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Choose Life. Choose a job. Choose a career. Choose a family. Choose a fucking big television, choose washing machines, cars, compact disc players and electrical tin openers. Choose good health, low cholesterol, and dental insurance. Choose fixed interest mortgage repayments. Choose a starter home. Choose your friends. Choose leisurewear and matching luggage. Choose a three-piece suit on hire purchase in a range of fucking fabrics. Choose DIY and wondering who the fuck you are on Sunday morning. Choose sitting on that couch watching mind-numbing, spirit-crushing game shows, stuffing fucking junk food into your mouth. Choose rotting away at the end of it all, pissing your last in a miserable home, nothing more than an embarrassment to the selfish, fucked up brats you spawned to replace yourselves. Choose your future. Choose life… But why would I want to do a thing like that? I chose not to choose life. I chose somethin’ else. And the reasons? There are no reasons. Who needs reasons when you’ve got heroin?

We paid for this instead of a generation of health insurance, or an alternative energy grid, or a brand-new system of roads and highways. With the $13-plus trillion we are estimated to ultimately spend on the bailouts, we could not only have bought and paid off every single sub-prime mortgage in the country (that would only have cost $1.4 trillion), we could have paid off every remaining mortgage of any kind in this country - and still have had enough money left over to buy a new house for every American who does not already have one.

Choose life. Choose a job. Choose a career. Choose a family. Choose a fucking big television, Choose washing machines, cars, compact disc players, and electrical tin openers. Choose good health, low cholesterol and dental insurance. Choose fixed- interest mortgage repayments. Choose a starter home. Choose your friends. Choose leisure wear and matching luggage. Choose a three piece suite on hire purchase in a range of fucking fabrics. Choose DIY and wondering who you are on a Sunday morning. Choose sitting on that couch watching mind-numbing sprit- crushing game shows, stuffing fucking junk food into your mouth. Choose rotting away at the end of it all, pishing you last in a miserable home, nothing more than an embarrassment to the selfish, fucked-up brats you have spawned to replace yourself. Choose your future. Choose life... But why would I want to do a thing like that?

Everyday I feel more and more like a full-fledged adult. Even though it was (metaphorically) only yesterday I was sloshing in the door at four a.m. after Dollar Beer Night, I find myself with a mortgage, four types of insurance, and a non-laundry-quarter-based retirement fund.

For me, the future was a complete paradox. One one hand [..] teachers were pushing that 'know what you want to do for the rest of your life' attitude. Yet, on the other hand I wanted to stay a kid. Parents and teachers were so intimidating when they talked about the 'real world' and taxes and mortgages and bills and insurance. With freedom comes responsibility and I wasn't sure if I was ready for all that.

...I do not function too well on emotional motivations. I am wary of them. And I am wary of a lot of other things, such as plastic credit cards, payroll deductions, insurance programs, retirement benefits, savings accounts, Green Stamps, time clocks, newspapers, mortgages, sermons, miracle fabrics, deodorants, check lists, time payments, political parties, lending libraries, television, actresses, junior chambers of commerce, pageants, progress, and manifest destiny.

At the time, the Federal Housing Administration and Veterans Administration not only refused to insure mortgages for African Americans in designated white neighborhoods like Ladera; they also would not insure mortgages for whites in a neighborhood where African Americans were present.

The “consumer loan” piles that Wall Street firms, led by Goldman Sachs, asked AIG FP to insure went from being 2 percent subprime mortgages to being 95 percent subprime mortgages. In a matter of months, AIG FP, in effect, bought $50 billion in triple-B-rated subprime mortgage bonds by insuring them against default.

As in Rollingwood ten years earlier, one of the federal government’s specifications for mortgages insured in Milpitas was an openly stated prohibition on sales to African Americans.

Today the man who has the courage to build himself a house constructs a meeting place for the people who will descend upon him on foot, by car, or by telephone. Employees of the gas, the electric, and the water- works will arrive; agents from life and fire insurance companies; building inspectors, collectors of radio tax; mortgage creditors and rent assessors who tax you for living in your own home.

Mike Burry didn’t own any triple-B-rated subprime mortgage bonds, or anything like them. He had no property to “insure”; it was as if he had bought fire insurance on some slum with a history of burning down.

When the Goldman Sachs saleswoman called Mike Burry and told him that her firm would be happy to sell him credit default swaps in $100 million chunks, Burry guessed, rightly, that Goldman wasn’t ultimately on the other side of his bets. Goldman would never be so stupid as to make huge naked bets that millions of insolvent Americans would repay their home loans. He didn’t know who, or why, or how much, but he knew that some giant corporate entity with a triple-A rating was out there selling credit default swaps on subprime mortgage bonds. Only a triple-A-rated corporation could assume such risk, no money down, and no questions asked. Burry was right about this, too, but it would be three years before he knew it. The party on the other side of his bet against subprime mortgage bonds was the triple-A-rated insurance company AIG—American International Group, Inc.

There’s too much structure in the world: too much insurance, litigation, unfulfilling work, fighting; too many credit cards, receipts, forms, taxes, mortgages, traffic jams, obligations—and always enormous pressure and fear as a result. The

Anyway, you now owe $117,500 on the house. After that five years, once the house gets 90 percent loan-to-value—that means you’re getting close to getting underwater—the bank ‘recasts’ the loan and now flips you to a full am, which means you pay an old-fashioned mortgage, which is principal plus interest on $117,000. You now have a thirty-year loan at 7 percent. Plus you have to buy the mortgage insurance because you don’t have anything down, which puts you somewhere at $900 a month. Your payments have more than tripled overnight. A $200,000 house is now costing you $1,800 a month and we both know the guy was never making that kind of money.

Romantic literature often presents the individual as somebody caught in a struggle against the state and the market. Nothing could be further from the truth. The state and the market are the mother and father of the individual, and the individual can survive only thanks to them. The market provides us with work, insurance and a pension. If we want to study a profession, the government’s schools are there to teach us. If we want to open a business, the bank loans us money. If we want to build a house, a construction company builds it and the bank gives us a mortgage, in some cases subsidised or insured by the state. If violence flares up, the police protect us. If we are sick for a few days, our health insurance takes care of us. If we are debilitated for months, national social services steps in.

State-regulated insurance companies, like the Equitable Life Insurance Company and the Prudential Life Insurance Company, also declared that their policy was not to issue mortgages to whites in integrated neighborhoods. State insurance regulators had no objection to this stance. The Bank of America and other leading California banks had similar policies, also with the consent of federal banking regulators.

Romantic literature often presents the individual as somebody caught in a struggle against the state and the market. Nothing could be further from the truth. The state and the market are the mother and father of the individual, and the individual can survive only thanks to them. The market provides us with work, insurance and a pension. If we want to study a profession, the government’s schools are there to teach us. If we want to open a business, the bank loans us money. If we want to build a house, a construction company builds it and the bank gives us a mortgage, in some cases subsidised or insured by the state. If violence flares up, the police protect us. If we are sick for a few days, our health insurance takes care of us. If we are debilitated for months, social security steps in. If we need around-the-clock assistance, we can go to the market and hire a nurse – usually some stranger from the other side of the world who takes care of us with the kind of devotion that we no longer expect from our own children. If we have the means, we can spend our golden years at a senior citizens’ home. The tax authorities treat us as individuals, and do not expect us to pay the neighbours’ taxes. The courts, too, see us as individuals, and never punish us for the crimes of our cousins. Not only adult men, but also women and children, are recognised as individuals. Throughout most of history, women were often seen as the property of family or community. Modern states, on the other hand, see women as individuals, enjoying economic and legal rights independently of their family and community. They may hold their own bank accounts, decide whom to marry, and even choose to divorce or live on their own. But the liberation of the individual comes at a cost. Many of us now bewail the loss of strong families and communities and feel alienated and threatened by the power the impersonal state and market wield over our lives. States and markets composed of alienated individuals can intervene in the lives of their members much more easily than states and markets composed of strong families and communities. When neighbours in a high-rise apartment building cannot even agree on how much to pay their janitor, how can we expect them to resist the state? The deal between states, markets and individuals is an uneasy one. The state and the market disagree about their mutual rights and obligations, and individuals complain that both demand too much and provide too little. In many cases individuals are exploited by markets, and states employ their armies, police forces and bureaucracies to persecute individuals instead of defending them. Yet it is amazing that this deal works at all – however imperfectly. For it breaches countless generations of human social arrangements. Millions of years of evolution have designed us to live and think as community members. Within a mere two centuries we have become alienated individuals. Nothing testifies better to the awesome power of culture.

default swaps on subprime mortgage bonds. Only a triple-A-rated corporation could assume such risk, no money down, and no questions asked. Burry was right about this, too, but it would be three years before he knew it. The party on the other side of his bet against subprime mortgage bonds was the triple-A-rated insurance company AIG—American International Group, Inc. Or, rather, a unit of AIG called AIG FP. AIG Financial Products was created

banks—the biggest of which was the $13.9 billion AIG owed to Goldman Sachs. When you added in the $8.4 billion in cash AIG had already forked over to Goldman in collateral, you saw that Goldman had transferred more than $20 billion in subprime mortgage bond risk into the insurance company, which was in one way or another being covered by the U.S. taxpayer. That fact alone was enough to make everyone wonder at once how much more of this stuff was out there, and who owned it.

