Q&A: Is “Credit Crisis” For Real?

Posted on Sep 19, 2012 in Unique Loan Programs

Question by Peter C: Home Affordable Modification Program (HAMP).?
I am considering refinancing through the HAMP.
http://www.makinghomeaffordable.gov/

I am looking for downsides. For example will I be locked into staying in the home for some time period? Will there be any tax impact like having to pay income tax on part of the benefit?
Any other downsides not in the FAQ

Thanks

Pete

Best answer:

Answer by v b
http://www.irs.gov/irb/2009-28_IRB/ar06.html

What do you think? Answer below!
Question by stevkaprel: Is “Credit Crisis” For Real?
Is the reported credit/liquidity crisis just another phony “weapons of mass destruction” ploy being used to manipulate the public into a hidden agenda?

I don’t have the answer. But I listen to and read the news and surf the internet and come up empty on this question (unless you put stock in endless, buy unsubstantiated assertions or think that the stock market and liquidity are synonymous).

I’m not talking about the credit crisis confronting financial firms which have recklessly gambled their and their clients’ money and lost. I’m talking about the man on the street and sound, cialis 40mg well managed businesses.

You would think that if the crisis exists, information pills interest rates would be up. However, home mortgage rates are still at historical lows and they, as well as investment grade corporate bond rates, have not dramatically increased (1).

You would also think that business bankruptcies would be up but that does not appear to be the case (2).

I’m not really familiar with M1, the government’s money supply statistic, but that also does not appear to have declined (3).

As I say, I don’t have the answer. But just assume that there really is a credit crisis. Why in the world would you relieve it by taking the questionable assets off the hands of the improvident (and, as a result, empty pocketed) firms that created the crisis and assume that their renewed prosperity would “trickle down” and the world would be back to normal.

Why not, instead, take the same $ 700 billion and make it available for borrowing directly by the man on the street and well managed businesses who have had a hard time finding it elsewhere? It’s not like the government doesn’t know how to lend money where it will do good, e.g. student loans, small business loans, FHA housing loans.

Lax oversight and laissez faire carried to the extreme let the wolves in the chicken coop. So what does the government propose to do? Feed the wolves more chickens.

(1)
http://www.federalreserve.gov/releases/h15/data.htm

(2) http://www.abiworld.org/AM/Template.cfm?Section=Business_Bankruptcy _Filings1&Template=/TaggedPage/TaggedPageDisplay.cfm&TPLID=59&
ContentID=36301

(3)
http://www.federalreserve.gov/releases/h6/current/

Best answer:

Answer by Tobias B
I think it’s for real , yeah

we’ve seen nothing like this for a long time

since the South Sea bubble?

Add your own answer in the comments!

4avg.rating 23 votes.

One Comment

  1. No its all an illusion