No Writing Down the Taxpayer's Role in the Mortgage Crisis
Whenever I am confronted with some new monetary or fiscal outrage, I go through the 5 Stages of Shock, namely starting with Denial (“Nobody is that stupid!”)
Then I quickly move to the Anger (“Those bastards!”) stage, followed by Fear (“We’re Freaking Doomed”) and Bargaining (“I’ll use my votes for the persons who are as against this outrage as I am, and who campaign on a platform of tracking down the banker and neo-Keynesian economist trash that did this to us, and put them in jail so that I won’t have to personally get up off my fat, lazy butt to rise up and lead a popular rebellion to abolish the Federal Reserve, put the United States back on a gold standard and re-establish the Glass-Steagel separation of banking from investing”).
Finally, the 5th stage is Acceptance (“Alas, there’s nothing I can do, except to scream in outrage about the satanic Federal Reserve until I die, and then I can come back from the dead as some malevolent demon from hell to haunt them all, and vex their descendents with spooky crap all the time so that they never get any sleep, their children grow up weird and everybody ends up being crazy and locked away someplace”).
But no matter which stage I am in, or what it is about, I have consistently warned that there is no government outrage so great that the government will not do something even more outrageous.
Sure enough, on the front page of The Wall Street Journal was the headline “Mortgage Deal Takes Shape,” which is the most socialist, communist piece of lowlife crap that the government ever undertook (so far), which is that the government wants mortgage servicers to “reduce the loan balances of troubled borrowers who owe more than their homes are worth.”
No sooner had you clasped your hands to your chest as sudden shooting pains radiate down your left arm and your heart is going “boom boom boom” at this unbelievable crap than it was immediately followed by, “The cost of those writedowns won’t be borne by investors who purchased mortgage-backed securities.”
“Well,” you have to ask yourself, “If they won’t have to eat the losses, who will?” The Wall Street Journal said that the losses will be borne by the banks, as a result of the new, raw extortion of “some state attorneys general and federal agencies are pushing for banks to pay more than $20 billion in civil fines or to fund a comparable amount of loan modifications for distressed borrowers.”
Interestingly, anyone classified as a mortgage servicer who “mishandled foreclosure procedures” will have to “eat losses” by writing down loans, too, for any loans that they “service on behalf of clients,” which turns out to be – surprise! – “Fannie Mae and Freddy Mac, as well as investors in loans that were securitized by Wall Street firms.”
I say that the answer to the question, “Who will pay for all these reductions in mortgages?” is that everyone will. Losses are always ultimately passed along to customers in the form of higher prices, and passed along to the taxpayers, too, in the form of losses being expenses, and are thus deductions from taxable income.
Apparently, I have my head up my bazoo, as The Wall Street Journal says that banks and mortgage servicers will be required to literally operate at a loss, as “under the administration’s proposed settlement, banks would have to bear the cost of all writedowns rather than passing them on to other investors.” Hahaha!
Of course, I figure that this is just more of the staggering, suicidal stupidity that is so rampant in the world today, and thus another reason to buy gold, silver and oil stocks in pure self-defense.
And with the guaranteed inflationary horror and economic collapse inherent in the Federal Reserve creating more than a trillion dollars a year in new money so that the federal government can increase the national debt by an estimated $2 trillion in that selfsame One Freaking Year (OFY), the decision to buy gold, silver and oil is such a no-brainer that you can’t stop yourself thinking, “Whee! This investing stuff is easy!”