The nature of the present economic crisis illustrates very clearly the need for departures from unmitigated and unrestrained self-seeking in order to have a decent society. Even John McCain, the 2008 U.S. Republican presidential candidate, complained constantly in his campaign speeches of “the greed of Wall Street.” Smith had a diagnosis for this: he called promoters of excessive risk in search of profits “prodigals and projectors”—which, by the way, is quite a good description of many of the entrepreneurs of credit swaps insurances and subprime mortgages over the recent past.

The big celebration, the wedding or housewarming, takes place not when the debt is discharged, but when it is undertaken. What is emphasized on TV, for example, is not the middle-aged man who has finally paid off his mortgage, but the young man who moves into his new home with his family, proudly waving the papers he has just signed and which will bind him for most of his productive years. After he has paid his debts—the mortgage, the college expenses for his children and his insurance—he is regarded as a problem, a “senior citizen” for whom society must provide not only material comforts but a new “purpose.

The FHA had adopted a system of maps that rated neighborhoods according to their perceived stability. On the maps, green areas, rated “A,” indicated “in demand” neighborhoods that, as one appraiser put it, lacked “a single foreigner or Negro.” These neighborhoods were considered excellent prospects for insurance. Neighborhoods where black people lived were rated “D” and were usually considered ineligible for FHA backing. They were colored in red. Neither the percentage of black people living there nor their social class mattered. Black people were viewed as a contagion. Redlining went beyond FHA-backed loans and spread to the entire mortgage industry, which was already rife with racism, excluding black people from most legitimate means of obtaining a mortgage.

There was more than one way to think about Mike Burry’s purchase of a billion dollars in credit default swaps. The first was as a simple, even innocent, insurance contract. Burry made his semiannual premium payments and, in return, received protection against the default of a billion dollars’ worth of bonds. He’d either be paid zero, if the triple-B-rated bonds he’d insured proved good, or a billion dollars, if those triple-B-rated bonds went bad. But of course Mike Burry didn’t own any triple-B-rated subprime mortgage bonds, or anything like them. He had no property to “insure” it was as if he had bought fire insurance on some slum with a history of burning down. To him, as to Steve Eisman, a credit default swap wasn’t insurance at all but an outright speculative bet against the market—and this was the second way to think about it.

It’s such a strange thing, but in two years of hustling I never once thought of it as a crime. I honestly didn’t think it was bad. It’s just stuff people found. White people have insurance. Whatever rationalization was handy. In society, we do horrible things to one another because we don’t see the person it affects. We don’t see their face. We don’t see them as people. Which was the whole reason the hood was built in the first place, to keep the victims of apartheid out of sight and out of mind. Because if white people ever saw black people as human, they would see that slavery is unconscionable. We live in a world where we don’t see the ramifications of what we do to others, because we don’t live with them. It would be a whole lot harder for an investment banker to rip off people with subprime mortgages if he actually had to live with the people he was ripping off. If we could see one another’s pain and empathize with one another, it would never be worth it to us to commit the crimes in the first place.

The state and the market are the mother and father of the individual, and the individual can survive only thanks to them. The market provides us with work, insurance and a pension. If we want to study a profession, the government’s schools are there to teach us. If we want to open a business, the bank loans us money. If we want to build a house, a construction company builds it and the bank gives us a mortgage, in some cases subsidised or insured by the state. If violence flares up, the police protect us. If we are sick for a few days, our health insurance takes care of us. If we are debilitated for months, national social services steps in. If we need around-the-clock assistance, we can go to the market and hire a nurse – usually some stranger from the other side of the world who takes care of us with the kind of devotion that we no longer expect from our own children. If we have the means, we can spend our golden years at a senior citizens’ home. The tax authorities treat us as individuals, and do not expect us to pay the neighbours’ taxes. The courts, too, see us as individuals, and never punish us for the crimes of our cousins.

In this march through a virtual lifetime, we’ve visited school and college, the courts and the workplace, even the voting booth. Along the way, we’ve witnessed the destruction caused by WMDs. Promising efficiency and fairness, they distort higher education, drive up debt, spur mass incarceration, pummel the poor at nearly every juncture, and undermine democracy. It might seem like the logical response is to disarm these weapons, one by one. The problem is that they’re feeding on each other. Poor people are more likely to have bad credit and live in high-crime neighborhoods, surrounded by other poor people. Once the dark universe of WMDs digests that data, it showers them with predatory ads for subprime loans or for-profit schools. It sends more police to arrest them, and when they’re convicted it sentences them to longer terms. This data feeds into other WMDs, which score the same people as high risks or easy targets and proceed to block them from jobs, while jacking up their rates for mortgages, car loans, and every kind of insurance imaginable. This drives their credit rating down further, creating nothing less than a death spiral of modeling. Being poor in a world of WMDs is getting more and more dangerous and expensive.

Romantic literature often presents the individual as somebody caught in a struggle against the state and the market. Nothing could be further from the truth. The state and the market are the mother and father of the individual, and the individual can survive only thanks to them. The market provides us with work, insurance and a pension. If we want to study a profession, the government’s schools are there to teach us. If we want to open a business, the bank loans us money. If we want to build a house, a construction company builds it and the bank gives us a mortgage, in some cases subsidised or insured by the state. If violence flares up, the police protect us. If we are sick for a few days, our health insurance takes care of us. If we are debilitated for months, national social services steps in. If we need around-the-clock assistance, we can go to the market and hire a nurse – usually some stranger from the other side of the world who takes care of us with the kind of devotion that we no longer expect from our own children. If we have the means, we can spend our golden years at a senior citizens’ home. The tax authorities treat us as individuals, and do not expect us to pay the neighbours’ taxes. The courts, too, see us as individuals, and never punish us for the crimes of our cousins.

Romantic literature often presents the individual as somebody caught in a struggle against the state and the market. Nothing could be further from the truth. The state and the market are the mother and father of the individual, and the individual can survive only thanks to them. The market provides us with work, insurance and a pension. If we want to study a profession, the government’s schools are there to teach us. If we want to open a business, the bank loans us money. If we want to build a house, a construction company builds it and the bank gives us a mortgage, in some cases subsidised or insured by the state. If violence flares up, the police protect us. If we are sick for a few days, our health insurance takes care of us. If we are debilitated for months, national social services steps in. If we need around-the-clock assistance, we can go to the market and hire a nurse – usually some stranger from the other side of the world who takes care of us with the kind of devotion that we no longer expect from our own children. If we have the means, we can spend our golden years at a senior citizens’ home. The tax authorities treat us as individuals, and do not expect us to pay the neighbours’ taxes. The courts, too, see us as individuals, and never punish us for the crimes of our cousins. Not

If you are stuck in circumstances in which it takes Herculean efforts to get through the day— doing low-income work, obeying an authoritarian boss, buying clothes for the children, dealing with school issues, paying the rent or mortgage, fixing the car, negotiating with a spouse, paying taxes, and caring for older parents— it is not easy to pay close attention to larger political issues. Indeed you may wish that these issues would take care of themselves. It is not a huge jump from such a wish to become attracted to a public philosophy, spouted regularly at your job and on the media, that economic life would regulate itself automatically if only the state did not repeatedly intervene in it in clumsy ways. Now underfunded practices such as the license bureau, state welfare, public health insurance, public schools, public retirement plans, and the like begin to appear as awkward, bureaucratic organizations that could be replaced or eliminated if only the rational market were allowed to take care of things impersonally and quietly, as it were. Certainly such bureaucracies are indeed often clumsy. But more people are now attracted to compare that clumsiness to the myth of how an impersonal market would perform if it took on even more assignments and if state regulation of it were reduced even further. So a lot of “independents” and “moderates” may become predisposed to the myth of the rational market in part because the pressures of daily life encourage them to seek comfort in ideological formations that promise automatic rationality.

According to Bartholomew, an important goal of St. Louis zoning was to prevent movement into 'finer residential districts . . . by colored people.' He noted that without a previous zoning law, such neighborhoods have become run-down, 'where values have depreciated, homes are either vacant or occupied by color people.' The survey Bartholomew supervised before drafting the zoning ordinance listed the race of each building's occupants. Bartholomew attempted to estimate where African Americans might encroach so the commission could respond with restrictions to control their spread. The St. Louis zoning ordinance was eventually adopted in 1919, two years after the Supreme Court's Buchanan ruling banned racial assignments; with no reference to race, the ordinance pretended to be in compliance. Guided by Bartholomew's survey, it designated land for future industrial development if it was in or adjacent to neighborhoods with substantial African American populations. Once such rules were in force, plan commission meetings were consumed with requests for variances. Race was frequently a factor. For example, on meeting in 1919 debated a proposal to reclassify a single-family property from first-residential to commercial because the area to the south had been 'invaded by negroes.' Bartholomew persuaded the commission members to deny the variance because, he said, keeping the first-residential designation would preserve homes in the area as unaffordable to African Americans and thus stop the encroachment. On other occasions, the commission changed an area's zoning from residential to industrial if African American families had begun to move into it. In 1927, violating its normal policy, the commission authorized a park and playground in an industrial, not residential, area in hopes that this would draw African American families to seek housing nearby. Similar decision making continued through the middle of the twentieth century. In a 1942 meeting, commissioners explained they were zoning an area in a commercial strip as multifamily because it could then 'develop into a favorable dwelling district for Colored people. In 1948, commissioners explained they were designating a U-shaped industrial zone to create a buffer between African Americans inside the U and whites outside. In addition to promoting segregation, zoning decisions contributed to degrading St. Louis's African American neighborhoods into slums. Not only were these neighborhoods zoned to permit industry, even polluting industry, but the plan commission permitted taverns, liquor stores, nightclubs, and houses of prostitution to open in African American neighborhoods but prohibited these as zoning violations in neighborhoods where whites lived. Residences in single-family districts could not legally be subdivided, but those in industrial districts could be, and with African Americans restricted from all but a few neighborhoods, rooming houses sprang up to accommodate the overcrowded population. Later in the twentieth century, when the Federal Housing Administration (FHA) developed the insure amortized mortgage as a way to promote homeownership nationwide, these zoning practices rendered African Americans ineligible for such mortgages because banks and the FHA considered the existence of nearby rooming houses, commercial development, or industry to create risk to the property value of single-family areas. Without such mortgages, the effective cost of African American housing was greater than that of similar housing in white neighborhoods, leaving owners with fewer resources for upkeep. African American homes were then more likely to deteriorate, reinforcing their neighborhoods' slum conditions.

