Uh excuse me, but the lifeboat leaks

August 8, 2011 at 4:50 pm | Posted in Consumer Issues, economy, I'm just saying, rants, stupidity | 9 Comments
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I saw a little blurb, in the August 15th issue of Time Magazine, about Bank of America in Cleveland, as well as other banks that are demolishing some of their inventories of foreclosed homes.  The reason being, according to economist Thomas Lawler, is that fewer houses may revive prices.  He states, “It’s the right thing to do.”   Perhaps Lawler should consider a career in politics because he seems good at contradicting himself; check out another of his very recent articles, that would seem to indicate he thinks otherwise.  The whole concept pissed me off.  How freaking stupid is this idea?

The banks, bless their magnanimous little hearts, after razing the houses are often donating the lots to local governments or non-profit organizations.  I’m guessing they ran the numbers and it turned out that rather than holding the properties, paying property taxes and other expenses, that donating them, which I imagine comes with a sweet tax write-off, is better for their bottom line.

Let me get this straight…the economy sucks and unemployment is off the charts.  Couple this with a housing market that’s in the toilet because of record foreclosures, the sad fact that most people cannot afford to buy homes at today’s prices, and for the ones that can it is difficult if not impossible to get the banks to finance the purchase.  For the most part the only people able to take advantage of lowered housing prices are investors already flush with cash.  So I’m having trouble with the concept of taking actions that will drive housing prices higher.  If you presently own a home that is under water, artificially inflating its value might correct that situation…but if you haven’t been able to make the mortgage payments and are facing foreclosure that will hardly matter, you’re still just as screwed.  It’s rather like getting into a leaky lifeboat as the ship is going down.

We are told the problem is that there is a surplus of homes for sale.  DUH!  But that surplus doesn’t exist because there are not enough people who need homes.  Do they think the people who once resided in all those foreclosures have mysteriously disappeared?  They have not; they are either renting, staying with friends or family, sharing living quarters, or homeless. It seems to me, the only thing we have a surplus of in this country is greed, corruption, and stupidity.

I’m just saying.


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