I bet there will be hundreds of people calling in when the show goes live again saying things like "oh, but *I* am different. My husband and I decided not to have kids we couldn't afford, we both had jobs and we had a very small, comfortable fixer-upper that someone with half our incomes could afford. I lost my job and our payments went up, something we didn't anticipate and we felt like we were tricked in some way. We had one car ( a clunker) and didn't even have a dog."

Blah blah blah... That's what we call an exception to the RULE(in a WAY), which doesn't mean the RULE isn't still true. So shut the hell up, get off the phone and get on with your life

MOST of the people who consider themselves victims DID set themselves up. Hell, even my brother said.. and I quote.... "Our lord will work it out for us and everything will be fine." WHERE'S your GOD NOW??? Hmm?? (all this after he stole over 20 grand from my mom, who is now dying and *I* am giving end of life care to.. because... stealing from old women is the christian thing to do, right??) These people purchased houses they could not afford based on growth they expected , growth based on what they think they DESERVED, growth that felt natural to them because they are living the DREAM... (otherwise known by the rest of us sane people as a DELUSION). More like they're living IN a dream world.

Optimism is fantastic, I love optimism, hope, all of that. But you should not be so delusional about it that you have children based on that optimism. Then McMansions to house them in, SUVs to drive them around in, etc etc.

To then, on top of all that, to sign ANYTHING with payments that eventually balloon into a level of income well beyond any kind of traditional pay raise and well into la-la-land... equals idiocy. Next time, get a lawyer instead of a priest to look over your contracts.

I remember a while after 9-11, driving into a newly developed area in my region. A sports team had just decided to remain here and they had built a new stadium, mostly with taxpayer money of course, to keep them around for a while longer. This new development was built around this new stadium. Strip malls were built. They got their own Wal Marts and Targets and major restaurant chains, even a multi-screen cinema. Surrounding all of this was row after row after row of McMansions, all sitting in a flood plain (which they of course guaranteed was safe now... but check the price of flood insurance there for the real story). As I drove by with my family on the way to pick up food for the holiday get-together, I told them what I thought would happen to this new community.

I told them that all of these young families in these over-large homes, with over-large cars and over-large diaper budgets every year, would crash and burn within just a few years. Because they were all getting loans too easily. They were living beyond their means based on a future they had only invested HOPE in. I mentioned that someone out there smarter than them would be making a profit from their loss and their defaults.

I was laughed at and scolded for basically "pissing all over their hopes and dreams, their traditions", etc etc.

I didn't have any idea what these defaults would do to the general economy, I'm no economist and maybe even less than basically knowledgeable in the field. And I'm not so special. I'm convinced that hundreds of thousands if not millions of other people like myself also could see it coming.

But know this. Don't be an idiot and think that these "easy loans" weren't a set-up. Sure, they deserved what they got, but on the other side... they were being laughed at by people who stood to earn VAST wealth from their idiocy and losses.

As we come out of the other side of all this, we're JUST starting to see the real elephant in the room. Rent.

Rent that is set to insane amounts, based on uncommon low incomes that just barely meet the "three times the rent" requirements. And you just try being single and trying to set up a comfortable little studio apartment when you're in your 20s and earning barely above minimum wage, or even a little more. You will find high income areas with ultra-low rents and high income and credit requirements, just up the road from low income areas with VERY high rents and very loose income and credit requirements.

This is where the cries of "DE-REGULATE" stop sounding like thunder to me and more like a whimper. See, they already de-regulated YOU. They ended rent control slowly but surely nationwide, while banks were allowed to do whatever they wanted all the way through to what would be considered criminal if you or I did it on a much smaller scale.

My very own slumlord a few years back let the property get so bad that the electric company refused to allow service. Then he sold the property to 2 people in 2 different countries, somehow. He must have taken cash payment or large down payments and skipped town. So I ended up with 2 new landlords at my door asking for rent. I checked out where my slumlord was living a few weeks later after he'd left (and even had the audacity to call me and accuse me of trying to live there rent-free). It wasn't a MCmansion.. it was a MANSION. Fuck these people. There are people who are burdened with taxes that make it hard to run a business. I've been there. But there are also people who are fucking the system at YOUR expense and living large on it. On you.

