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America's big bad wolf

By Tom Toles

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By Tom Toles  | October 10, 2010; 12:00 AM ET
Categories:  Economy and jobs  
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Real estate is local, however...

AS A NATION increased residential mortgage debt from $5.1 trillion to $11.1 trillion in 7 short years from 2000 – 2007.

Again, we increased our national residential mortgage debt BY 6 trillion dollars during that time.

It took us many decades to get to 5.1 trillion. It took us only 7 years to more than double that number to $11.1 trillion!

The question is, how much did we overspend? 2 trillion? 3 trillion? More??

That is what people do not seem to grasp yet.

ANY loan done during that time frame was a bad loan because the value of the underlying asset was grossly distorted/inflated.

The harsh reality is that millions of the jobs that were created during that time were temporary, because they existed only as long as the real estate bubble existed.

That bubble has burst and it’s a long way down back to earth.

The pain must come.

JOBS (preferably non-government, export-creating jobs) are the only pain reliever!

The anti-business attitude in Washington has got to stop.

Jobs are the only thing that can save us, if anything can.

Posted by: Painesright1 | October 14, 2010 8:40 PM | Report abuse

I am laughing out loud.....
Hey, Little Red Riding-Hood
where are you??
I have enjoyed today's date!! : )

Posted by: bertzel | October 10, 2010 7:28 PM | Report abuse

Democrats are now going to start counting getting a shot as a job why didn't Pelosi think of that? Will those be counted as jobs created or jobs saved?

Posted by: billybeer6 | October 10, 2010 1:13 PM | Report abuse


Dear DougMUSN,
It might be a good idea to offer free immunizations out in the desert for people coming here illegally. Our Government ignores the fact that people enter this country without immunization. In 2009 public sector union members exceeded private sector union members. Of the 594,754.3 jobs created or saved by the stimulus funds, two thirds went to save jobs in the education industry. Those were pencil ready jobs, not shovel ready. And where will the funds to keep those jobs come from next year? We need a Captain like Governor Christie of New Jersey. He lays it on the line and is not afraid to stand up to those who would steer the ship into more unfundable debt.

Posted by: bobbo2 | October 10, 2010 9:43 AM | Report abuse

Milbank has a new book about his jealousy of Glen Beck. Robinson, a Pulitzer comrade of Mr. Toles, has a new book about how America is hopelessly racist. Well Mr. Toles, where is your book? And what might it be about? Global climate disruption? The Nanny State? Cooking with Tofu? Drawing political cartoons while blindfolded riding the Tilt-O-Whirl?

Posted by: bobbo2 | October 10, 2010 9:16 AM | Report abuse

How is unemployment like childhood immunizations?

In the last sixty years, we have added immunizations to protect against measles, mumps, rubella, polio, pertussis, pneumonia, chickenpox, hepatitis (A and B), HIB, influenza and HPV infections. "Usual" childhood diseases have all but vanished from the landscape--my father told me that in 1938 when discussing raising children with his new bride, my mother, they chose to have four children so two might live. As people forgot about these conditions with the success of immunizations, some well-meaning parents are seeking to stop or modify immunizations as dangerous.

Proving a negative is all but impossible.

Today, our economy is clearly not robust. Unemployment is too high. We are taking on water not because we are not bailing out the bilges as fast as possible but because the holes in the ship are larger than the capacity of our bucket. The solution to flooding is not to stop bailing out the boat. Ask a sailor if bailing out the ship is a bad thing and you might get the Breton fisherman's prayer: "Oh God, thy sea is so great and my boat is so small!"

Conservatives love to claim persistent unemployment as the Dems' fault but cannot grasp the concept of how much worse off we might be absent actions taken thusfar.

Posted by: DougMUSN | October 10, 2010 7:13 AM | Report abuse

"But we have to pass the bill so you can find out what is in it, away from the fog of the controversy." Nancy Pelosi (Dem, CA) ----People keep electing Pelosi because they live with the Democrats food stamp nation.

