Your Questions About Save Loan Crisis

Paul asks…

Does anyone care what McCain’s position was on the Saving’s and Loan crisis of the 80s?

This is what Obama is trying to stick McCain with now and I am wondering if anyone really cares about something that happen so long ago.

John answers:

And I quote “I am wondering if anyone really cares about something that happen so long ago.”

MAN! Every time you guys bring up Ayers or Wright…. That is what I think.

Obama / Biden 08!!!!!!

William asks…

what happened during the saving and loans crisis?

John answers:

Are you talking about the S&L crisis in the late 1980s? (It was during the Reagan and Bush years — not the Clinton years)

If so — there were several factors:

1. Banking deregulation allowed S&Ls to invest in securities that they were previously prohibited from purchasing. A lot of S&Ls bought junk bonds — primarily because Drexes, Burnham, Lambert was pushing them & saying that default rates were low. But in the late 1980s, a lot of these bonds started to default — and a lot of S&Ls lost money. Congress reacted by passing legislation that forced S&Ls to sell the bonds they still had. This flood of junk bonds into the market caused prices to fall further.

2. A lot of Texas S&Ls went under for another reason. Oil prices had jumped in the 1970s — causing an oil boom in Texas. But in the 1980s, oil prices plummeted. A lot of these banks loaned money to oil companies and also gave mortgages to employees of oil companies. When oil prices went down, the oil companies defaulted on their loans and laid off their employees — who defaulted on their mortgages. Because the banks were not diversified — many went under.

3. Some S&Ls went under because of illegal activities by the people running the firms.

These problems can be avoided today — because banks can sell their mortgages to FNMA, FHLMC or GNMA and use the money to buy mortgages from other parts of the company — letting them diversify their mortgage portfolio. They can also sell their whole loans or buy credit derivatives to protect themselves from industry risk.

Depositors in the S&Ls were not generally hurt. While S&Ls do not have FDIC — they do have FSLIC — which insures deposits up to a certain limit.

Nancy asks…

Crisis Loan to pay rent in advance in my situation?

Im on a low income and have a 2 month baby (SMP, tax credits, housing and c. tax benefit)

I was raped, reported to police etc but couldn’t go through with court case due to existing mental health issues

Because the guy lives within my area, i would like to move out of the area, i don’t care whereas staying here is giving me a lot more issues but i don’t know whether it will be worth applying for a crisis loan or not

Police wont do anything unless he tries something again so moving is my last hope

Anyone know if i have chances of getting financial help?

I cant get help with a Rent deposit scheme as police have said I am low risk until I am contacted by the rapist again so I am stuck. I cant even save for a deposit myself so I am stuck

John answers:

Not an easy situation to resolve but the fact remains ( to my mind ) that you are at risk. No magic answer here but it may be worth asking the police to give you a note to the fact that you may be at risk and take that, together with supporting evidence from your GP, social worker, crime support worker … Anyone you can think of …… To the local council and ask for urgent consideration of rehousing. The council should at least listen. But don’t borrow money that you cannot repay as that will only put more stress on you. Don’t forget that the police opinion of low risk is only an opinion ….. They may be right but clearly you don’t share that view. What you do, and what is necessary here, all depends on you and how much anxiety this is causing you. I guess it’s hard for a man to understand that, so perhaps you should only deal with woman officers/officials when you take this further? Good luck ..

Richard asks…

How do you save the mortgage crisis ?

LONGER loans ! 50 year, and 60 year loans !

John answers:

You take a shit on the equator the size of a creator and make government officials breath harder then dark vator.

God bless you :)

Sandy asks…

Do people really believe that bailing people out of the loan crisis will help American families?

I am a mom and part of a generation that has been kicked out of the “American dream” of owning a home and staying home with my child. My parents could afford a nice home that was twice their annual income, now it takes over fifteen times the median income in our area. Another fundamental difference was that my parent’s generation could make it on ONE income. One way to surely help reverse this tragedy is to let the housing market naturally come down. My husband and I, like most of my generation, are renting without any hope of qualifying for a loan in this area, and we earn an income well above the median and have a significant savings. Many of our peers still live at their parent’s house in the desperate attempt to save for the out of reach dream of home ownership. Increasing the Fannie Mae limit loan limits will only hurt families like mine who have worked hard and saved. This will only help the speculators, banks and real estate agents.

John answers:

Yes, bailing people out of the mortgage crisis will help the country. Letting thousands upon thousands lose their home will sink us into a depression, and someone would have to be crazy to think that would be good. No one is talking full scale bail out, but when you’ve a choice between a recession and a depression do whatever you have to prevent the depression.

As an aside, there’s some sound economic research on the cost of living between the 50’s and now. It’s true to some extent that basics were slightly less when the value of the dollar is taken into account, but a large portion of why it takes two incomes now is due to lifestyle change. Homes were not nearly as big back then. They didn’t have tons of gadgets that we “need” these days. They didn’t have two car payments. Etc.

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3 Responses to Your Questions About Save Loan Crisis

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