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March 12, 2008


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"I commend Mayor Vreeland (I know, a first, right?) for commenting on the plight of local Realtors at today's Pacifica Democrats meeting."

I look forward to the first annual "Million Man/Woman Realtor March" on Washington to highlight the plight of down trodden Realtors everywhere.

Caveat Emptor ("Let the buyer beware') is generally good advice for any buyer, but it is more than a little bit harsh for that advice to be the entirety of the support that we, as a civilization, offer on something so necessary as housing and as complex as a mortgage agreement. Also, I should make it clear that I view the problem as systemic and not necessarily the result of criminal types of individuals. Many behaviors that would once have been (and should now be) considered criminal conspiracies are now considered normal business practices, and people working in the system are compelled to be part of arrangements that, in the end, have a criminal effect. Yes, the depth of desire people have to provide a home for their families might cloud their judgment, but many of us whose expertise lies someplace other than in the area of mortgages are kind of at the mercy of experts in that field and, of course, the laws that regulate them.

Again, the film "The Corporation" and the film "Story of Stuff" (also viewable at storyofstuff.com) cover a great deal of how "extremely ethical" individuals end up being part of a very serious problem.

Let's not forget: many of our homes, now 30 years old, were selling for $20,000 to $40,000 new.

I commend Mayor Vreeland (I know, a first, right?) for commenting on the plight of local Realtors at today's Pacifica Democrats meeting.

The financial toll on those in the industry has been substantial. Most Realtors are extremely ethical and most mortgage brokers do not want to sell you a bad loan, and they have suffered as much as anyone during this downturn.

It's easy to blame bogeymen for our misfortunes, and there will be evidence of improprieties as there are in any industry, but I think you will find this was a combination of a hot market, and many buyers wanting to "get in" and agreeing to loans they knew they could not afford.

Not some grand conspiracy.

The "ignorant buyer" argument ignores an even older adage:


This is in regard to the Bruce and Butch and Kat discussion of personal accountability and responsibility.

Part of taking responsibility is arranging safeguards for those people who are somewhat unsophisticated in one area or another which, of course, is to say almost all of us. In every line of work there are those who are, shall we say, 'No better than they are required to be'. Before Ronald Reagan's 'Let the buyer be damned' philosophy took hold there were safeguards in most industries which was frustrating to many among us who had criminal leanings.Now, with the Neo-Conservatives holding sway, Ronald Reagan's dream is in full flower. Con men can act with impunity AND get bailed out by the taxpayers while we really need to give some thought to whether the citizens they robbed (fair and square) are really 'deserving poor'. The dot-com bust, the bursting housing bubble, the running of an endless war on no-bid contracts to cronies all facilitate the transfer of wealth from working people to the extremely wealthy who in turn buy propaganda to make us all chant "no new taxes" and "end government regulation". All of the free
trade agreements provide freedom TO multinational corporations and what they provide freedom FROM is the voice of the people, from the
environmental, zoning, and labor safeguards that used to protect us
from the skilled and knowlegible sociopaths (see the film "The
Corporation") that these multinational corporations are. Also, don't
think that corporations chartered in the USA care any more about you or
me than corporations chartered elsewhere. They don't. "American
interests abroad" is only a reference to who is going to foot the bill
when a corporation misbehaves. It may also indicate what kind of PR
hooks they are likely to use but it has nothing at all to do with
allegiance. They might appreciate the flag for its ability to move
people but their trashing of the constitution has been very intentional
and, sad to say, very effective.

I have tried to read all the fine print on my mortgage loan agreement
but the only reason I am not losing my house is that I was lucky enough
to get a loan broker whose moral compass precluded the misbehaviors
that are very much allowed today. If I had been up against the sharks
we would all be deciding if I was the "deserving poor" or not.

This country cannot afford to constantly bail out everyone who takes a risk. My opinion is that if you know a decision is risky, you own it. That is the way this country used to be. In the year 2000, we had so many natural disasters that a lot of people refuse to this day to buy insurance: €”We pay for them. The dot.com fiasco: €”We paid for them. 9/11: We are still paying. Katrina: still paying. The list could go on. Everyone is warned of risks, but they do it because they know America will not let them starve. Social Security and welfare were designed for problems in the 1930s; it cannot handle the problems we face in the 21st century. Everybody globally is doing better, living longer, driving more, and still America is the cleanest, safest place to do business. Let the recession run its course; nobody should get any bailouts. America will survive this; she has before.