And the occupy movement may seem annoying, hippie-like, unfocused. But as long as I live in a city that makes it illegal to be homeless, illegal to live in your car or motor home. As long as I live in a city that lets slumlords get away with crap like what I went through....

I'm on their side.

But that doesn't mean these middle class posers didn't get what they deserved. They should have waited to have kids. They should have rented an apartment. They should have remained single for a few more years perhaps in order to build some kind of a career before building an over-sized family. Maybe even stay single and live with mommy and daddy for a few more years if they'd have them.

But no. They had to have MORE MORE MORE and be the little show-off fucks you see on Facebook with their Priuses and their "foodie" habits. You know what? If you can't afford your mortgage payment, you have no business being a fucking food blogging fuck spending 200 a week on local restaurants. And you certainly have no fucking business with an iPad, sitting at the local Starbucks drinking 3 5 dollar lattes a day working on your "novel" (see: picking up hipster chicks to cheat with) while your 4 kids are a school wearing their Kohls wardrobe and eating their very NON-"foodie" packed lunches.

If I believed in a god, you know what I'd pray for? A generation of young people growing up right now that sees through your bullshit and lives the lives THEY want to live. Not the lives you expect them to live. I hope they reject your American dream poppycock and settle into fulfilling, single lives fucking themselves silly well into their 50s while their parents sit back and wonder what went wrong. Then the parents would die of some chemical Starbucks was using to make your lattes taste "smoother" or some chemical in the batteries of iPads and iPhones that was odorless, tasteless and invisible. That's my prayer.

Nothing against iPhones and iPads. Just the typical douches that use them. Maybe someday they will make an app that tracks these people down so we can hunt them down after the apocalypse.

But I bet they'll still spend their Sundays praying for a bigger pool or a larger SUV.

So the next time you hear a politician talk about de-regulation and getting the government off our backs so we can prosper and be "job creators", ask yourself if he or she means bottom-up de-regulation or top-down. Take a guess which it is. You've been duped.

No, Obama sure as hell isn't going to pull our asses out of the fire, but the pack of dumbshits that Republic party is doling out to you this time sure as FUCK won't do it either. The only difference is they will actually tell you they're going to give you one from behind without lube while Obama will swear... SWEAR he's just going to "put the tip in... promise". Right before he does exactly what the Republic party assholes will do to you.

You know who I feel most sorry for? The people who think Obama is a communist. Or even a liberal. You've been duped too.

So what's the solution?

Shut up and fuck, or join a revolution. But don't you dare vote one of those Republic party, christian conservative fucks into office. And not the beloved R Paul either. Sure, some of his ideas actually could fix this country. Absolutely. He's probably the best candidate out there right now. But if you think he'll get away with doing ANYTHING he wants to do, you're delusional. And what he WILL be allowed to do, he'll do to the poor ONLY.

Essentially, we're fucked.

Can't wait for the show to come back.

Blow me up?

(p.s. - If you think this is too long, oh well. You're welcome.

I moved to South Florida when it was red hot in 2004. I was in a crap job paying me only 40k a year, and started looking at homes. Every realtor I talked to wanted my business. It was hilarious, I nearly bought a $450k duplex. Something inside my head said, hold on a second, this isn't right. I am damn glad I didn't. Nearly every person who bought a home in 2004-2008 in South Florida that I know has lost their homes. I look back and laugh.

Just bought a home in a "nice neighborhood" for $130k. At the peak, these were going for $300k. I drive an old car that works, right past everyone in BMWs, etc. Not saying you can't have one, but not if it is 1/3 your after tax income, like I know it is for many of my neighbors.

I guess my point is this, if you can afford it do it.

I listened to you for years on the radio. Your comments on the foreclosure mess are not surprising or news to me. In principle I agree with most of what you said. I am on the front lines of the foreclosure business as a lawyer for more than 17 years. I have to say the last 4 years have been some of my most profitable. In principle I agree with most of what you said. Everyone is responsible for their own actions. You take a loan you cant pay that is your problem, but the problem is also the banks and investment. they made bad loans to people that clearly did not have the ability to pay. That would be fine if the money they were lending was their own, but it was not. All these huge investment banks and banks are public owned companies. Their stock is bought mainly by pensions and investment funds which are also bought by pensions. Lets not forget the trillions of dollars we have already given the banks to cover these bad loans. I heard you talking about how irresponsible mommy and daddy where. About how mommy and daddy made you sleep in hotels for years. What i didn't hear was anything about the other side. The investment banks and banks that made these loans knowing that mommy and daddy couldn't pay them back. without the banks loaning anyone with a pulse, almost any amount they wanted, you could of bought your second house long ago. What is really funny is you think their is you and them. But you and them equals us. As in all of us are gonna be feeling this for a long time. I am all for people taking responsibility for their actions, but there was two sides to this, and so far only one has been held responsible.

