Mugged by the Moralizers

Gerald · 11-01-10, 10:06 PM

“How many of you people want to pay for your neighbor’s mortgage that has an extra bathroom and can’t pay their bills?” That’s the question CNBC’s Rick Santelli famously asked in 2009, in a rant widely credited with giving birth to the Tea Party movement. It’s a sentiment that resonates not just in America but in much of the world. The tone differs from place to place — listening to a German official denounce deficits, my wife whispered, “We’ll all be handed whips as we leave, so we can flagellate ourselves.” But the message is the same: debt is evil, debtors must pay for their sins, and from now on we all must live within our means.

And that kind of moralizing is the reason we’re mired in a seemingly endless slump.

http://www.nytimes.com/2010/11/01/op...ml?ref=opinion

Note:By PAUL KRUGMAN
Published: October 31, 2010

Buddahaid · 11-02-10, 01:31 AM

I certainly prefer being liquid. Business doesn't like customers acting like businessmen. (bad form, you see)

GoldenRivet · 11-02-10, 08:31 AM

Debt is not a bad thing... So long as it is responsible debt.

At $30K a year you know you can't afford that $270K house but you borrow anyway. That's irresponsible debt.

As a bank, you know theguy doesn't make much money but your willing to give him a break... So you require no downpayment and offer attractive rates. Knowing full well that the mortgage payment alone is worth over 80% of the monthly income... That's irresponsible lending.

Blood_splat · 11-02-10, 08:51 AM

Soon will be able to get loans from Bank of China.

Gerald · 11-02-10, 08:53 AM

Debt, are they most cases the best thing on my own experience, assuming it would not involve major renovation items or luktrativ investment, and you get a good settlement with the bank as it is to gain..

Penguin · 11-02-10, 04:39 PM

I don't make debts - the only exceptions being a pub visit or when buying real estate. Can't afford something? Tough ****, either save or buy something cheaper or used. The only winners in this debt game are the banks.
I expect the same from my government - of course without my personal exceptions. Wait, maybe a visit to the pub would do them good

.

Gerald · 11-02-10, 04:49 PM

Do you think it is better to buy or borrow on credit?

August · 11-02-10, 07:30 PM

Quote:

Originally Posted by GoldenRivet

Debt is not a bad thing... So long as it is responsible debt.

At $30K a year you know you can't afford that $270K house but you borrow anyway. That's irresponsible debt.

As a bank, you know theguy doesn't make much money but your willing to give him a break... So you require no downpayment and offer attractive rates. Knowing full well that the mortgage payment alone is worth over 80% of the monthly income... That's irresponsible lending.

Well I could understand if not forgive a buyer not understanding all the ramifications of what they're getting into. The sheer amount of paperwork generated by a mortgage is pretty daunting.

The bank on the other hand knew exactly what it was doing. They were granting those loans because they intended to sell the notes to someone else before the buyer inevitably defaulted. That's more than irresponsible, it's predatory imo.

11-01-10, 10:06 PM	#1
Gerald SUBSIM Newsman Join Date: May 2008 Location: Close to sea Posts: 24,254 Downloads: 553 Uploads: 0	Mugged by the Moralizers “How many of you people want to pay for your neighbor’s mortgage that has an extra bathroom and can’t pay their bills?” That’s the question CNBC’s Rick Santelli famously asked in 2009, in a rant widely credited with giving birth to the Tea Party movement. It’s a sentiment that resonates not just in America but in much of the world. The tone differs from place to place — listening to a German official denounce deficits, my wife whispered, “We’ll all be handed whips as we leave, so we can flagellate ourselves.” But the message is the same: debt is evil, debtors must pay for their sins, and from now on we all must live within our means. And that kind of moralizing is the reason we’re mired in a seemingly endless slump. http://www.nytimes.com/2010/11/01/op...ml?ref=opinion Note:By PAUL KRUGMAN Published: October 31, 2010 __________________ Nothing in life is to be feard,it is only to be understood. Marie Curie

11-02-10, 01:31 AM	#2
Buddahaid Shark above Space Chicken Join Date: Jun 2008 Posts: 9,319 Downloads: 162 Uploads: 0	I certainly prefer being liquid. Business doesn't like customers acting like businessmen. (bad form, you see) __________________ "However vast the darkness, we must provide our own light." Stanley Kubrick "Tomorrow belongs to those who can hear it coming." David Bowie

11-02-10, 08:31 AM	#3
GoldenRivet Subsim Aviator Join Date: Mar 2007 Location: Texas Posts: 8,726 Downloads: 146 Uploads: 0	Debt is not a bad thing... So long as it is responsible debt. At $30K a year you know you can't afford that $270K house but you borrow anyway. That's irresponsible debt. As a bank, you know theguy doesn't make much money but your willing to give him a break... So you require no downpayment and offer attractive rates. Knowing full well that the mortgage payment alone is worth over 80% of the monthly income... That's irresponsible lending. __________________

11-02-10, 08:53 AM	#5
Gerald SUBSIM Newsman Join Date: May 2008 Location: Close to sea Posts: 24,254 Downloads: 553 Uploads: 0	Debt, are they most cases the best thing on my own experience, assuming it would not involve major renovation items or luktrativ investment, and you get a good settlement with the bank as it is to gain.. __________________ Nothing in life is to be feard,it is only to be understood. Marie Curie

11-02-10, 04:49 PM	#7
Gerald SUBSIM Newsman Join Date: May 2008 Location: Close to sea Posts: 24,254 Downloads: 553 Uploads: 0	Do you think it is better to buy or borrow on credit? __________________ Nothing in life is to be feard,it is only to be understood. Marie Curie

11-02-10, 08:51 AM	#4
Blood_splat Samurai Navy Join Date: Aug 2006 Location: Beneath the waves Posts: 568 Downloads: 20 Uploads: 0	Soon will be able to get loans from Bank of China.

11-02-10, 04:39 PM	#6
Penguin Ocean Warrior Join Date: Mar 2010 Location: Rheinische Republik Posts: 3,322 Downloads: 92 Uploads: 0	I don't make debts - the only exceptions being a pub visit or when buying real estate. Can't afford something? Tough ****, either save or buy something cheaper or used. The only winners in this debt game are the banks. I expect the same from my government - of course without my personal exceptions. Wait, maybe a visit to the pub would do them good .