Keep Comparing the Great Recession to the Great Depression

THE BUILDING OF HOOVER DAM DURING THE GREAT DEPRESSION KEPT VEGAS ON THE MAP
The Great Recession is not as crushing as the Great Depression, but President Obama’s problems in the face of economic turmoil are beginning to look like those of Herbert Hoover, the President during the beginning of the Great Depression. The stimulus program on which he hung his hat may, as its friends argue, have prevented an even worse economic debacle. Clearly, however, the $800 billion plus stimulus failed to jump-start an economic recovery. Many of the administration’s pet stimulus programs have joined Jerry Ford’s “Whip Inflation Now” buttons on the junkpile of history: green jobs, cash for clunkers, debt relief for homeowners, and now, by the President’s own admission, ‘shovel-ready’ infrastructure projects.

Like Hoover, President Obama now finds himself (at least temporarily) without the ability to shape national economic policy. His opponents in Congress will block the kind of second stimulus his instincts and allies propose, and the Fed is not at this point particularly impressed by the White House’s recovery plan and is acting on its own. Like Hoover, President Obama faces the possibility of a devastating second downturn due to economic problems in Europe — and like President Hoover, President Obama can’t do much to prevent it. Like Hoover, President Obama is harried by a domestic populist revolt against his leadership and the policies he supports and like Hoover, President Obama’s once unassailable popularity is being slowly ground down by economic bad news, by Is Carter A Best Case Scenario?.

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Freestyle writing not about foreclosure

WORLD WAR TWO STOPS A DEPRESSION AND CREATES A FAMOUS WRITER
“When I write I can shake off my cares. My sorrow disappears, my spirits are revived. The nicest part is being able to write down all my thoughts and feelings; otherwise, I’d suffocate. But, and that’s the big question, will I ever be able to write something great. Will I ever become a journalist or writer? I hope so, oh, I hope so very much, because writing allows me to record everything, all my thoughts ideals and fantasies. You’ve known for a long time that my greatest wish is to be a journalist, and later on a famous writer. In any case, I’d like to publish a book” states Anne Frank in her diary.

Freestyle writing is like brainstorming. You just write down words, not sentences, but words. Crap. The words sometimes turn into sentences. I forgot about that. Sometimes you do both. Crap.

Freestyle writing is designed to organize the thoughts in your mind. You can thow the writing away when you are done, or not. The benefit of freestyle writing is it makes you think better. Maybe, another benefit (not likely) is it gets published.

How does freestyle writing progress over time? First, like Punk Rock music- raw and in your face, then subtle like champagne jazz. Look for themes in your freestyle. Do certain words keep popping up? Cuss words? People’s names? Illegal thoughts? Can thoughts be illegal? Can you copy someone elses writing and have it still be freestyle? Can you?

Isn’t journaling the same as freestyle? No, yes, it can be. Are they a recordation of events? They can be. Are they accurate? They can be. Should you judge your freestyle writing? You can. Does it matter? It can. If it matters should you care? Maybe. Just keep writing.

What if someone reads it? Keep writing. Isn’t that personal? Yes. Do people really take an interest in your journals? They might. Can your journaling become an international event and shut down the country? If you are a politician, yes. If not, we’ll see.

“Night after night, green and gray military vehicles cruise the streets. It is impossible to escape their clutches unless you go into hiding. No one is spared. The sick, the ederly, children, babies and pregnant women-all are marched to their death,” states Anne Frank.

The Great Recession my final word

Signs of collpase are everywhere. With economic security an uncertainty, marriages are being postponed at record numbers. To many Americans, capitalism seems beyond repair. Unfortunately the problem is without a solution. When historians and economists look back at the Great Recession, most will conclude there was no solution.

What makes the Great Recession so appalling a human tragedy is that, it like the Great Depression, can only be overcome by an event as awesome and as terrifying as itself. For the Great Depression, that event was the Second World War.

New Nevada law may or may not impact short sales

A new Nevada law effective July 1, 2011, AB 273 virtually eliminates the six (6) YEAR statute of limitations for second mortgages. Now, lenders have only six (6) MONTHS to file a lawsuit for a deficiency judgment after either a short sale or foreclosure sale. That six (6) months applies to second mortgages. In other words, after a short sale or foreclosure sale the lender only has six (6) months to come after you for the second mortgage. The new law does not effect first mortgages.

Can reducing the time frame to file a law suit really measurably change real estate in Nevada? Just like the temporary “excitement” surrounding HAFA a couple of years ago, AB 273 will likely generate temporary excitement, but die down…to possibly nothing. After all, the law still doesn’t address negative equity which is the real problem.

