WARNING: This is not a recommendation to buy, sell or hold any financial instrument.
Once again, the gangsters on Wall Street have succeeded in getting the American Corporate State to force a shit sandwich down the collective throat of U.S. Dollar holders.
It’s nanny state lotto time for billionaires on the one hand, and the liar loan slobs on the other. And to those of you who don’t fall into either of those categories, well… Uh… Just sit back, relax and watch the Is-Europe-a-Country-Girl in all her glory. Don’t worry. Everything is under control.
I referenced the chart below in Lehman Brothers Forced to Juggle Some of Its Own Hand Grenades; Where Are the Rest and When Will They Blow?
We should know better by now. We should know that They’re just not going to let the thing go off the rails and crash in a single, violent event. The purpose of the American Corporate State is to externalize the costs of unthinkable plunder onto the backs of people who are mostly too tired, dumb and angry to understand anything that’s happening to them. Americans, in general, are content to flush more of their children’s futures down the gurgler and thank Christ for their big screen TVs. Anyone who’s not behind the plan to save the criminal gangs on Wall Street must be with Bin Laden.
The tab, of course, is going to be paid by people who were stupid enough to manage their finances in a prudent manner. What handouts will the people who took fixed rate loan products during the bail out period get? Will they win the nanny state lotto as well?
Congressional aides say the Bush administration has hammered out an agreement with industry to freeze interest rates for certain subprime mortgages for five years in an effort to combat a soaring tide of foreclosures.
These aides, who spoke on condition of anonymity because the details have not yet been released, said the five-year moratorium represented a compromise between desires by banking regulators for a longer time frame of as much as seven years and industry arguments that the freeze should only last one to two years.
Another person familiar with the matter said the rate-freeze plan would apply to borrowers with loans made at the start of 2005 through July 30 of this year with rates that are scheduled to rise between Jan. 1, 2008, and July 31, 2010.
The administration said that President Bush will speak on the agreement at the White House on Thursday and the Treasury Department announced that Treasury Secretrary Henry Paulson and Housing and Urban Development Secretary Alphonso Jackson would hold a joint news conference Thursday afternoon with officials of the mortgage industry.
Treasury also announced that there would be a technical briefing to explain more of the details of the proposal.
Paulson, who has been leading the effort to craft a plan, said on Monday that the program would only be available for owner-occupied homes â€” as a way to make sure that the break is not granted to real estate speculators.
The plan emerged from talks between Paulson and other banking regulators and banks, mortgage investors and consumer groups trying to address an avalanche of foreclosures that are feared as an estimated 2 million subprime mortgages reset from lower introductory rates to higher rates.
The higher rates in many cases will boost monthly payments by as much as 30 percent, making it extremely difficult for many people to keep current with their loans.
The plan is aimed at homeowners who are making payments on time at lower introductory mortgage rates but cannot afford a higher adjusted rate.
Through October, there were about 1.8 million foreclosure filings nationwide, compared with about 1.3 million in all of 2006, according to Irvine, Calif-based RealtyTrac Inc. With home loan defaults still rising, the trend is expected to worsen next year.
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