I find it pretty amazing that they can have so much loss from bad debt. CEOs and other executives get paid all these millions and they still make fundamental blunders like that? And for those of us working to pay off debts, how does it make you feel to see so many people just get to write theirs off? Sure, it comes with a lot of pain, I'm sure, but it still seems like we are heavily subsidizing people who made bad decisions, whether through the stock market crashing or public bailouts and stimulus packages being tossed around frantically in DC right now.
So do you feel sorry for BoA, Chase, Citigroup, etc.?
January 18th, 2008 at 10:42 am
January 18th, 2008 at 10:51 am 1200653478
}}}scrapes juice out of the last of the tuna we've had to eat all week*...
NOOOOOOOOOOOOOOOOOOOOOOOOO!!!!!!
{{{{/scraping
*just kidding, sort of!
January 18th, 2008 at 11:09 am 1200654591
January 18th, 2008 at 01:05 pm 1200661515
To be fair, everybody in the financial sector did though. Some just managed to recover better than others. That and it's over some exotic debt instruments that obviously didn't pan out. Perhaps there's a life lesson in there somewhere.
January 18th, 2008 at 01:42 pm 1200663726
One couple mentioned in MONEY this month is on the verge of losing their home. They owe $550,000 on the mortgage (the original amount wasn't given). They earn just $120,000. $4,100/month of their $6,000 take-home pay goes to housing payments. So both parties screwed up. The bank had no business making that loan and the couple had no business taking it. How did anyone expect them to be able to live with nearly 70% of their income going to pay the mortgage? They shouldn't have bought a home for more than about $360,000, maybe $400,000 tops, and any loan beyond that should never have been approved.
So no, I don't have much sympathy.
January 18th, 2008 at 01:54 pm 1200664496
What I beleive led to this was such pressure for higher returns in a low rate environment. You want 7% rates on mortgages, we need to have banks loan to riskier people. Hence higher returns on bond funds, when things are going good.
I don't feel bad for the companies but I do feel bad for for the people who invest in mutual funds.
January 18th, 2008 at 05:37 pm 1200677838
January 18th, 2008 at 05:38 pm 1200677938
If any of you watch / have seen the show on HGTV called House Hunters you will know how true what he said really is.
It annoys the crap out of me to hear/see 20-somethings, newly married, NO kids . . . yet they need at least 4 bedrooms,(1 for them, 1 for guests and then they each need their own office @@ - - God forbid what's going to happen if/when they have a kid or 2 or more) 3 full bathrooms . . . and 3000 square feet to live in . . . W T H?!!!?
They currently live in a 3-bedroom, 2 bathroom, 2000 square foot house but simply don't have any space. @@
And 9 times out of 10, the couples in question choose the most expensive house and/or the one that is the most over their "budget." @@ OY!
January 18th, 2008 at 06:54 pm 1200682464
January 18th, 2008 at 08:40 pm 1200688807
The reason I don't feel sorry for the financial companies is not because they 'screw people over' as some claim, but because they got just as greedy as the borrowers themselves. However, these companies are so big that they'll probably survive, and it's also in the interest of the American economy that they do survive. On the other hand, the borrower will have a much harder time surviving. So if you ask me, I feel more sympathy for the borrower, but I also feel they are more at fault than the lender companies.
January 18th, 2008 at 09:52 pm 1200693133