Collateral Capacity or Net Worth? If young Bill Gates had knocked on your door asking you to invest $10,000 in his new company, Microsoft, could you get your hands on the money? Collateral capacity is access to capital. Your net worth is irrelevant if you can’t access any of the money. Collateral capacity is my favorite wealth concept. It’s almost like having a Golden Goose! Collateral can help a borrower secure loans. It gives the lender the assurance that if the borrower defaults on the loan, the lender can repossess the collateral. For example, car loans are secured by cars, and mortgages are secured by homes. Your collateral capacity helps you to avoid or minimize unnecessary wealth transfers where possible, and accumulate an increasing pool of capital providing accessibility, control and uninterrupted compounding. It is the amount of money that you can access through collateralizing a loan against your money, allowing your money to continue earning interest and working for you. It’s very important to understand that accessibility, control and uninterrupted compounding are the key components of collateral capacity. It’s one thing to look good on paper, but when times get tough, assets that you can’t touch or can’t convert easily to cash, will do you little good. Three things affect your collateral capacity: ① The first is contributions into savings and investment accounts that you can access. It would be wise to keep feeding your Golden Goose. Often the lure of higher return potential also brings with it lack of liquidity. Make sure you maintain a good balance between long-term accounts and accounts that provide immediate liquidity and access. ② Second is the growth on the money from interest earned on the money you have in your account. Some assets earn compound interest and grow every year. Others either appreciate or depreciate. Some accounts could be worth a great deal but you have to sell or close them to access the money. That would be like killing your Golden Goose. Having access to money to make it through downtimes is an important factor in sustaining long-term growth. ③ Third is the reduction of any liens you may have against these accounts. As you pay off liens against your collateral positions, your collateral capacity will increase allowing you to access more capital in the future. The goose never quit laying golden eggs – uninterrupted compounding. Years ago, shortly after starting my first business, I laughed at a banker that told me I needed at least $25,000 in my business account in order to borrow $10,000. My business owner friends thought that was ridiculously funny too. We didn’t understand collateral capacity and quite a few other things about money.

The Ten Commandments As Interpreted by Robin Palmetier 1. Don’t lie. Unless it’s to the police. 2. Don’t cheat your customers. Robin always made sure her dime bags were just a bit larger than any other dealers’ in the area, insuring loyalty in her clientele. 3. Always be polite. Especially to people who don’t like you, as it will piss them off. 4. Don’t steal from anyone. Anyone meaning people, leaving corporations and the IRS fair game. 5. Don’t kill. This one was also on the Bible’s list but, like many Christians, Robin had a long list of exceptions to this rule. It was okay to kill sexual predators (unless they were born-again while serving time), liberal commentators, and anyone described as a "bad guy" by the greatest journalist and political leader of all time, Box News commentator Malcolm Wright. Unless, of course, Mr. Wright happened to be talking about one of her personal friends, which, on occasion, he had. 6. Do not take the Lord’s name in vein. Shit, fuck, cock, pussy, bitch, bastard and their ilk were just fine. Goddamn’s and Jesus Christ’s were no-no’s. 7. Always repay a favor with a favor. Someone does something nice for you, do something nice right back. Being in someone’s debt is a dangerous thing. 8. Affirm that every word in the Bible is true, except the parts that clearly aren’t. Like that thing about eating shellfish—though supposedly an abomination on par with adultery, murder, poly-cotton blends and paying interest on a mortgage—it could not possibly be God’s will. Robin loved scallops and knew the good Lord would not wish to deny her this pleasure. 9. Discuss all decisions with God directly and listen closely to his advice. Sadly, when Praline tried this himself he got nothing but an extended silence, while his mother always seemed to get very detailed instructions. 10. Always remember your mama loves you.

The FHA had adopted a system of maps that rated neighborhoods according to their perceived stability. On the maps, green areas, rated “A,” indicated “in demand” neighborhoods that, as one appraiser put it, lacked “a single foreigner or Negro.” These neighborhoods were considered excellent prospects for insurance. Neighborhoods where black people lived were rated “D” and were usually considered ineligible for FHA backing. They were colored in red. Neither the percentage of black people living there nor their social class mattered. Black people were viewed as a contagion. Redlining went beyond FHA-backed loans and spread to the entire mortgage industry, which was already rife with racism, excluding black people from most legitimate means of obtaining a mortgage.

bank gives some poor schmuck a mortgage at 100% the value of his property. No deposit. The bank sells the debt off to a larger bank in return for instant cash. The larger bank bundles up a hundred crappy mortgages like this and sells insurance policies for ten cents on the dollar – because their analysts tell them it’s a sure thing. They do this with thousands of loans. The mortgage securities market grows. Nothing can go wrong, right?” “Until the homeowner can’t make his repayments.

give you an example. A bank gives some poor schmuck a mortgage at 100% the value of his property. No deposit. The bank sells the debt off to a larger bank in return for instant cash. The larger bank bundles up a hundred crappy mortgages like this and sells insurance policies for ten cents on the dollar – because their analysts tell them it’s a sure thing. They do this with thousands of loans. The mortgage securities market grows. Nothing can go wrong, right?

Mortgage Workouts Even if you don’t qualify for any of the government loan modification programs or your lender doesn’t agree to participate, you may be able to arrange a “mortgage workout.” A workout is any agreement you make with the lender that changes how you pay the delinquency on your mortgage or otherwise keeps you out of foreclosure. Many lenders require this formal process even for short-term fixes. Here are some workout options your lender might agree to: • Spread repayment of missed payments over a few months. For example, if your monthly payment is $1,000 and you missed two payments ($2,000), the lender might let you pay $1,500 for four months. • Reduce or suspend your regular payments for a specified time, and then add a portion of your overdue amount to your regular payments later on. • Extend the length of your loan and add the missed payments at the end. • For a period of time, suspend the amount of your monthly payment that goes toward the principal and only require payment of interest, taxes, and insurance. • Let you sell the property for less than you owe the lender and waive the rest. This is called a “short sale.” It’s best to start the workout negotiations as early as possible. But before you contact the lender about a workout, you should prepare information about your situation, including: • a reasonable budget for the

I have never been someone who likes rules or structure. I don't even like ruled notebook paper. There's too much structure in the world: too much insurance, litigation, unfulfilling work, fighting; too many credit cards, receipts, forms, taxes, mortgages, traffic jams, obligations and always enormous pressure and fear as a result.

The first is to never carry a mortgage larger than twice your gross income. The second is to spend less than 20% of your gross income on housing, including your mortgage payment, utilities, property taxes, insurance, and maintenance.

savings and time deposits, savings-and-loan-association accounts, life insurance, annuities, and real-estate mortgages or equity ownership.

Rent or mortgage payment: $____per month (Angela’s Average: $1,060) 2. Food, household: $____per month (Angela’s Average: $511) 3. Gas, electric, water, phone: $____per month (Angela’s Average: $289) 4. Transportation: $____per month (Angela’s Average: $729) 5. Insurance payments: $____per month (Angela’s Average: $300)           Total $____per month (Angela’s Average: $2,889) Total basic monthly expenses:_______× 12 =__________per year (US average basic annual expenses: $34,668)

Because the FHA’s appraisal standards included a whites-only requirement, racial segregation now became an official requirement of the federal mortgage insurance program. The FHA judged that properties would probably be too risky for insurance if they were in racially mixed neighborhoods or even in white neighborhoods near black ones that might possibly integrate in the future.

By 1950, the FHA and VA together were insuring half of all new mortgages nationwide.

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It's such a strange thing, but in two years of hustling I never once thought of it as a crime. I honestly didn't think it was bad. It's just stuff people found. White people have insurance. Whatever rationalization was handy. In society, we do horrible things to one another because we don't see the person it affects. We don't see their face. We don't see them as people. Which was the whole reason the hood was built in the first place, to keep victims of apartheid out of sight and out of mind. Because if white people ever saw black people as human, they would see that slavery is unconscionable. We live in a world where we don't see the ramifications of what we do to others, because we don't live with them. It would be a whole lot harder for an investment banker to rip off people with subprime mortgages if he actually had to live with the people he was ripping off. If we could see one another's pain and empathize with one another, it would never be worth it to us to commit the crimes in the first place.

