GOP Primary Megathread!

[Sheilbh]

Wouldn't it be better if the mortgaged properties were forgiven enough debt so that they were no longer underwater but to retain the bulk of the loan, or is that what we're talking about here?

I think this is like what Obama proposed based on the ideas of one of Romney's economic advisors.  Basically his argument is that the extremely low interest rates haven't had as much effect as they should because of the amount of people with negative equity.  They can't take advantage of the lower interest rates and that's holding the economy back.  The policy is some way of allowing people who are paying their mortgages to refinance at current, lower, interest rates.  It seems an interesting idea to me, but it's not from Warren.

[DGuller]

Loan forgiveness isn't that new of an idea in general.  One thing that always puzzled me is why banks are so adamnant about foreclosing and kicking people out.  Yes, they're the creditors, and they get the whole house after a default.  Why won't they renegotiate with the current owners rather than let the house that they now own rot or go at fire-sale prices?  They're losing money either way, surely in many cases they will lose less when they don't kick the current occupants to the curb?

[Admiral Yi]

Yes.  Individual bankruptcies in the US amost always involve forgiveness of loans.  that has been so for many years now.

A number of people have been advocating changes to the bankruptcy laws so that home mortgages can be packed down.  As things stand they can't, for the simple reason that the home covered by that mortgage is a protected asset in bankruptcy.

Now if Warren is not among those advocating this change, I stand corrected.

[Admiral Yi]

I think this is like what Obama proposed based on the ideas of one of Romney's economic advisors.  Basically his argument is that the extremely low interest rates haven't had as much effect as they should because of the amount of people with negative equity.  They can't take advantage of the lower interest rates and that's holding the economy back.  The policy is some way of allowing people who are paying their mortgages to refinance at current, lower, interest rates.  It seems an interesting idea to me, but it's not from Warren.

What Obama proposed recently is that people with underwater loans (who are current on their payments) be made eligible for low interest FHA loans.

[Admiral Yi]

Loan forgiveness isn't that new of an idea in general.  One thing that always puzzled me is why banks are so adamnant about foreclosing and kicking people out.  Yes, they're the creditors, and they get the whole house after a default.  Why won't they renegotiate with the current owners rather than let the house that they now own rot or go at fire-sale prices?  They're losing money either way, surely in many cases they will lose less when they don't kick the current occupants to the curb?

Moral hazard. 

Borrowers who are not in default would ask for the same deal, and if foregiveness were made obligatory it would create a perverse incentive for borrowers to default and lower their principal amounts.

[Phillip V]

Santorum going into today's Minnesota contest with a 9-point lead.

http://www.realclearpolitics.com/epolls/2012/president/mn/minnesota_republican_presidential_primary-1747.html

[Admiral Yi]

If I'm not mistaken, Minnesooooota is holding a non-binding straw poll.

[The Minsky Moment]

A number of people have been advocating changes to the bankruptcy laws so that home mortgages can be packed down.

Haven't heard of this.

[citizen k]

Tonight's Santorum's night. 

[Sheilbh]

[Eddie Teach]

   State   Gingrich   Paul   Romney   Santorum         reporting
02/07   MO   -   12.0%   25.3%   55.3%         89%
02/07   MN   10.7%   27.1%   16.5%   45.4%         47%
02/07   CO   21.4%   9.8%   18.9%   49.6%         7%

Dang.

[Darth Wagtaros]

This is awesome. We could see a real convention floor fight. 

[Neil]

What makes you think that?

[jimmy olsen]

I'm surprised that Santorum's made a comeback.

[Razgovory]

I'm surprised that Santorum's made a comeback.

I know he hasn't actually gained anything in Missouri.  I wonder if any of the other state's elections had some meaning.