Posted by PJM/MI on 3/15/07 6:10am
Msg #180009

Foreclosures in MI & subprime lenders

Over 13,000 foreclosed homes in Michigan (according to one website) with over 22,000 bankruptcies filed.
I'm a little distressed the Feds are blaming this entire mess on the subprime lenders. Yea.. I know alot of crappy loans were written and there was alot of predatory lending going on.
BUT... alot of people signed those notes when they had JOBS. And some people signed some darn good notes when they had JOBS.
Without a secure job force, of course the foreclosures are going to be more & more.
The problem does not stem from the mortgage world.. it stems from the overall economy of the U.S. We are shipping our jobs overseas and no one seems to want to put a stop to that.
I think the finger is being pointed in the wrong direction..but that's JMHO.
4 foreclosed homes in my neighborhood.. why? LOSS OF JOBS.
I sat down with my ex-neighbor to find out what happened. He had a really good job at a local manufacturing firm. Their last re-fi was 3 yrs. ago. Excellent rate (4.75) on a 30 yr. fixed. All credit cards paid off. No vehicle payment. Went into work on Friday and was told the plant was shutting down on Monday. Wife worked there, too. Both tried very hard to get another job, but both have only manufacturing skills. Unemployment ran out. Savings was depleted. Foreclosed home. Was it the lenders fault? No. Was it the borrowers fault? No.
Just think.. this scenerio is being played out daily throughout the U.S. Where will it end?
Added note: 29 state police are being laid off today and the Academy is being closed.

Reply by Julie Williams on 3/15/07 7:03am
Msg #180010

PJM you seem passionate on this subject as I have noticed you frequently post on the foreclosures and subprimes loans.

I have been in the title business since 1983 and this is a cycle. There are ups and there are downs.

What is different from 15 years ago, is that people are using their equity in their homes to payoff credit cards. They are using their equity to buy cars as the interest is deductable. Lay-a-away is unheard of, you go to art van, buy their crappy furniture and make no payments for 36 months. By that time, it's fallen apart and no payments have been made on the old stuff.

Toyota and Honda have been building cars that are more reliable and the big three have ignorned the warnings.

The unions have had the auto industry paying layed off workers 95% of their pay. Many of my family members worked the line and they also went in on the weekends with their mini-televisions and got double pay for doing nothing, by their own admission. The costs of hospitals have gone up, the pay for nurses has gone up so health care premiums are next to go up.

We live in a free country and it's just the economy, folks need to be proactive, especially in our state and realize it is not longer feasible to spend your working life on the assembly line. Costs are cheaper overseas, what is business supposed to do? They are their to make money, not be the caretakers of a country. It's time for people to get proactive and by stock in the oil companies (Michigan's pension is invested in a lot of oil companies, yet Graholm says how wicked they are), so folks need to look at the big picture. Just as most were farmers 100 years ago, the job climate is changing and you just have to keep up with the times.

Reply by LarryTN on 3/15/07 7:56am
Msg #180016

I agree that it is the economy... IMHO I feel that the economy is being ruined by the greedyness of big business, oil and gas interests, utilitiy companies, pharmaceutical companys, and the medical profession, all fueled by over paid over bearing lobbyists in Washington DC....Along with greedy congressmen who take the freebies. When will it ever stop?
I agree, companies will go outside this country if they can get cheaper labor simply because it is cost effective to their bottom line. ..... if we could bring the cost of living down in this country, employees might consider taking lower wages and keep those jobs in this country! Of course I don't see that happening in the distant future...I'm afraid if we continue to go down this road we will eventually become a third world country!

Reply by Dorothy_MI on 3/15/07 8:02am
Msg #180020

I agree

And a big part of that problem is ILLEGAL immigration. But as long as we sit on our hands and do nothing they (the crooks in WA - and they're in both parties) will continue to "follow the money" and lean whichever way their contributors do. WE CAN MAKE A DIFFERENCE! If any of you are interested, send me a private reply and I will send you a web site that is very effective in letting congress (and the President) know your feelings on this and other important legislative issue. I for one am willing to do whatever I can to stop us from becoming a third world country.

Reply by LisaWI on 3/15/07 8:10am
Msg #180022

I have to agree with PJM and Larry. My question is: Where has the pride gone in stating "Made in America". Corporate America has taken over Mom and Pop Shops and then moved their business oversees for production or what not.
I, IMO of course, dont think our economy is doing very well as a whole. It might be for the "Big Dogs", but not for "Joe Schmo".
And I came to the conclusion 2 or 3 years ago, there isnt any such thing as Job Security anymore.

Reply by PL on 3/15/07 8:33am
Msg #180032

I drive an American made Subaru and my brother a Mexican

made Ford. So what is American made? I am somewhat careful about my purchases and I try to stay away from Chinese made goods, but we live in an era where global trade is here and it's going to stay for the forseeable future.
My mortgage is with an Australian company and offers a darn good rate and package. Should I have got a Citicorp mortgage, because they are headquartered in NY? Why no, because it's not about being made in America, it's about competing against the world and offerring the best package. We still have it good in this country, for I have been all around this world and I'll stake my and my family's future here, for I still believe it's the land of opportunity.

Reply by MelissaCT on 3/15/07 9:39am
Msg #180051

Brings to mind something I heard a while back about

a guy losing his job to outsourcing & he's complaining that people aren't buying american made products. Well, he has a Toyota truck, Mitsubishi car, Sony TV, etc...we all get the picture. Problem is, your point -- the lines are becoming blurry.

