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#931741 - 03/27/08 07:01 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
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the underwriting has already changed significantly since the meltdown. can we mandate it to stay that way or is that, as some argue, the place where the market needs to dictate? i would say that, based on what just happened, this is exactly where the government should step in with regulations. The market's fixing this problem - let's make sure it can't respond effectively to the next problem!!!
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#931751 - 03/27/08 07:10 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
Jokerman
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Ron, many of the lenders and brokers are out of business. And Jokerman is right. Why do you think these programs came into existence to begin with? They were created to make credit available to those that didn't have another way to get it. Look at HUD-they always had tight restrictions on the condition of the property to help insure a borrower got into a home that was in good condition. Back in 2005, they completely wiped out the requirements. Why? because noone was going FHA anymore-the other loan products didn't have these restrictions, so why go through the headache? It is like anything else-adjust to the market and your consumer base, or you are a dead duck. I am not trying to justify this mess, but IMO, overregulation will continue to choke the real estate market.
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#931758 - 03/27/08 07:16 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
TB 12
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many of the lenders and brokers are out of business and you don't think more should pay, too? or have enough been forced out of the market. talk about corporate welfare! They were created to make credit available to those that didn't have another way to get it. created by whom? Back in 2005, they completely wiped out the requirements. well, then they were idiots if this happened with hud to keep up with the market. the thing this regulation does is that it prevents ANYBODY from participating in this pro-cyclical irrationality.
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#931761 - 03/27/08 07:21 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
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I am not defending the lenders-they should pay for their bad choices, as should hte borrowers.
Lenders-banks-whoever...new products come out all the time...current products are revised....
Perhaps the Government should just take over lending since they could handle it so well....
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#931766 - 03/27/08 07:28 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
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borrowers will pay. they are still on the hook for the value of their home at a premium. current products are certainly revised, but the fundamental nature of collateral value is hard to get around. Perhaps the Government should just take over lending since they could handle it so well.... finally the reason for me even bringing this up!!! did you hear about paulson?
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#931770 - 03/27/08 07:38 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
straw
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Yes but those mortgage derivatives allowed credit standards to be lowered, as there was a ready market to "offload" the debt and risk from the lenders' balance sheet.
And of course, Ron has not even considered that. or have i but you just didn't recognize it when i referredt to it? Please show me the reference in this thread and we'll see if you referred to it. Still waiting Rono.
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#931870 - 03/27/08 08:47 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
straw
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well, i am talking about mortgage--the underlying event--underwriting standards. how the earlier capital regulations helped create this problem how well do you think anybody understood the mbs and cdos? don't bear stearns' and the rest of the managers/investors' of these things' plights seem a bit like res ipsa loquitur? are you saying that lenders will somehow create an 'air rights' analogous situation with collateral regulations for the underlying mortgages? in other words, the bundle of underlying debt is 80% ltv (or whatever) but lots of individual pieces are 100 ltv+? does that even matter? i dont think it will but maybe you can think of another way to cook it up. and if you can, i suggest you get out of what you are doing now because you can make 1000s time more structuring these things around collateral regs.
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#931888 - 03/27/08 08:55 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
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well, i am talking about mortgage--the underlying event--underwriting standards. how the earlier capital regulations helped create this problem how well do you think anybody understood the mbs and cdos? don't bear stearns' and the rest of the managers/investors' of these things' plights seem a bit like res ipsa loquitur? are you saying that lenders will somehow create an 'air rights' analogous situation with collateral regulations for the underlying mortgages? in other words, the bundle of underlying debt is 80% ltv (or whatever) but lots of individual pieces are 100 ltv+? does that even matter? i dont think it will but maybe you can think of another way to cook it up. and if you can, i suggest you get out of what you are doing now because you can make 1000s time more structuring these things around collateral regs. A couple of points. I don't think you understand what res ipsa locquitur means. Secondly, Bear Stearns' meltdown was brought about by margin calls as much as by MBS and CMO write downs. Everyone was racing to get money out of Bear Stearns because they feared collapse, much like depression era bank runs, which took place regardless of a bank's actual strength or weakness. And what I am saying is the CMO/MBS markets have already been altered for these new risks. Regulations will simply create new market forces that will create unintended or unknown issues. Lastly, I don't think you have any idea how a CMO is structured. Perhaps before you opine on this you should see if your school has a class on it.
