Fed's N8 bailout

[dante]

so it's good to see that the federal government is finally getting around to tackling the mortgage crises, and helping out those who desperately need it. the poor, impoverished homebuilder. :shocked:

Forty percent of the cost of the bill will fund a business tax break expected to help homebuilders.

http://money.cnn.com/2008/04/02/news/economy/housing_bipartisan_draft/?postversion=2008040322

WTF?? $100m for consulting homeowners on their (lack of) options, but $6 BILLION handed to home builders who made buckets of money in the last 7 years building way too many homes and now are having financial difficulties? And through the entire bill, the aspect that has the affects the greatest number of people is a $1000 property tax deduction for people who don't itemize. Wait a sec, people with mortgages itemize because of the mortgage interest. So this'll only help homeowners with no mortgages. Yup, those are definitely the people who need rescuing, as opposed to people who actually *HAVE* mortgage payments each month.

:rant:

[Echo]

I am not the least bit surprised by this. Our government is so completely out of touch with reality, the only options at this point are either lying down and accepting it, or outright revolution. Either way it's gonna be ugly.

[N8]

I'm laying sideways in the public trough!!!

[$tinkle]

n8 is sure to crack under the cruel yoke of the fed's economic stimulus pkg

[N8]

construction drives the economy!

[N8]

The bill just extends 2 years to the current time for losses under current law...

Not like it's free money.

The bill would allow homebuilders and other firms affected the by the mortgage meltdown, such as investment banks, to use losses in 2008 and 2009 to get back taxes they owed over the previous four years. That's a change from the two years allowed under current tax law.

[Plummit]

construction drives the economy!

All the over-building and buying by developers, builders and speculators drove the economy all right.. Drove it straight down....

[$tinkle]

you'd rather it go to overseas manufacturing or gov't programs?

[Plummit]

you'd rather it go to overseas manufacturing or gov't programs?

I'd rather it go back to taxpayers in the form of broad tax cuts and reduced government spending rather than a bailout for an industry that was pits dip in the action that got us where we are. Seems more and more conservatives want "private profits and socialized losses," as the pundits on CNBC have been hyping. The free market works when business is free to succeed and free to fail.

If we are going to try and stabilize the housing market by government intervention, seems like we ought to try and keep people in their homes. That would probably result in fewer homes being put on an already back logged market.

Whether you decide to subsidize builders to employ people to continue flooding the market w/ excess capacity or in a farm programs sort of way pay them not to build OR subsidize home owners who got in trouble b/c of greed, stupidity, duplicitous lenders, or all three; the final result is sure to be a lengthened stagnation of housing prices/ longer time frame for recovery in prices as a result of hamstringing the market's ability to solve the problem.

[$tinkle]

see, i agree w/ thisThe free market works when business is free to succeed and free to fail.but not necessarily this:
If we are going to try and stabilize the housing market by government intervention, seems like we ought to try and keep people in their homes. as it sets one standard for business, and another for homeowners.

both these groups are people who made business decisions. signing a mortgage is signing a contract. we wouldn't think it fair if houses were a sure thing for making money & the lenders wanted a "fairer" slice of the pie, no?

[jimmydean]

I think it's a fine line on the bailout. There are people that obviously bought too much house with little or no down and crap credit. Those people are screwed.

But there are also a lot of people that got suckered into thinking they were ok because loan companies forged documents and inflated figures.

The real issue is there is no real way to divide the group of fail. So the GOV is bailing everyone out.

What sucks is it's on my dime and I didn't get to make my own stupid financial decision.

[Plummit]

see, i agree w/ thisbut not necessarily this:
as it sets one standard for business, and another for homeowners.

As would bailing out the builders but not the homeowners.

both these groups are people who made business decisions. signing a mortgage is signing a contract. we wouldn't think it fair if houses were a sure thing for making money & the lenders wanted a "fairer" slice of the pie, no?

Exactly why I said, "if" we are determined to try to stabilize the housing mkt through governmental intervention.

Of course, now that I think about it, handing money to home builders won't reduce the number of layoffs and job cuts or increase the number of homes they build into a soft and bloated mkt. It'll just make the balance sheet more positive to shareholders. Bonuses all 'round.