Over the next few years, the number of African Americans seeking jobs and homes in and near Palo Alto grew, but no developer who depended on federal government loan insurance would sell to them, and no California state-licensed real estate agent would show them houses. But then, in 1954, one resident of a whites-only area in East Palo Alto, across a highway from the Stanford campus, sold his house to a black family. Almost immediately Floyd Lowe, president of the California Real Estate Association, set up an office in East Palo Alto to panic white families into listing their homes for sale, a practice known as blockbusting. He and other agents warned that a 'Negro invasion' was imminent and that it would result in collapsing property values. Soon, growing numbers of white owners succumbed to the scaremongering and sold at discounted prices to the agents and their speculators. The agents, including Lowe himself, then designed display ads with banner headlines-"Colored Buyers!"-which they ran in San Francisco newspapers. African Americans desperate for housing, purchased the homes at inflated prices. Within a three-month period, one agent alone sold sixty previously white-owned properties to African Americans. The California real estate commissioner refused to take any action, asserting that while regulations prohibited licensed agents from engaging in 'unethical practices,' the exploitation of racial fear was not within the real estate commission's jurisdiction. Although the local real estate board would ordinarily 'blackball' any agent who sold to a nonwhite buyer in the city's white neighborhoods (thereby denying the agent access to the multiple listing service upon which his or her business depended), once wholesale blockbusting began, the board was unconcerned, even supportive. At the time, the Federal Housing Administration and Veterans Administration not only refused to insure mortgages for African Americans in designated white neighborhoods like Ladera; they also would not insure mortgages for whites in a neighborhood where African Americans were present. So once East Palo Alto was integrated, whites wanting to move into the area could no longer obtain government-insured mortgages. State-regulated insurance companies, like the Equitable Life Insurance Company and the Prudential Life Insurance Company, also declared that their policy was not to issue mortgages to whites in integrated neighborhoods. State insurance regulators had no objection to this stance. The Bank of America and other leading California banks had similar policies, also with the consent of federal banking regulators. Within six years the population of East Palo Alto was 82 percent black. Conditions deteriorated as African Americans who had been excluded from other neighborhoods doubled up in single-family homes. Their East Palo Alto houses had been priced so much higher than similar properties for whites that the owners had difficulty making payments without additional rental income. Federal and state hosing policy had created a slum in East Palo Alto. With the increased density of the area, the school district could no longer accommodate all Palo Alto students, so in 1958 it proposed to create a second high school to accommodate teh expanding student population. The district decided to construct the new school in the heart of what had become the East Palo Alto ghetto, so black students in Palo Alto's existing integrated building would have to withdraw, creating a segregated African American school in the eastern section and a white one to the west. the board ignored pleas of African American and liberal white activists that it draw an east-west school boundary to establish two integrated secondary schools. In ways like these, federal, state, and local governments purposely created segregation in every metropolitan area of the nation.

At the time, the Federal Housing Administration and Veterans Administration not only refused to insure mortgages for African Americans in designated white neighborhoods like Ladera; they also would not insure mortgages for whites in a neighborhood where African Americans were present. So once East Palo Alto was integrated, whites wanting to move into the area could no longer obtain government-insured mortgages. State-regulated insurance companies, like the Equitable Life Insurance Company and the Prudential Life Insurance Company, also declared that their policy was not to issue mortgages to whites in integrated neighborhoods. State insurance regulators had no objection to this stance. The Bank of America and other leading California banks had similar policies, also with the consent of federal banking regulators.

in Rollingwood ten years earlier, one of the federal government’s specifications for mortgages insured in Milpitas was an openly stated prohibition on sales to African Americans.

Government's commitment to separating residential areas by race began nationwide following the violent suppression of Reconstruction after 1877. Although the Supreme Court in 1917 forbade the first wave of policies—racial segregation by zoning ordinance—the federal government began to recommend ways that cities could evade that ruling, not only in the southern and border states but across the country. In the 1920s a Harding administration committee promoted zoning ordinances that distinguished single-family from multifamily districts. Although government publications did not say it in as many words, committee members made little effort to hide that an important purpose was to prevent racial integration. Simultaneously, and through the 1920s and the Hoover administration, the government conducted a propaganda campaign directed at white middle-class families to persuade them to move out of apartments and into single-family dwellings. During the 1930s the Roosevelt administration created maps of every metropolitan area, divided into zones of foreclosure risk based in part on the race of their occupants. The administration then insured white homeowners' mortgages if they lived in all-white neighborhoods into which there was little danger of African Americans moving. After World War II the federal government went further and spurred the suburbanization of every metropolitan area by guaranteeing bank loans to mass-production builders who would create the all-white subdivisions that came to ring American cities. In 1973, the U.S. Commission on Civil Rights concluded that the 'housing industry, aided and abetted by Government, must bear the primary responsibility for the legacy of segregated housing. . . . Government and private industry came together to create a system of residential segregation.

While we often think of where we live as a matter of personal preference, there is actually a massive amount of policy and legislation behind where we reside. As historian Richard Rothstein shows in The Color of Law, because racial discrimination was official federal policy through the middle of the twentieth century, black citizens were excluded from federally insured mortgages. 17 Not only that, housing developers were only eligible for government insurance if they maintained a strict policy of banning African Americans from inhabiting the homes they built. The racial divide we see today between many affluent suburbs and nearby urban neighborhoods is not an accident of history nor the amalgamation of countless individual choices; it is de jure (according to law) segregation, constructed and sustained by federal and, in many cases, state and local government policies. This means that the majority of us live where we do not simply as a matter of preference or convenience. How we decide where to live is shaped by what we might call a housing practice.

To solve the inability of middle-class renters to purchase single-family homes for the first time, Congress and President Roosevelt created the Federal Housing Administration in 1934. The FHA insured bank mortgages that covered 80 percent of purchase prices, had terms of twenty years, and were fully amortized. To be eligible for such insurance, the FHA insisted on doing its own appraisal of the property to make certain that the loan had a low risk of default. Because the FHA's appraisal standards included a whites-only requirement, racial segregation now became an official requirement of the federal mortgage insurance program. The FHA judged that properties would probably be too risky for insurance if they were in racially mixed neighborhoods or even in white neighborhoods near black ones that might possibly integrate in the future. When a bank applied to the FHA for insurance on a prospective loan, the agency conducted a property appraisal, which was also likely performed by a local real estate agent hired by the agency. as the volume of applications increased, the agency hired its own appraisers, usually from the ranks of the private real estate agents who had previously been working as contractors for the FHA. To guide their work, the FHA provided them with an Underwriting Manual. The first, issued in 1935, gave this instruction: 'If a neighborhood is to retain stability it is necessary that properties shall continue to be occupied by the same social and racial classes. A change in social or racial occupancy generally leads to instability and a reduction in values.' Appraisers were told to give higher ratings where '[p]rotection against some adverse influences is obtained,' and that '[i]mportant among adverse influences . . . are infiltration of inharmonious racial or nationality groups.' The manual concluded that '[a]ll mortgages on properties protected against [such] unfavorable influences, to the extent such protection is possible, will obtain a high rating.' The FHA discouraged banks from making any loans at all in urban neighborhoods rather than newly built suburbs; according to the Underwriting Manual, 'older properties . . . have a tendency to accelerate the rate of transition to lower class occupancy.' The FHA favored mortgages in areas where boulevards or highways served to separate African American families from whites, stating that '[n]atural or artificially established barriers will prove effective in protecting a neighborhood and the locations within it from adverse influences, . . . includ[ing] prevention of the infiltration of . . . lower class occupancy, and inharmonious racial groups.

If your company has any credible strategy for providing equity-based returns with muted volatility, you have not just a value proposition, but one of the most important value propositions of our time.... What's the concept in an operating real estate REIT? Operating real estate (as distinct from net leases or mortgages, which are other financing concepts) has the potential to produce equity-like long-term returns, but isan extremely powerful diversifier, in that real estate correlates positively with inflation while stocks and bonds correlate negatively with it. Inflation, with it attendant higher interest rates, chokes off new supply of real estate: new expensive to build, to expensive to finance at prevailing market rents. When new supply dwindles, normal growth absorbs the available space and puts upward pressure on rents, increasing cash flows to the owners... until rents get to a point where new construction pencils out again. (Meanwhile, in an inflation/interest rate flareup of any consequence, stocks and bonds are usually getting hit, and sometimes hit hard.) This, to me, is a trifecta of a conceptual value proposition: (a) the potential for the equity-like long-term returns investors need, (b) historically correlated positively with inflation, unlike all financial assets, and (c) just when you think this story can't get better, with 90% of available income paid out currently to income-starved investors.... What's the concept for variable life insurance? It's certainly the least expensive long-term form of life insurance, in that, as the investment portion grows, it extinguishes the insurance company's exposure. (As Ben Baldwin gnomically and brilliantly observes, 'All insurance is term insurance.') It may also be, in a given situation, the cheapest way of funding an estate tax liability, leaving the maximum legacy to one's heirs. And, of course, if the ownership is vested in an insurance trust, one may (under current law at this writing) be bequeathing wealth without income or estate taxation. As long as there is an estate tax - any estate tax - there will be a financial planning issue in the life of every affluent household/family: how do you want the heirs to pay it? And it seems likely that, conceptually, VUL will always be an answer.... Small cap equities? The concept is, clearly, higher returns with - and precisely because of - their higher volatility.

