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scooterbug44

SoWal Expert

I am starting to feel Amish or something whenever I read these articles.
 
Was I just raised completely out-of-touch and old fashioned with the idea that you're supposed to be able to pay for what you're buying?
 
And that wealthy means you AREN'T in financial straits? :idontno:

I am starting to feel Amish or something whenever I read these articles. 
 
Was I just raised completely out-of-touch and old fashioned with the idea that you&#039;re supposed to be able to pay for what you&#039;re buying? 
 
And that wealthy means you AREN&#039;T in financial straits? :idontno:

SHELLY

SoWal Insider

'You only find out who is swimming naked when the tide goes out' ? Warren Buffett


.

&#039;You only find out who is swimming naked when the tide goes out&#039; ? Warren Buffett 
 
 
.

[quote="scooterbug44, post: 345618"]I am starting to feel Amish or something whenever I read these articles.
 
Was I just raised completely out-of-touch and old fashioned with the idea that you're supposed to be able to pay for what you're buying?
 
And that wealthy means you AREN'T in financial straits? :idontno:[/QUOTE]

[url]http://www.chron.com/disp/story.mpl/business/steffy/5458539.html[/url]

[SIZE="3"][B]Wake-up call's for us all[/B][/SIZE]

By LOREN STEFFY
Houston Chronicle 

The phone's ringing. It's for us.

This week, wake-up calls came for just about everyone who wallowed in the carefree money of the past few years.

On Wall Street, it was in the form of Citigroup's announcement Tuesday that it would book an $18 billion loss from investments in subprime mortgages.

Citi may lead the bad-debt parade, but Merrill Lynch is just a few steps behind, facing a write-down that analysts estimate will be as much as $15 billion.

At the time it was sold, the now-worthless paper dragging down Citi, Merrill and their banking brethren seemed like innovation. Bankers, borrowers and lenders all believed that they'd found a way to expunge risk and make houses — or "the American dream of homeownership" — available to those who couldn't actually afford them.

Blind faith led to foolishness and foreclosure.

The phone's ringing for retailers, too. Stores from Circuit City to Sears have reported dismal fourth-quarter results as the consumer spendathon that's been driving our economy fades. The Sears-Kmart merger, hyped as proof of private equity investor Eddie Lampert's genius, is languishing.

The only one still buying it is Lampert himself. Under his leadership, Sears has repurchased about $1.5 billion worth of its own stock as its shares have tanked during the past two quarters.


[B]Not just banks, retailers[/B]

The wake-up calls don't end with Wall Street banks or Main Street retailers, though. Nor does the phone ring just for this quarter amid dismal corporate results or just this year as consumer spending wanes, housing collapses, jobs evaporate and recession looms.

It rings for the future of America itself.

On Monday, Moody's Investors Service, one of the credit-rating agencies that blessed those pungent loans that now beleaguer Citi and Merrill, warned that the U.S. could lose its triple-A credit rating within a decade.

That's a wake-up call for the rest of us.

We are addicted to spending. We buy based on want rather than need or ability. The bills are a worry for later, a someday that we postpone like a dentist appointment.

We bought our houses this way, and we've run our government this way.

Our banks struggle with the consequences of our addiction now; our children will struggle with it later. Stuck with the tab for our careless abandon, they may have to sacrifice their own living standard to pay for ours.


[B]Consequences of debt[/B]

As a country, our credit rating has remained impeccable since it was first assessed in 1917, the Financial Times reported this week. Through one world war and part of another, through a depression, through two oil crises, through the lingering threat of nuclear annihilation, it never wavered.

Now, it teeters because of our thirst for debt. As I wrote a couple of weeks ago, spending on entitlement programs such as Social Security and Medicare will rise by $100 billion this year.

Additional spending increases will bring the total to $190 billion, a 7 percent hike from last year. Similar increases are projected for each year during the next decade, according to the Congressional Budget Office.

With each tick upward, a tiny piece of America's financial supremacy chips away.

The office forecasts that the government will bring in more than it spends beginning in four years, but in reality, that's fantasy. Already our politicians talk of more — more tax cuts, more spending increases, more of the same borrow-and-spend mentality that's dug this hole during the past seven years.

Interest payments on our national debt will increase to more than $250 billion this year. By 2012, assuming no more spending increases, it will reach $292 billion.


[B]Best financing costs[/B]

As staggering as that number is, it's the result of the best possible financing costs. Lower the credit rating and our cost of borrowing will increase even more rapidly.

Our political leaders ignore the problem. The phone rings unanswered for lack of political will.

We are left to wrestle with the sheer bigness of the numbers that now befall us. How, we may wonder, can the country's biggest bank report an $18 billion loss from debt it overvalued that was backed by mortgages that were poorly collateralized and sold to people buying houses they couldn't afford?

Unfortunately, it was all too easy. But the easy money is over.

The phone is ringing. It's our wake-up call.

<blockquote class="xfBb-quote" data-name="scooterbug44">I am starting to feel Amish or something whenever I read these articles. 
 
Was I just raised completely out-of-touch and old fashioned with the idea that you&#039;re supposed to be able to pay for what you&#039;re buying? 
 
