alt.politics.usa.republican

in article @ , me at
oconnell@ wrote on 8/13/07 10:25 AM:

> On Aug 12, 5:43 pm, Blash wrote:
>> in article ...@ , me at
>> oconn...@ wrote on 8/12/07 4:46 PM:
>>
>>
>>
>>
>>
>>> On Aug 9, 11:44 pm, alexy wrote:
>>>> me wrote:
>>> [snip]
>>>>> I guess you can make the case that the market assumes
>>>>> a general level of distortion and adjusts accordingly. But that
>>>>> gets back to the concept that the market adjusts
>>>>> its lies faster than it accounts for the distortions. The liar
>>>>> knows the adjustments being made to their value, so
>>>>> they know the amount of distortion they have to achieve.
>>>>> The evaluator on the other hand has no way to measure
>>>>> the magnitude of the distortions until after the fact.
>>
>>>> I'm curious what solution you think would be appropriate. It seems
>>>> pretty clear to me that the problem is credit being extended to people
>>>> who cannot afford it, often on terms that unfairly induce them to take
>>>> on that debt.
>>
>>> Really, I think what we are beginning to see is that the borrower
>>> isn't as "qualified" as the paper work he was generating and signing
>>> implied. The broker may have been complicit because they knew
>>> that the risk was down stream and therefore they aren't exposed to it.
>>
>>>> While I suspect that we disagree on the magnitude, I am
>>>> willing to stipulate that the ability for loans to be resold and
>>>> packaged as CDOs contributed to the availability of funds for these
>>>> loans, But what is the solution? I suggest that a targeted approach,
>>>> attacking the problem at its source--the loan origination--is the
>>>> right course, and is less likely to have undesirable consequences than
>>>> a shotgun approach. What would you suggest?
>>
>>> I have to admit most of the "solutions" don't particularly appeal
>>> to
>>> me but somewhere it would seem we need the initiator of the loans
>>> to maintain some connected risks.
>>
>> I suggested something like this once many moons back, not just on
>> mortgages, but on all forms of debt, equity, etc. I suggested that the
>> initiator, underwriter, banker, attorneys, etc. take a small % of their fee
>> in the form of 144 type paper which would not free up for X number of
>> years....
>> Boy, oh boy, did I get pooh-poohed!!!-
>
> Well, you potentially are undermining a fundamental principal of
> capitalism. You're forcing people to tie up capital in unalterable
> investments.
>

NONE of those people have set fees.....they are all negotiable........
they could turn down the deal if they didn't like that type of
structuring.........(if you notice, I said "a small % of their fee")......
Look at the take home checks of some of them......it wouldn't put them
in the soup-line......