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#931889 - 03/27/08 08:55 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
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Way, way south.
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Can you start back at your posts from 8/10/05?
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#931890 - 03/27/08 08:55 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
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which part don't you follow? i will try to clarify. All of it.
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#931912 - 03/27/08 09:09 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
straw
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I don't think you understand what res ipsa locquitur means. the event speaks for itself roughly. Bear Stearns' meltdown was brought about by margin calls do you know what brought those margin calls about? (hint: a tautology is involved) can you appreciate the weight of that much leverage? http://www.brandeis.edu/global/rosenberg_institute/usmpf_2008.pdfsome light reading. start on page 25. Regulations will simply create new market forces that will create unintended or unknown issues. well, i am still curious if you have any notions of how people are going to be able to fake out ltv caps or something to this effect without fraud. Lastly, I don't think you have any idea how a CMO is structured. is a cmo riskier or less risky with tauter underlying interests? not a whole lot of payment streams coming from failed loans are there? so why do loans fail in a real estate bubble?
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#931917 - 03/27/08 09:13 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
straw
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allowed FI's to continue to lend at the same levels as prior to the regulations. point goes to ron. And at least be honest in that until this thread you had never even heard of the Basel regulations. i admit: i haven't. so what? is this a history test or a financial structuring/policy discussion (grafted onto a hillary thread of course )
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#931927 - 03/27/08 09:20 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
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[quote=Ronzilla] I don't think you understand what res ipsa locquitur means. the event speaks for itself roughly. Right. A business failing has only one cause. Regulations will simply create new market forces that will create unintended or unknown issues.
well, i am still curious if you have any notions of how people are going to be able to fake out ltv caps or something to this effect without fraud. I am curious if you will ever understand that these market forces I am talking about are not about faking out, or committing fraud or anything nefarious. Quote: Lastly, I don't think you have any idea how a CMO is structured.
is a cmo riskier or less risky with tauter underlying interests? Further evidence that you know nothing about CMO's. What, nothing on Wiki about CMO's.
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#931930 - 03/27/08 09:21 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
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allowed FI's to continue to lend at the same levels as prior to the regulations. point goes to ron. And at least be honest in that until this thread you had never even heard of the Basel regulations. i admit: i haven't. so what? is this a history test or a financial structuring/policy discussion (grafted onto a hillary thread of course ) Typical. You have no idea where we have been or how we have gotten here, but you know how to fix it.
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#931939 - 03/27/08 09:30 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
straw
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straw, what is it that you want? you don't really want discussion, do you? res ipsa loquitur was referring to the fact that bear stearns and other managers/investor didn't really grasp what they were doing with these instruments! I am curious if you will ever understand that these market forces I am talking about are not about faking out, or committing fraud or anything nefarious. oh, so the market will lend to things other than real estate. fair enough. what are lenders going to secure loans with for the transactions of real estate. or do you think this current economic evironment is not a result of contagion related to real estate-backed lending? Further evidence that you know nothing about CMO's. how so, straw? can failed underlying obligations deliver a cash flow to the cmo? or is this the "no no ron, cdos are about prepayment risks" argument?
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#931943 - 03/27/08 09:34 PM
Re: CBS Busts Hillary About Outright Lie on Bosnia
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if by that you mean to avoid problems associated with underwriting risks then, yes j, i agree. regulating certain underwriting prudence is not a boogeyman. Does anyone wonder why the government is always fighting the last war? (I mean, anyone other than Ron, who admits he hasn't - so what?)
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