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Credit for Banks, but not for you. - 11/9/2008 12:49:36 PM   
UncleNasty


Posts: 1108
Joined: 3/20/2004
Status: offline 		From the San Francisco Chronicle relating to banks tightening credit restrictions for businesses and consumers.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/11/06/MNCP13VR15.DTL

These comments of Barney Frank are rather telling to me:

"Increased lending activity is the only legitimate purpose for taxpayer funding of these institutions," Frank declared. "It is very important if congressional and public support for this program is to continue that we receive assurances ... that the money being advanced will be used only for relending and for no other purpose."

View the comments in reverse perspective:

No conditions have been imposed on the recipients whatsoever and they get to use, keep, or spend the money given to them in any way they choose.

I think Rumplestiltskin could probably do a better job than our congress.

Uncle Nasty

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RE: Credit for Banks, but not for you. - 11/9/2008 1:13:20 PM   
pahunkboy


Posts: 33061
Joined: 2/26/2006
From: Central Pennsylvania
Status: offline 		Dear bank,

A fool and his money are soon parted.

Ahahahaha!

HA HA HA HA!

(in reply to UncleNasty)
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RE: Credit for Banks, but not for you. - 11/9/2008 1:17:37 PM   
LadyEllen


Posts: 10931
Joined: 6/30/2006
From: Stourport-England
Status: offline 		I believe the bail out over here was conditional on lending being to the same levels as last year - except its not. Question is, what are the govt going to do about it when the banks know they have us all over a barrel and dont need lube to fuck us any which way they want?

Interestingly though, my bank recently lent me funds sufficient to pay off my credit card debt - at half the card interest rate. This is good for me, but also good for the banks - they can show that they are lending and they just reduced their possible losses should I not be able to repay, so strengthening their position, whilst not actually having lent a penny.

E

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RE: Credit for Banks, but not for you. - 11/9/2008 2:33:16 PM   
Musicmystery


Posts: 30259
Joined: 3/14/2005
Status: offline 		This is why calmer heads are proposing investing in infrastructure projects--which definitely need attention--as banks are still nervous about lending and wary consumers will tend to save. Government projects will get the money out and create jobs.

The banks won't sit forever, though. Waiting costs them money, and as soon as they feel safe, they'll loan--and consumers will spend.

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RE: Credit for Banks, but not for you. - 11/9/2008 3:35:09 PM   
Lorr47


Posts: 862
Joined: 3/13/2007
Status: offline 		I think Moyers had a man on his show Friday night who was very upset about how the banks were acting.  First, the banks created the atmosphere of fear that the sky was falling to get the money and then used the money for dividends, officers' salaries and basically everything but loans.  He was actively requesting sanctions.  For once Barney Frank may be screaming about something that has merit.

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RE: Credit for Banks, but not for you. - 11/10/2008 6:53:40 AM   
cjan


Posts: 3513
Joined: 2/21/2008
Status: offline 		I'm shocked that the media aren't all over this. I was for the "bailout", but thought that the bill provided congressional oversight for how the money was to be disbursed and used . Apperently, this has not been the case. The banks are using the money primarily for acquisitions and have no intention of loaning it out to business or individuals, thereby defeating the purpose.

Here's a recent story in the NYT regarding what JP Morgan intends to do with $25B it has received in bailout funds.
http://www.nytimes.com/2008/10/25/business/25nocera.html?_r=1&oref=slogin

What's infuriating is that this is being done with the full knowledge and support of the Treasury and the current administration. That's why Paulson wanted no oversight or transparency right from the beginning. I'm mad as hell. Where is the media coverage? Where is Congress ? They know what's going on too.


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" When you look into the abyss, the abyss also looks in to you"- Frank Nitti



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RE: Credit for Banks, but not for you. - 11/10/2008 7:08:10 AM   
subfever


Posts: 2895
Joined: 5/22/2004
Status: offline 		Since when could you count on Congress to stop the plunder and rape of the of the people?

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RE: Credit for Banks, but not for you. - 11/10/2008 7:10:05 AM   
subfever


Posts: 2895
Joined: 5/22/2004
Status: offline 		... and ditto for the banksters too.

