The Sub-Prime lending mess.

[Lori]

Since I have 1% of my brain still functioning for this world that is not wrapped up in being TS, I use it for trying to keep up with current events and I ran across something that was very interesting and applicable to my life.

So how does the sub-prime mess correlate to being transsexual? In a way that is almost justified.

I was reading a website

http://ml-implode.com/

I stumbled upon the forum there and started reading some of the posts. It would appear that not only are home owners sinking fast but the lenders as well. So far to date there are 246 lenders that have "imploded". So again, what does this have to do with being transsexual? Well nothing really direct, but the extreme prejudice shown to these people is almost alarming. Although in some cases I'm sure it is justified. Many were crooked and evil and predatory and made tons of money doing these loans. They should have saved their money I guess because now they cannot even find jobs.

Here is the jist of what I got out of my readings tonight. Apparently having a "sub-prime" lending career on your resume is about as bad as having Enron on it. Once a prospective employer learns of this, your chances of being hired are pretty slim. Albeit there are probably some really good people that lost their jobs and careers due to their employers lack of caring for the customer, but the industry was so loaded with crooks going for the almighty dollar that nobody knows who was good and who was bad. Therefore the whole group of them are going down together. Good and bad.

They are screaming and crying that they are being persecuted against. All for having worked for a sub prime lending company. I couldn't help but to smile as I read how sad and horrible they felt about being singled out and refused employment for something they had or had no control over. Yes I'm a bitch for smiling, but ya know....now they know what it feels like.

Now just imagine how a transsexual feels that goes in for a job interview only to have the fact that "Maggie" used to be "Dave" and is refused employment due to prejudice. The difference is Dave didn't have a choice and didn't rip off and profit from scrupulous dealings and sucking lower class individuals of every dollar they had.

But the effect is the same.  Employment denied due to prejudice. Doesn't matter what the issue is, its still prejudice. Good luck trying to prove that it was. Now that boat we are floating in just got much fuller.

[lisagurl]

The odds of winning when gambling against the bank are slim. Oh the importance of high school math.

[MeghanAndrews]

Hey Lori,
I worked in subprime lending for 15 years AND I'm TS, nice combination huh? Well, just like the saying, we should probably not judge a book by the cover. True, there were many, many people in the industry that steered their borrowers the wrong way and burned them, but for each one of those people, there were many good people that were concerned about their clients' well being. I never, ever did a loan for someone that I wouldn't have taken myself or given a family member. It's how I slept at night. There were a lot of people like that in the industry.

True though Lori, there is a lot of discrimination against people that were in the industry. I don't laugh at it, I don't even smile at it. That's just me though, I try to get through life by treating other people as I'd want to be treated. I'm sorry that this industry had so many bad apples in it, but, that's the way it is. The only thing that I'd ask is to remember that not everyone in the industry was evil. My employer was one of the 246 on the list. When I go out and look for a job, I guess I'll face the double scrutiny of being in the mortgage industry AND being TS. We'll see, I'm not worried about it too much. I'll probably just end up crashing on your floor any way Meghan

[Lori]

Hey Lori,
I worked in subprime lending for 15 years AND I'm TS, nice combination huh? Well, just like the saying, we should probably not judge a book by the cover. True, there were many, many people in the industry that steered their borrowers the wrong way and burned them, but for each one of those people, there were many good people that were concerned about their clients' well being. I never, ever did a loan for someone that I wouldn't have taken myself or given a family member. It's how I slept at night. There were a lot of people like that in the industry.

True though Lori, there is a lot of discrimination against people that were in the industry. I don't laugh at it, I don't even smile at it. That's just me though, I try to get through life by treating other people as I'd want to be treated. I'm sorry that this industry had so many bad apples in it, but, that's the way it is. The only thing that I'd ask is to remember that not everyone in the industry was evil. My employer was one of the 246 on the list. When I go out and look for a job, I guess I'll face the double scrutiny of being in the mortgage industry AND being TS. We'll see, I'm not worried about it too much. I'll probably just end up crashing on your floor any way Meghan

I think partly what made me smile was the fact that regardless of what people say, what laws are passed, prejudice exists for everybody. Not just LGBT. I also smiled because I am a bitch and the value of my home has tanked as I'm sandwiched in between foreclosures on all sides. A couple were sub prime loans while a few more were "no income verification" loans. They were just handing money out left and right down here and it was amazing to see the bubble just grow and grow. It has not really popped here, just oozed out everywhere. I smiled because the people that caused this mess are not going unpunished. What is unfair is people like you and many others that were honest and were taken advantage of by customers who lied, cheated, changed w2's and so on.

