An Honorable Renter and Saver Rants: "Remember When Republicans . . . ?"

Housing Crash Survivor Asks, "Remember When Republicans . . . ?"

As readers of this blog know, I am a big fan of Motley Fool message boards.

The collective wisdom of investors who are doctors, lawyers, armed forces members, stripclub DJs, stay at home moms, CEOs of publicly traded companies, retirees, etc., cannot be matched anywhere on the Internet in my opinion.

One of the things which has erupted in the past two weeks is a growing discontent by Motley Fool posters from all political persuasions, Democrats, Independents, Republicans, Libertarians . . . you name it . . . for hints at and calls for government intervention in the Housing Bubble Crash.

Over the past two weeks, posts on the Motley Fool boards which were well written and critical of any government intervention to bailout Wall Street and homeowners who made very risky purchases of overpriced Real Estate and CDOs, MSBs, etc., were recommended so many readers they became "Posts of the Day" read by tens of thousands of Motley Fool readers.

The Anger of Responsible Americans Is Evident Everywhere on the Internet

Yesterday, I laid a link on you from the "Eye on Miami" blog.

If you read the responses to that blog discussing government intervention to bailout homeowners, you would have seen that responders to that blog were all aligned in thought: NO government bailouts.

If you were to read Michael Shedlocks (or Mish as he's known by those of us who still post on the board he founded on Motley Fool) you'd sometimes see 300 responses in which more than 95% of the responders are saying, "No government bailouts." (By the way, to read Mish's blog, check the right hand margin of this blog.)

A Gem of a Piece of Writing from a Motley Fool Board Earlier this Morning. . .

Today, actually just minutes ago, I read another post about this ridiculous pandering by the current Administration to American adults who made unwise life decisions to buy housing when it was obscenely overpriced.

On this blog I constantly ask, "Where are the adults?"

Today, in an outstanding post on the Motley Fool's Political Asylum board, a regular poster there, JimiH3ndrix, asks "Where are the true Republicans?" And then he lays down a rant which is fast collecting "best of" recommendations from readers.

His post, message number #1117035 dated today and posted at 9:38 AM is one of those brilliant posts and rants which you want to print out and put into magazine form for the whole world to read.

Recently, I had that idea. Why not take some of the best posts and responses of Motley Fool and repost them on this blog so as to get more readers involved in the "education, enlightenment, and amusement" of small investors . . . which is Motley Fool's mission statement?

I can use this blog to introduce non-Motley Fool posters to a world of individual investors and freethinkers who have formed one of the most exciting communities of brain power anywhere. Sometimes, the community fights one another like a mongoose and snake. Other times, it seems as the whole community pulls behind a idea which is too big to ignore.

Often, I've urged new readers of this blog to become members of Motley Fool boards.

Recently, Dave and Tom Gardner, founders of Motley Fool, made the discussion boards FREE.

So, you no longer have to pay to read or post there.

Hence, once you read the following post . . . and I'll give you the direct link to JimiH3ndrix's post. . . please, upon completing your read, join the gang at Motley Fool.

When you join, introduce yourself as a new poster and take time to explore the different discussion boards. (I'm usually found on the Macro Economic Trends and Risks board.)

That said, here is Mr. Hendrix's entire post, unedited, word for word.

As soon as I hear from several Motley Fool responders, I hope to add their remarks to the end of this post . . . or you can click on the link and read them for yourselves.

This is the first time I've ever posted a Motley Fool message board piece. I just want Jimi H3ndrix to know it is an honor to post something which was written with so much fire and passion.

So, world, here comes your introduction to Motley Fool's JimiH3ndrix and his rant:

"Remember When Republicans . . . ?"

Politcal Asylum Board on Motley Fool msg. 1117035

(Rock's note: click on the red highlight above and you should be taken to the entire "thread" where Jimi's post shows first and all responses show next. If you have problems seeing this, World, maybe you will first have to become a FREE member of Motley Fool. I don't know. But it would be nice if one of you non-Motley Fool readers would respond to this blog and let me know if you could link directly to Jimi's post and the ensuing thread.)

Everything which follows . . . in blue ink . . . is JimiH3ndrix's words from his post "Remember When Republicans . . . ?"

Remember When Republicans . . . ?

Believed in the primacy of free markets?

Believed in the enforcement of contracts freely entered into?

Believed in individual responsibility for decisions made & actions taken?Believed that government distortion of markets, at best, tended to make them inefficient, and at worst, contributed to moral hazard?

Yeah, me neither.

WASHINGTON -- President Bush, looking for ways to respond to the subprime-mortgage crisis, will outline a series of policy changes and recommendations today to help borrowers avoid default, senior administration officials said.