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RE: Credit for Banks, but not for you. - 11/10/2008 7:10:37 AM   
meatcleaver


Posts: 9030
Joined: 3/13/2006
Status: offline 		Give someone a get out of jail free card, they're going to use it.

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RE: Credit for Banks, but not for you. - 11/10/2008 7:28:11 AM   
UncleNasty


Posts: 1108
Joined: 3/20/2004
Status: offline 		Why is it we aren't taking up rakes, pitchforks and torches?

Uncle Nasty

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RE: Credit for Banks, but not for you. - 11/10/2008 7:51:31 AM   
LadyEllen


Posts: 10931
Joined: 6/30/2006
From: Stourport-England
Status: offline 		because our card limits have been curtailed UN; we cant afford these things any more

E

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RE: Credit for Banks, but not for you. - 11/10/2008 8:12:45 AM   
cjan


Posts: 3513
Joined: 2/21/2008
Status: offline
quote:

ORIGINAL: UncleNasty

Why is it we aren't taking up rakes, pitchforks and torches?

Uncle Nasty


Exactly. And why are the media mostly silent ? Where are Pelosi, Frank, and Reid ? Was this all just a dog and pony show with both parties fully knowing what was going to happen ? it sure looks that way.Where's Obama on this issue, btw ? Not a peep.


_____________________________

"I never saw a wild thing sorry for itself. A bird will fall ,frozen , dead, from a bough without ever having felt sorry for itself."- D.H. L

" When you look into the abyss, the abyss also looks in to you"- Frank Nitti



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RE: Credit for Banks, but not for you. - 11/10/2008 9:20:04 AM   
UncleNasty


Posts: 1108
Joined: 3/20/2004
Status: offline 		I believe Obama voted for the initial bailout package. I say initial intentionally as I knew from the outset that it would only be the beginning.

Remember, the government has no money of their own. They take it from you and then give it to the folks they want to have it. What part of this do some manage to view as being different than a redistribution of wealth?

Uncle Nasty

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RE: Credit for Banks, but not for you. - 11/10/2008 9:30:34 AM   
MadRabbit


Posts: 3460
Joined: 8/9/2006
Status: offline 		Either I am extremely lucky or just not seeing it, but so far I have yet to experience any of the effects of this credit crunch. I am also a bit baffled at the constant references to it in the media, but very few testimonies to back it up.
  • My credit union is still lending money in accordance with standards tightened back to normal regulations.
  • I talked to a friend/buisness owner the other night and the five banks he deals with are all still lending money, 2 of them providing 100%, no money down loans.
  • I received my student loan money for the spring semester with no issue (I purposefully when through the state lender and not Wachovia)
  • My buddy who makes in low 30, high 20's income bracket recently signed a car loan for a 13,000 vehicle that he can't afford with only 1000 dollars down and no co-signer.


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Obama is NOT the Messiah! He's just a VERY NAUGHTY BOY

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RE: Credit for Banks, but not for you. - 11/10/2008 11:20:01 AM   
popeye1250


Posts: 18104
Joined: 1/27/2006
From: New Hampshire
Status: offline 		Today is the 10th of November (Happy Birthday USMC!)
I can almost garauntee you that on or about Dec 1st the banks will start lending again.
Maybe before then.
It's the Christmas season starting up and they sure don't want to miss out on all that business!
I know one guy who is planning on buying his wife a $1,400 fancy refridgerator for Christmas. (Lucky her; she's been throwing "hints" and what the wifey wants she gets!) (shhhhh!)
I'm going to be spending a few bucks this Christmas as well, moreso than usual.
And, a lot of people have been paying off their credit card balances during the last year or so and not buying so there's a lot of pent up demand out there!
In Feb I owed $3,500 on one of my cards and it's now down to about $400.
Yee Hah! That'll probably be back up to $2,000 by Christmas.
And, I think from a few things I'm seeing that were going to have a year end rally in the stock markets. I just don't know how big it'll be yet but it could be "exciting."
And like Music said the banks aren't making any money by holding onto that money, they need to loan it out and put it to "work" so that'll stimulate things a lot too!
And, I know a few people who are going to be spending money again in 2009, some of them a lot of money.
I love it when there's a lot of "doom and gloomers" out there!
That always signals the "bottom" of the markets.

