Other Priorities

This country has had some rather lame and shallow things on its mind for the last 18-24 months.  Most of the media has been engrossed in the 2008 Presidential Election.  Compared to the recent financial situation it now appears to be one large pissing contest between two large (or not so large) dicks.  How could we stoop to this level?  I’m really not impressed at all.  I thought I’d be trying to make a change by financially supporting the Hill-dawg but that kinda fluttered.  I certainly do not exclude myself from anything said here.

The election was priority 1 in the news while the worsening financial crisis was relegated to Suze Orman on CNBC and Lou Dobbs on CNN.  They are both polarizing figures and don’t necessarily garner an audience as large as “Dancing with the Stars” or “Top Model.”  Suze stuck to her usual message of credit card debt relief and the housing market while Lou stuck to our illegal immigration crisis and staggering trade deficit with China, not to mention the joys of free trade agreements.  I don’t think either one saw this recent Wall Street deflation (umm… fucking mess) coming.  A reasonable person would say that a “crisis” of this magnitude would have shown itself much sooner.  Where were the economists?  Why didn’t they warn us?  Did they warn us and did we not listen?

I’m scared.  People are losing trillions of dollars in investments amid the market’s floundering.  [I have a million more adjectives, trust me.]  Fear is causing the downturn in the markets.  The collapse or near collapse of several major financial institutions is also a cause for concern.  A few things need to change:

1. We need to implement constraints on the proportion of risky debt that a bank owns.
2. Sub-prime mortgage lending needs to end.  Although this will lead to a slow down in new housing starts, responsible lending and borrowing can ensure that these types of issues do not reoccur.
3. Any of those on the precipice of foreclosure need to have their mortgage monthly payments rolled back to where they were before their adjustable rate mortgages (ARMs) adjusted or interest-only payments ballooned.
4. Predatory lending practices in the housing market must stop.  80/20, 80/15, and 80/15/5 loans are not acceptable any more.  I believe that at least a 10% down-payment needs to be required, if not 20%.  We saw housing prices deflate which left many with a mortage(s) much larger than their house value.
5. We need to see more “truth in lending” in the credit card markets.  I have a Washington Mutual (WaMu) credit card whose interest rate went to 32.99% even though I pay it off monthly and had my FICO score increase by 50 points.  WaMu did this to raise more capital in their tough times.  Credit card companies should have to warn you of rate increases in advance and disclose all of their late fee charges.
6. We need a cap on credit card interest rates.  Whether it be tied to the Prime Interest Rate, LIBOR Index, 30 year treasuries, or a fixed rate such as 19.9%, anything would help.  People get in to these situations where they are paying 30% interest rates with minimum monthly payments of 4% of their total.  This would mean that it takes a person 25-30 years to pay off that credit card.
7. Banks cannot keep treating people the way they have for the last 15-20 years.  It’s disgraceful and harmful to the American people.  Their profit motive of screwing the customer is now gone because we can’t afford it anymore.
8. Let’s roll back the bankruptcy laws of a few years ago and allow unconditional Chapter 7 filings and resolutions to help us get through these times.  Bankruptcy is not only caused by the borrower, but the lender.  Lending institutions should not go unfettered in their lending to high risk people.

Yeah, I’m scared.  The thing is that we all got us here.  Wall Street, Main Street [sic], you, me, Joe six pack [really sic], investment banks, and other financial institutions got us to where we are today.  Let’s not panic and screw ourselves any more.  Also, this vein pissing contest of a Presidential election is a joke.  Do you think either one of these men can unite the country and create the waves of “Change” that we really need?  If you do you’re kidding yourself.  It will take longer than 4 or 8 years to erase 10 BILLION in debt.  Savings bonds anyone?  I have little doubt that their interest rate will increase next month!

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