And that wealthy means you AREN&#039;T in financial straits? :idontno:</blockquote> 
<a href="http://www.chron.com/disp/story.mpl/business/steffy/5458539.html" target="_blank" class="link link--external" rel="nofollow ugc noopener">http://www.chron.com/disp/story.mpl/business/steffy/5458539.html</a> 
 
Wake-up call&#039;s for us all 
 
By LOREN STEFFY 
Houston Chronicle 
 
The phone&#039;s ringing. It&#039;s for us. 
 
This week, wake-up calls came for just about everyone who wallowed in the carefree money of the past few years. 
 
On Wall Street, it was in the form of Citigroup&#039;s announcement Tuesday that it would book an $18 billion loss from investments in subprime mortgages. 
 
Citi may lead the bad-debt parade, but Merrill Lynch is just a few steps behind, facing a write-down that analysts estimate will be as much as $15 billion. 
 
At the time it was sold, the now-worthless paper dragging down Citi, Merrill and their banking brethren seemed like innovation. Bankers, borrowers and lenders all believed that they&#039;d found a way to expunge risk and make houses — or &quot;the American dream of homeownership&quot; — available to those who couldn&#039;t actually afford them. 
 
Blind faith led to foolishness and foreclosure. 
 
The phone&#039;s ringing for retailers, too. Stores from Circuit City to Sears have reported dismal fourth-quarter results as the consumer spendathon that&#039;s been driving our economy fades. The Sears-Kmart merger, hyped as proof of private equity investor Eddie Lampert&#039;s genius, is languishing. 
 
The only one still buying it is Lampert himself. Under his leadership, Sears has repurchased about $1.5 billion worth of its own stock as its shares have tanked during the past two quarters. 
 
 
Not just banks, retailers 
 
The wake-up calls don&#039;t end with Wall Street banks or Main Street retailers, though. Nor does the phone ring just for this quarter amid dismal corporate results or just this year as consumer spending wanes, housing collapses, jobs evaporate and recession looms. 
 
It rings for the future of America itself. 
 
On Monday, Moody&#039;s Investors Service, one of the credit-rating agencies that blessed those pungent loans that now beleaguer Citi and Merrill, warned that the U.S. could lose its triple-A credit rating within a decade. 
 
That&#039;s a wake-up call for the rest of us. 
 
We are addicted to spending. We buy based on want rather than need or ability. The bills are a worry for later, a someday that we postpone like a dentist appointment. 
 
We bought our houses this way, and we&#039;ve run our government this way. 
 
Our banks struggle with the consequences of our addiction now; our children will struggle with it later. Stuck with the tab for our careless abandon, they may have to sacrifice their own living standard to pay for ours. 
 
 
Consequences of debt 
 
As a country, our credit rating has remained impeccable since it was first assessed in 1917, the Financial Times reported this week. Through one world war and part of another, through a depression, through two oil crises, through the lingering threat of nuclear annihilation, it never wavered. 
 
Now, it teeters because of our thirst for debt. As I wrote a couple of weeks ago, spending on entitlement programs such as Social Security and Medicare will rise by $100 billion this year. 
 
Additional spending increases will bring the total to $190 billion, a 7 percent hike from last year. Similar increases are projected for each year during the next decade, according to the Congressional Budget Office. 
 
With each tick upward, a tiny piece of America&#039;s financial supremacy chips away. 
 
The office forecasts that the government will bring in more than it spends beginning in four years, but in reality, that&#039;s fantasy. Already our politicians talk of more — more tax cuts, more spending increases, more of the same borrow-and-spend mentality that&#039;s dug this hole during the past seven years. 
 
Interest payments on our national debt will increase to more than $250 billion this year. By 2012, assuming no more spending increases, it will reach $292 billion. 
 
 
Best financing costs 
 
As staggering as that number is, it&#039;s the result of the best possible financing costs. Lower the credit rating and our cost of borrowing will increase even more rapidly. 
 
Our political leaders ignore the problem. The phone rings unanswered for lack of political will. 
 
We are left to wrestle with the sheer bigness of the numbers that now befall us. How, we may wonder, can the country&#039;s biggest bank report an $18 billion loss from debt it overvalued that was backed by mortgages that were poorly collateralized and sold to people buying houses they couldn&#039;t afford? 
 
Unfortunately, it was all too easy. But the easy money is over. 
 
The phone is ringing. It&#039;s our wake-up call.

Busta Hustle

Beach Fanatic

actually Skunky that article is a year and a half behind reality...we've had upside down sales in some of the nicest neighborhoods since 2006.

actually Skunky that article is a year and a half behind reality...we&#039;ve had upside down sales in some of the nicest neighborhoods since 2006.

30A Skunkape

Skunky

[url]http://www.reuters.com/article/inDepthNews/idUSN1530426720080117?feedType=RSS&feedName=inDepthNews&rpc=22&sp=true[/url]

<a href="http://www.reuters.com/article/inDepthNews/idUSN1530426720080117?feedType=RSS&amp;feedName=inDepthNews&amp;rpc=22&amp;sp=true" target="_blank" class="link link--external" rel="nofollow ugc noopener">http://www.reuters.com/article/inDe...dType=RSS&amp;feedName=inDepthNews&amp;rpc=22&amp;sp=true</a>

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Cars of 30A At Alys Beach: Event Highlights & Photo Gallery

Sixth annual Run Watersound At Watersound Town Center October 24, 2026

Support Our Parks: The 2026 Friends of Camp Helen Pumpkin Patch Is Open

Annual Events and Festivals in South Walton