It's about damned time, Tom! Your honest, and unapologetic opinion has been missed from the conversation. I'm waiting patiently till 4/2/2012. Stay well, Tom.

Dude you are way off base. There are three million homes in Metro Phoenix area vacant and owned by the feds. That is after 5 years of selling foreclosures full time. The trustee auctions used to take 2000 on average, homes a day now they are down to 300-500 a day. These are not all people who spent too much. You are wrong and are making yourself feel good by saying I am smart I don't over spend. Phoenix is ground zero for the real estate slump. Mixed with the foreclosures are the folks who walk from their homes because they are so upside down they fell they will never come back so they go buy at today’s prices and walk from their homes. Our values are down to WAY BELOW replacement cost, what it takes to build the home. That is crazy. If you get divorced, a new, better job, your spouse dies, you lose your job and cannot find another here in town all the very many reasons you might have to move your option is to short sell or rent if your payment is not too high or carry back and wrap your loan. All not great options. I have a client who bought her town home 13 years ago put down 10% paid on it 13 years and she is upside down. She is a college professor and got her dream job offer heading up a department in another state which is based upon her research work for her PHD. 800+ FICO score she owes $60,000. And her place is worth $40,000. Not her fault. To retain her credit so she can own again in her new town we are selling on an agreement of sale which is a safe way to sell without giving up control of the ownership no foreclosure is necessary if they buyer does not pay she removes them much like a tenant. It is even hard to sell this way in today’s climate in the Chandler Real Estate Market. What did she do wrong?

The economy sucks. If you are self-employed small business, especially. People are hurting out here, all walks of life. I have a MD friend who got laid off why pay him $300,000. A year when they can get a PA for $90,000? So much of what you think is based on living in a crystal wine glass looking through the world through your overly sensitive ego. Get a clue. Times are bad and getting worse. Have you watched the news? Do you see what is going on? In Biblical terms we are approaching Armageddon and the truth is right in front of your eyes if you pull off the wool covering them.

Good one Tom. But while your at it, how about a blog about all the whinning assholes participating in the Occupy (fill in the name) union backed sit ins? I guess they choose to occupy public spaces instead of occupying their time by looking for a job. Worthless assholes every one of them.

Hey! Just discovered your coming back to the radio. Wicked cool.
I'm glad to see I'm not the only one pissing my pants with laughter as the market "corrects" itself.
I grew up a foster kid in Washington state and never got a thing I didn't work my ass off for. No parents. No college fund. No GI bill. Just the school of hard knocks.
9 years active duty (volunteer) Army. By the time I went civilian the housing prices were already to the moon.
I've raised 5 children (all more successful than me at the same age) and never lived in a home bigger than 1500 square feet. Because that's what I could afford.
I've been self employed since leaving the Army in '85 and paid my bills the whole way. Even when the banks wouldn't refinance my home to a lower intrest rate because the self employed are considered 'high risk'.
I've spent most of my adult life cursing the yuppy generation for helping themselves to the best of everything and passing responsibility on to others.
Sure, you can live your whole life without setting aside a dime for retirement. What's that? You want your kids to pay social security taxes because you were too stupid to plan for yourself?
Sure, you can get 14% intrest through that savings & loan when 8% is the going rate. What's that? It was a scam and you want your grand kids to cover your losses?
Sure you can get pregnant in high school and not worry about how you're going to feed the kid. What's that? You don't think you should have to go to work 'till the kid is 18 and everybody else should pick up the bill?
Sure, you can have the best medical care money can buy. Whats that? You want your great grand kids to pick up the tab and you're too cheep to even pay for your own pills.
On and on...
Last winter I finally bought my dream home. Because I can afford it. 4200 square feet on 5 acres in a secluded neighborhood. Custom everything. And the banks are so hard up to do business with me now, that I financed the whole thing (minus a big down payment) at 2.25%.
Frankly, the recession is the best thing that could have happened to my family.
Maybe, just maybe, it will teach this dumb assed generation a lesson in critical thinking.

