Tuesday, April 6, 2010

Why Are We Helping Brandee Chambers?

The AP reports: Gov't aims to help more "underwater" homeowners. Here's the essence:

The Obama administration will give $3,000 for moving expenses to homeowners who complete such a sale -- known as a short sale -- or agree to turn over the deed of the property to the lender. It's designed for homeowners who are in financial trouble but don't qualify for the administration's $75 billion mortgage modification program.

Here's a beneficiary:

A short sale appears to be the only way out for Brandee Chambers, 36, of Las Vegas. She got into trouble during the housing boom by taking out a risky loan against her home and using the money to buy two investment properties in Phoenix.

She later lost those two properties to foreclosure, and now she is trying to sell the home she lives in for $209,000, but the mortgage balance is $350,000.

Chambers, who owns two hair salons, says she would rather stay in her home, where she lives with her 14-year old son. But she had no luck getting help with her loan. She said she's resigned to scaling back her lifestyle and renting out an apartment.

"I've had to accept a lot in the last year," she says.

Brandee, you're not alone in your financial misfortune. But it appears that your health is good and that you have an ongoing business. You may well have a high income. Why should taxpayers kick in on your behalf?

There is little rhyme or reason in this administration's actions. Ms. Chambers can likely take $3000 out of her business.

From corporate welfare for Big Finance to harsh treatment for GM's creditors, from imposing high Obamacare costs on the young and healthy to simple cash giveaways to seniors just simply for being old, the President has taken a "Great Recession" and used it as the springboard for a massive expansion of Federal power, almost all of it using printed or borrowed funds.

Unlike in 1994, when balanced budgets began to be imposed on the Clinton administration, there is no Ross Perot who had two years earlier received one-fifth of the vote for President because of the budget deficit issue. Tea Parties are much smaller than the Perot movement. Thus a Republican victory in November, should it occur, is likely to have less force than it did in 1994.

Chronic and large deficits as far as the imagination can envision? Could be. What would this mean for investors? Not clear.

Copyright (C) Long Lake LLC 2010

No comments:

Post a Comment