OPEC, united in driving up the price of gas.

Seems like it could have been the answer and can be in the future:

Imagine that a few years ago, at a time when you were renting your home, a fast-talking lender had approached you and explained how you could afford to buy your first house. The monthly payments seemed affordable.

At the closing, you were swamped with forms, dutifully signing where you were told. Recently you discovered that one of the forms you didn’t read at the closing explained how your monthly payments would rise three years after the closing. Now that those years have passed, you can’t afford the payments. You have defaulted, and now face the prospect of losing your home.

Now suppose that the process had been completely different. Well before signing the papers, you had to watch a video warning you about the pain foreclosure brings. You were required to work through a budget that took into account the increase in your mortgage payments and helped you understand how much money you would have to meet your other expenses after you made your mortgage payments. A credit counselor explained the consequences of taking out the loan and countered the influence of the fast-talking lender. Might you have decided against taking out the loan? And if millions of other borrowers had had a similar experience, might we now not be in the crisis we are in? (hat tip Consumer Law & Policy Blog)

This is truly pathetic . . .

Secretary of Housing and Urban Development Steve Preston said the centerpiece of the federal government’s effort to help struggling homeowners has been a failure and he’s blaming Congress.

The three-year program was supposed to help 400,000 borrowers avoid foreclosure. But it has attracted only 312 applications since its October launch because it is too expensive and onerous for lenders and borrowers alike, Preston said in an interview. (link)

Dorrien on the opportunity presented to Obama in these challenging times:

We need to remember what happened last time. Franklin Roosevelt inherited bank runs, twenty-five percent unemployment, a manufacturing output decline of thirty-five percent from 1929, and a devastating deflation of currency values. The New Deal stopped the bleeding, whittling unemployment to fourteen percent by 1937. But Roosevelt never really believed in Keynesian social investment. The New Deal was a bundle of cautious half-measures. Roosevelt reduced unemployment spending in 1937, which helped to send unemployment soaring to nineteen percent the following year. By 1940, after seven years of New Deal economics, unemployment stood at 14.5 percent and the “New Deal” was not a candidate for iconic status. It became a great success only by gearing up for World War II.

That is hardly a model to emulate. We need huge investments in green technology, infrastructure rebuilding, high-speed trains, education, and health care to meet our human and ecological needs and to utilize the productive capacity of the economy. We need a Securities and Exchange Commission that actually regulates the financial sector, which would be a revolution. Cautious pruning of George W. Bush’s policies will not turn the tide. The question for the Obama administration is whether it really believes in a social and environmental investment strategy, or only half-believes. If taxpayers are going to bail out Citigroup or General Motors, the public should have a proportional say in how these companies operate. That basic justice principle is way overdue to be taken seriously in American politics and perfectly timely. (link)

WASHINGTON — A $14 billion emergency bailout for U.S. automakers collapsed in the Senate Thursday night after the United Auto Workers refused to accede to Republican demands for swift wage cuts.

Senate Majority Leader Harry Reid said he was “terribly disappointed” about the demise of an emerging bipartisan deal to rescue Detroit’s Big Three.

He spoke shortly after Republicans left a closed-door meeting where they balked at giving the automakers federal aid unless their powerful union agreed to slash wages next year to bring them into line with those of Japanese carmakers.

Republican Sen. George V. Voinovich of Ohio, a strong bailout supporter, said the UAW was willing to make the cuts _ but not until 2011.

Assuming this account is true, if our economy implodes because the good folks at the UAW are willing to accept cuts, but just not until two years from now, instead of right now, I don’t know what I will do with myself.

In two years . . . half of you may have no job to speak of, let alone take a pay cut.

Seriously.

I guess everybody needs to watch their back . . .

Well-paid professionals like lawyers and architects are joining the rapidly expanding unemployment rolls in New York City, according to a new unemployment study.

The report, released by the Fiscal Policy Institute, shows that the effects of the financial crisis have spread well beyond Wall Street to other white-collar jobs, as well as construction, retail and service jobs.

The number of white-collar workers outside the financial industry receiving unemployment checks has increased by more than 40 percent and the number of college graduates collecting benefits is up by 50 percent in the city since last year, the report shows. (link)

About 1.1 billion people have no access to clean water, and half the planet lacks the same quality of water that the ancient Romans enjoyed. (link)

How, the hell, did this happen?

Merry Christmas!

(Center for American Progress Cartoon)

So says the National Bureau of Economic Research. Awesome.

Seriously.

As I have recently been learning more about the mortgage meltdown, it has become apparent to me that if these entities had been better regulated we would not be where we are today.

I hate you . . . rating agencies.