Mike Shedlock points out the complete idiocy of Keynesian worshipping economists like Mark Zandi. How can idiots like this be given a platform in the MSM for some of the dumbest fucking ideas ever conceived. These nitwits and morons want to take YOUR MONEY and funnel it to underwater home occupiers without verifying the income of borrowers and the appraised value of the houses being refinanced. Isn’t that special. Hmm. Where did I see that used as a policy before? Oh yeah. Between 2004 and 2007 by the Wall Street criminal banks. This policy blew up the fucking world financial system. Zandi and his ilk are intellectually corrupt and must be getting paid off by Obama’s minions to peddle this bullshit. Enough is enough!!!
If you see this Zandi jackwagon on any MSM station, just change the channel. He’s proven himself to be an asswipe.
Zandi Loses His Mind (Assuming He Ever Had One)
I have really had it will bailouts, all of them, but especially bailouts that come at with a huge cost to taxpayers.
The latest heap of Keynesian clown bailout madness comes from economist Mark Zandi on how to jump-start HARP (Obama’s Home Affordable Refinance Program).
Please consider Experts back expanding Obama mortgage refi effort
At issue is the White House’s Home Affordable Refinance Program, or HARP, which has seeks to provide refinancing options to millions of underwater borrowers who have no equity in their homes as long as their mortgage is backed by Fannie Mae and Freddie Mac, the government-controlled housing giants.
“Jump-starting HARP requires that Fannie and Freddie not charge add-on rates, even for refinancing borrowers who have lost a lot of equity in their homes or have relatively low credit scores,” said Mark Zandi, the chief economist of Moody’s Analytics.
As it stands now, the HARP program only allows borrowers to refinance at current low interest rates into a mortgage that is at most 25% more than their home’s current value.
David Stevens, president of the Mortgage Bankers Association, acknowledged that allowing borrowers who are even more underwater, that is they owe even more than that cap, to participate would enable more qualified borrowers to refinance.
Zandi made additional suggestions, including proposing that Fannie and Freddie could forgo borrower income verification and detailed home appraisals to keep costs down.
As of June, roughly 840,000 borrowers have refinanced their mortgages through HARP. However, RealtyTrac reports that about 16 million of the 40 million U.S. mortgages are underwater.
According to CoreLogic, the number of mortgages that are 25% or more underwater is 4.6 million and the number that is 50% or more is 2.3 million
Look at the self-serving circular thinking of David Stevens, president of the Mortgage Bankers Association who acknowledged that including borrowers who are even more underwater “would enable more qualified borrowers to refinance”. Of course it would. Loosen standards and more qualify for loans, by definition.
You can temporarily jump-start nearly anything if you throw enough money at it, and that is exactly what Keynesian clown fools want to do. Unfortunately, no amount of taxpayer money is too great for any cause any fool believes in.
Common sense dictates (and history proves), losses accelerate as you loosen standards. Forgo income verification and ignore credit scores as Zandi proposes and losses would soar.
It is ludicrous to propose loan modifications to those with no job or no income, and those significantly upside down on their mortgage. The former cannot afford any payment and history proves the latter will walk away anyway.
No income and no verification liar loans are among the reasons we are in this mess in the first place. Thus, Zandi clearly has a short memory, if any memory at all, coupled with no common sense whatsoever.
The best way to “jump-start” housing is to let the market find a bottom. Once prices get sufficiently low, investors and buyers will step in. Meanwhile, any steps that artificially prop up prices and postpone foreclosures at taxpayer expense will delay the bottom in housing, delay household formation, and delay a jobs recovery as well.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Hope@ZeroKelvin says:
I heard this Zandi guy speaking on “morning briefing” on the POTUS channel at 0-dark-thirty this morning. Almost lost control of the beemer as my jaw dropped to the level of my accelerator and I had do to a double face palm while wrapping my head in duct tape so it would not explode!!
This guy is a complete idiot!! A dolt, moron, assclown, douchbag, a craven and lickspittle motherfucking LIAR.
I usually don’t start shouting at the radio so early in the morning, but this guy’s completely delusional take on the effect of the stimulus, the overall shape of the economy, Obama’s “jobs saved or created” fiction was so breathtakingly at odds with reality it might as well have been beamed in from Pluto – it was probably broadcasted from (Zandi’s) UR-ANUS, ha ha.
Lordy, lordy, the Obama koolaid DOES cause permanent brain damage among the drinkers, don’t it?
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16th September 2011 at 9:32 am
Stucky says:
America MUST implement the Biblical concept of “Jubilee”. The Year of Jubilee happens every so often and it entails the fogiveness off all debt.
I propose that 2012 be a Mortgage Year of Jubillee. In 2012 wipe out EVERY mortgage in America. Yes, the banks will take a loss (tough shit). But, every American with a home would now be rich.
Then in 2013 we could proclaim The Year Of HolyShit We Gots Money!! All homeowners would be required to take a $100,000 Home Equity loan. Consumer spending would soar. Employment would be near 100%. We would have money to invade Uzbekistan. America would be saved.