Among the moves will be an administrative change to allow the Federal Housing Administration, which insures mortgages for low- and middle-income borrowers, to guarantee loans for delinquent borrowers. The change is intended to help borrowers who are at least 90 days behind in payments but still living in their homes avoid foreclosure; the guarantees help homeowners by allowing them to refinance at more favorable rates.

Mr. Bush also will ask Congress to suspend, for a limited period, an Internal Revenue Service provision that penalizes borrowers who refinance the terms of their mortgage to reduce the size of the loan or who lose their homes to foreclosure. And he will announce an initiative, to be led jointly by the Treasury and Housing and Urban Development departments, to identify people who are in danger of defaulting over the next two years and work with lenders, insurers and others to develop more favorable loan products for those borrowers.

http://online.wsj.com/article/SB118851742988914064.html?mod=hps_us_whats_news

(Rock's note: Motley Fool posters almost always attribute words from online links in Italics. In the case above, the words in Italics were part of the Wall Street Journal article which JimiH3ndrix is using as a basis for his latest rant.)

It was clear for so long that buyers were stretching to get into the largest & riskiest mortgage they still couldn't afford.

Buyers were complicit.

Lenders were complicit.

Assessors were complicit.

Wall Street was complicit.

Bush doesn't encourage return to responsible real estate markets.

Bush doesn't propose pursuit of the complicit who broke laws.

Bush wants to punish responsible American savers who might otherwise purchase a distressed home through a market transaction. He prefers short circuiting the ability of individuals through such a market transaction from solving the problem in both the short and long run.

In the short run, distressed assets pass from weakly capitalized parties to more strongly capitalized parties.

That is how it should be.

Those who lose their homes were never "home-owners": they were leasing it from the lender who owned the note on the home. In many cases, borrowers were using interest only instruments that established no additional homeowner equity beyond the wager that house prices would continue to escalate.

They made a bet, and they were wrong.

They need to leave the chips on the table and walk away.

Not get bailed out by bloated government.

In the long run, market transactions bring discipline back to lending standards. If the speculators and the liars-on-loans and the lenders get bailed out, there's little reason for them to change their practices.

And if you're struggling to make good on your mortgage today, Bush has just increased the incentives to you to skip some payments so that you, too, can qualify for the handout being proposed.

This is known as "moral hazard."

I rent.

I have saved responsibly.

I have a wife & son in search of a home.

I stand at the ready with liquidity to purchase a home.

I am one of the responsible saving individuals who can help solve this problem. That free markets rely upon to step in to solve the "problem" of distressed assets.

They are not a "problem": they are the natural result of markets acting freely, and they reward those who save.

Bush's proposal punishes me.

Punishes my wife.

Punishes my son.

It punishes markets.

It punishes taxpayers

It rewards the liars, the gamblers & the irresponsible,

Jimi

(end of Jimi's rant)

Now that is the kind of writing you can read for free by people who are not members of the Mainstream media.

It is powerful and to the point.

And that so many readers are already responding to it, shows that there is a groundswell of anger, early on, in this stupid wasteful attempt by politicians to "save" somebody else with the latest socialistic handouts.

If it isn't payments to farmers to not grow crops, it's corporate welfare to un-Patriotic Americans who embezzle billions in Iraq as so called contractors.

If it isn't pork barrel projects to build bridges to nowhere, its handouts to the wealthiest supporters who scored huge bonuses last year on Wall Street but who are standing with palms outstretched this year.

I can tell you this: the first politician who steps up to the plate and says, "Enough" instead of "Let's give everybody free money so they can make risk free bets," is going to win a landslide of votes from honorable Americans who work their asses off and who scrimped and saved to attain their wealth.

This is a huge groundswell of anger facing politicians on both sides of the aisles.

The middle is no longer going to vote Republican or Democrat.

But I can tell you this: George Bush, go ahead, push through these bailouts, and you'll see the Republican Party lose more seats than anyone thought imaginable in the 2008 election.

Mr. Bush, responsible American adults are pissed with this enabling of gamblers from both ends of your voting block spectrum. If you think catering to speculators' interests can go unnoticed by the great mass of Americans who play by the rules, you've got another thing coming, Sir.

Think of the villagers with torches and pitchforks in the old Frankenstein movies. They are going to torch what's left of the Grand Old Party.

And it can't come soon enough.

May a new Barry Goldwater emerge from the ashes.

Humbly yours,

Rock Trueblood . . . Key West

(disclosure: I don't make a red cent off recommedning people to read Motley Fool boards . . . or any other writer listed in my Honor Roll of Links. I simply provide a watering hole for your brains. I can't make anyone drink.)

p.s. Thanks to JimiH3ndrix again for his great post and thanks to everyone at Motley Fool for making it possible for so many wonderful people to congregate and argue in ways which show how a true Democracy works.