forward looking survival techniques and not backward looking setnimental values are needed for the individual. Not to be to cynical mind you, both my parents are naturalized immigrated US citizens and I have two passports. The Aussiedler have an interesting history:
Nach Beginn des Krieges wurden mehr als 1.200.000 Russlanddeutsche entsprechend dem Erlass des Obersten Sowjets vom 28. August 1941 innerhalb weniger Wochen unter dem Vorwurf der Kollaboration mit Deutschland aus den europäischen Teilen der Sowjetunion nach Osten – vorwiegend Sibirien, Kasachstan und in den Ural deportiert.
Familien wurden auseinandergerissen, die Menschen wurden mit Viehwaggons transportiert und irgendwo in den Steppen Kasachstans ‚abgekippt’, wo sie sich Erdhütten gruben und mit Entsetzen dem bevorstehenden Winter entgegensahen. Wieder andere wurden Kolchosen zugewiesen und mussten dort nach Überlebensmöglichkeiten suchen, die man den ‚Faschisten’ eigentlich gar nicht zubilligte. Gleichzeitig wurden ihre staatsbürgerlichen Rechte aberkannt und ihr Eigentum bis auf ein geringes Handgepäck eingezogen. Die meisten von ihnen – im Alter zwischen 14 und 60 Jahren – mussten in Arbeitslagern unter unmenschlichen Bedingungen arbeiten. Mehrere Hunderttausend – die nicht ermittelte Zahl schwankt um 700.000 – starben in dieser Zeit vor allem an schlechten Arbeits-, Lebens- oder medizinischen Bedingungen.
Tod und Verbannung [Bearbeiten]
Die Deutschen wurden der Sonderverwaltung (Kommandantur) unterstellt und praktisch zu rechtlosen Arbeitssklaven, die dann im Herbst 1941 zusammen mit deutschen Kriegsgefangenen, darunter auch Zivilisten, in die sogenannte Trudarmee(von "труд" für "Arbeit") gesteckt wurden. Unter militärischer Knute mussten sogar 15-jährige bei minimaler Ernährung und bei mörderischer Kälte Schwerstarbeit z.B. im Wald, beim Eisenbahnbau oder unter Tage verrichten. Schätzungen zufolge hat etwa jeder dritte der etwa einer Million Russlanddeutschen diese Zeit nicht überlebt.
So Stalin deported to Siberia/Kazhakstan 1.2 million German people (they lived with their own culture in villages,nonintegrated with quaint dialectts by this time not understood anymore in Germany) and 700,000 died in bitterest winter.
My wife's father's family were taken to Germany in cattle cars from Nazi occupied Ukraine (her Dad was 4 years old and the winter was bitter) by the nazis and her grandfather had to become an SS soldier which guaranteed Gulag and death after the war in Russia.
In Russia they were Germans and here they are Russians is the standard complaint. My wife as mixed blood later generation never suspected discrimination there however.
The recent controversy using young Turkish criminals as an excuse to get votes by Roland Koch in Hessen is very much a Nazi tactic although technically speaking lots of what they are saying is good in principle about a harder line to protect the population.
However when they eliminate so many judges and police over several years and favor only the rich, letting the poor(unlucky born - 6:1 rich go to Gymnasium compared to those with non higher educated parents) wallow in 3rd class schools without any hope for the future or of any job and then suggests just before elctions that the criminal foreign youth be shot against the wall. He is fishing for NPD voters and SPDs Struck is right to respond to Koch's (CDU) apology request that "He can go screw himself". Struck's had quipped that Koch was happy that an old man was beaten half to death by foreign youth so Koch could make a right wing campaign issue out of it as he is falling behind in the polls for this month's regional Hessen elections.
We agree that the rules are in flux, and you are basically conceding what I mentioned.
You just don't happen to agree with the policy.
Blood is much thicker then a piece of paper.
That some Turks were given citizenship is due to the "flux" which really is a loosening of standards due to globalist influence. Give it time and see what happens to places like the UK and France when things get tight, they are going to have a huge 5th column problem just like the US.