Reply by SueW/Tn on 3/15/07 2:37pm
Msg #180094

Julie is 110% right on, BO's must take their fair share of the debt blame. We're an instant gratification society, we want what we want and we want it NOW! I remember "lay-aways", I'm not even sure they exist now. I also agree with PJM and appreciate her passion for folks that get into a situation that for the most part isn't of their doing. However I can speak from first hand knowledge, there is NO job security in any industry. People have forgotten about the rainy day fund and get lulled into the "it can't happen to me" thought process. If you don't take care of you, no one else will. Dog eat dog.

Reply by NCLisa on 3/15/07 8:10am
Msg #180023

When Unemployment runs out

you are off the radar. When you hear that the unemployment rates are lower than ever, it truly has nothing to do with the number of people unemployed, only the number still eligible for unemployment payments. That always makes it look like we have a better economy than we do. The political forces that continually talk about what a great economy we have right now, don't live anywhere close to the real world!

Reply by PA_Notary_II on 3/15/07 9:20am
Msg #180044

The political forces...

are the reason our economy is where it's at today. Greed is the engine that powers our economy. As an example, consider the drug companies. Our tax dollars fund their research, and when they have a fantastic breakthrough drug, they sell it back to us for $5 a pill, forgetting that it was our money that already paid for their success. (forget that they are now producing that pill for 4 cents each) I didn't believe that gasoline prices went down, the last time they did, because it was election time. I was proved wrong when they went up immediately after the vote was done. I have voted Republican for many years, but I want my Republican office holders to know that, becuse of their mis-handling of our economy, I can't afford to vote for them any longer. Maybe it's not a matter of which party is in office, but I've got to try something else, if only as a matter of conscience.

Reply by JanetK_CA on 3/15/07 7:59pm
Msg #180126

Re: The political forces...

I pretty much agree with both of you. Unemployment figures also don't include the underemployed - people who often at the height of their earning years (mostly in their 50's) lose their jobs, then are forced to take employment at a much lower income level.

And then we have the unconscionable income levels of top corporate executives. Where the average CEO used to make 4 - 5 times the average income of company employees, some are now making 40 - 50 times their employees' average incomes. I can't think of any justification for this, except that they sit on each other's boards and can get away with it.

As for pharm co's, in all fairness, I believe that they do invest significant amounts in research developing new drugs - as long as the market for them is potentially very big and requires long term maintenance vs. an actual cure... But when they talk about how expensive it is to develop new drugs, they always talk about it in dollar amounts, rather than a percentage of revenues which would be a more meaningful figure. In fact, many of them are making record profits, like the oil companies. In some ways, I think we might be better off long term if more medical research was paid for by taxpayers, especially for stem cell and genetic research. That way, the knowledge would be public domain vs. patented by individuals and corporations.

BTW, re: the comment above that included doctors in the greedy category, while there are certainly some exceptions, I do have to disagree. As a whole, their incomes are actually coming down very significantly, to the point where there could be shortages with the aging baby boomers. There are already some shortages within certain areas of specialization. It's the insurance companies that get me riled up when it comes to health care costs. I won't even get started on that one...!

Re: gas prices, I did predict that they would go down before the election and go right up again right after it. (And I sure hated being right about that one!) What I didn't predict is how badly they would turn the screws on consumers in CA again. We are somehow having shortages in refinery output here to the point where gas that's refined to meet our air quality requirements is again up to the $3.20/gal range (at least in south OC). Earlier today, however, I paid $2.91/gal at a Costco some 25 miles from here after a signing appt. On the way home, I drove by the local Costco (Irvine) and saw it was selling for $3.03. (They're typically much cheaper than other stations.) I have a hard time blaming the differences on property values and rent costs! But some of it is our own fault because so many continue to increase consumption - commuting longer and longer distances and insisting on driving big SUVs, even though there is usually only one person in the car! However, I'd bet money that part of it is also an attempt to get us increasingly used to paying more at the pump. Unfortunately, it seems to be working... ['Course the increasing consumption of countries like China, etc. might have some kind of impact on supply and demand...;>]

Oh, and PA_Notary_II, good for you for recognizing that we need to hold our political leaders accountable, regardless of party. I believe that to be the very best way of demonstrating our patriotism and of protecting our political system. Reminds me of a quote (from whom, I have no idea...): "We have the worst political system in the world.... except for all the others!"

Whew!! That was fun getting on my soapbox again! [If you guessed that I'm killing some time before my next appointment, you guessed right! ;>]

Reply by SDSJCC on 3/15/07 11:23am
Msg #180057

I truelly agree with everything pjm has written. I know for a fact it's the economy going down.Due to all these bussines moving over seas, for instance right here where i live Rival manf. closed there door one day with "NO" warning.over 600 people lost there job, what skills do they have??????

Reply by PL on 3/15/07 11:57am
Msg #180061

What skills do they have?

Who knows? Companies though are not in business to be perpetual employment centers, they are in business to produce products that sell and generate enough profit to continue in business. Perhaps this Rival facility could not make and sell its product at a profit, is it the responsibility of Rival to continue this business ad infitem for the benefit of the employees? Of course not, Rival is beholden to its shareholders and others to continue to be profitable or risk sinking the whole ship.
Perhaps these 600 can get further education and move on to more profitable enterprises or perhaps they will have to move to find greener pastures. Either way it is America and these folks have the same hope and promise that we all share.

Reply by JanetK_CA on 3/15/07 8:37pm
Msg #180131

Re: What skills do they have?

Or they can become a notary republic (sic) and NSA and make a six-figure income! Right??? Just ask XXY and the other copy cats...!! ;>

Reply by Elizabeth Soliday on 3/15/07 11:19pm
Msg #180150

My whole family lives in Grand Rapids, Michigan. We tried to find jobs there, but were unwilling to take the risk with the economy the way it is. We did end up buying a nice house there in GR, so we will always have something there just in case. My heart goes out to all those Michiganders who are losing their jobs though.