Tom - you couldn't be more correct. It never made sense to me that people borrowed money not expecting to pay it back. Or those nimrods who took out interest only loans and were bragging that their Million home cost them $38 a month. It is simple math. Borrow the money and pay it back. In Brooklyn they would not have gotten off as easy as the repo man. Rocko and Nunzio would have shown up at their doorstep….

Except many people may now only able to afford to shop at Target four times per year instead of four times per month.

I was relocated to Los Angeles in 2004. The homes were overpriced even then. And before I could save even a tiny down payment the prices went up drastically. This made home “ownership” impractical. Instead I found myself in El Segundo still renting at age 27. I must confess that seeing so many people in nice houses and driving nice cars (seemingly overnight) while I continued to struggle truly made me feel like a loser. On top of that I had just started a business out of my small apartment sleeping on an air mattress with used office equipment from Craigslist.

During this time any unemployed person (ex: Casey Serin) could get hundreds of thousands or even millions of dollars for a house(s). But after “applying” at over 10 banks I could not get one line of business credit as a sole proprietor.

The result? It's been 7 years of pain and suffering working 65-85+ hour work weeks with no social life just to net 70k annually (note: 70k per year is comparable an employee salary of over 100k per year) and I still cannot afford to “purchase” a home in Los Angeles . I didn’t and still don’t understand how all these people can be so well off.

In 2005-2006 attended entrepreneurs club meetings in the hope of meeting other people like me who aspired to be free and fiscally secure. Instead I was shocked to see the dozens of people with business cards reading (in effect) “self employed real estate investor”. As the conversations progressed I was equally shocked to learn these people had “purchased” homes little to no money down using stated income loans; now disconcertingly sporting business cards reading “ ABC Real Estate Holding Co LLC” or “ XYZ Real Estate Investing Group Inc” etc claiming to be “self employed business owners”. Funny me. I thought the point of investing was to buy cheap and sell dear (high)”. When questioned how purchasing Real Estate was an “investment” at the peak of a never before seen economic super bubble I received a very unpleasant response from these “entrepreneurs”.

http://answers.yahoo.com/question/index;_ylt=AlxMIcG6URsDcBmIGfDTYB7ty6I...

7 years later my income is grinding up YOY even in the midst of this recession. And it’s anything but easy. Making money feels like one of the hardest things in the world. And even though I could “purchase” a home I’m not entirely comfortable working as a “mortgage slave” for 20 years to pay back borrowed money. From this perspective prices are still too high. I also don’t feel prices have fallen fast enough. Interest rates have nowhere to go but up.

Yet even in this recession I continue to see people splurging on shopping, expensive vacations, weekend getaway, buying expensive cars and generally “living it up” while I continue to go without choosing to put back the majority of my net profits into my import export business and saving for a “rainy day”. Needless to say I don’t feel sorry for these foreclosure “victims” either.

I agree with this article 100%

P.S. The ONLY thing that bothers me about these peoples predicaments is their debts could be theoretically be wiped out via hyperinflation.

-Michael

You're right Tom, some people are losing their homes because they got into a deal they couldn't afford thinking they deserve it BUT what I feel sorry for is those that got into a home they did afford but are losing it because they lost their jobs and the DOUCHE in the White House that we voted for, was and still is more interested in his own agenda (Healthcare and other crap) than the economy and creating jobs!! Miss you and your show Tom!!!

You hit the nail on the head, Tom. When I bought my house in San Francisco in 2004, I had no debt, qualified for an "old fashioned" loan, made a strange thing called a "down payment", and calculated such things like taxes, maintenance and insurance. I also bought it to live in, not "flip".

Today, it might be worth just a bit below what I paid for it, but I don't care - I'm still living in it happily, and I'm nowhere near underwater. Yes, I can still easily afford it.

The idiots who bought houses with no down - interest only - and 125% LTV, were idiots and the buzzards have come home to roost. I don't feel sorry for those idiots.

"You deserve what you are willing to work for and nothing more."
Thank you for being the common sense enema that I need from time to time.