GOP Primary Megathread!

[The Minsky Moment]

She advocates loan foregiveness and transfer of the collateral.

That's pretty vague; it is missing a subject, an object and a bunch of adjectives.

[Admiral Yi]

That's pretty vague; it is missing a subject, an object and a bunch of adjectives.

What subject, object, and bunch of adjectives is it missing?

[CountDeMoney]

On the former, she advocates loan forgiveness through the bankruptcy system, which is what it was designed for.

She advocates loan foregiveness and transfer of the collateral.

The US government has advocated loan forgiveness for decades.  If it's good enough for Bolivia, Guyana, Haiti, Honduras, and Nicaragua to the tune of $3.5 billion, it should be good enough for US citizens.

Ah, I get it;  debt forgiveness to other countries is OK when a GOPtard does it;  for US citizens, it's secular-socialism.

[Admiral Yi]

The US government has advocated loan forgiveness for decades.  If it's good enough for Bolivia, Guyana, Haiti, Honduras, and Nicaragua to the tune of $3.5 billion, it should be good enough for US citizens.

Ah, I get it;  debt forgiveness to other countries is OK when a GOPtard does it;  for US citizens, it's secular-socialism.

It may very well be good enough for US citizens, but we need to be aware of the price.  Whenever you make it more difficult to collect money owed, you raise interest rates and reduce loan availability.

[The Minsky Moment]

That's pretty vague; it is missing a subject, an object and a bunch of adjectives.

What subject, object, and bunch of adjectives is it missing?

Who is foregiving what loans made to whom, and under what circumstances and what terms?
What collateral is being transferred, how is being transferred, from who to who, how is it being done etc?

[garbon]

Ah, I get it;  debt forgiveness to other countries is OK when a GOPtard does it;  for US citizens, it's secular-socialism.

You're not that obtuse, what gives?

[Admiral Yi]

Who is foregiving what loans made to whom, and under what circumstances and what terms?
What collateral is being transferred, how is being transferred, from who to who, how is it being done etc?

The evil socialist-secular administration of Elizabeth Warren is forcing the Righteous and Virtuous Bank Holding Company to forgive part of the home loan made to Deadbeat Borrower and to transfer the collateral of [home] to Deadbeat Borrower.

[The Minsky Moment]

The evil socialist-secular administration of Elizabeth Warren is forcing the Righteous and Virtuous Bank Holding Company to forgive part of the home loan made to Deadbeat Borrower and to transfer the collateral of [home] to Deadbeat Borrower.

Somehow I suspect Ms. Warren would explain her proposals a bit differently.

[Admiral Yi]

Somehow I suspect Ms. Warren would explain her proposals a bit differently.

Yeah, she would sound a lot more like Seedy.

[Ideologue]

The evil socialist-secular administration of Elizabeth Warren is forcing the Righteous and Virtuous Bank Holding Company to forgive part of the home loan made to Deadbeat Borrower and to transfer the collateral of [home] to Deadbeat Borrower.

Somehow I suspect Ms. Warren would explain her proposals a bit differently.

Sounds okay to me, but what about student loans?

[Admiral Yi]

Sounds okay to me, but what about student loans?

You'd be in much better shape if the US Dep of Ed hadn't taken over all student lending.

[Neil]

You'd be in much better shape if there were no student loans, because then you wouldn't have gotten your useless and antisocial degree.

[The Minsky Moment]

Whenever you make it more difficult to collect money owed, you raise interest rates and reduce loan availability.

Maybe, maybe not.
A proposal for partial principal reduction now has no effect on future loans, and thus in itself should not effect either present interest rates or loan availabilty.

The only theory on which it would have an effect is if it leads lenders to believe that it is likely to be repeated in the future and thus will have some impact on their assessment on the predicted future cash flow of the loan.

But the counter to that is that the reasoning behind a general principal reduction program is that if adopted on a national basis, it will free up the frozen housing market, improving collateral quality and getting rid of a debt overhang that is strangling the overall economy, which are things that benefit lenders and enhances expected cash flow returns on loans generally.

The net effect on interest rates and lending depends on which of these factors predominates.  My own anecdotal experience and "gut" is that many lenders have pretty short memories and that any residual negative effect on lender confidence will evaporate quickly in the next upturn.

[Admiral Yi]

A proposal for partial principal reduction now has no effect on future loans, and thus in itself should not effect either present interest rates or loan availabilty.

I thought you said she was talking about making pack downs part of the bankruptcy law.  That by definition is pretty enduring.

[DGuller]

Loan forgiveness can be a reasonable alternative to either a crippling debt load, or foreclosure.