Here’s how it works: let’s say your income is $150,000 per year, or $12,500 a month gross. At 36% DTI, your total monthly payments, including your proposed mortgage, taxes, homeowners insurance, and homeowners’ association (HOA) or condo fees can’t exceed $4,500.

A thorough flip budget includes: • Investment property purchase price and settlement costs • Loan costs (such as application fees, points, and lifetime interest) • Repair and renovation costs (based on estimates from experienced contractors) • Inspection fees • Staging costs • Selling costs (including real estate agent commission and other closing costs) • Professional fees • Insurance • Property and school taxes • Utilities • Income tax provisions

Unlike the house you live in, practically every expense attached to your rental property counts as a deductible business expense for tax purposes. Expenses to deduct include: • Mortgage interest • Property taxes • Insurance • Homeowners association dues • Advertising (to fill a vacancy) • Utilities • Repairs and maintenance • Pest control • Landscaping • Trash pickup • Depreciation What doesn’t count as an expense? Any major repairs or renovations you perform count as capital expenditures that get added to the cost basis of the property, effectively reducing your taxable income when you eventually sell.

Merely four months before, that same Congress passed the ACA, further expanding our insurance-based system. Yet the practices of “affordable” health care are virtually the same practices now outlawed in mortgage lending: we all make our health care decisions with their financial implications intentionally hidden from us. How

The American real-estate industry believed segregation to be a moral principle. As late as 1950, the National Association of Real Estate Boards' code of ethics warned that "a Realtor should never be instrumental in introducing into a neighborhood ... any race or nationality, or any individuals whose presence will clearly be detrimental to property values." A 1943 brochure specified that such potential undesireables might include madams, bootleggers, gangsters - and "a colored man of means who was giving his children a college education and thought they were entitled to live among whites." The federal government concurred. It was the How Owners' Loan Corporation, not a private trade association, that pioneered the practice of redlining, selectively granting loans and insisting that any property it insured be covered by a restrictive covenant - a clause in the deed forbidding the sale of the property to anyone other than whites. Millions of dollars flowed from tax coffers into segregated white neighborhoods. "For perhaps the first time, the federal government embraced the discriminatory attitudes of the marketplace," the historian Kenneth R. Jackson wrote in his 1985 book, Crabgrass Frontier, a history of suburbanization. "Previously, prejudices were personalized and individualized; FHA exhorted segregation and enshrined it as public policy. Whole areas of cities were declared ineligible for loan guarantees." Redlining was not officially outlawed until 1968, by the Fair Housing Act. By then the damage was done - and reports of redlining by banks have continued.

Young back-to-the-landers who had felt reassured by the "real" skills of growing their own food and building their own shelter were now also experiencing what their farm neighbors and forebears had long known: relying strictly on yourself and on the land for your livelihood puts you frighteningly at the mercy of chance. An early frost, a slipped saw blade, a hot-selling market vegetable suddenly passing out of vogue- one stroke of bad luck could be devastating. Many were shocked to discover that poverty- even romantic, "turned-on" poverty- was defined not by a lack of material possessions but by a lack of control. Mortgages and health insurance and the other systems their parents had counted on to provide stability suddenly made a lot more sense.

Net wages: “It’s not what you make, but what you net” after paying the FIRE sector, basic utilities and taxes. The usual measure of disposable personal income (DPI) refers to how much employees take home after income-tax withholding (designed in part by Milton Friedman during World War II) and over 15% for FICA (Federal Insurance Contributions Act) to produce a budget surplus for Social Security and health care (half of which are paid by the employer). This forced saving is lent to the U.S. Treasury, enabling it to cut taxes on the higher income brackets. Also deducted from paychecks may be employee withholding for private health insurance and pensions. What is left is by no means freely available for discretionary spending. Wage earners have to pay a monthly financial and real estate “nut” off the top, headed by mortgage debt or rent to the landlord, plus credit card debt, student loans and other bank loans. Electricity, gas and phone bills must be paid, often by automatic bank transfer – and usually cable TV and Internet service as well. If these utility bills are not paid, banks increase the interest rate owed on credit card debt (typically to 29%). Not much is left to spend on goods and services after paying the FIRE sector and basic monopolies, so it is no wonder that markets are shrinking. (See Hudson Bubble Model later in this book.) A similar set of subtrahends occurs with net corporate cash flow (see ebitda). After paying interest and dividends – and using about half their revenue for stock buybacks – not much is left for capital investment in new plant and equipment, research or development to expand production.

In a study Suzanne Mettler asked 1,400 Americans whether they had used a government social program. Fifty-seven percent said they had not. Then she asked if they had used one of twenty-one specific federal policies, including child-care tax credits, the Earned Income Tax Credit, employer-sponsored and thus tax exempted health insurance, Medicare, Social Security, unemployment insurance, mortgage-interest deductions, and student loans. It turned out that 96 percent of those who had denied using government programs had in fact used at least one, and the average responder had used four. This clear disconnect between Americans' perception of who benefits from government programs and the reality makes it easier to keep demonizing the "welfare state.

State-regulated insurance companies, like the Equitable Life Insurance Company and the Prudential Life Insurance Company, also declared that their policy was not to issue mortgages to whites in integrated neighborhoods. State insurance regulators had no objection to this stance.

as numerous individual colored folders, one for each of the following categories: • Insurance info • Mortgage info • Purchase docs • Monthly income statements • Bank statements • Tenant interactions • Rehab and maintenance • Tenant files • Receipts • Miscellaneous paperwork This way, each property will have one overarching folder file, as well as several color-coded folders for easy retrieval of information. Need insurance docs for 123 Main Street? Oh, that’s in the 123 Main Street file, red folder.

list of documents that may be required. It can look intimidating, especially if you’ve not been actively involved in your family finances, but don’t panic. If you can’t find all of them or don’t have access, there is a later step in the divorce process called “discovery,” when you can legally compel the other side to provide copies of anything else you need: •Individual income tax returns (federal, state, local) for past three years •Business income tax returns (federal, state, local) for past three years •Proof of your current income (paystubs, statements, or paid invoices) •Proof of spouse’s income (paystubs, statements, or paid invoices) •Checking, savings, and certificate statements (personal and business) for past three years •Credit card and loan statements (personal and business) for past three years •Investment, pension plan, and retirement account statements for past three years •Mortgage statement and loan documents for all properties you have an interest in •Real estate appraisals •Property tax documents •Employment contracts •Benefit statements •Social Security statements •Life, homeowner’s, and auto insurance policies •Wills and trust agreements •Health insurance cards •Vehicle titles and/or registration •Monthly budget worksheet •List of personal property (furnishings, jewelry, electronics, artwork) •List of property acquired by gift or inheritance or owned prior to marriage •Prenuptial agreements •Marriage license •Prior court orders directing payment of child support or spousal support Your attorney or financial advisor may ask for additional documents specific to your case. Some of these may not be applicable to you.

Gather six to 12 months of checking, savings, and credit card statements, and break your income and expenses down into categories and then line items. I have suggested some here, but add your own as needed. Check to see if your bank or credit card company provides reporting that categorizes charges or lets you assign categories—your work may already be almost done for you: •Income—paychecks, interest, dividends, rents, royalties, business income, pension, social security, child support, spousal support •Housing—mortgage/rent, property taxes, HOA dues, insurance •Utilities—gas, electric, propane, phone, TV/Internet, trash, water/sewer •Food—groceries, dining out •Auto—car payments, gasoline, repairs, insurance •Medical—health insurance, doctor/dentist visits, prescriptions, physical therapy •Entertainment—travel, concerts/shows, sports •Clothing—personal purchases, dry cleaning, uniforms •Personal care—hair/nails, gym/yoga, vitamins/supplements •Miscellaneous—gifts, pets, donations •Children—education, activities, school lunches, childcare You can use a spreadsheet or pen and paper to take note of income and expenses as you go through statements, then calculate a monthly average for each item.

the FHA does require an additional payment, called "Private Mortgage Insurance." This "PMI" insurance protects the lender and is required when the down payment on an FHA loan is less than 20%. The extra PMI payment can make your monthly payment slightly higher, thus reducing your cashflow.

Your mortgage, property tax, and insurance (called PITI) should not exceed 25% of your gross (pre-tax) monthly income.

Critics of capitalism often decry the “greed” that animates successful entrepreneurs. The real problem, however, is not the amount of money made by people at the top; it is the systematic suppression of people at the bottom. The real-life equivalent of the Monopoly player who has to mortgage all his money-making assets to pay his debts is the hand-to-mouth day laborer who, unable to pay his car insurance, loses his car and, unable to drive to his job, is unable to pay his rent. The villain here is not necessarily the avarice of the banker who loaned this poor fellow his money in the first place. It is the unstable dynamic of a system that mercilessly drives some people down to the bottom through a succession of cascading misfortunes. To experience the board game version of this kind of misery vortex in Monopoly is to appreciate the advantages of the welfare state, which, when it is functioning properly, does not just take money from rich people and give it to poor people. It also softens the iterative feedback dynamics within the system so as to ensure that minor nudges—a lost job, a criminal conviction, a divorce, a medical setback—do not create feedback effects that ultimately produce a full-blown personal catastrophe. Job training, public health care, a humane justice system, community housing and support for single mothers are examples of programs that can achieve that effect.