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RE: Credit for Banks, but not for you. - 11/10/2008 11:39:25 AM   
meatcleaver


Posts: 9030
Joined: 3/13/2006
Status: offline
quote:

ORIGINAL: UncleNasty


Remember, the government has no money of their own. They take it from you and then give it to the folks they want to have it. What part of this do some manage to view as being different than a redistribution of wealth?

Uncle Nasty


Isn't the whole point of capitalism to redistribute wealth the the rich?

My brother's father in law told him to 'Never work hard to earn a living, work hard at accumulating money.'  Ever since, my brother has always told me I'm a mug for earning a living, I could make money so much easier. 

Now I know how!

_____________________________

There are fascists who consider themselves humanitarians, like cannibals on a health kick, eating only vegetarians.

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RE: Credit for Banks, but not for you. - 11/10/2008 12:13:14 PM   
cjan


Posts: 3513
Joined: 2/21/2008
Status: offline
quote:

ORIGINAL: MadRabbit

Either I am extremely lucky or just not seeing it, but so far I have yet to experience any of the effects of this credit crunch. I am also a bit baffled at the constant references to it in the media, but very few testimonies to back it up.
  • My credit union is still lending money in accordance with standards tightened back to normal regulations.
  • I talked to a friend/buisness owner the other night and the five banks he deals with are all still lending money, 2 of them providing 100%, no money down loans.
  • I received my student loan money for the spring semester with no issue (I purposefully when through the state lender and not Wachovia)
  • My buddy who makes in low 30, high 20's income bracket recently signed a car loan for a 13,000 vehicle that he can't afford with only 1000 dollars down and no co-signer.



Glad to hear that is the case where you are, MR. It's not like that here in SW Florida. I know people with credit scores in the 700 and uprange that have been turned down for car loans. Also folks that haven't been able to renew a car lease. All of the ones I've spoken with have never missed a payment.

You refer to banks standards tightening up to "normal regulations. Perhaps that's true, but when banks routinely cut folks' credit limit by half, to say nothing of arbitrarirly raising interest ( in some cases to 30% ), they automatically change your credit score and the income to debt ratio used in considering whether to approve a loan.

I also know of a number of small business owners whose line of credit has been cut, thereby hamstringing them from conucting business and generating cash flow. Hell, one of our CM members started a thread about that recently because that was his experience as a small business owner.

Read the link to the article I posted above. It seems that the banks, with Treasury's approval, have no intention of using bailout funds for loans.Do you think that legislation would have passed if the public was aware of that ? I think not.  We've been taken for a ride again, it seems. And, the deaening silence from both sides of the isle in Congress makes a convincing argument, imo, that this is no surprise to them.


_____________________________

"I never saw a wild thing sorry for itself. A bird will fall ,frozen , dead, from a bough without ever having felt sorry for itself."- D.H. L

" When you look into the abyss, the abyss also looks in to you"- Frank Nitti



(in reply to MadRabbit)
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RE: Credit for Banks, but not for you. - 11/10/2008 12:15:55 PM   
Mercnbeth


Posts: 11766
Status: offline 		Popeye,
Here's a few things to consider regarding your comments.

First to the OP - the difference between you and the 'Banks' getting credit is that the Banks still have some collateral; most individuals and companies no longer do.

The question isn't why aren't the Banks lending but how will they be allowed to lend. Credit cards lending is not a good source of economic stimulation. Refinancing mortgages to pay off credit cards at their limits either before or after Christmas is. Unfortunately, the collapse of the national RE market removed the ability for Banks to refinance. Its a double whammy when you consider that lax loan underwriting caused the collapse in the first place. Under current scrutiny regulator bureaucrats will be covering their collective ass by scrutinizing closely ANY exceptions or new 'out of the box' lending programs, such as 'no doc loans' or 'negative amortization' loans. 

How bad is it? My company was solicited for months to switch my LOC to another bank who wanted my business. Finally I gave in to the weekly soliciting phone call and had a meeting set last week. The day before he had to call to cancel because the regulators, who in the prior quarter cited them for their lack of Commercial LOC's, came back now and put them on the 'Watch List' due to their existing loan portfolio collateral. What changed? The same thing that changed for all of us - ALL of what we 'owned', or what we claim as an asset has depreciated in value. In the macro - it makes it difficult for Banks to lend 'real money'. In the micro - your house and mine is no longer the 'Christmas Club' or 'piggy bank' it used to be when you wanted to buy something or needed to deal with maxed out credit cards.