Are you in Germany because you know they will do much better when TSHTF because of past policy? While trying to argue the opposite? LOL
One half of my family comes from Prussia, where in the East depending on the day of the week it was Königsberg or Kaliningrad. The point is that their blood is German and that is why they were given citizenship.
To paleo-conservatives and some other factions on the Right Mr. Bush does not act like a conservative. He has expanded entitlements (e.g. the Medicare drug entitlement), signed big pork barrel bills into law, and done other things with spending that put him in very sharp contrast to arch spending cutter Gerald Ford (who achieved a record in terms of vetoed spending bills). Also, the Iraq war misadventure is not a conservative undertaking. It is reckless.
I could go on. But the point is that just because someone is an elected Democrat or an elected Republican that doesn't mean that standard labels fit them.
This is called the "Two Santa Claus" policy in Republican leadership circles. If the Democrats can impose a social security tax to give money to old poor people, the Republicans can give subsidized mortgages to young middle class people so they can buy a house and get in on the mortgage deduction.
Look at where the money goes and try to figure out how poor people can get in on the benefits and subsidys. From the national parks to the ROTC programs, how many welfare mommies or welfare kiddies benefit?
It's been a long, long, time since welfare mostly went to poor people. That was when it was a county function paid for by local taxpayers who would give the local county selectmen what for if they handed out money to undeserving poor, or to any middle class people at all.
Bob Dole talked about finding out that his grandparents were on welfare when he had to sign their welfare application as a county district attorney. No signature, no welfare. Nowadays we have farm subsidies that would have kept them of welfare entirely by making their hardscrabble little dirt farm so valuable that they could have retired to Florida.
My comment that began this was a reply to musashi, who wanted to make some claim about the subprime crisis et sequelae being caused by leftist housing policy.
Sorry. The Republicans and Mr Bush and paleo neo schizo cons OWN the current recession/depression.
Without using the same terms, I generally agree. The apex of the problem is subprime ARMs. I read (somewhere ?) that a couple of billion were issued when GWB was sworn in and this ballooned to a bit over a half trillion on his watch. Roughly 4+ years ago the subprime ARMs began to decline in volume and were down to a trickle of new issues 2 years ago.
This one is clearly and squarely on GWBs watch. 99.6%
Securitization of mortgages (slice and dice 10% tranches of mortgages) was well under way at the end of Clinton's administration but it came to totally dominate & control the mortgage market under GWB. Assign 80% to GWB and 20% to Bill might be fair.
Yes, irresponsible borrowers. That does not excuse the irresponsibility of the banks and mortgage brokers, but the borrowers were still irresponsible themselves.
When loans were approved with little or no equity participation, the borrowers had no risk, but of course... the lenders didn't either since they securitized the paper and re-sold it.
No one can tell us senior management in this arrangement is blameless. They took huge fees for developing this business model (and gave themselves huge bonuses). The CEO at Countrywide "earned" something like $120 million in 2006. In 2007 Countrywide is broke. Where is this CEO now? On vacation in Bermuda? The same behavior was demonstrated by management at Bear Stearns, Citi, Morgan Stanley, Merrill, etc... These guys are well educated, privileged, upper class crooks. They should be in work rehabilitation assignments in the neighborhoods they destroyed... not retired or fired. Their ill gotten rewards need to be returned.
But my real issue is this: Where was the NYT or the Wall Street Journal during all of this shameful business?
Where was the crack financial analysis that supposedly permeates their business pages?
Did those reporters and editors resign in disgrace because they were silent? Why do they remain silent in the face of this immense scandal?
That is a very incisive question. And the same thing happened with the original Ponzi scheme, by Charles Ponzi himself. None of the major papers would touch the story, and the few reporters who tried were reportedly hounded into silence. Except for one embattled Federal Bank Examiner, the government was silent as well.
Until it all fell apart, of course, and then all the fine folks were all over each other and themselves pointing fingers.