Yes there were bad apples on both sides. I blame wallstreet as well and it looks like they are going to get away scott free with the exception of the 8% of layoffs they have had to endure.

You have your work cut out for you. Somehow I'm sure you will be able to explain how yours was one of the institutions that did not lie, cheat, swindle nor take advantage with predatory lending.

I'm just trying to find the words of what I feel. I suppose I could say now they know how it feels to be persecuted for something they were involved in. Its not quite the same for TS, or say even African Americans who have no choice. Things are just the way they are. Where we didn't create our situation to get persecuted against, many that did create the housing/credit bubble are now reaping what they sowed.

I'm finding it hard not to smile because I will have to eat over 40k in equity off of my home if I had to sell today. I feel vindicated because those that caused this are in the same boat or worse. I'm smiling at one post because the guy is explaining how he saved his money after ripping off everybody that sat down if front of him because he knew it would not last forever. He was yelling at others to stop whining because they had to sell their beach homes, corvettes, new toys, and trade in their trophy wives because they thought the money would just keep rolling in.

I'm sure things will get sorted out in the wash for you and others that worked at your company. If you made it through transition, this should be a cake-walk for you. The original post was not directed at those that did the right thing. But we didn't get into the mess from people doing the right thing and way more people were doing the wrong thing then were doing the right. The amount of money is staggering.

What is truly not funny is the mortgage securities we sold over seas. We just ripped off the globe. How sad is that...now they don't trust us. Go figure!!

[MeghanAndrews]

My sentiments exactly Lori. You are right, there's a reason I've been extremely happy and satisfied with my life and that pretty much started when the industry started having issues. I too feel bad for the consumers in this whole thing. They are the ones, like you, who get to watch their homes depreciate in value, rates adjust, and eventually many lose their homes. Sadly, I don't even think we've seen the tip of the iceberg when it comes to all of the foreclosures and people losing their homes. It really is a sad situation, but we are a resilient Nation so we should be able to weather the storm.

On the bright side, the new mortgage laws being passed will ensure that people doing lending will be somewhat monitored and that they will be held accountable for their actions. In the meantime, I'll hope for a speedy recovery of housing values and that you and so many others see their #1 investment get some value back

[Lori]

Well the number of ARMS resetting this summer is alarming. I'm wondering how Washington Mutual is going to survive. The market went up huge today and like you, I don't think the foreclosures are anywhere near finished. The peak of this mess was in 2006 so two years later would bring us to now.....2008. Most homes as you know are sold in the spring through summer. The bulk of ARMS resetting started last month and I think they go through August of this year.

I would expect things to get worse before they get better, yet the market doesn't think it will. I'm almost surprised.

One thing I do know...is my house is not an asset nor my #1 investment. It was my fall back plan. I'd rather trade securities and invest in mutual funds and build assets that way. I hope for a speedy recovery as well for people like you who need to find work and were just swept up in this huge mess without a life raft.

[buttercup]

I saw a doco recently on the foreclosures on homes in a particular town in America, large mansion type homes with double garage etc, row after row, every second home vacant with grass knee high, ugly signs out front, FOR SALE.  Tumbleweeds rolling down the deserted streets, it was pitiful to watch.
My question, is America in a recession at this time?  Is it that serious or is this just another scaremongering tactic?  We have heard that is pretty damn serious and that we shall soon follow here. 

[Just Mandy]

It is a mess... but that is really an understatement in my opinion. Calamity comes to mind. Yep...
looked it up: "a disastrous event marked by great loss and lasting distress and suffering".

I think in ten years we will look back and see how close we came to total collapse (assuming it does not happen). There
are so many issues facing the economy right now. The biggest problem is that the Fed is going to
be forced into even more extreme positions soon to support the banking system. They have cut lending rates faster than
ever before, added liquidity at unprecedented rates, to  entities that did not qualify (prior to this crisis) for fed loans.
The fed is obviously in full panic mode right now and the bad news keeps coming. If you want to be really scared take
a look at the non-borrowed reserves starting in December of last year on this Fed statistical release:
http://www.federalreserve.gov/releases/h3/Current/h3.pdf.  Reserves are nothing more than cash the bank
is by law mandated to set aside to cover bad loans.

