The Power of Strangers

It would be a beautiful thing if there was an easy solution for ‘underwater’ mortgages, but there really is not. The real problem lies in the reluctance of all Parties to make amends to the initial mistakes made. Both Consumers and Creditors ignore the most fundamental first mistake of their mortgage; which was the maximization of their Credit potential when first acquiring the mortgage. Understand that the excessive extension was mutual; bankers should no more allowed such growth in mortgage size than Customers should have asked for such large amounts of untied Cash. Mortgages should have proper reserves, exactly as Banks must fulfill demands of the Fed for capital reserves. The concept that a down payment served as such a reserve was stupid in concept, and only another fuel component to the fire of mortgage meltdowns. A much brighter choice would have been insistence that banks could only extend 88% of the estimated value of the property as mortgage loan. This initial moderation could have probably have saved a majority of these mortgages, and the useless nature of down payments could have been dropped from the lexicon; thus eliminating artificial creation of bank reserves, and not stripping immediate Cash reserves from the mortgage holder.

I will let the Reader pick through this thing without that much Comment. I will first state that the source of any fraud is confusion and mixup of the lexicon; the fraudulent first convince the Sucker that there is a vast range of ideation out there which the Sucker does not comprehend, and the fraudulent will act as cursor through the complexity as friend. Prop trading first, last, and always is the selling of ‘Blue Sky’. There is no sharp delineation of Risk, there is not designed recourse to non-fulfillment, and no justification of the middleman Costs of the Issuer. The later has already established the Risk, designed the spread instrumentation, and frees itself from any reactive risk through documentation which the Purchaser cannot alter. Such Issuances does not offer opportunity to negotiate the instruments, or offer an identifiable Product exchange; this all means that such instruments do not constitute legal Contracts in the traditional sense. The best which might be said of prop trading is that it is legitimized fraud.

Here is a good Post on the ability to utilize altered circumstance to attain a relative degree of power. Thank God that the 10-hour Day did not take hold; I already find the passage of the hours to be a constant burden. Poor Students have for years been pressed to learn all the digital systems of measurement, and the methodology of transference from one system to another. Now We must learn the differences between old and new forms of Risk, simply to avoid losing what forms of capital We managed to attain under older systems. It is Time to stop and smell the flowers, before they devise a new Rent rate for the damned things. lgl