Economics applies to people, somewhat idealized, but alive and active. Alive and active implies metabolism --- food energy in and mechanical and nerve pulse energy out. Thermodynamics applies, but not in a way that has been worked out in any detail.
Sure, the borrowers had some responsibility. But it was not the unqualified borrowers that blew up the system. It was the slicers and dicers that repackaged the loans at below real cost. If there were unqualified borrowers, that should have been easy to determine from the loan applications - no job, no equity, no nothing - DOH! It's not at all the borrower's fault that their loans got repackaged and resold in such a way as to cause the meltdown.
Cutting of reserve requirements, eliminating walls between financial industries and banks, destroying abilities of states to regulate (eg it's much easier to own one Congress than all the states) - those are not the borrower's responsibility either.
I agree. What broke the system was securitization. Once lenders started selling the mortgages, they stopped caring who they loaned money to. They weren't going to hold the mortgages, so the borrower just had to make payments for 30 days or so till they could unload the mortgage and wash their hands of it. Borrowers didn't invent "no doc" loans and "liar" loans. The loan process, from start to finish, is under the control of the lenders.
The rate that customers repaid loans worsened ``quite suddenly'' in December, causing American Express to change its 2008 estimates, Chief Financial Officer Daniel Henry said yesterday in a conference call. The weakness was isolated in the U.S. consumer, not in other countries or in business spenders, he said.
Henry told analysts in October that the company's ``affluent and high-spending'' cardholders sheltered the company from the problems of borrowers with the riskiest credit histories.
American Express has declined 26 percent in the last 12 months, compared with the 1.6 percent retreat of the S&P 500 Index. Today's drop was the worst since Sept. 17, 2001, six days after the terrorist attacks on New York and Washington.
Part of the housing mess was giving mortgages to under quilified and illegals.Then within 60 days were given heloc's upto 125% of the mortgage.BAC was big on giving bank credit to illegals.I wonder how many have funneled that cash back to Mexico to buy a house down there and let the one in the US go BK.Now the same thing imo will happen to the credit cards gave the illegal easy fruit to pick.Half dozen credit cards run them up buying stuff and have one clean card to get back home.Isn't America great!! The bankers had an open house and they lost the house.
vapor--
Ah, now it is clear, all our troubles are the result of:
Sub-prime borrowing immigrant teenage welfare mothers on drugs.
Why didn't I think of that?
I feel kind of lucky in that I have contacts thru my work with high earners and those just barely getting by in life.Part of the housing thing was for a tax deduction two different individuals said point blank I'm getting into this house for almost nothing down and if I lose it so what I was renting before. But now I have almost no tax liability because the whole house payment is a deduction.I didn't say anything about the people you described.I've work with and for illegals and they are no dummies.This stuff with housing is just starting.
It's been five years since we had a raise in pay
And they disallowed my business lunches today
Somebody must have changed the rules of the game
So we've found a convenient scapegoat we can blame
It's those teenage immigrant welfare mothers on drugs
(They're too lazy to work)
Teenage immigrant welfare mothers on drugs
(They're stealing our jobs)
Somebody ran this country deep into debt
I called up Congress, but nobody's called back yet
Sometimes I get so mad I can't think straight
We're looking for relief and it feels so great to hate
All those teenage immigrant welfare mothers on drugs
(They're on the Dole)
Teenage immigrant welfare mothers on drugs
(They're speaking espanol)
Who's to blame for the things we're so angry about?
Who's to blame for uprisings, downsizings, and the drought?
Who's to blame for the end of the good old days?
Who's to blame for that backwards-cap-wearing craze?
It's those teenage immigrant welfare mothers on drugs
(Let's build a thousand-mile fence)
Teenage immigrant welfare mothers on drugs
(It's just common sense)
Teenage immigrant welfare mothers on drugs
(Like the Berlin Wall)
Teenage immigrant welfare mothers on drugs
(Land mines and all!)
Teenage immigrant welfare mothers on drugs
Then within 60 days were given heloc's upto 125% of the mortgage.