Then go back in time... you will never find a time where banks have been so short of cash reserves. The release shows over
a trillon dollar swing from Decmber 2007 till last week in bank non-borrowed reserves. The really bad thing is the
non-borrowed reserve is negative meaning... ALL THE RESERVES ARE BORROWED... from the fed.  Banks have NO cash
reserves to cover bad loans.... there all gone due to bad sub-prime loans.

The commercial banking  system is insolvent and the ONLY thing holding things together is unprecedented action by the
fed to pump money into the system. No one is reporting this in the media, it's like everyone is afraid to say anything for
fear of starting a massive bank run. I believe that at least two or three large US banks are insolvent and Citibank is one of them.

LOL... one of my most masculine hobbies is watching economics and markets... I could go on like this about two or three
other areas of the economy, and the only thing that keeps me sane is knowing that if it goes everyone, and I
do mean everyone will be affected. I may lose everything but so will everybody else. I never thought I'd be posting
about this at Susan's but people need to know and who better to tell then friends

So... is it any wonder that I would rather come here and talk about my transition LOL

[Lori]

Hee hee..I have a 37 thread post on another forum from Last December when I moved my 401k moving over. Why we only lost 2000 pts since the high last year on the DOW is beyond me.

The way I see it the Fed has taken the most extreme action since the great depression. There is a reason for that. We were in serious trouble.

Commodities finally pulled back but oil and gold are still at record levels and those told me how bad things were. Those were the only safe havens for money. Things are way worse than what they will ever tell us they are. If we knew the real truth the Dow would be around 8500-9000 an nasdaq which has been hammered would be around 1000. I have no idea why the tech stocks suffered so bad when it was the financial institutions that were in trouble. Maybe tech stocks rely on more loans or something to keep going. What ever the reason is there are so many stocks below their 200 DMA its like christmas trying to find stocks to buy. If only I had a million dollars to invest right now...omg...

So far we are up to 973 billion on my last count that he Fed has loaned out at tax payers expense. There are tent cities popping up everywhere as the homeless are looking for shelter. The economy certainly has slowed and we are probably in a recession. We won't know for sure until April in my book when the numbers come out. Many think it started in January this year which means we will be waiting until June or July for the official results. I think it started in October of last year and has slowed down more and more each month.

What makes 973 billion loan so bad from the Fed is they printed this money up and its based on "nothing". That caused inflation, stagflation and god knows what else. Prices of everything has gone up when the dollar is worth less. Funny how things work out like that. Other countries are sure enjoying shopping over here though.

Well anyhow....they say we have reached bottom and its never wise to argue with the market so I jumped back in today and started investing again. Watch it roll over and die tomorrow. I'll be sooo pissed.

[lisagurl]

The American culture and economy are dependent on consumption. The world has a limited amount of resources. The population keeps growing there has to be a limit. The very core of our politics needs changing. People must realize that we can not keep using resources like there is no end. War, pollution, poor use of land, plastics, chemical farming, waste of energy, and many other decisions made like buying products from slave wage countries are and will make life much harder for everyone.

The world needs to embark on a plan to limit population growth and bring the standards of living of everybody in line with what can be sustainable. Things like rails are less friction than roads. Right now the only drawback of nuke plants is the waste. The fusion technology will solve that but is years away. Down size autos and homes. Help make education a passion. Step-back from machines and spend more time in face to face human contact. Few remember victory gardens. We are not alone on this planet and it is about time everyone lived like it is important.

[Just Mandy]

The way I see it the Fed has taken the most extreme action since the great depression. There is a reason for that. We were in serious trouble.

You got it. I don't think anyone(media, general public) gets that yet.

Hee hee..I have a 37 thread post on another forum from Last December when I moved my 401k moving over. Why we only lost 2000 pts since the high last year on the DOW is beyond me.

Commodities finally pulled back but oil and gold are still at record levels and those told me how bad things were. Those were the only safe havens for money. Things are way worse than what they will ever tell us they are. If we knew the real truth the Dow would be around 8500-9000 an nasdaq which has been hammered would be around 1000. I have no idea why the tech stocks suffered so bad when it was the financial institutions that were in trouble. Maybe tech stocks rely on more loans or something to keep going. What ever the reason is there are so many stocks below their 200 DMA its like christmas trying to find stocks to buy. If only I had a million dollars to invest right now...omg...

So far we are up to 973 billion on my last count that he Fed has loaned out at tax payers expense. There are tent cities popping up everywhere as the homeless are looking for shelter. The economy certainly has slowed and we are probably in a recession. We won't know for sure until April in my book when the numbers come out. Many think it started in January this year which means we will be waiting until June or July for the official results. I think it started in October of last year and has slowed down more and more each month.