Posted by: billybeer6 | October 9, 2010 9:52 PM | Report abuse

The housing market has brought the U.S. economy out of the last seven recessions. A better bet than food stamps and unemployment benefits doing it. Less than a month before Ms. Pelosi has to give up her gavel.

Posted by: bobbo2 | October 9, 2010 7:35 PM | Report abuse

"Unemployment benefits are creating jobs faster than practically any other program." Just another word for word assertion from the mouth of House Speaker Nancy Pelosi (Dem, CA) ----

wha...???

Posted by: bertzel | October 9, 2010 7:04 PM | Report abuse


"Unemployment benefits are creating jobs faster than practically any other program." Just another word for word assertion from the mouth of House Speaker Nancy Pelosi (Dem, CA) ---- Democrats are the food stamp nation.

Posted by: billybeer6 | October 9, 2010 6:57 PM | Report abuse

~~~~
the South. Those states belong to the rightwingers who attach "beer" to their names to prove their level of education.
papa~~~

I beg to differ...we here in the north praise beer as well : )
course that has nothing to do with education does it?!?!

Posted by: bertzel | October 9, 2010 6:20 PM | Report abuse

The best way to create jobs is hand out more food stamps." Nancy Pelosi on how the Democrats are building their food stamp nation.

Posted by: billybeer6 | October 9, 2010 11:50 AM | Report abuse

*********
Wht is more true than your childish assertion, is that most poverty is in states of the South. Those states belong to the rightwingers who attach "beer" to their names to prove their level of education.
Nancy Pelosi has been one of the most hard working and effective Speakers in the last forty years. All it takes is a woman to get the task done, unlike the men who would rather just collect their wealth from big business for saying NO to holding them accountable.
Perhaps you might check the level of food stamps and poverty in your own state. You might be so surprised you'll want to take a hard look at those around you.

Blaming Pelosi for something she has no control over labels you an uninformed child. Maybe you can ask your Repug Congressmen to do some work for the taxes we pay for their salary and benefits and other luxuries. After all, they too are receiving food stamps in the form of what we pay them for doing absolutely nothing. fritz

Posted by: papafritz571 | October 9, 2010 4:38 PM | Report abuse


~~~We had a Government with regulatory control that did not regulate. The housing bubble was "good' for the economy.....bobbo2~~~~

Exactly! well said....the 'big bucks' and government were seen hand in hand.....

Posted by: bertzel | October 9, 2010 4:21 PM | Report abuse

Our unemployment rate had stayed at over 9.5% for over 14 months. Even with the billions of dollars from the stimulus. Isn't it amazing how these brilliant people with their degrees in economics have not made any real change in the performance of our economy. They have their laws of economics, their statistics, their theories, and yet the jobless rate has been stagnant for over a year. Our politicians and their economic advisors have succeeded in increasing our Federal debt. And they have succeeded in making the Federal Government bigger. Since our politicians find it necessary for Government to create jobs then why aren't they succeeding at that?

Posted by: bobbo2 | October 9, 2010 2:07 PM | Report abuse

To Tom Toles,
We all live in straw houses and are susceptible to getting blown away.
David Eddy

Posted by: OchamsRazor | October 9, 2010 1:08 PM | Report abuse

Economics is a simple matter of enough without too much.
Just like the gas pedal on a vehicle regulates the amount of gasoline the engine gets determines the speed of the vehicle; it is the government that is responsible to regulate the flow of financial resources to maximize the funds available to support a quality society without flooding the system.
Too much gas and the engine floods and dies, too little gas and the car does not move.
Presently, there are not enough financial resources on the demand side of economics to operate our economic engine. Just as China did as I suggest when I went to China twenty years ago; we need to restructure our economic system. The demand side of economics has to have sufficient funds to use our human and natural resources efficiently.
David Eddy

Posted by: OchamsRazor | October 9, 2010 1:03 PM | Report abuse

The best way to create jobs is hand out more food stamps." Nancy Pelosi on how the Democrats are building their food stamp nation.