Arbor Cultural Ltd helps you manage your trees in a way that is more sustainable, beneficial and environmentally conscious. We carry out tree surveys and produce tree reports for a variety of needs, such as health and safety, mortgage and insurance purposes, enabling customers to achieve planning surveys and successful house purchases, as well as addressing duty of care and legal requirements. We also undertake Arboricultural Impact Assessments for planning and development as well as decay detection testing to give you certainty about the condition of your trees.

The numbers shocked even him. They didn't need to collapse; they merely needed to stop rising so fast. House prices were still rising, and yet default rates were approaching 4 percent; if they rose to just 7 percent, the lowest investment-grade bonds, rated triple-B-minus, went to zero. If they rose to 8 percent, the next lowest-rated bonds, rated triple-B, went to zero. At that moment--in November 2005--Greg Lippmann realized that he didn't mind owning a pile of credit default swaps on subprime mortgage bonds. They weren't insurance; they were a gamble; and he liked the odds. He wanted to be short.

The numbers shocked even him. They didn't need to collapse; they merely needed to stop rising so fast. House prices were still rising, and yet default rates were approaching 4 percent; if they rose to just 7 percent, the lowest investment-grade bonds, rated triple-B-minus, went to zero. If they rose to 8 percent, the next lowest-rated bonds, rated triple-B, went to zero. At that moment--in November 2005--Greg Lippmann realized that he didn't mind owning a pile of credit default swaps on subprime mortgage bonds. They weren't insurance; they were a gamble; and he liked the odds. He wanted to be short.

But it comes down to the fact we are not normal people. I hear celebrities saying that and I think, ‘Where’s your mortgage? Do you struggle to pay for childcare so you can go to work? Do you hesitate to see a doctor because you can’t afford the co-pay on your insurance? Or you have no insurance at all?’ Of course, Mom and Dad eat and breathe and sleep, but their lives, and by extension our lives, are not normal.

The Atlantic puts it best: “It’s boring to point out that having more money affords you more food, more clothes, more housing, and more cars. But the richest families actually spend less on food, clothes, housing, and cars than the poorest families as a share of their income. The real difference between the rich and the poor is that the rich spend a larger share of their much larger income on insurance, education, and when you drill into the housing component, mortgages – all of which are directly related to building wealth, preserving wealth, and passing it down in the form of inheritance of direct investments in the lives of their children.

Ideally, you want to get at least one percent of the property’s overall value in the rent each month, since that brings in enough money to cover the mortgage, insurance, and necessary repairs.

At Loan Corp, we have invested in slick tech-based systems to ensure a seamless journey for our customers. From consumer finance such as mortgages, remortgages, secured loans, banks, credit cars and insurance, we API directly into our top-tier lenders that match your requirements. Our commercial offerings are bridging loans, auction finance, development loans, loans to buy land and all aspects of commercial finance. Offering short- and long-term business loans in the UK from a wide range of products such as invoice finance, cash flow loans and even small business loans for bad credit.

I went to see the house. (...) The place was a squat—thirty-five heroin addicts were living there. The chaos was palpable. It smelled like dog shit, cat shit, piss. (...) One floor was literally burned—it was nothing but charred floorboards with a toilet sitting in the middle. This place looked terrible. “How much?” I asked. Forty thousand guilder, they told me. They clearly just wanted to dump this house. But if you bought it, you were also getting the heroin addicts who were squatting in it, and under Dutch law, it was all but impossible to get them out. For any normal human being to buy this place would be like throwing money out the window. So I said, “Okay, I’m interested.” I talked about it with my friends. “You’re nuts,” they said. “It’s not money you have—what the hell are you going to do?” ...A drug dealer [had] bought the place. But he didn’t pay the mortgage. And he didn’t pay and he didn’t pay, and finally he was in such financial trouble that he decided to burn the place down for the insurance. Except that the fire was stopped in time and only the one floor was damaged. And then the insurance investigator found that the drug dealer had done it intentionally, and the bank took the house away from him. And this was how it turned into a squat for heroin addicts. “But where is this guy?” I asked. “He’s still living in the house,” the neighbor told me. This house had two entrances. One went to the first floor and the other to the second. The door with the board across it was the entrance to the first floor, where I’d already been; the drug dealer was living on the second floor. So I went around and knocked on the door, and he answered. “I want to talk to you,” I said. He let me in. There was a table in the middle of the floor, covered with ecstasy, cocaine, hashish, all ready to go into bags. There was a pistol on the table. This guy was bloated—he looked like hell. And suddenly I poured my heart out to him. I told him everything... I said that this house was what I wanted—all I wanted—the only home I could afford with the little money I had. I was weeping. This guy was standing there with his mouth open. He stood there looking at me. Then he said, “Okay. But I have a condition.” “This is my deal. I’ll get everybody out; you’ll get your mortgage. But the moment you sign the contract and get the house, you’re going to sign a contract that I can stay on this floor for the rest of my life. That’s the deal. If you cross me...” He showed me the pistol. It was in a good neighborhood, where a comparable place would sell for forty to fifty times the price. And [now] it was empty—not a heroin addict in sight. I got a mortgage in less than a week. But now, since my bank knew the house was empty, Dutch law gave them the right to buy the house for themselves. So I went back to the drug dealer and said, “Can we get some addicts back into the place? Because it’s too good now.” “How many you want?” he asked. “About twelve,” I said. “No problem,” he said. He got twelve addicts back. I took curtains I found in a dumpster and put them on the windows. Then I scattered some more debris around the place. Now all I had to do was wait. My contract signing was two weeks away—it was the longest two weeks in my life. Finally the day came... and I walked into the bank. The atmosphere was very serious. One of the bankers looked at me and said, “I heard that the unwanted tenants have left the house.” I just looked at him very coolly and said, “Yeah, some left.” He cleared his throat and said, “Sign here.” I signed. “Congratulations,” the banker said. “You’re the owner of the house.” I looked at him and said, “You know what? Actually everybody left the house.” He looked back at me and said, “My dear girl, if this is true, you have just made the best real-estate deal I’ve heard of in my twenty-five-year career.

I’m amazed at how this has snowballed into such a media event. It began last week when I saw a national news report by Tom Brokaw about this adorable little lady from Georgia, Mrs. Hill, who was trying to save her farm from being foreclosed. Her sixty-seven-year-old husband had committed suicide a few weeks earlier, hoping his life insurance would save the farm, which had been in the family for generations. But the insurance proceeds weren’t nearly enough. It was a very sad situation, and I was moved. Here were people who’d worked very hard and honestly all their lives, only to see it all crumble before them. To me, it just seemed wrong. Through NBC I was put in touch with a wonderful guy from Georgia named Frank Argenbright, who’d become very involved in trying to help Mrs. Hill. Frank directed me to the bank that held Mrs. Hill’s mortgage. The next morning, I called and got some vice president on the line. I explained that I was a businessman from New York, and that I was interested in helping Mrs. Hill. He told me he was sorry, but that it was too late. They were going to auction off the farm, he said, and “nothing or no one is going to stop it.” That really got me going. I said to the guy: “You listen to me. If you do foreclose, I’ll personally bring a lawsuit for murder against you and your bank, on the grounds that you harassed Mrs. Hill’s husband to his death.” All of a sudden the bank officer sounded very nervous and said he’d get right back to me. Sometimes it pays to be a little wild. An hour later I got a call back from the banker, and he said, “Don’t worry, we’re going to work it out, Mr. Tramp.” Mrs. Hill and Frank Argenbright told the media, and the next thing I knew, it was the lead story on the network news. By the end of the week, we’d raised $40,000. Imus alone raised almost $20,000 by appealing to his listeners. As a Christmas present to Mrs. Hill and her family, we’ve scheduled a mortgage-burning ceremony for Christmas Eve in the atrium of Trump Tower. By then, I’m confident, we’ll have raised all the money. I’ve promised Mrs. Hill that if we haven’t, I’ll make up any difference. I tell Imus he’s the greatest, and I invite him to be my guest one day next week at the tennis matches at the U.S. Open. I have a courtside box and I used to go myself almost every day. Now I’m so busy I mostly just send my friends.

On Monday, Lehman Brothers had filed for bankruptcy, and Merrill Lynch, having announced $55.2 billion in losses on subprime bond–backed CDOs, had sold itself to Bank of America. The U.S. stock market had fallen by more than it had since the first day of trading after the attack on the World Trade Center. On Tuesday the U.S. Federal Reserve announced that it had lent $85 billion to the insurance company AIG, to pay off the losses on the subprime credit default swaps AIG had sold to Wall Street banks—the biggest of which was the $13.9 billion AIG owed to Goldman Sachs. When you added in the $8.4 billion in cash AIG had already forked over to Goldman in collateral, you saw that Goldman had transferred more than $20 billion in subprime mortgage bond risk into the insurance company, which was in one way or another being covered by the U.S. taxpayer.

The truth is that I'm a bad person. But, that's gonna change - I'm going to change. This is the last of that sort of thing. Now I'm cleaning up and I'm moving on, going straight and choosing life. I'm looking forward to it already. I'm gonna be just like you. The job, the family, the fucking big television. The washing machine, the car, the compact disc and electric tin opener, good health, low cholesterol, dental insurance, mortgage, starter home, leisure wear, luggage, three piece suite, DIY, game shows, junk food, children, walks in the park, nine to five, good at golf, washing the car, choice of sweaters, family Christmas, indexed pension, tax exemption, clearing gutters, getting by, looking ahead, the day you die.