The markets thinks the fed can step in an save it one more time and that is why you saw the uptrend start in March. But I think
the markets are just playing the game till the next big downleg. The Fed is out of bullets, the rate cuts are not working and they've
had to start doing things that the fed has never done before and now they want even more power. There is a saying "you cannot
fight the fed" and that has been true. But this time it's very different and the tools that the fed has to fight this problem have been
used and have failed for the most part and now they are forced into more drastic actions.

The problem is the Fed cannot fix this with what they have available and that is why they have asked for more powers. The reason
lowering rates has not helped is that banks are afraid to loan to anyone and they do not have the reserves to do it.
Right now banks are so afraid to loan money for ANY project and that is why the Fed is in panic mode. When banks can't or
won't loan money, EVERYTHING stops.

I hope I wrong about all this.

What makes 973 billion loan so bad from the Fed is they printed this money up and its based on "nothing". That caused inflation, stagflation and god knows what else. Prices of everything has gone up when the dollar is worth less. Funny how things work out like that. Other countries are sure enjoying shopping over here though.

What the fed wants to do is create inflation and they have in some areas(food, oil) but in other areas(real estate) we have massive
deflation. And to compound it we already had a weak dollar so any steps to lower rates will also drive down the dollar. That is why
everything is moving to gold. A weaker dollar hurts us so much more now than in the past because we buy so much more foreign
goods than in the past and a weak dollar buys less. It's a horrible place to to because a "fix" in one area hurts another. The best
we can hope for is stagflation, that will be painful, but I think it will be a lot worse.

Well anyhow....they say we have reached bottom and its never wise to argue with the market so I jumped back in today and started investing again. Watch it roll over and die tomorrow. I'll be sooo pissed.

I personally do not have anything sitting in stocks or MF's since December when I saw the Fed's report, it's way too risky in my
opinion, because when everyone tries to leave at the same time it's going to get ugly. The upside is only a few hundred
points on the dow, if it breaks 12,800 to 13,000 then yes it might be a bottom but right now all I see is a small uptrend
since March 5 and the best I think the market is going to do is go sideways. What's the point of taking the risk if we
are moving sideways?

This is the last I'm going to post about this, I'm normally a very positive person and this makes me sick to think about
because it's so negative and disturbing. ... and there are a many more happy things to talk about here

Amanda

[tekla]

Well let's take the employment thingy first.  I know a lot of people who can command about as much coin as they want.  They are sought after, and can name their price.  They are like that because they have been involved in success after success, they are hard workers, they know their ->-bleeped-<- - so they have good skills, good resumes, good references, (and not even good, great.)  Its assumed when you hire such people, and pay them the money, you are not only buying some of those skills, but in that extra money they can command, that your going to get a bit of that work-ethic, that espirt de corps, that level of success in your own project.

So, now, out here you have the Sub-Prime Loan people.  Most are out of work because these 'institutions' (though I shudder to call them that) have folded like a house of cards in a hurricane.  They folded because at root, what they did was dishonest.  They made loans in sheer and willful ignorance of the most basic rules of lending.  They did  it to prop up short term gains on quarterly reports, not as long range investments.  After all, they were just going to bundle the loans and sell them off anywho.  All these businesses went belly up, their failure is resulting in something that looks like - have you ever seen the movie Smoking Ace's?  They did to our financial systems what those guys did to that hotel floor - certain doom, people being locked into paying on a house that is priced a great deal above what its worth.  Foreclosure rates at a record highs (from people who's job it was to sell houses).  Property values in decline (when they had been in biz to increase property values).

And you want to bring that magic to my company, to my project?  Your kidding right?

The Fed is out of control.  It has less than zero ideas about what's its doing.  There is no model for this.  They have pumped money into the economy in huge and vast amounts that just get swallowed in an ever rising sea of debt - lead off of course, by the Bush Administrations own record level of debt. 

And the Fed (you do know that the Federal Reserve, is about as "Federal" as Federal Express, right?) has very limited power to do anything given the problems we are facing.  Its not a problem of money in circulation, its a falling value of a basic item, one that is the bedrock financial investment for most Americans.