The stock market is a bit different. That is run on confidence and innuendo as much, if not more so, than reality. The current 'word on the street' can be summed up by one word - doubt. Nobody knows what's coming, and that's keeping a LOT of money on the sidelines. The Market is parked in neutral, like a car with a bad parking brake sitting on a steep hill only able to move quickly one way - DOWN, to ANY negative news, while at the same time qualifying any positive news in the face of the new Administration. If there is a Bull market it won't come until Spring at the earliest when the current rhetoric is finally replaced by implemented policy. Too many people, having influence on the economy, have no idea what to expect. That doubt results in a downward trend to all investment especially in the speculative markets.

Also, remember that on the regulating policy and administration side of the problem you have the status quo. Unlike the Republican party blamed as a whole for the economic mess generated by a President who authorized spending more than any prior Democratic counterpart; the voters decided that the party controlling Congress should remain the same. Senator Frank and the rest of the Democratic majority hold all the ability to dictate what happens next. The most ardent Democratic Party apologist should assign some responsibility on them, although I doubt it. Pragmatically they, more than the President, had the ability to prevent or, at minimum, lessen what occurred and yet, in the face of their single digit 'approval' rating as a whole, their failure to do anything was rewarded by reelection and a greater plurality. Good for them! - But now; "What will they do?" with this power and a Democrat in the White House, is another source of doubt. Doubt is the food of a 'Bear' market. 

I also doubt that anyone will read this next part and see neutrality but I'll say it anyway. In the short term, a McCain victory would have seen a small 4th quarter boom. (KEY - Short term!) Long term his administration was potentially much more damaging and potentially disastrous. However, the 'status quo' works for Bankers and investors; because whatever the 'game' they can play it, and exploit it, when they know the rules. The current fall out is a result of that comfort level not being there. It is for that same reason I see the end of the 1st quarter as being the starting point for a new boom.

At the end of the first quarter PE Obama will be the President and all his previous, and sometimes conflicting, policy statement will give way to direct action. When those policies and Presidential 'Executive Orders' are in place; market doubt will be replaced by market pragmatism. I for one - can't wait for it to happen. Similar to my 'big brother' companies and investors I'll also respond appropriately with growth, or further consolidation and down sizing.

Meanwhile - personally made handicrafts and gifts are economical and the personal touch makes them great for Holiday gift giving! Depending on how cold it gets we can all be hoping for Santa to bring us 'coal' this year. 

PS - HAPPY BIRTHDAY TO THE CORE~!

PPS - I tried not to make it so, but; does this post represent the 'doom & gloom' side of the debate?

< Message edited by Mercnbeth -- 11/10/2008 12:54:39 PM >

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RE: Credit for Banks, but not for you. - 11/10/2008 1:07:49 PM   
MadRabbit


Posts: 3460
Joined: 8/9/2006
Status: offline
quote:

ORIGINAL: cjan

quote:

ORIGINAL: MadRabbit

Either I am extremely lucky or just not seeing it, but so far I have yet to experience any of the effects of this credit crunch. I am also a bit baffled at the constant references to it in the media, but very few testimonies to back it up.
  • My credit union is still lending money in accordance with standards tightened back to normal regulations.
  • I talked to a friend/buisness owner the other night and the five banks he deals with are all still lending money, 2 of them providing 100%, no money down loans.
  • I received my student loan money for the spring semester with no issue (I purposefully when through the state lender and not Wachovia)
  • My buddy who makes in low 30, high 20's income bracket recently signed a car loan for a 13,000 vehicle that he can't afford with only 1000 dollars down and no co-signer.




Glad to hear that is the case where you are, MR. It's not like that here in SW Florida. I know people with credit scores in the 700 and uprange that have been turned down for car loans. Also folks that haven't been able to renew a car lease. All of the ones I've spoken with have never missed a payment.