Worse than that. That 125% LTV (loan to value) was not based upon a conservative appraisal, but on a wildly optimistic estimate, based mostly on a few recent neighborhood sales, all financed by -- yep, loosey goosey mortgages. If competent appraisals had been done, I'd bet that some of these people were at 150-200% LTV BEFORE the recent slide in home values.
Umm.. any statistics to back up your nonsense about illegals? Any idea if illegals are actually in arrears on payments?
I really hate bigotry and scapegoating. It leads to violence and other inhumanity, and distracts us from the real problems and responsibilities. Soo easy to scapegoat though. And so tempting. And a real cheap cop-out for so many.
Just do a search on illegal alien credit cards BAC is handing them out without a Social security number.I know of illegal workers that claim 4-5 kids and not even married and work at the job 11 months or so and move on.
I guess you couldn't answer my question. I know about the credit cards, and I have seen no evidence that they default more than anyone else. And I think your claim about the mortgage issue is ridiculous beyond belief. I have probably met 15 people in foreclosure in the last 3 months. Generally middle to lower middle class whites so far. Some asian, all as legal as you and me (I will assume you are). Are you aware of a single foreclosure in an illegal?
Americans going deeper into debt to pay their food and energy bills?
http://www.nytimes.com/2008/01/12/business/12charts.html?ex=1357794000&e...
OFF THE CHARTS
Some Debt Trends Are Good. This Isn’t One of Them.
By FLOYD NORRIS
Published: January 12, 2008
Rather suddenly, not that it's primary season, Bush and Congress are making noises about a stimulus package. But, but, they've been spending more than the income from tax collections, etc., for decades. Looks like the U.S. "economy" is addicted to deficit spending.
E. Swanson
Well, yes, and a difference from the past is that something has changed. Every time they do a stimulus package - a.k.a. on the 'internets' a 'helicopter drop' - the dollar will tank some more and the psychologically all-important gasoline and diesel dollar prices will leap. Decades ago, the oil-import share was not yet enough to really close this nasty little feedback loop. The upcoming multi-trillion-dollar election-year giveaway of free mega-houses to irresponsible borrowers, who wished on stars and will have their dreams come true, will surely further 'stimulate' the loop.
"irresponsible borrowers" ??
That's the Rush Limbaugh meme. I think there is more problem here than a few desperate blue-collar workers and single moms who greedily thought they could improve their situations.
How about the felonious -- not to mention greedy -- white collar criminals who sold them this mess?
American workers are victims in the sense that their pensions will lose value because the trustees bought the garbage paper from the investment banks. Unions, states, etc. They sold their people out for trinkets, golf club memberships and visits to the dollar ballet.
The sub prime people that entered into the liar mortgages are co conspirators with the brokers, they well understood how each was going to make his money for nothing. They didn't think the music would stop.
The government policy of forcing banks to give loans to sub prime people or "expanding the home ownership experience" is what started the whole mess.
It forced many working people into more expensive housing in order to gain access to halfway safe schools for their children. For the most part, middle class people didn't move into upscale neighborhoods to make a buck, they just saw the degeneration of their old neighborhoods and wanted their children safe.
Government policy started the whole ball rolling and then all sorts of opportunists took advantage, but the root of the problem was left wing government policy to force banks to lend to people financially unfit to be home owners.
Note: I'm not a US citizen.
Could you give a precise reference to the government acts that forced banks to lend to unfit people? My understanding is that the major driver was the individuals wanting the loans and an inappropriate incentive structure for those doing the selling: mortgage brokers/bank staff make their monthly quota/qualify for a bonus based on how many mortgages they sell and don't get penalised for how many default after two years, with similar incentives applying to those higher up the food chain into CDOs, etc.
