Friday, September 1st, 2006

Nightmare Mortgages
They promise the American Dream: A home of your own — with ultra-low rates and payments anyone can afford. Now, the trap has sprung

Atrios tells us this is going to be bad.

Because banks don’t have to report how many option ARMs they underwrite, few choose to do so. But the best available estimates show that option ARMs have soared in popularity. They accounted for as little as 0.5% of all mortgages written in 2003, but that shot up to at least 12.3% through the first five months of this year, according to FirstAmerican LoanPerformance, an industry tracker. And while they made up at least 40% of mortgages in Salinas, Calif., and 26% in Naples, Fla., they’re not just found in overheated coastal markets: Through Mar. 31 of this year, at least 51% of mortgages in West Virginia and 26% in Wyoming were option ARMs. Stock and bond analysts estimate that as many as 1.3 million borrowers took out as much as $389 billion in option ARMs in 2004 and 2005. And it’s not letting up. Despite the housing slump, option ARMs totaling $77.2 billion were written in the second quarter of this year, according to investment bank Keefe, Bruyette & Woods Inc.

Most of the pain will be born by ordinary people. And it’s already happening. More than a fifth of option ARM loans in 2004 and 2005 are upside down — meaning borrowers’ homes are worth less than their debt. If home prices fall 10%, that number would double. “The number of houses for sale is tripling in some markets, so people are not going to get out of their debt,” says the Ford Foundation’s McCarthy. “A lot are going to walk.”

When Conrad Burns insulted taxi drivers he insulted a hard working group of American citizens, and people who love this country so much they are becoming American citizens. Driving a taxi is one of the most difficult and stressful jobs in this country. In any list of high stress jobs, driving a taxi appears at the top. Taxi drivers are constantly subjected to insults and discriminatory behavior. Their lives are in danger far more frequently than workers in other professions, and there are few protections in place for them. It is highly improper for a US Senator to heap on further insult, and expose our neighbors and hard working Americans to further suspicion and potential insults and danger, creating even more difficult working conditions. It is additionally shocking and insulting that the first lady should endorse these remarks. Burns attempts at retraction do not change what he said.

“Burns talked about the war on terrorism, saying a ‘faceless enemy’ of terrorists ‘drive taxi cabs in the daytime and kill at night,'” the Associated Press reports.

In her speech, the first lady praised Burns for talking about terrorism with “civility and respect.”

Bush flew over New Orleans on August 31, 2005 and pictures of his flyover were in all the major news media. The BagNewsNotes did this particularly incisive analysis of the photos. Describing one of the photos:

What is unique about this shot is that it’s the only one that manages to depict Bush and New Orleans at the same time. Because we can see that he sees it, this photo (more than the others) serves as a visual indictment of Bush’s absence from a situation he is clearly responsible for.

Just as powerfully, however, what the image also represents is the extent to which Bush remains encapsulated in his own confined world. The image reinforces the understanding that Bush remains walled off at all times, with only the most distant and fragmentary perception of what is going on outside.

Dr. Doom adds an editorial view of Bush looking on.

And in his concluding remarks BagNewsNotes writes:

On the other hand, it is much harder to take the President’s posturing at face value when you can see evidence of the stage and the actor, one pose after another. At that point, you can see that this is simply a photo shoot, and the President, rather than being somebody at this critical moment, is trying to look like someone instead.