You refer to banks standards tightening up to "normal regulations. Perhaps that's true, but when banks routinely cut folks' credit limit by half, to say nothing of arbitrarirly raising interest ( in some cases to 30% ), they automatically change your credit score and the income to debt ratio used in considering whether to approve a loan.

I also know of a number of small business owners whose line of credit has been cut, thereby hamstringing them from conucting business and generating cash flow. Hell, one of our CM members started a thread about that recently because that was his experience as a small business owner.

Read the link to the article I posted above. It seems that the banks, with Treasury's approval, have no intention of using bailout funds for loans.Do you think that legislation would have passed if the public was aware of that ? I think not.  We've been taken for a ride again, it seems. And, the deaening silence from both sides of the isle in Congress makes a convincing argument, imo, that this is no surprise to them.



I'm not trying to make any claim to the credit crunch being bogus or having any knowledge beyond my own little place in South Carolina, but in my skeptical nature, I compare my personal experiences with what is being spewed in the media and question if the two don't match.

Even though I am not happy to hear what you and your friends are going through, at least, I have some personal testimony to reference for truth.

_____________________________

Advice for New Dominants
The Unpolitically Correct Lifestyle Definitions

Obama is NOT the Messiah! He's just a VERY NAUGHTY BOY

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RE: Credit for Banks, but not for you. - 11/10/2008 2:16:55 PM   
popeye1250


Posts: 18104
Joined: 1/27/2006
From: New Hampshire
Status: offline 		CJ, I didn't know that things were so bad in S. Florida
I just bought a new Lincoln MKS about 6 weeks ago with a 714 credit rating and 2 other people who I know here bought cars together a month before.
I didn't have any problem whatsoever. "Sign right here Mr Popeye!"
And I have plenty of  cash left in this condo, about 40%.
One of the above ladies who bought a car moved here from N.Y. 4 years ago and paid $218k cash for her brandnew home after selling hers up North.
If I told you what my monthly mortgage payment is you'd probably become ill it's so low. Some people pay that on car payments.
I've heard of people with $1,800-$2,000 month mortgages. Mine isn't even a third of that.
CJ, any of your friends want a new car send them up here to S.C.!
And, the maximum sales tax on *any* new vehicle in this state is $300.
Rolls Royce? $300!
Maserati? $300!
Buy a new car here and register it here and you could save thousands.
And the car dealers want your business and will finance you.
I went through Ford Motor Credit on the Lincoln.
Merc, I understand what you're saying.
I buy *very* high yielding stocks with a lot of upside potential.
Look up (FRO) and (NAT)
If they were to cut the dividend in half I'd still say, "Thankyou!"
Companies like that really don't care what the *price* of oil is, they don't "sell" it they "ship" it. I bought them (and others) near their 52 week lows and just sit back and collect the dividends.
There's opportunities in all markets.
With gas prices back down now people are driving more and thus consumming more gasoline!
That's good for my stocks!
Two or three months ago on a thursday night I was out at 8 pm one night and it was like a ghost town around here with gas at $4.00!
The high gas prices are what killed off a lot of business.
I talked to a waitress who told me her business was off by a third! y/y
I hope you're right about that bull mkt in the spring, I like to buy *before* a bull mkt starts as a lot of the upside comes right at the start of a bull.
We've been in this bear mkt for about 2 1/2 years now so your timing looks good!
True the markets don't like "uncertainty" but as we get closer to Obama's inauguration I think a lot of that uncertainty is going to vanish once people realise that we truly are headed in a differant direction!
And the reason I'm saying these things is because I "know" we'll be having the biggest re-construction project of the infrastructure of this country ever!
This will jumpstart the economy bigtime under Obama!
People will be put to work at good paying jobs and that in itself will be good for the economy.
I've already read a few blurbs about it and I think Obama will be talking more and more about it in the next few months.
The People will like it, Wall Street will like it, Companies will like it.
And it's surely overdue!
They say that 600-800 bridges in this country need to be *replaced*
Roads, sewers, water lines, electrical, schools, hospitals, fire houses, police stations, all number of public buildings need to be replaced.
There's a shortage of asphault in this country.
This morning I bought 500 shares of (TSO) Tesoro energy.
Among other things, they make,...asphault.
They were up for the day.

< Message edited by popeye1250 -- 11/10/2008 2:55:37 PM >

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