Certainly in the UK most of the problems have centred around incentives encouraging inappropriate selling behaviour (eg, encouraging people to fake NINJA mortgage applications). This isn't to excuse the individuals engaging in either stupid long term planning or even outright fraud, but to point out that if you give workers an incentive not to detect lies (and maybe encourage them), well, guess what? They will tend not to detect the lies. I keep waiting to see anything in the financial news about any company restructuring their bonus programs to encourage long-term goals, but I haven't seen anything yet and I don't really expect to.
The program was called HOPE, something like Home Ownership Participation for Everyone.
If you Google it there are many pages of references.
This is what started the massive lowering of lending standards, first to make unfit people qualify, and then little by little the standards were lowered for everyone.
Just one LINK to get the feel of it, goes way back if you want to study it.
I should add to clarify.
Your understanding is correct for the most part if you just look at what happened at the end of the cycle.
What started the cycle is the lowering of standards.
That's how everything goes to hell. Look at the school system. Once anything goes away from a pure meritocracy and standards are lowered for one segment of the population, it is human nature to follow the path of least effort and pretty soon everything works to the lower standard.
This is why countries like Germany work much better, citizenship is determined by the status of the parents or mother and not by place of birth or geographic accident, and if immigrants or minorities want to live there they damn well comply with German standards. It works just as well in the military here. No one gets a break, comply with high standards, leave or be kicked out.
Your understanding of Germany is not quite correct, though the framework has been in flux for a number of years now. In part, because of how ineptly many of the challenges have been handled.
If you can prove that your parents/grandparents were ethnic German, you can become a German citizen. Which is why in my region, Russian is often heard among teenagers, because a lot of Aussiedler live here. Their citzenship had nothing to do with 'place of birth or geographic accident,' nor does it have anything with if they 'want to live there they damn well comply with German standards.' In another words, in the name of 'Germanness,' ten of thousands of people who speak no German and have no connection with Germany except that this is the place they were able to escape to after the end of the Soviet Union now live here, often supported by German taxpayers.
Ironically, many of those taxpayers are second or third generation Turkish workers, who in the past had little right to become German citizens, though they were born in Germany, were schooled in Germany, work in Germany, and pay taxes in Germany. In the mid 1990s, something like 110,000 of these Turkish-Germans applied for citizenship - something around 10,000 were approved during that same time. You may draw your own conclusions why such a low percentage of often German schooled and German born Turkish citizens were not fit for German citizenship, especially in light of the fact that according to general German belief, Turkish-Germans have no interest in German citizenship.
I can give a hint, though. It is very hard in Germany to change your name, unlike in the U.S. (If you convert to Islam, you can pretty much forget changing your name, for example.) However, I do know people who have had that happen, without any problem at all - it was when they lost their 'false' Czech name for a proper German one.
Broadly speaking, Germany is not a model for the U.S., and there is little here to emulate - edit - in terms of immigration. What is sad is watching yet another part of the Constitution die, as so many Americans (who themselves are only American citizens generally because they were born in the U.S.) now reject the idea that children born on American soil are American citizens - since that has been the only requirement for determining who is a true American citizen since the founding of the United States. Parentage had nothing to do with it, unless you live outside of the U.S., where it is possible to have a second birth certificate provided by the State Department, proving a child's citizenship to the satisfaction of the United States. (Though technically, they can never become president - just like all the children born overseas of parents serving in the U.S. military.)
As a side note - if my Germany born children do not live in the U.S. as adults (five years, I believe), and in turn have children born outside of the U.S., those children will not be American citizens. American citizenship is based on shared values and was never intended to be hereditary. It is a truly revolutionary idea, and much like the absolute rejection of torture by anyone serving their nation, something which has faded over time. Sic transit gloria.
Expat,
My wife is an Aussiedler. My kids speak all three languages and have two passports US/German and could probably get Russian passports. In turbulent times when entire civilizations could collpase forward looking survival techniques and not backward looking setnimental values are needed for the individual. Not to be to cynical mind you, both my parents are naturalized immigrated US citizens and I have two passports. The Aussiedler have an interesting history:
http://www.bpb.de/themen/AA1Q8R,0,0,Die_Geschichte_der_Russlanddeutschen...
http://de.wikipedia.org/wiki/Geschichte_der_Russlanddeutschen
So Stalin deported to Siberia/Kazhakstan 1.2 million German people (they lived with their own culture in villages,nonintegrated with quaint dialectts by this time not understood anymore in Germany) and 700,000 died in bitterest winter.
