Insurance Agent Forum

[midwestbroker]

I smell a new mortgage tax...whoo hoo! More taxes!

I think I am going to have to hire a magician to do my taxes if I want to keep any of my own money.

[Paradigm]

The real reason for the bailout is that the bondholders on the mortgage debt are from China and the Middle East. The US have always implicitly backed these monopolies. They will never reemerge as private entities they will be government agencies.

The problem is the economy is so connected right now globally. While I would like to go with the market solution, the problem is no one in the market has the credibility or resources to back stop the system.

Bear Sterns would have been bad if it had imploded but this would be 10,000 times worse. Unfortunately they were too big to sale. I think every one involved in this criminal choices at the GSEs should be fired and jailed.

The legacy of this will run into the 100's of millions of dollars. There must be federal oversight of the markets. Capital and Reserve requirements must be increase. Most importantly future loans must require a 10-20% downpayment. No more questionable mortgage holders.

[Paradigm]

Also mortgage securitization must be done away with no more swaps. Lenders must hold paper more directly. The will encourage better risk assessment and more due dillegence

[SportsNut]

Originally Posted by Paradigm

I think every one involved in this criminal choices at the GSEs should be fired and jailed.

Unfortunately, the top execs... instead of facing the fate that they should, are being retained as consultants and offered lucrative buyouts.

Hell, it is not the gov't operatives at Treasury's money, so why not stick some in the execs pockets...? Pervasive attitude of those who are charged with the responsibility of overseeing our coffers. Pathetic.

[Mr. Bill]

Yep, just plain disgusting. Jimmy Rogers (Soros' old partner) has had it absolutely positively right on:

CEO: Fannie/Freddie Bailout Makes America 'More Communist than China'

.

“This is a big huge mess and neither one of them has a clue as to what to do next year,” Rogers said. “Bank stocks around the world are going through the roof, that’s because they’ve all been bailed out. You don’t see the homeowners in Kansas going through the roof because they’re not being bailed out.”

[midwestbroker]

That is correct...as a KS resident, I have not seen anything change with my mortgage. Still the same payment (well, taxes have gone up...surprise surprise)

[padthaiforlunch]

AIG has $600 million Fannie, Freddie preferred: source


AIG has $600 million Fannie, Freddie preferred: source | Markets | Bonds News | Reuters

[SportsNut]

Originally Posted by padthaiforlunch

AIG has $600 million Fannie, Freddie preferred: source


AIG has $600 million Fannie, Freddie preferred: source | Markets | Bonds News | Reuters

Drop in the bucket compared to AIG's exposure to credit default swaps. They have taken a financial azz kicking from 07 to 08 due to the mtg crisis, and their coverage of financial institutions who have defaulting mtgs. Think of credit default swaps as a large PMI policy, covering a portfolio of mtgs. Ouch. I am personally laying low offering any AIG products, due to this issue until the storm passes.


Form 10-Q for AMERICAN INTERNATIONAL GROUP INC Three Months Ended March 31, Percentage Increase/(in millions) 2008 2007 (Decrease)Total revenues $ 14,031 $ 30,645 (54) %Income (loss) before income taxes and minorityinterest (11,264 ) 6,172 -Net income (loss) $ (7,805 ) $ 4,130 - %AIG's consolidated revenues decreased in the three months ended March 31, 2008 compared to the same period in 2007 due to an unrealized market valuation loss of $9.1 billion on AIGFP's super senior credit default swap portfolio recorded in other income, higher net realized capital losses and a decline in net investment income, which more than offset growth in premiums and other considerations in the Life Insurance & Retirement Services segment. Net realized capital losses of $6.1 billion in the three months ended March 31, 2008 included other-than-temporary impairment charges of $5.6 billion, primarily related to the significant disruption in the residential mortgage and credit markets and investment-

Summary of AMERICAN INTERNATIONAL GROUP INC - Yahoo! Finance

[NewHealthStrategies]

Hmmmm.... let's see.

It only took the Federal Gov't 40 years to drive an institution that had a virtual monopoly on the secondary housing market into the ground....

If not mistaken, it was Roosevelt that established this institution after the Great Depression to shore up the housing market.... another great job by the Dem's.... by Obama will do better I'm sure (no I'm not, btw)

[InsuranceGuru]

I worked in the mortgage industry in Florida for 11 months, started right at the peak of the bubble. I was younger and had no idea what was going on in the industry, so I really didn't pay much mind to the whole idea that the industry was in trouble.

Then I was pushed to write loans with no regard for the rules (I was licensed, I knew what was correct and what was "fraud"). I had one instance where I was working a loan for a young couple (slightly older than me at the time). I worked mostly with the wife, her name was Megan.

After getting the disclosures signed and the loan submitted to the lender, the deal didn't go through. I was about to shop another lender when Megan called me, telling me she was concerned that she might not be able to afford the home they were buying. I went back and looked, and she asked me, straight up, should she go through with it. I said, "Megan, if you have doubts as to whether you can afford to do this, then don't do it. It's something you'll be paying on for a long time, and if you can't afford it, it will stay with you for most of your life." She asked me to pull the deal, and I agreed.

And I can sleep at night because I got fired the next day. There's no mystery here. Mortgage companies and the people who operate the sales cycle on lending know good and well what rules they break and exactly when they are breaking them to secure the financing. I was new to the industry. I knew what bended the rules and what was sound, legitimate business. I say to anyone that claims, "Well, I never thought it could happen... I feel so bad, but hindsight is 20/20," BULLSHIT! In my eyes, you're the sales manager who followed the herd into the netherworld of the mortgage industry that it is today.

It's not unheard of in insurance that rules are bending, even being broken. I do my best to follow the rules, because rules are there to protect the people you're trying to help. You do a disservice to anyone looking to buy a home if you fix their reported income, state the assets beyond what you know to be reasonable, and "Do what the customer tells you."

Which is why I'm also against "needs-based" insurance sales. The whole idea is nonsense... because people look to insurance agents to produce quality insurance protection. You don't say to someone, "Oh, well, it's your decision whether to add this, this, and this, because it will protect you." For me, I say, "If you don't add this, this, or this, you're going to sign an agreement that you declined this coverage or I will not write your policy."

And I may not even do that, because people without a thorough understanding of health insurance aren't going to understand what it is that they are buying, no matter how well it's explained to them. I may just tell them, "Okay, I'm looking into other options for you, because I'm not comfortable writing this policy for you and leaving you with these gaps." Clients sit there trying to comprehend, trying to rationalize their budget with the coverage, but in the end, they have little clue what they are buying because they don't deal with insurance on a day to day basis. Needs-based sales is like telling a School Teacher to pick out the right space suit to meet "their needs" for walking in space. "Better pick the best suit, or you'll regret it..."

Just my opinion on that... people should know better.