Thursday, July 24, 2008

They keep pumping but there still a hole in that there bucket

US lawmakers pass housing rescue

The US House of Representatives has passed a massive (3,900,000,000 dollars )housing rescue bill that could help struggling homeowners get cheaper loans. More than a million Americans have lost their homes in the worst housing crisis since the Great Depression. Under the rescue plan, hundreds of thousands of homeowners trapped in mortgages they cannot afford on homes that have fallen in value would be able to refinance their mortgages with more affordable, fixed-rate loans backed by the Federal Housing Administration. It also includes a tax break of as much as $7,500 for first time home buyers, as well as help for troubled mortgage finance providers Fannie Mae and Freddie Mac. Many Republicans are angry about the legislation, which they say bails out irresponsible homeowners and lenders

Posted by who stole my pension? @ 06:20 AM (727 views)
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7 thoughts on “They keep pumping but there still a hole in that there bucket

  • too big to fall means more cash to stay afloat.

    inflation is still winning the day against deflation and will do for the forseeable future.

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  • This bill is yet another milestone on the sad road to Socialism in the US.

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  • Good extract here from a nice article comparing the USSR collapse against the soon to be USA.

    May have been posted before but its worth bookmarking…….. : http://www.energybulletin.net/node/23259

    “One important element of collapse-preparedness is making sure that you don’t need a functioning economy to keep a roof over your head. In the Soviet Union, all housing belonged to the government, which made it available directly to the people. Since all housing was also built by the government, it was only built in places that the government could service using public transportation. After the collapse, almost everyone managed to keep their place.

    In the United States, very few people own their place of residence free and clear, and even they need an income to pay real estate taxes. People without an income face homelessness. When the economy collapses, very few people will continue to have an income, so homelessness will become rampant. Add to that the car-dependent nature of most suburbs, and what you will get is mass migrations of homeless people toward city centers.”

    Remember the old films made about USA – THE LAND OF FREEDOM AND DEMOCRACY at war with the Russian communists who would took away their freedom…?

    I bet some yanks wish they had !

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  • last_days_of_disco says:

    @debtfree

    No, deflation is still winning. 3.9bn is a drop in the ocean. Remember the banks have written down much more than 100bn already.

    The fact that commodities have been increasing in price has nothing to do with inflation from a money supply point of view. The overall money supply has shrunk *already*. Now the governments have to do catchup, but the price of commodities is being driven up in the meanwhile because suddenly everyone wants to buy them to escape the property crash.

    Those commodities will crash too at some point when everyone realizes we are using a lot less of them. I doubt people really understand how wasteful the western economies are.

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  • $3.9B? They can cover that by stopping the Iraq War 10 days earlier than planned and still have change. (According to an AP/Yahoo report in March, the war is costing an estimated $12B a month.)

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  • 12B here, 3.9B there……… it all adds up. I see no deflation at all.

    A general rise in wages can only occur if central banks induce an inflationary expansion of money and credit. USA min wage is increasing in stages til July 2009.

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  • @ harold — there’s nothing wrong with socialism, quite the contrary. It’s when profits are privatised while losses are socialised that’s the problem, resulting in glib comments like yours.

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