I have researched this thoroughly and am convinced it will work.
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16th September 2011 at 9:55 am
AKAnon says:
“The best way to “jump-start” housing is to let the market find a bottom. Once prices get sufficiently low, investors and buyers will step in.” The problem with this statement is that (from libtards perspective) the WRONG investors and buyers will step in. The intent is not to sell homes or “save” mortgages, it is to put/keep folks who can’t afford homes in their own homes anyway. Let’s face it, if he could (and who says he won’t try?), Obama would GIVE the FSA their own houses.
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16th September 2011 at 10:29 am
Smokey says:
“I have researched this thoroughly and am convinced it would work.”
ROFLMAOPIMP
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16th September 2011 at 11:17 am
TeresaE says:
How is it we are having this conversation.
According to my fearless leader, this was all taken care of last year – you know, when housing hit bottom.
All I know is that something will “be done.”
This “solution” will fuck things up worse and losers that don’t understand what it means to sign a contract, or make a bad business decisions, will get something taken from the rest of us.
And, my house will still be underwater, my mortgage still high plus I’ll get the added benefit of being one of the idiots left trying to earn my keep in this country.
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16th September 2011 at 11:23 am
johnnyboy says:
I just learned this a few days ago…Asswipe in Italian is “Stronzetta”. I learned that the hard way.
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16th September 2011 at 11:33 am
KaD says:
Stucky; there’s a reason the Isrealites were able to survive as long as they have while nations fell; they operate as a tribe (many tribal people have existed comfortably and continuously for 10000 years) whereas most nations operate on a city/state/empire model; which always fails at some point. Yes, the Jubliee was the year after 7 cycles of 7 years (every 50 years). The seven year cycle was used in farming; every seventh year the field was left fallow so the soil had a chance to regenerate and was not used up to the point of not being able to grow anything. This kept their agriculture viable over the long term. On the Jubilee all debt was forgiven and all slaves were freed. This had the effect of equalizing the economy so it wouldn’t get to the point of a few people being obscenely wealthy while the rest had nothing. This kept their economy viable over the long term. There’s a better explanation of this here: http://www.amazon.com/Last-Hours-Ancient-Sunlight-Revised/dp/1400051576/ref=sr_1_1?s=books&ie=UTF8&qid=1316187340&sr=1-1
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16th September 2011 at 11:36 am
Welshman says:
Stucky,
That diet is working wonders on your synapses. Jubiell 2012 mortgage forgiveness is your brainchild. 2013 equity home loan would be a tremendous stimulas infusion, and now if you can come forward with two Saudi Abria oil reserves, thing will be back to normal. The empire would be in overdrive and we can shut down TBP as not needed any longer.
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16th September 2011 at 2:59 pm
Stucky says:
I am delighted that my suggestion is appealing to some of you.
KaD — there is evidence whatsoever that the Jews actually ever celebrated the Year of Jubliee. A Jew … forgiving debts?? You gotta be fuckin kidding me. I think G-d was just playing a practical joke.
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16th September 2011 at 4:23 pm
Stucky says:
Oops. That should be —- “there is NO evidence ..”
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16th September 2011 at 4:24 pm
Opinionated Bloviator says:
“These nitwits and morons want to take YOUR MONEY and funnel it to underwater home occupiers without verifying the income of borrowers and the appraised value of the houses being refinanced.”
How else will the Wall Street banks be made whole from the now subprime mortgages still festering on their books? They after all Too Big To Fail.
Look at their Tier 1 capital, it’s a fucking disaster zone even with “mark to unicorn” ponzi accounting, the strategic defaults and implosion in housing prices is literally killing them, this solves all the problems, a floor is placed under real estate to stop the valuation hemorrhage and the title/legal issues resulting from forged signatures and fake contracts printed out of thin air to steal houses from under the owners feet are magically washed away with new paperwork.
As an added bonus, the refi’s are now FULL RECOURSE and CANNOT be discharged by bankruptcy, so if the bozo’s refinancing lose their job they will also enjoy the privilege of living under a bridge and eating out of dumpsters when the banks strip them of every last cent they have to their name, including 401k’s.
The end result is the public pays Wall Street a huge premium to steal not only the remains of their net worth but the roof over their heads as well.
This is how it should be – SERFS only exist to work the land/capital, ownership is restricted to their Ruling Class Masters such as Wall Street Banks, Congress and the Obama Administration.
Hoax and Chains you can believe in – literally…
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16th September 2011 at 9:05 pm
Anonymous says:
Mark Zandi is a sychophant ass-kisser, I have met him, listened to him, and he knows “all” the answers! Like the guy with “all” the pick up lines, but still cant get a date! Complete fraud!
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16th September 2011 at 5:36 pm
CJ says:
Fast forward in time… the government is refinancing underwater “homeowners” (really debt slaves with underwater assets) without verifying income or appraisals.
Mark Zandi the asswipe wins again.
He was on CNBC this morning sounding like king of all asswipes.
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16th September 2011 at 1:18 pm