Really? Big news story in the Wall St journal today, fewer will get mortgages over the next year. Yes, this is something we know. Too many people got mortgages based on no finances. Those bad, irresponsible folks taking a nice house for their family offered to them by the mortgage lenders at the banks who were doing the offering, telling them they could afford it, that everything would be fine, selling them a house with a flexible rate. When the market fell, they lost their home. They should have known better. They should have worked hard, saved their pennies and offered a sizeable down payment at the time of purchase, with their solid credit rating, and not taken a deal unless it had a fixed rate and decent interest rate.
Well, news flash, most people live paycheck to paycheck, even at the higher middle class levels with 2 incomes in the family. Partly this is due to our credit culture where we all have to have our “things” to be happy. But let’s pass around the responsibility a bit.
Most Americans watch 4-7 hours of television per day, where commercials blast “things” at us every 10 minutes of programming. What are the constant messages blasted at us by the media circuit, on television, Internet, radio (if anyone still listens to that, perhaps in their car), on bill boards as we drive? — It’s all about “things” we need to be happy, to have a girlfriend/boyfriend. To go against this constant barrage of needed “things”, we have to go against the norms of society, which means we have to swim upstream. It gets tiring. Somewhere along the way, we cave in and just “go with the flow”. President Bush sends out a check to families, telling them to SPEND IT to help the economy! The economy was tanking, if they spent it, they paid an electic bill with it!
Those people getting loans based on nothing are now losing their homes. But the banks, the mortgage lenders? No sweat, they got bailed out. We all heard in the news how they took the bail out money and continued to pay their CEOs millions in BONUSES. So we all know who cares not a whit about the people losing their homes. We all know who suffers and who goes on as they have been since the end of the Great Depression.
So my actual focus of this blog is this: Where do we go from here? Where we are going is back to BEFORE WWII, when 30-year mortgages without needing a huge down payment were INVENTED, mostly for the GIs returning to get out of the shanty towns that were set up in quonset houses, barracks, and get them and their families into nice, individual homes. Of course, these home loans were denied to black GIs, but oh well. The public wasn’t ready for integration of suburbs.
Bankers and lenders have always done whatever they want, while the people working those jobs take the hand outs and imagine they are independently deciding these things.
People losing their homes, losing their jobs, are now unable to pay those home loans and credit cards at the high interest rates, and their CREDIT RATING is going DOWN THE TUBES. And it is not their fault. Companies offered these things to them and convinced them they could afford it, and their neighbors were getting them, so they also “needed” them. Now we know that was a sham. But the people of America, those hard working people now seeing the loss of those promised “things” are losing out. Their credit rating is going down and there is nothing they can do about it. They will not be able to get a home loan, they will be denied credit cards, and increasingly, employers are checking CREDIT RATINGS before they hire someone. It is a black hole, there is no escape. So the middle class is disappearing. Those at the higher ends can still afford their payments. Those in the middle are moving to the bottom, are losing their homes, now forced to rent a place, and see their wealth disappear. When they lose those jobs, they also lose their health care. So they will die sooner. But we know from watching the Republican debate on television, the Tea Partiers think that laughable. “Let him die! (erupted laughter)”. We are fast returning to an era of haves and have nots. Was Marx more prophetic than we give him credit for? He did not foresee a middle class, minimum wage laws, easy credit. Are we returning to his predictions? Interesting thought. Time will tell. In the meantime, we all search for a way to survive present conditions. Students take to the streets to protest their thousands in student loans and lack of jobs and opportunity.
There is a certain amount of survival skills due to life experience that comes with 57 years of life. This too shall pass. What the next stage will be, no one knows. Change is certain. Each of us is responsible for what change occurs. Each of us has a brain. Study, learn and contribute. Always contribute. Prepare the best you can. For the immediate future, try to keep costs down, live simply, have any sort of “savings” if you are able. Find a way to survive. Build your skill levels, add things to your resume, promote yourself, network.
It is certain that some will survive, and some will not. Makes me want to gather my children and grandchildren close around me. Know who you can trust and depend upon each other. We are not in this world alone and none of us can survive alone. Human beings are social creatures. Trust and love.
Doctor Grandma 