Good example. Of course its an extreme case and clearly the guy should not have been extended that loan. Instead of bailing Jeff Gray out what if the bank evicted Jeff immedietely and promptly sold the property at auction to the highest bidder? The bank could then report the loss to the banks shareholders who could promptly fire the BOD and elect competent board members. The new board could then institute stringent loan vetting and income documentation requirements. If the loss is too great to bear then the bank could GO OUT OF BUSINESS. Depositors could then file for FDIC or FCUA funds. If FDIC and FCUA funds are unavailable because insufficient reserve has been set aside then those depositors could lose their money. Then the depositors who lost their money could ask themselves if that vote they cast for Barney Frank or Maxine Waters or Chris Dodd were really in the best interest of the country. Yknow, just a hypothetical question. Anyway who makes 8k per year? This aint El Salvador.
This is not "helping your neighbor out," it's rewarding bad/irresponsible behavior which begets more of it. Enabling people to live beyond their means got us into this mess and more of the same won't solve it. Not everyone is entitled to live in a house, only those who can afford to.
Right, and you've put your finger on the key word here, which is "entitled." This is the mentality we are dealing with. The essential point on which I think we disagree is whether that mentality can ever be altered. Everyone on this board is a trader. To stay a trader, one must be able to quickly learn and benefit from mistakes and change one's behavior accordingly. So it's not surprising that anyone on this board would make the assumption that other people might learn lessons through experience. But we are not talking about traders now; we are talking about people who never learn, no matter what happens to them. If you can't take personal responsibility for your actions, you will never change them.
The issue isn't whether or not we as a society change their thinking, it's whether or not we tolerate their behavior. Taking your argument to the extreme we should also tolerate violent crime and murder.
Under Obama's plan just announced yesterday, this guy will likely qualify for a loan modification. Moreover, the mortgage payment will reduce to less than one third of the income, that is, $2000 a year (Yes, that is yearly payment). welcome to socialism.
Sucks to be the losers that already bailed - nothing for them. Maybe we should all stop paying our mortgage and let Uncle Sam bail us all out.