My wife's father's family were taken to Germany in cattle cars from Nazi occupied Ukraine (her Dad was 4 years old and the winter was bitter) by the nazis and her grandfather had to become an SS soldier which guaranteed Gulag and death after the war in Russia.
In Russia they were Germans and here they are Russians is the standard complaint. My wife as mixed blood later generation never suspected discrimination there however.
The recent controversy using young Turkish criminals as an excuse to get votes by Roland Koch in Hessen is very much a Nazi tactic although technically speaking lots of what they are saying is good in principle about a harder line to protect the population.
However when they eliminate so many judges and police over several years and favor only the rich, letting the poor(unlucky born - 6:1 rich go to Gymnasium compared to those with non higher educated parents) wallow in 3rd class schools without any hope for the future or of any job and then suggests just before elctions that the criminal foreign youth be shot against the wall. He is fishing for NPD voters and SPDs Struck is right to respond to Koch's (CDU) apology request that "He can go screw himself". Struck's had quipped that Koch was happy that an old man was beaten half to death by foreign youth so Koch could make a right wing campaign issue out of it as he is falling behind in the polls for this month's regional Hessen elections.
We agree that the rules are in flux, and you are basically conceding what I mentioned.
You just don't happen to agree with the policy.
Blood is much thicker then a piece of paper.
That some Turks were given citizenship is due to the "flux" which really is a loosening of standards due to globalist influence. Give it time and see what happens to places like the UK and France when things get tight, they are going to have a huge 5th column problem just like the US.
Are you in Germany because you know they will do much better when TSHTF because of past policy? While trying to argue the opposite? LOL
One half of my family comes from Prussia, where in the East depending on the day of the week it was Königsberg or Kaliningrad. The point is that their blood is German and that is why they were given citizenship.
Those darn left wing Republicans.
That darn lefty George W. Bush.
To paleo-conservatives and some other factions on the Right Mr. Bush does not act like a conservative. He has expanded entitlements (e.g. the Medicare drug entitlement), signed big pork barrel bills into law, and done other things with spending that put him in very sharp contrast to arch spending cutter Gerald Ford (who achieved a record in terms of vetoed spending bills). Also, the Iraq war misadventure is not a conservative undertaking. It is reckless.
I could go on. But the point is that just because someone is an elected Democrat or an elected Republican that doesn't mean that standard labels fit them.
This is called the "Two Santa Claus" policy in Republican leadership circles. If the Democrats can impose a social security tax to give money to old poor people, the Republicans can give subsidized mortgages to young middle class people so they can buy a house and get in on the mortgage deduction.
Look at where the money goes and try to figure out how poor people can get in on the benefits and subsidys. From the national parks to the ROTC programs, how many welfare mommies or welfare kiddies benefit?
It's been a long, long, time since welfare mostly went to poor people. That was when it was a county function paid for by local taxpayers who would give the local county selectmen what for if they handed out money to undeserving poor, or to any middle class people at all.
Bob Dole talked about finding out that his grandparents were on welfare when he had to sign their welfare application as a county district attorney. No signature, no welfare. Nowadays we have farm subsidies that would have kept them of welfare entirely by making their hardscrabble little dirt farm so valuable that they could have retired to Florida.
My comment that began this was a reply to musashi, who wanted to make some claim about the subprime crisis et sequelae being caused by leftist housing policy.
Sorry. The Republicans and Mr Bush and paleo neo schizo cons OWN the current recession/depression.
Without using the same terms, I generally agree. The apex of the problem is subprime ARMs. I read (somewhere ?) that a couple of billion were issued when GWB was sworn in and this ballooned to a bit over a half trillion on his watch. Roughly 4+ years ago the subprime ARMs began to decline in volume and were down to a trickle of new issues 2 years ago.