Posted by: billybeer6 | October 9, 2010 11:50 AM | Report abuse

All...please take few minutes to read these articles. I started some research. Even if you are unsympathetic to the homeowner these should infuriate and frighten you...Apart from the American Banker where is the main stream media?

These Lazy, Stupid, Greedy Idiots May Have Blown up the World Economy

http://www.americanbanker.com/issues/175_114/foreclosure-challenges-1020961-1.html

http://www.ritholtz.com/blog/2010/10/foreclosure-fraud-reveals-structural-legal-crisis/

http://seminal.firedoglake.com/diary/75473

Posted by: DANP1966 | October 9, 2010 11:28 AM | Report abuse

All...please take few minutes to read these articles. I started some research. Even if you are unsympathetic to the homeowner these should infuriate and frighten you...Apart from the American Banker where is the main stream media?

These Lazy, Stupid, Greedy Idiots May Have Blown up the World Economy

http://www.americanbanker.com/issues/175_114/foreclosure-challenges-1020961-1.html

http://www.ritholtz.com/blog/2010/10/foreclosure-fraud-reveals-structural-legal-crisis/

http://seminal.firedoglake.com/diary/75473

Posted by: DANP1966 | October 9, 2010 11:26 AM | Report abuse

The newspapers ought to have pictures of these expensive houses that are being repossessed. Then people will realize that they are the same houses that they lived in ten years ago for $150,000. Only the price changed in the boom. No reason for envy. Some bought at peak price and have to pay th piper. Better look at the last ones to sell high. They are the ones to envy.

Posted by: GaryEMasters | October 9, 2010 8:12 AM | Report abuse

Mortgage rates are historically low you can easily refinance these days your mortgage to 3%. It is the best way to save money. Search online for "123 Mortgage Refinance" they can do 3% refinance and free analysis of your current mortgage

Posted by: maxjulien09 | October 9, 2010 6:20 AM | Report abuse

@Jane, Efficient copiers improve productivity and decrease costs. Always Compare prices and save if you need a digital copier for your office http://bit.ly/ap8whH

Posted by: maxjulien09 | October 9, 2010 3:06 AM | Report abuse

The financial sector has tried to manage foreclosures with the same negligent lack of due diligence that they employed in writing the mortgages in the first place. They've used "robo-signers" who have no knowledge of the validity of the foreclosure documents (thus breaking the law), and MERS to get around the "slow" title companies (and circumvent the law in some jurisdictions).

Coverage of foreclosures seems to focus on the "little guy" who's losing his house, but what about the big investors like condo developers... are any of them losing their shirts? And if so, are they stuck with paying the bill, or just walking away? Funny how it's the little guy who is told to be responsible. For the big guy who doesn't have to pay, its just business as usual.

Posted by: moore_te | October 9, 2010 1:37 AM | Report abuse

We had a Government with regulatory control that did not regulate. The housing bubble was "good' for the economy. People got mortgages they could never pay. Home values skyrocketed and the property taxes flowed into State coffers and was spent like water. Homeowners borrowed against the value and spent it on stuff. The bubble burst. Jobs lost. Welcome TARP. Welcome stimulus. Unemployment at over 9.5% for over 14 months. When we get over this National hangover some things must change. Banks should have to hold on to their mortgages for at least a decade. And never again, never again, does the taxpayer bailout Institutions or individuals who blow bubbles.

Posted by: bobbo2 | October 8, 2010 11:39 PM | Report abuse

This is a lender to lender problem. People who bought houses, expensive cars, flat screens, and expensive watches who can't pay will still be foreclosed on after the midterm elections. Thanks BHO

Posted by: jornolibist | October 8, 2010 8:04 PM | Report abuse

Freeloaders not paying the bill it's time to get the vacuum out.

Posted by: jornolibist | October 8, 2010 7:47 PM | Report abuse

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