Hate??? I do not think anyone hates these people, but we just like them to bear the responsibilty themselves. As for them being immigrants, what does that have to do with anything?

Y'all hate those irresponsible borrowers (some of them are immigrants!) but what happened today?
The poor banking/brokerage industry is being bailed out to the tune of $200 billion by the Federal Reserve.
I guess we know now where the priorities lie: With the ruling class, suckers!

I agree with Bruce and Butch, and you better believe I am writing to my reps stating, "Don't make me pay for this." The banks and the people who took the risk of such loans should pay, not me and my family.

Hey Bruce, didn't we have this conversation on a different site sometime ago? You are 100% correct, but in this country, it is always someone else's fault if you get into trouble. Lack of personal accountability and responsibility is out the window in the USA!!!

It is ironic that none of the comments blame the people who bought these homes, often with neg am, or adjustable mortgages without realizing that by gosh some day they would have to pay. Why is it that every foreclosure is the result of some poor soul being duped, and none seem to be due to adults who knowingly bought more than they could afford?

With the signing of NAFTA, everybody globally was making a shitload of money. The banks had a tremendous amount of money to loan. In the 1990s, places like Ameriquest (where are they now?) were offering the worst predatory loans. Their appraisers were cooking their appraisals, making the homes around the Bay Area "worth" more than they really were. If you look into the SF Chronicle archives, I believe around 1999, the Chronicle outed Bank of America. They were designing loans for illegal immigrants who could not prove income and had no tax records and also people who had bad credit bad and no money down. Look into Chuck Schumer, Senator from New York, who wanted all immigrants and poor people to own their own homes. I believe he still is on the committee that was supposed to watch over Fannie Mae and Freddie Mac loans. The hearings will start with Congress. There is a recession in the housing market. But in some states it is now affecting municipal bonds. Hang on to your hats, it is going to be a rough ride. The free market will punish those responsible. Remember, with every loser there is a winner. The paper trail will lead us to them.

"realtors...have pocketed the proceeds"

The sentence reads, "In the end, the Realtors, brokers and banks have pocketed the proceeds."

Whatever the fallout or outcome of the housing crisis, commissions were made by all of the above and the current round of investigations by the FBI, among others, is to determine (among other things) just how much of this was calculated to derive commissions knowingly at the expense of the consumer and public who were duped into financing loans the industry knew they could not afford.

So, Scotty, rather than misquoting me or saying things like "I guess it's easier to blame whatever your personal boogey man is than to face facts, but at some point we should start to act like adults," take a deep breath first. It may help you in the end.

Houses will again fall to what is a supportable level over the past 100 years, e.g., 2.5 to 3 times the household salary average. The average salary in SF is around $50,000, so housing prices should average around $150,000. The bottom is a long way off still.

See the Case-Shiller graphs to picture how truly inflated this market was for the past 10 years. Shiller is the Yale economist who called the 90s housing bust the dot-com bust, and now this.

"In the end, the Realtors, brokers and banks have pocketed the proceeds."

Wrong. They got their (sweet) cut in fees, but the vast majority of $ was transferred to those wise or lucky enough to sell at the top. And as for the banks—you have not been paying attention. More often than not, they are the ones left holding the empty bag because they are forced to foreclose on properties worth less than the loan they made.

Let's see... the comment that "realtors... have pocketed the proceeds" is placed under a photo that notes that "This former real estate office in Pacifica's Manor district stands empty after decades of continuous operation under various brokerages." Obviously, business is booming. Combine that with the fact that the mortgage and finance industries are taking record losses, and I have to ask what alternative universe are you living in? I guess it's easier to blame whatever your personal boogey man is than to face facts, but at some point we should start to act like adults.

The industry has made its money. I've heard several Realtors scoff at the crisis, saying things like "One week of war funding will clean all this up."

In the end, the Realtors, brokers and banks have pocketed the proceeds. The only thing left is if the handful of investigations that are ongoing can show these housing industry insiders have profited from a crime.

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