Frank Louis
Somebody, please tell me why! (Housing crisis: no end in sight)
By Frank Louis
August 31, 2010


I am sorry, but what stability are they talking about? The housing sector is now, at this moment, at its worst in 30 years and getting worse, a possible double dip in housing values, and there is more talk of a new (also destined to fail) homebuyer tax credit. This new, even dumber, plan is to have the government (us) fund mortgages for more that a home's current value. Why, to make people slaves? I mean, really now! Oh yeah, there is the unemployment issue as well. Should I go on?

Tonight, I was watching (and listening) to Larry Kudlow on CNBC and he made a good comment. He said let free market capitalism correct the housing problem. I agree. Get the government out once and for all. The money they allocate is ours in the first place. But the government was in this crisis from the on slot so they need to give us our money back first. Then get out. The TARP and stimulus funds should be used to repay Americans the money stolen from them in this housing crisis; not to continue paying the banks the fraudulent balances due on them.

But, Larry, there is not going to be anyone left to buy anything. Don't you get it either? About 100 million people have lost their life savings and owe more for their homes than they are or will be worth. These are not the regular suspects who were on the dole from the beginning. These are people who were hard working, long saving, and investing, good credit score folks until now. These are not folks with big credit card debt. They were the free market capitalists. They are now in big debt, perhaps foreclosure, and have low credit scores. Larry, who is going to be left to play "free market capitalism" with you? No one!

Here is the scheme: The government takes our money in the form of taxes; gives it to the banks to lend back to us on our upside down in value property so we can stay in debt for the rest of our lives. Wow, are people that stupid?

And who is going to "qualify" for this money? Surely not anyone who placed 20% down or more.So who? I know, the sub-primes! Ha! I get it; the same people who drove housing prices up with no money down because they were "victims in search of the American Dream" will now take out these new loans as well. The banks will get the money and property values will still be upside down and going lower still. If this is to whom these programs are addressed, then the answer to my previous question is unequivocally "yes!" People really are that stupid!

Today, on a local radio talk show, I heard a woman (a democrat) running for State Treasurer here being interviewed. She was talking about how important her concept of a "Money School" is. It would help those "disadvantaged" folks. You know, the "under-banked" people who do not bother to balance their checkbooks watch their credit scores, pay their rents, utilities, etc. Well you know these "victims" who are already targeted for over $50 million of our money.

While I do fee sorry for them, they are some of the same people who took out sub-prime no-doc, no-down-payment loans and caused this crisis. Do you know she did not make one mention of the people who were systematically robbed of hundreds of thousands of dollars just because they bought a piece of property in 2005 with a 20% down payment. Are not these people the real "victims?"

For the amount of attention these Americans are getting (which is none except for Frank Louis) they may as well have made a campfire with their money. At least they would have gotten heat and light for an evening with it.

Larry, why don't you address these people? Have some on your show.

By now I am getting to think that this is the plan. The "No solution to the problem" plan. Just exotic and ingenious ways to get the people more in debt and steel our equity more and more. Yes that is the plan: The "Ruin America Plan."

Yes, wealth redistribution. It seems to be a plan not unlike the George Soros "Break the Bank of England on Black Wednesday by betting against the currency plan."The plan that left him a billionaire and left millions of people broke from what I understand. Now, wehear he funds groups the likes of Acorn. Wow.

These new bets are against housing. You know it, I know it. It just can't be fully reported on in 1,000 words. Do your own research then demand your money back if you invested in this real estate fraud thinking you were being dealt fairly by the professionals you hired to sell you the property. Somehow, someone decided to write and sell enough bad loans to bring the standard of Middle America's wealth, their homes, down. I do not think it just happened. The plan worked.

In an Aug 29 article from the Huffington Post, I read that Housing and Urban Development Secretary Shaun Donovan said in an interview on CNN last Sunday that HUD "plans to introduce" an FHA refinancing program to help borrowers whose mortgages exceed the market value of their homes." I can't believe it. And the media reports it with a straight face. "Oh, ... umm... yes " they say.

Mr. Donovan: Why not evaluate the properties for what they are actually really worth, and then write the loans for that? The value that would be realized in a foreclosure or short sale; write the mortgage for that amount. In fact, if the people paid a traditional down payment on this investment in property, give them their down payment back besides. If they have already lost the property, give them their down payment back, clean up their credit score and let them back into the economy. It is called the Short Keep. I write about it often. It is my plan to stop the housing crisis and save our economy. The Short Keep is both necessary and just.

Interviewed on CNN's State of the Nation." Donovan went on to say that the July decline in housing sales was "clearly worse than we expected."

No Way! Who would have guessed? Keep foreclosing and you will not see values go up and I do not think you have to be a rocket scientist to realize this.

Then, I read the small print at the end of the CNN article: "may not be published, broadcast, rewritten, or redistributed as it is copyrighted material by the Associated Press. What, so now we are not even to talk or write about what these people are doing and planning to do? Makes sense to me. After all, we are not permitted to read House Bills any longer.

This is all about keeping two separate and distinct groups happy: Those on welfare (the 53% we read about that do not pay taxes) who will be in large enough numbers soon to win elections and those in the banking industry who also know how to control the financial environments to keep funds coming their way. The Fed provides the money (taxed from taxpayers) to give the banks so that they do not loose money in these upside down mortgages. Then the bank forecloses on your property. You still owe the loan balance and have to pay the taxes to repay the gov for the money they gave the banks. Go figure!

The simple solution: This nation was founded on Biblical principles. These principles, being rooted in Biblical behavior rely on Biblical principles to work. These "exotic" financing games are not Biblical. They will not work.

"It is impossible to rightly govern the world without God and the Bible" President George Washington, September 17th, 1796. Or try: "Except the Lord build the house, They labor in vain who build it." "I firmly believe this." Benjamin Franklin, 1787, Constitutional Convention

No wonder nobody at the Jackson Hole Conference last week could figure it out. They read the wrong stuff and, they would be putting themselves out of a job.

© Frank Louis


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Frank Louis

Frank Louis is a print and on-air commentator who offers opinions and solutions on and for the economy, social issues, and the future of this nation. In the Old Testament, Nehemiah 4: 14 instructs us to fight for our houses; something we need to be doing now. Our future generations depend on it!... (more)


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