Category: News & Entertainment

The U.S. housing crisis

In case you haven’t been paying attention, or just simply ignored the crisis, NPR’s This American Life had a great summary and explanation of the current mortgage/housing crisis in the U.S.

Here’s a very brief summary as I understand it. Basically there’s suddenly been all this new money in the world. The amount of money being spent worldwide doubled over the last 6 years.

Poor countries were becoming richer and richer by making things like TVs and selling oil so suddenly there’s LOADS of money with no place to invest. And what good is money if you can’t invest it to make more money for you? So we end up with twice as much money looking for investments but not twice as many places to invest into.

Alan Greenspan kept the fed interest rate at 1% – so that folks couldn’t make money off of us treasury bonds. The show says basically, Greenspan said, “Screw the international pool of money – we’re not going to help you make money off our treasury bonds.” Ha!

So the investors looked for other places to invest – like the US housing market. And investors were willing to take a risk on mortgage loans in order to make well more than 1% on their investments.
But of course the investors don’t want to worry with the hassle of individual loans so folks on Wall Street found a way around the issues and hassle of individual loans. Folks would sign on to a mortgage at 5-10% and then those loans are sold to small banks who then sell them to a guy on Wall Street.

That guy on Wall Street now has several thousand loans with big fat checks coming in every month – and will be scheduled to come in for the next 30 years. So he turns around and sells shares of his investment to all these folks with loads of new money, aka mortgage bank securities.

By 2003, just about everyone who could qualify for a loan could get one – yet the money was just getting started. So the loan qualifications and guidelines got looser and looser till folks could get half-a-million dollar loan without any proof of income.

Of course the more loans you give out, the stronger your security will be.

“We almost couldn’t produce to help keep the appetite of our investors happy.”

And the rich get richer and the poor get poorer.

Of course this is just a brief summary of a one-hour program. Listen online for the real details and what really started the crisis.

Fight with Tools

just found Flobots and their “new” album Fight With Tools.
very cool sound. reminds me of Jurassic 5 — with more of a social consciousness/alertness. i downloaded the album from Amazon.com for $8 – always a great deal with no DRM!

here are the lyrics to the first and last songs on their album…
Continue reading Fight with Tools

Gas prices expected to drop after strike ends

As our economy continues to be based more and more more on a global level, its important to realize what happens in Nigeria may not stay in Nigeria.

A recent strike in Nigeria as caused Exxon to completely shut-down production there, hurting the balance between supply and demand world-wide. But now it looks like the striking workers requests may have been solved and oil production can continue.

Also, recent attacks on oil refineries have also led to a reduction in overall oil production.
Continue reading Gas prices expected to drop after strike ends

Switch off that television

This video is making it’s rounds around the Interweb. I’ve seen it on 3 or 4 sites now but saw it first on Thomas’ blog a day or two ago. Everyone’s had some great opinions on it. I personally like Thomas’ best – maybe cause we’re looking at things in a similar way.

I’ll try not to steal his thunder. Watch the video and then read his post for sure. But here are just a couple highlights:

From the video:

Media that’s targeted at you but doesn’t include you may not be worth sitting still for.

Thomas writes:

The way Clay expresses it is basically… the new media (blogging/wikipedia/youtube etc) = consuming + producing + sharing > this is a shift from the old media that only expects you to consume.

People are watching less television and are doing something… making something happen… like just now as I create this post. It reminds me of the old Why don’t you? motto :: Why Don’t You Just Switch Off Your Television Set and Go and Do Something Less Boring Instead? :: kind of ironic, I know… but its real… and its now!

I have some great friends who chose not to purchase a TV for the first couple years of their marriage. They only had a small Commodore monitor hooked up to a VCR for watching movies. They finally gave in though when Tim needed his Texas Rangers fix and probably didn’t help that their girls were getting older – but I wonder how different our lives would be if we all stopped simply consuming television on a daily basis….