Mortgage Carnage Round-Up

Before I get going, I’d like to let people know that until August 25, you can log your opinion about the focus for BlogHer’s Global Health initiative. You do not need to be a member to vote. But on to the round-up!

Barbara Ehrenreich starts the show with “Smashing Capitalism”, in which she amusingly shows us signs of the poor leading a revolution by not paying their mortgages and then failing to go shopping. At least at Wal-Mart. Somehow, Target is doing just fine thank you very much.

Speaking of mortgages, foreclosures are up 9% month-over-month and almost double year-over-year. the All Spin Zone says “duh.” Democrats are falling over themselves trying to propose solutions. Here’s a creative answer, converting foreclosures to “own to rent” contracts. I’m not sure it would work — state laws are in play — but it’s interesting.

Fed action is probably not enough to make the problems go away. And that is not just because Mr. Bernanke cannot wave a magic wand and cause thousands of homeowners to have enough money to pay the mortgage. It’s because the market for “commercial paper” — buying and selling bonds, mortgages, and other debts — is broken. And don’t get to thinking “oh boo hoo for the rich fat cats who trade that stuff!” The paper doesn’t trade as it should, so new money for new loans does not exist. That includes the new loan for equipment at your workplace that would mean adding people to the payroll to run it. That includes the refinanced mortgage on Joe and Jane Average’s place.

And that brings us to the Wall Street side of the problem. Jim Cramer arrives fashionably late to the party with advice “Don’t Buy Fannie Mae!” Really, Jim? Thanks, but I think a lot of us had figured that one out. Then we have Dave Johnson, who points out that “The unwinding of the housing bubble takes us way beyond mortgages and into the financial markets of Wall Street.” Speaking of which, investors flush a half a Trillion with a T dollars to bail out just one bond and loan fund. Does that give you an idea how big this problem could be? And coming full circle, the BondDad points out that a lot of real human beings who work in the financial services industry — Americans with mortgages of their own to pay — are going to lose their jobs before all is said and done.

As usual, I will watch the job “creation” numbers with interest when they come out.

In closing: reader Jukkou-san sent World Clock; amazingly enough the strangest thing you will ever read about Karl Rove, even if it is about his dad; it’s still the economy, stupid; George Lakoff seems to think that Centrist really means someone who is willing to pretend that cutting the baby in half makes everyone happy, and he is wrong; Steven Levitt on how things have changed in the beverage world; must read item on the United Nations Population Fund and the anti-contraceptive nuts who want to undermine them; the USDA, organic food, and you; I don’t know what to make of the Daily Show’s Iraq correspondent; Bill Nye booed for telling the truth about the moon…. wait for it…. in Waco; Daily Kos is late to the impeach Gonzo party; oh no! “Immigration crackdown threatens bumper U.S. apple harvest” and farmers may actually have to pay American citizens to pick apples!; so you want a DeLorean; sorry, Senators, you don’t get to pick the leader of a sovereign nation.

And finally, a bit of follow up from Friday Follow-up’s paragraph on Real ID. When it came up on David Farber’s Interesting People list, I offered the only reply, nothing I didn’t say before, but:

I read the CNN article about Real ID yesterday, and found it interesting. First, they point out that some Americans would need a passport “to have a picnic in a national park.” While that is an interesting issue, “for all federal purposes” means those same Americans would also need a passport to do business in person with other federal entities such as the Social Security Administration offices, federal courthouses, and IRS offices. Will they need a passport to pick up a registered letter at the Post Office? I sincerely hope there is not an impending catch-22 with the State Department, since strictly speaking one should need a Real ID compliant card to get a passport. All these things seem much more important than “a picnic in a national park” to me.

Second, why is CNN suddenly on about a law passed 2 years ago?

Corrente offered an interesting commentary called “When internal passport controls go into effect, will DHS “Behavior Detection Officers” profile us like DEA does now?” And more, alert the media, Bruce Schneier said something that shows he doesn’t get it: “This sounds tough, but it’s a lot of bluster. The states that have passed anti-REAL-ID legislation lean both Republican and Democrat. The federal government just can’t say that citizens of — for example — Georgia (which passed a bill in May authorizing the Governor to delay implementation of REAL ID) can’t walk into a federal courthouse without a passport. Or can’t board an airplane without a passport — imagine the lobbying by Delta Airlines here. They just can’t.” Sorry, Mr. Schneier. They already did. They can and did specify using a federally approved ID for federal purposes. If Congress can’t get its act together and get this thing repealed, our only hope is that some judge will realize it impairs citizen’s First Amendment right to seek redress in the courts.