Americans. All had good credit ratings, and banks were willing to issue mortgages if the FHA would approve. But the agency stated that “no loans will be given to colored developments.” When banks told the real estate agent that without FHA endorsement they would not issue the mortgages, he approached the Prudential Life Insurance Company, which also said that although the applicants were all creditworthy, it could not issue mortgages unless the FHA approved. Today, Fanwood’s population remains 5 percent black in a county with a black population of about 25 percent.

Well, folks, you can see that those superscrapers came through the storm just fine. It’s too bad they’re mostly empty right now. I mean they’re residential towers supposedly, but they were always too expensive for ordinary people to afford. They’re like big granaries for holding money, basically. You have to imagine them all stuffed to the top with dollar bills. The richest people from all over the world own the apartments in those towers. They’re an investment, or maybe a tax write-off. Diversify into real estate, as they say. While also having a place to visit whenever you happen to want to visit New York. A vacation place they might use for only a week or two every year. Depends what they like. They usually own about a dozen of these places around the world. Spread their holdings around. So really these towers are just assets. They’re money. They’re like big tall purple gold bars. They’re everything except housing.... Now, here below us is Central Park. It’s a refugee camp now, you can see that. It’s likely to be that for weeks and months to come. Maybe a year. People will be sleeping in the park. Lots of tents already, as you see.... So you know what? I’m sick of the rich. I just am. I’m sick of them running this whole planet for themselves. They’re wrecking it! So I think we should take it back, and take care of it. And take care of each other as part of that. No more table scraps. You know that Householders’ Union that I was telling you about? I think it’s time for everyone to join that union, and for that union to go on strike. An everybody strike. I think there should be an everybody strike. Now. Today.... What I mean by a householders’strike is you just stop paying your rents and mortgages ... maybe also your student loans and insurance payments. Any private debt you’ve taken on just to make you and your family safe. The daily necessities of existence. The union is declaring all those to be odious debts, like some kind of blackmail on us, and we’re demanding they be renegotiated ... So, we stop paying and call that the Jubilee? ... That’s an old name for this kind of thing. After we start this Jubilee, until there’s a restructuring that forgives a lot of our debt, we aren’t paying anything. You might think that not paying your mortgage would get you in trouble, and it’s true that if it was just you, that might happen. But when everyone does it, that makes it a strike. Civil disobedience. A revolution. So everyone needs to join in. Won’t be that hard. Just don’t pay your bills! ... What will happen then is that the absence of those payments of ours will cause the banks to crash fast. They take our payments and use them as collateral to borrow tons more, to fund their own gambling, and they are way, way, way overextended. Overleveraged.... At that point they will be asking the government to bail them out. That’s us. We’re the government. At least in theory, but yeah. We are. So we can decide what to do then. We will have to tell our government what to do at that point. If our government tries to back the banks instead of us, then we elect a different government. We pretend that democracy is real, and that will make it real. We elect a government of the people, by the people, and for the people. That was the whole idea in the first place. As they used to tell us in school. And it’s a good idea, if we could make it real. It might never have been real, up till now. But now’s the time. Now’s the time, people!

Well, folks, you can see that those superscrapers came through the storm just fine. It’s too bad they’re mostly empty right now. I mean they’re residential towers supposedly, but they were always too expensive for ordinary people to afford. They’re like big granaries for holding money, basically. You have to imagine them all stuffed to the top with dollar bills. The richest people from all over the world own the apartments in those towers. They’re an investment, or maybe a tax write-off. Diversify into real estate, as they say. While also having a place to visit whenever you happen to want to visit New York. A vacation place they might use for only a week or two every year. Depends what they like. They usually own about a dozen of these places around the world. Spread their holdings around. So really these towers are just assets. They’re money. They’re like big tall purple gold bars. They’re everything except housing.... Now, here below us is Central Park. It’s a refugee camp now, you can see that. It’s likely to be that for weeks and months to come. Maybe a year. People will be sleeping in the park. Lots of tents already, as you see.... So you know what? I’m sick of the rich. I just am. I’m sick of them running this whole planet for themselves. They’re wrecking it! So I think we should take it back, and take care of it. And take care of each other as part of that. No more table scraps. You know that Householders’ Union that I was telling you about? I think it’s time for everyone to join that union, and for that union to go on strike. An everybody strike. I think there should be an everybody strike. Now. Today.... What I mean by a householders’strike is you just stop paying your rents and mortgages ... maybe also your student loans and insurance payments. Any private debt you’ve taken on just to make you and your family safe. The daily necessities of existence. The union is declaring all those to be odious debts, like some kind of blackmail on us, and we’re demanding they be renegotiated ... So, we stop paying and call that the Jubilee? ... That’s an old name for this kind of thing. After we start this Jubilee, until there’s a restructuring that forgives a lot of our debt, we aren’t paying anything. You might think that not paying your mortgage would get you in trouble, and it’s true that if it was just you, that might happen. But when everyone does it, that makes it a strike. Civil disobedience. A revolution. So everyone needs to join in. Won’t be that hard. Just don’t pay your bills! ... What will happen then is that the absence of those payments of ours will cause the banks to crash fast. They take our payments and use them as collateral to borrow tons more, to fund their own gambling, and they are way, way, way overextended. Overleveraged.... At that point they will be asking the government to bail them out. That’s us. We’re the government. At least in theory, but yeah. We are. So we can decide what to do then. We will have to tell our government what to do at that point. If our government tries to back the banks instead of us, then we elect a different government. We pretend that democracy is real, and that will make it real. We elect a government of the people, by the people, and for the people. That was the whole idea in the first place. As they used to tell us in school. And it’s a good idea, if we could make it real. It might never have been real, up till now. But now’s the time. Now’s the time, people!

TO THE IGNORANT MOTHERFUCKERS who keep breaking into my house: it’s bad enough that my children and I have been homeless for 2 and a half years but now I have to deal with this. Your greediness has cost me over $35,000 in damages and the bank has put a forced insurance of $5000 on my mortgage, so as of jan 1, my mortgage payment goes up $500 a month. I hope you feel good about what you have done and I hope

With the first banks opened on Monday, the afternoon brought another request from Roosevelt. Stating that he needed the tax revenue, he asked Congress that beer with alcohol content of up to 3.2 percent be made legal; the Eighteenth Amendment did not specify the percentage that constituted an intoxicating beverage. Congress complied. The House passed the bill the very next day with a vote count of 316–97, pushing it to the Senate. Wednesday brought good cheer: The stock market opened for the first time in Roosevelt’s presidency. In a single-day record, the Dow Jones Industrial Average gained over 15 percent—a gain in total market value of $3 billion. By Thursday, for increased fiscal prudence, the Senate had added an exemption for wine to go with beer, but negotiated the alcohol content down to 3.05 percent. Throughout the week, banks were receiving net deposits rather than facing panicked withdrawals. Over the following weeks, the administration developed a sweeping farm package designed to “increase purchasing power of our farmers” and “relieve the pressure of farm mortgages.” To guarantee the safety of bank deposits, the Federal Deposit Insurance Corporation was created. To regulate the entire American stock and bond markets, the Exchange Act of 1933 required companies to report their financial condition accurately to the buying public, establishing the Securities and Exchange Commission. Safety nets such as Social Security for retirement and home loan guarantees for individuals would be added to the government’s portfolio of responsibilities within a couple of years. It was the largest peacetime escalation of government in American history.

The German inflation was a huge fraud which benefited the debtors and speculators at the expense of the large, prudent middle class. The following things happened in Germany: a. Bonds (including governments), real estate mortgages, life insurance, bank savings and all fixed value investments became worthless because they were redeemed by debtors with depreciated money. b. Common stocks of industrial concerns soared to fantastic heights and paid huge dividends. When stabilization came these stocks crashed and only the strongest companies survived. In spite of this common stocks proved to be the best investment. c. Real estate owners who paid off their mortgages with depreciated currency and held on to it until stabilization came, still had something of value. The same applied to purchasers of commodities such as diamonds, etc. d. Industries expanded, built huge additions to their plants and paid in worthless currency. Of all classes, the industrialists fared best. e. Professional men were badly off.