This one is clearly and squarely on GWBs watch. 99.6%
Securitization of mortgages (slice and dice 10% tranches of mortgages) was well under way at the end of Clinton's administration but it came to totally dominate & control the mortgage market under GWB. Assign 80% to GWB and 20% to Bill might be fair.
Alan
Yes, irresponsible borrowers. That does not excuse the irresponsibility of the banks and mortgage brokers, but the borrowers were still irresponsible themselves.
When loans were approved with little or no equity participation, the borrowers had no risk, but of course... the lenders didn't either since they securitized the paper and re-sold it.
No one can tell us senior management in this arrangement is blameless. They took huge fees for developing this business model (and gave themselves huge bonuses). The CEO at Countrywide "earned" something like $120 million in 2006. In 2007 Countrywide is broke. Where is this CEO now? On vacation in Bermuda? The same behavior was demonstrated by management at Bear Stearns, Citi, Morgan Stanley, Merrill, etc... These guys are well educated, privileged, upper class crooks. They should be in work rehabilitation assignments in the neighborhoods they destroyed... not retired or fired. Their ill gotten rewards need to be returned.
But my real issue is this: Where was the NYT or the Wall Street Journal during all of this shameful business?
Where was the crack financial analysis that supposedly permeates their business pages?
Did those reporters and editors resign in disgrace because they were silent? Why do they remain silent in the face of this immense scandal?
There's a lot of housecleaning to do...
I think a lot of people are starting to get a good clear look at just how corrupt the USA has become.
That is a very incisive question. And the same thing happened with the original Ponzi scheme, by Charles Ponzi himself. None of the major papers would touch the story, and the few reporters who tried were reportedly hounded into silence. Except for one embattled Federal Bank Examiner, the government was silent as well.
Until it all fell apart, of course, and then all the fine folks were all over each other and themselves pointing fingers.
I think everyone, even those who should know better, always holds out hope for perpetual motion.
Even if we know it goes against all the laws of nature there is still a part of us that thinks, maybe this time it's different.
Does thermodynamics apply to economics too?
That is basically what Tainter's The Collapse of Complex Societies is all about.
Economics applies to people, somewhat idealized, but alive and active. Alive and active implies metabolism --- food energy in and mechanical and nerve pulse energy out. Thermodynamics applies, but not in a way that has been worked out in any detail.
Thanks leanan - I have read that link before but I guess I need to get the book.
Sure, the borrowers had some responsibility. But it was not the unqualified borrowers that blew up the system. It was the slicers and dicers that repackaged the loans at below real cost. If there were unqualified borrowers, that should have been easy to determine from the loan applications - no job, no equity, no nothing - DOH! It's not at all the borrower's fault that their loans got repackaged and resold in such a way as to cause the meltdown.
Cutting of reserve requirements, eliminating walls between financial industries and banks, destroying abilities of states to regulate (eg it's much easier to own one Congress than all the states) - those are not the borrower's responsibility either.
cfm in Gray, ME
I agree. What broke the system was securitization. Once lenders started selling the mortgages, they stopped caring who they loaned money to. They weren't going to hold the mortgages, so the borrower just had to make payments for 30 days or so till they could unload the mortgage and wash their hands of it. Borrowers didn't invent "no doc" loans and "liar" loans. The loan process, from start to finish, is under the control of the lenders.
Exactly as forecast.
http://www.bloomberg.com/apps/news?pid=20601103&sid=asFwsTxP.Ra0&refer=n...
Sudden Worsening
The rate that customers repaid loans worsened ``quite suddenly'' in December, causing American Express to change its 2008 estimates, Chief Financial Officer Daniel Henry said yesterday in a conference call. The weakness was isolated in the U.S. consumer, not in other countries or in business spenders, he said.
Henry told analysts in October that the company's ``affluent and high-spending'' cardholders sheltered the company from the problems of borrowers with the riskiest credit histories.
