RED BLUE Me oh My.

ATTENTION: Serious pondering..not your traditional poo poo or pee pee stories, but full of poo poo and pee pee. :)
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Are we heading to a Socialist Economy?

Definitions:

Socialism with Chinese Characteristics:
socialist market economy or "socialism with Chinese characteristics." Under Deng Xiaoping, the leadership of China embarked upon a program of market-based reform that was more sweeping than had been Soviet leader Mikhail Gorbachev's perestroika program of the late 1980s. Deng's program, however, maintained state ownership rights over land, state or cooperative ownership of much of the heavy industrial and manufacturing sectors and state influence in the banking and financial sectors.
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I am so perplexed. I am so concerned. I am SO frustrated.
What are we going to do with our country? We have choice A and Choice B. Is there a mix of Choice C?

The way I see it is our problems started out with people that couldn't afford loans and greedy companies that provided "legal" loans that were regulated/enforced by the Gov't. More "needy" people saw how easy it was to get a home. More "greedy" people saw how easy it was to make a buck. This cycle continued OVER and OVER again.

From the unqualified loan applicant: Who wouldn't get a loan when it was cheaper than renting? Who wouldn't get a loan when it was so easy? Why even put any money down, no one told me I had to. Why even worry about the higher interest rates... I didn't figure it out. I qualified, if I didn't qualified, they wouldn't have let me have the loan. I can also get my furniture from Rooms to go and not pay for it for 4 years. Wow. Now that is living the dream. I didn't have to work to save and put down a deposit, I can have wonderful new furniture and a wonderful new house while everyone else is saving and doing everything possible to work so I can have this all handed to me because I did not do enough so I could "qualify" for these WONDERFUL loans!! I love the gov't!

Meanwhile:

Mr. Greedy Corporate/Sales/Mortgage lender companies: I can get these people in that qualify for these loans. ALl they care about is their monthly payment, and that it is cheaper than their rent. I can have their first year and second year mortgage REALLY low, and then raise the interest rate after the 2nd year to something I know they can't qualify for or pay, but hey, I'll not be responsible for it and I am sure it'll work itself out. I just care about the front end of qualifying, and hey I have to get to the next person waiting for these easy loans.

Government: Poor people that can't qualify for loans. They are so pitiful. I am sure they are saving, and working as hard as possible. I am sure they will make reasonable decisions in order to not get into trouble by reading all of the paperwork on their loans. Everyone should be able to purchase a house RIGHT NOW, not 5-10 years after they have saved for it. NOT by going to college, or taking extra classes so they can better themselves so they can make more money, NOT by working harder and smarter... no, the people that should have easy loans and no down payments should have homes like everyone else.

Problem:
Government mandated that people that qualified for Fannie Mae and Freddie Mac loans have reduced restrictions.

Problem:
When these people could not afford their mortgages, foreclosures started happening.

My story:
We were the first people to buy in a neighborhood. Since we made a certain amount of money, we did not qualify for specialty loans. The builder did offer incentives for buyers that did. From what I remember, it was ridiculous programs where the first year was like 4% second 5% and third 6% and it went up from there.

Almost 10% of homes were foreclosed in 2 years. Renters came into our neighborhood so people could try and salvage their homes. What made it really unsafe was that the "renters" that didn't qualify for the VERY affordable loans were bringing down our home values even more. They didn't care about their property as it was not their own.

There were almost as most renters as property owners living in the neighborhood. As a matter of fact, if you combine the amount of renters and foreclosed homes, it was probably more.

We paid $143,000 for our first home. A home that had the special mortgage and the owner had to have the property foreclosed sold their home for $120,000. This drove down the value of our neighborhood and our property.

I realized AWHILE back there was a problem. I talked to my husband about this. I saw it. We have friends that are in EXPENSIVE homes, and DO not have the income to support this.

Interest free loans are what drives our level. Forget Freddie Mac and Fannie Mae, the people that can't qualify for these loans go for the interest only loans.

This means that they are basically "renting" our homes, and are not paying for the principal. Add that to the easy credit line increases that are granted without even asking on credit cards, easy lines of credit from banks... I swear, everyone wanted to give money out! No one really cared what your debt was.

How did we get to this point?

I think it can be summed up as living above your means. But more basically NOT knowing what your "REAL" means is.

Our generation is so focused on our "credit" means rather than our "actual" means. I am SO guilty of this. No matter how much money I have, I always buy what I want. Yes, it gets paid off, but it's like a never ending supply of funds!

I don't balance my checkbook. I know what my credit limit is, and that is what my "credit" means is to me. I am sure my "actual" means will catch up sometime! :)

The problem is that with the economy as volatile as it is these days, I hate to say but I think everyone is living in the "credit" means. This sets up most families in a huge dilemma. With jobs expecting to be cut, monies lost in retirement and savings, credit harder to come by, what are people going to do?

When you have had everything come so easily...homes, cars, clothing, vacations, etc. etc. etc. What will people do when they have to live in their "actual" means? Do you think people can handle it?

Cutting out: Cell phones, cable, pedicures/manicures, haircuts, colors, computer, driving, anything EXTRA that is not necessary to function. I don't think people realize (including me) how much money it takes for the extras that we consider "basic".

We are in for a RUDE awakening. We have experienced a little glimpse of how it could be with waiting in line for gas, having NO gas available, wondering when gas would come, paying almost $5 a gallon for milk AND gas, watching prices of food go up and up. Luckily, we mostly have still had our jobs. Fearfully, we are hearing more and more people losing or about to lose theirs.

What are they going to do?

When a State (CA) is fearful they are not going to make payroll, when gov't doesn't know what hit them with the global economic (and domestic) crisis, when powerful countries like Russia, China and others are so volatile, gas is expensive... what are we in for in the next few years?

Back to the basic question, does anyone feel like either president will be a good choice?