Unfortunately, the Bull that gilded Renaissance New York did little for most Americans. Eighties Wall Street was about institutional money released by deregulation, mergers and acquisitions, and, most of all, the debt that made it all possible. As John Kenneth Galbraith points out, financial euphoria always starts with new ways to borrow money; this time it was triggered by the Savings & Loan crisis. Volcker’s rocketing interest rates had forced S&Ls to offer double digits to new depositors while only getting back single digits on the old thirty-year mortgages on their books. S&Ls were going under, and getting a mortgage was nearly impossible, so in March 1980, with the banking system and the housing market on the brink, Carter had signed a law to allow them to issue credit cards, invest in commercial real estate, and offer checking accounts in order to stay in business. Reagan then took it a step further with a change that encouraged S&Ls to sell their mortgages in search of higher returns, freeing up a $1 trillion that needed to be invested in something. Which takes us back to Salomon Brothers, where in 1978 one Lew Ranieri had repackaged an old investment product the government had clamped down on during the Depression: A group of home mortgages all backed by government insurance would be bundled together, then sliced into bonds, thus converting the debt some people owed on their homes into an asset for others. Ranieri had been a bit ahead of the curve then—the same high interest rates that killed the S&Ls also made his bonds unattractive—but now deregulation let Salomon buy up the S&Ls’ mortgages at a deep discount, bundle them into bonds, and sell them back to the S&Ls who believed they’d diversified into the bond market when in fact they’d just bought ground meat made out of their own steaks. In June 1983, Salomon Brothers and Freddie Mac together issued the first collateralized mortgage obligation bonds (CMOs), which bundled up debt and cut it into tranches based on the amount of risk: you could choose between ground chuck and ground sirloin. It would be years before technology would allow doing this on a huge scale, but the immediate impact was that all kinds of debt, not just mortgages, were bundled, cut into bonds, and sold: credit card debt, car loans, you name it. Between 1983 and 1988, some $60 billion of CMOs were sold; GM’s financing arm became more profitable than its cars. America began to make debt instead of things. The

Gross rental income (including utilities fee) –  Mortgage payment (including principal, interest, taxes, and insurance) – Cost of utilities –  Vacancy allowance (10 percent of gross rents) –  Maintenance and CapEx (estimated at 1 percent of the property’s value, divided by 12 for monthly cost) –  Property management (10 percent of gross rents) Cash flow

Once more, let’s run down the major points of this class: • Consider paying off your mortgage before you retire. • Start planning for how you will be able to keep working well into your 60s. • Save more today so you will be okay if you can’t afford to save in your 60s. • Make it a goal to delay when you start drawing Social Security, so you can earn a benefit that could be 80% bigger than if you start early. • Make sure all your retirement accounts are invested to complement one another. • Decide no later than age 59 if long-term care insurance should be part of your retirement plan.

What are your feelings from Bush to Obama? Besides being responsible for the death of half a million people, I feel like Bush dealt a huge economic and social blow to the USA, one from which we may never fully recover. He directly flushed 3 trillion dollars down the toilet on hopeless, pointlessly destructive wars in Afghanistan and Iraq …and they’re not even over! For years to come, we’ll be paying costs for all the injured veterans (over 50,000) and destabilizing three countries, because you have to look at the impact that the Afghan war has on Pakistan. Bush expanded the use of torture, and created a whole new layer of government bureaucracy (the “Department of Homeland Security”) to spy on Americans. He created Indefinite Detention (at Guantanamo and other US military bases) and expanded the use of executive-ordered assassinations using the new drone technology. On economic issues, his administration allowed corporations to run things and regulate themselves. The agency that was supposed to regulate oil drilling had lobbyist-paid prostitutes sleeping with employees while oil industry lobbyists basically ran the agency. Energy companies like Enron, and the country’s investment banks were deregulated at the end of the Clinton administration and Bush allowed them to run wild. Above all, he was incompetent and appointed some really stupid people to important positions at every level of government. Certainly, Obama has been involved in many of these same activities. A few he’s increased, such as the use of drone assassinations, but most of them he has at least tried to scale back. At the beginning of his first term, he tried to close the Guantanamo prison and have trials for many of the detainees in the United States but conservatives (including many Democrats) stirred up public resistance and blocked this from happening. He tried to get some kind of universal healthcare because over 50 million Americans don’t have health insurance. This is one of the leading causes of personal bankruptcies and foreclosures because someone gets sick in a family, loses their job, loses their health insurance (because American employers are source of most people’s healthcare) and they can’t pay their health bills or their mortgage. Or they use up all their money caring for a sick family member. So many people in the US wanted health insurance reform or single-payer, universal health care similar to what you have in the UK. Members of Obama’s own party (The Democrats) joined with Republicans to narrowly block “The public option” but they managed to pass a half-assed but not-unsubstantial reform of health insurance that would prevent insurers from denying you coverage when you’re sick or have a “preexisting condition.” The minute it was signed into law, Republicans sued in the courts (all the way to the supreme court) and fought, tooth and nail to block its implementation. Same thing with gun control, even as we’re one of the most violent industrial countries in the world. (Among industrial countries, our murder rate is second only to Russia). Obama has managed to withdraw troops from Iraq and Afghanistan over Republican opposition but, literally, everything he tries to do, they blast it in the media and fight it in Congress. So, while I have a lot of criticisms of Obama, he is many orders of magnitude less awful than Bush and many of the positive things he’s tried to do have been blocked. That said, the Democratic and Republican parties agree on more things than they disagree. Both signed off on the Afghan and Iraq wars. Both signed off on deregulation of banks, of derivatives, of mortgage regulations and of the energy and telecom business …and we’ve been living with the consequences ever since. I’m guessing it’s the same thing with Labor and Conservatives in the UK. Labor or Democrats will SAY they stand for certain “progressive” things but they end up supporting the same old crap... (2014 interview with iamhiphop)

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Understandably, given public anger at bailouts, support had been gathering from both the right and the left for breaking up the largest institutions. There were also calls to reinstate the Depression-era Glass-Steagall law, which Congress had repealed in 1999. Glass-Steagall had prohibited the combination within a single firm of commercial banking (mortgage and business lending, for example) and investment banking (such as bond underwriting). The repeal of Glass-Steagall had opened the door to the creation of “financial supermarkets,” large and complex firms that offered both commercial and investment banking services. The lack of a new Glass-Steagall provision in the administration’s plan seemed to me particularly easy to defend. A Glass-Steagall–type statute would have offered little benefit during the crisis—and in fact would have prevented the acquisition of Bear Stearns by JPMorgan and of Merrill Lynch by Bank of America, steps that helped stabilize the two endangered investment banks. More importantly, most of the institutions that became emblematic of the crisis would have faced similar problems even if Glass-Steagall had remained in effect. Wachovia and Washington Mutual, by and large, got into trouble the same way banks had gotten into trouble for generations—by making bad loans. On the other hand, Bear Stearns and Lehman Brothers were traditional Wall Street investment firms with minimal involvement in commercial banking. Glass-Steagall would not have meaningfully changed the permissible activities of any of these firms. An exception, perhaps, was Citigroup—the banking, securities, and insurance conglomerate whose formation in 1998 had lent impetus to the repeal of Glass-Steagall. With that law still in place, Citi likely could not have become as large and complex as it did. I agreed with the administration’s decision not to revive Glass-Steagall. The decision not to propose breaking up some of the largest institutions seemed to me a closer call. The truth is that we don’t have a very good understanding of the economic benefits of size in banking. No doubt, the largest firms’ profitability is enhanced to some degree by their political influence and markets’ perception that the government will protect them from collapse, which gives them an advantage over smaller firms. And a firm’s size contributes to the risk that it poses to the financial system. But surely size also has a positive economic value—for example, in the ability of a large firm to offer a wide range of services or to operate at sufficient scale to efficiently serve global nonfinancial companies. Arbitrary limits on size would risk destroying that economic value while sending jobs and profits to foreign competitors. Moreover, the size of a financial firm is far from the only factor that determines whether it poses a systemic risk. For example, Bear Stearns, which was only a quarter the size of the firm that acquired it, JPMorgan Chase, wasn’t too big to fail; it was too interconnected to fail. And severe financial crises can occur even when most financial institutions are small.

For the first time in the history of America, New Deal policies made homeownership a real possibility for white families, but black families were denied these benefits when the federal government deemed their neighborhoods too risky for insured mortgages and officials loyal to Jim Crow blocked black veterans from using GI mortgages.20 Over three centuries of systematic dispossession from the land created a semipermanent black rental class and an artificially high demand for inner-city apartments.21

Contrary to popular opinion, a home is not an asset for creating real wealth, it is a liability.22 Your home does not generate any income; it is a Money Pit. You have to pay the mortgage, utilities, maintenance, property taxes that continue to go up each year, and, insurance that tends to also increase annually. After so many years, kitchens need remodeling, carpets & flooring replaced, and, painting and decorating requiring new furniture to match the updated changes. And, the larger the home the more furniture that is needed to fill it up.

Besides, let's face it, a joint mortgage is for twenty-five years. And unlike with a marriage, you can get insurance to cover yourself if something goes wrong.

New Deal legislation undoubtedly saved thousands of lives and prevented destitution for millions. New labor laws led to a flourishing of unions and built a strong white middle class. The Social Security Act of 1935 established the principle of cash payments in cases of unemployment, old age, or loss of a family breadwinner, and it did so as a matter of right, not on the basis of individual moral character. But the New Deal also created racial, gender, and class divisions that continue to produce inequities in our society today. Roosevelt’s administration capitulated to white supremacy in ways that still bear bitter fruit. The Civilian Conservation Corps capped Black participation in federally supported work relief at 10 percent of available jobs, though African Americans experienced 80 percent unemployment in northern cities. The National Housing Act of 1934 redoubled the burden on Black neighborhoods by promoting residential segregation and encouraging mortgage redlining. The Wagner Act granted workers the right to organize, but allowed segregated trade unions. Most importantly, in response to threats that southern states would not support the Social Security Act, both agricultural and domestic workers were explicitly excluded from its employment protections. The “southern compromise” left the great majority of African American workers—and a not-insignificant number of poor white tenant farmers, sharecroppers, and domestics—with no minimum wage, unemployment protection, old-age insurance, or right to collective bargaining.