Your Lying Eyes

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30 September 2008

How to Profit from the Bailout

Congress is going to give it another shot, this time starting with the much tamer Senate Wednesday night. To get the votes this time round, there will no doubt be more sweeteners to try to turn some votes. While it was the Republicans who rebelled on Monday, there were still a lot of Democrats opposing the bill. One thing Democrats are determined to get is a bailout of their deadbeat constituents, so can we expect some more propping up of defaulting home "owners"?

Financial guru Peter Schiff has a suggestion should the bailout finally go thru.
The first thing you do if you have a mortgage is you stop making the payments. That’s the number one thing for people who have mortgages based on this plan. And use that money to buy gold or stock up on food. You’re going to need it. Meanwhile, no one is going to kick you out of your house. You’re going to be able to live in your house for probably a year or two before the government calls you up to give you a lower mortgage because nobody is going to foreclose on you right now. Why would you foreclose? You sell the loan to the government. This plan is a huge moral hazard and it’s going to lead to a surge in mortgage delinquencies.
That would be cool - pocketing your monthly mortgage payment and socking it away in gold for a couple years - I could definitely go for that. Too bad there's no way I've got the balls to pull that one off.

2 Comments:

Anonymous Dano said...

The idea would work better if you were in one of the foreclosure hotspots like Florida, the entire southwest.

October 02, 2008 7:19 PM  
Anonymous ashwini said...

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