1. The banks will sue sooner. If the banks want to sue a homeowner to collect on a second mortgage they will have to move quickly- within six (6) months of the sale of the home. The banks will no longer have the luxury of waiting a few years for the economy to turn around and the homeowner to get a job and become solvent. It could, in theory, cause a flury of lawsuits.

2. The banks may forego filing a lawsuit. If the banks don’t move quickly they will miss their opportunity to file suit. Some deficiency judgments may be barred by the shorter statute of limitations.

3. The resale aftermarket for second mortgages will decrease. Deliquent HELOCs and second mortgages are bought and sold just like credit card debt. Second mortgages will be worth less, far less, because the purchaser of the second mortgage will have only six (6) months to sue instead of six (6) years. Purchasers of second mortgages, usually bill collectors or law firms, generally buy second mortgages in bulk and slowly begin filing lawsuits on them. Far fewer bill collectors will buy delinquent notes if they have only six (6) months to collect.

4. Portions of the new law could be overturned by a judge since it is arguably retroactive. Also, a judge could “interpret” the law differently than me. The lender might challenge the law and argue that it effects second mortgages that were taken out several years ago. At the time those mortgages were taken out, the lender assumed that it had six (6) years to sue in the event the homeowner defaulted. Quite possibly, the lender would not have made the loan had it known that it really only had six (6) months to sue. Thus, the law is affecting the rights of parties who have previously entered into a private contract and is thus, “ex post facto” unconstitutional and should be stricken.

America won’t look for its decade

The Federal Reserve on Wednesday cut its forecasts for U.S. economic growth, but offered no hint of action. The Fed looks set to take a break, sit on the bench awhile and watch the game unfold. Nice.

The Fed downgraded its view of the labor market, saying it had been “weaker than anticipated” and pushed its forecast for unemployment higher. That means a “lost decade” in where employment isn’t forecast to return to previous highs through 2020 at least. “There are some cities that are not going to be at the unemployment rate they were before the recession started for another 20 years”, said Los Angeles Mayor Antonio Villaraigosa on Tuesday.

We are still only half-way through this Lost Decade, and perhaps we can turn things around by an aggressive mid-decade course correction. Losing half of a decade could be bad luck. Losing a full decade begins to look like recklessness.

Nevada Assembly Bill No. 273

Darren Welsh’s Blog on AB 273

Actual Assembly Bill 273

CONCLUSION

The bottom line to AB 273 is that lenders have only six (6) MONTHS to file a lawsuit for a deficiency judgment after either a short sale or foreclosure sale. That six (6) months applies to second mortgages. In other words after a short sale or foreclosure sale the lender only has six (6) months to come after you for the second mortgage.

The prior time for which to file a lawsuit was six (6) YEARS after completion of the short sale or foreclsoure sale. See my previous article on time limitations for filing deficiency judgment lawsuits.

Will Boomer’s resist economic policies that favor rapid recovery?

AMERICA CAN AVOID JAPAN’S MISTAKE
Ageing societies prefer to sacrifice the young to a long period of slow growth rather than erode the savings of older voters; that is one reason why the Great Recession is dragging on. What?

The United States recovered from the Great Depression by instituting an economic policy of debt reduction by concurrently stimulating rapid growth with high inflation. Inflation reduces the real value of debt. People on fixed incomes and those with a large portion of their wealth in ordinary savings accounts realize a lower economic lifestyle when the economy heats up since their income does not rise nor their savings keep up with the rising cost of living. In effect the recovery from the Great Depression favored young people who were workers because it created jobs, and hurt older people who were on a fixed income. Eventually, however, even the older people benefited since a better economy improves the lives of all Americans.

Executing an inflation causing economic policy during the Great Depression was politically easier back than since there were fewer older people to vote against it. In America from 1945 to 2000 there were far more workers than non-workers. In the past five years, however, the opposite is true, the fraction of the population working has fallen from 63.1 per cent to 58.4 per cent. That ratio will continue to worsen over the next five years as Baby Boomers retire in historical numbers. The U.S. government must reduce debt even as it hurts a lot. There is no other choice if we are to avoid a lost decade.

What policy do you vote for when older people’s interests conflict with their kids and possibly grandkids? Who pays and who doesn’t? Pitting the interests of parents or grandparents against their children or grandchildren is short-sighted, because, current retirees on the average have paid payroll taxes that, in present value terms, equal or exceed the value of the pensions they will eventually receive, thus, they have given and they deserve to get back.

The solution to America’s current economic problems will require a sacrifice on the part of at least two generations: Boomers and X. The policy should favor generations Y and Z because, well, they are our kids and grandkids. Boomers will have to accept the fact that they will have a stagnating standard of living for a while as the economy heats up. Generation X will have to accept that they will never have it like their parents. Generations Y and Z will have to have hope.