American Express has declined 26 percent in the last 12 months, compared with the 1.6 percent retreat of the S&P 500 Index. Today's drop was the worst since Sept. 17, 2001, six days after the terrorist attacks on New York and Washington.
Part of the housing mess was giving mortgages to under quilified and illegals.Then within 60 days were given heloc's upto 125% of the mortgage.BAC was big on giving bank credit to illegals.I wonder how many have funneled that cash back to Mexico to buy a house down there and let the one in the US go BK.Now the same thing imo will happen to the credit cards gave the illegal easy fruit to pick.Half dozen credit cards run them up buying stuff and have one clean card to get back home.Isn't America great!! The bankers had an open house and they lost the house.
and taxpayers will be expected to pony up.
Looks like China and the middle east will be our new bankers.
vapor--
Ah, now it is clear, all our troubles are the result of:
Sub-prime borrowing immigrant teenage welfare mothers on drugs.
Why didn't I think of that?
You forgot the gender identity issue - at least some of them are lesbians, too.
Bill Clinton & The Vampire Lesbians of Sodom.
I feel kind of lucky in that I have contacts thru my work with high earners and those just barely getting by in life.Part of the housing thing was for a tax deduction two different individuals said point blank I'm getting into this house for almost nothing down and if I lose it so what I was renting before. But now I have almost no tax liability because the whole house payment is a deduction.I didn't say anything about the people you described.I've work with and for illegals and they are no dummies.This stuff with housing is just starting.
Teenage Immigrant Welfare Mothers on Drugs
http://www.austinloungelizards.com/teenage_immigrant_mothers.html
It's been five years since we had a raise in pay
And they disallowed my business lunches today
Somebody must have changed the rules of the game
So we've found a convenient scapegoat we can blame
It's those teenage immigrant welfare mothers on drugs
(They're too lazy to work)
Teenage immigrant welfare mothers on drugs
(They're stealing our jobs)
Somebody ran this country deep into debt
I called up Congress, but nobody's called back yet
Sometimes I get so mad I can't think straight
We're looking for relief and it feels so great to hate
All those teenage immigrant welfare mothers on drugs
(They're on the Dole)
Teenage immigrant welfare mothers on drugs
(They're speaking espanol)
Who's to blame for the things we're so angry about?
Who's to blame for uprisings, downsizings, and the drought?
Who's to blame for the end of the good old days?
Who's to blame for that backwards-cap-wearing craze?
It's those teenage immigrant welfare mothers on drugs
(Let's build a thousand-mile fence)
Teenage immigrant welfare mothers on drugs
(It's just common sense)
Teenage immigrant welfare mothers on drugs
(Like the Berlin Wall)
Teenage immigrant welfare mothers on drugs
(Land mines and all!)
Teenage immigrant welfare mothers on drugs
Worse than that. That 125% LTV (loan to value) was not based upon a conservative appraisal, but on a wildly optimistic estimate, based mostly on a few recent neighborhood sales, all financed by -- yep, loosey goosey mortgages. If competent appraisals had been done, I'd bet that some of these people were at 150-200% LTV BEFORE the recent slide in home values.
Umm.. any statistics to back up your nonsense about illegals? Any idea if illegals are actually in arrears on payments?
I really hate bigotry and scapegoating. It leads to violence and other inhumanity, and distracts us from the real problems and responsibilities. Soo easy to scapegoat though. And so tempting. And a real cheap cop-out for so many.
Just do a search on illegal alien credit cards BAC is handing them out without a Social security number.I know of illegal workers that claim 4-5 kids and not even married and work at the job 11 months or so and move on.
I guess you couldn't answer my question. I know about the credit cards, and I have seen no evidence that they default more than anyone else. And I think your claim about the mortgage issue is ridiculous beyond belief. I have probably met 15 people in foreclosure in the last 3 months. Generally middle to lower middle class whites so far. Some asian, all as legal as you and me (I will assume you are). Are you aware of a single foreclosure in an illegal?