[Lori]

Well let's take the employment thingy first.  I know a lot of people who can command about as much coin as they want.  They are sought after, and can name their price.  They are like that because they have been involved in success after success, they are hard workers, they know their ->-bleeped-<- - so they have good skills, good resumes, good references, (and not even good, great.)  Its assumed when you hire such people, and pay them the money, you are not only buying some of those skills, but in that extra money they can command, that your going to get a bit of that work-ethic, that espirt de corps, that level of success in your own project.

So, now, out here you have the Sub-Prime Loan people.  Most are out of work because these 'institutions' (though I shudder to call them that) have folded like a house of cards in a hurricane.  They folded because at root, what they did was dishonest.  They made loans in sheer and willful ignorance of the most basic rules of lending.  They did  it to prop up short term gains on quarterly reports, not as long range investments.  After all, they were just going to bundle the loans and sell them off anywho.  All these businesses went belly up, their failure is resulting in something that looks like - have you ever seen the movie Smoking Ace's?  They did to our financial systems what those guys did to that hotel floor - certain doom, people being locked into paying on a house that is priced a great deal above what its worth.  Foreclosure rates at a record highs (from people who's job it was to sell houses).  Property values in decline (when they had been in biz to increase property values).

And you want to bring that magic to my company, to my project?  Your kidding right?

The Fed is out of control.  It has less than zero ideas about what's its doing.  There is no model for this.  They have pumped money into the economy in huge and vast amounts that just get swallowed in an ever rising sea of debt - lead off of course, by the Bush Administrations own record level of debt. 

And the Fed (you do know that the Federal Reserve, is about as "Federal" as Federal Express, right?) has very limited power to do anything given the problems we are facing.  Its not a problem of money in circulation, its a falling value of a basic item, one that is the bedrock financial investment for most Americans.

I wonder if the fact that this is an election year may have something to do with it? As long as they paint a rosey picture and show that we are all ok....then oh well. I have a funny feeling after this summer when all the ARMS reset and the new president takes reign this market is going to roll over and we'll be lucky to stay above 8500 on the DOW. Until then I'm going to make as much money as I can while the market is trending up setting up more short points. There are a lot of stocks that will have head and shoulder patterns.

I noticed that the leaders from last year are still in command such as some of the solar stocks FSLR, STP, SOLF, CSIQ, AMAT, WFR, TSL, JASO, hen the search engines Bidu, Goog, which both suffered heavy losses and AAPL, DE, and other farm equipt. The fertilizers ...POT, TNH, MON, CF and others refuse to roll over as well. We have no new leadership to mark off the start of a new bull market. I was thinking perhaps the railroads would be that new leader but so far most of the volume has been to the old leaders. Until those old groups die off I agree we will be trading sideways. Volume last week was pitiful as well. Its like every body got fired and those that were left went on vacation.

Resistance on the DOW seems to be around 12750 and we cannot seem to get past that on good volume. The bad news just keeps rolling out day after day.

I agree the Fed is out of control. There is a reason why other countries don't start printing money when they run out. Taxpayers are going to be stuck with a 1 trillion dollar bill when this is all over...and that doesn't include the two wars going on either.

[tekla]

Part of the reason they are dumping currency is that they hope that the ARMs do re-set, but right now there is no money for that.

And monetary policy is not the ticket to the A List fun party people either.  Its complex, and can't be reduced to sound-bites, it has to be really examined, and no one whats to do that. 

There is no model for what a market ought to look like in times like these, and the looming problems make everything look beyond bad.  However, there have been people since the 1960s who predicted that there was a carry load deal, and one day we could, and would, pass it.

[cindianna_jones]

I pulled my money out of the market last October.  It was excellent timing.  I'm still very much ahead.

I watch all this with total dismay.  Countrywide continues to send me their weekly offer to loan me money on my house. I don't need or want a loan.  Our government continues to print money to cover the costs of big business going under.  Wouldn't it make sense to work directly with the homeowners?  Why bail out the lenders and then let them foreclose on the borrowers?  This makes no sense to me at all...... unless you view the top echelons of government with as much cynicism as I do.

One day, we may not settle for elections to choose our leaders.  I hope that doesn't happen until after I die.

Cindi

[RebeccaFog]

Since I have 1% of my brain still functioning for this world that is not wrapped up in being TS, I use it for trying to keep up with current events and I ran across something that was very interesting and applicable to my life.

OK Lori,

   That's enough for now.  Hand me the 1% before you hurt yourself.



(just kidding)

[Lori]

OK Lori,

   That's enough for now.  Hand me the 1% before you hurt yourself.



(just kidding)

Its too late.   

Good call Cindi...as early as October? Wow...nice timing.