September 2005 Archives

Racial Gap in Home Loans

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Racial Gap in Loans Is High in California.

I can give a variety of reasons for this.

First off, especially in Los Angeles but to a lesser extent throughout the state, there is a huge "Spanish speaking only" community. When you limit yourself to speakers of a language which isn't the nation's primary business tongue, you limit your ability to find loan officers who will treat you honestly and fairly and find you the best possible loan. I speak reasonable spanish myself, but not nearly enough to do a loan.

Second, those who speak spanish only are ripe pickings for unscrupulous loan officers and real estate agents. Because they do not understand english, the language the regulations are written in, they have less understanding of what is a complicated and confusing process for anyone who is not a practicing professional. In fact, I can name a lot of alleged professionals who speak english and are nonetheless limited in the comprehension of the process to judge by the evidence.

Third, those who speak spanish only have a lesser understanding of their rights under the law, and since the vast majority of all loan documents are in english (a few lenders are starting to generate a few documents in spanish, but not every document, and it will never be the main copy of anything), they have a lesser understanding of what they are agreeing to.

Gee, I hope the preceding helps the "Spanish only" lobby of separatists understand what they're setting up for the people whose benefit they are allegedly advocating.

But more importantly than all of the preceding, real estate and loans are "sales connection" businesses. Because most people do not shop for homes or home loans in a rational fashion. "I can't be rational! This is far too important for that!" Seems silly, but it's true. People buy or do business with you because you have made them more comfortable, or because they think you can do something nobody else can or will for them. They do business because they connect with you on some level, not because what you're offering is the best thing out there.

Identity politics exacerbates this. There are agents out there (often but not always necessarily of the same ethnicity) whose niche market is "black folks", or "spanish speakers" or "Koreans". Some people will do business just because youre the same, or because they feel some kind of cultural connection. Others will do business because you helped their brother, or friend, whether said brother was the toughest deal in creation or the easiest thing you ever did. And if you brother had to do something, or had something happen, it's only normal it should happen to you, too - right? One of the standard phrases in the sales lexicon is "My you were tough, but we got it done! How about some referrals." This by itself is not evil. But if you've taken advantage of someone as if they were a tough loan when in fact they were not and could have gotten a better deal from someone else, you're lining your pocket at your client's expense. Everybody deserves to get paid for a job well done. But when my contacts in the escrow and title business tell me about people who only serve this ethnic market or that ethnic market who have six percent state of California limits on their compensation externally applied to every single loan they do, or how these people consistently have a sales compensation a full percent above the market, that tells me something: that these alleged professionals are taking undue advantage of their target market. Many of these people they are targeting literally have no way of knowing there is something better out there. Are their tactics illegal? No. Unethical? In at least some cases. Taking advantage of client ignorance? Definitely.

The process of purchasing, selling, or refinancing real estate is byzantine, with rules and regulations that get more complex every year. The average citizen has difficulty understanding the things that may be relevant to their particular transaction (I've had to explain to lawyers how they got taken in their previous transaction). To most people, the whole thing is like some immensely complicated magical ritual. Place the proper documents at the foot of the underwriting god, dance three time sunwise and four times widdershins round the appraisal every day for a fortnight, pray with the high priests of insurance, and you get your house.

It has elements in common, I will admit. But the processes of real estate sales and real estate loans are coldly, brutally, logical once you understand them. Unfortunately, the odds of understanding are stacked even further against those who are apart from the majority of society. Those who are concerned with minorities having inferior loans would have more success in connecting the people to the mainstream of society than in considering further burdensome anti-discrimination legislation.

Caveat Emptor

Updated here

Near Miss at Las Vegas

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Air Controller Loses Job After Near-Miss. Except that he didn't. He was decertified on the position, perhaps from all positions of operation. This is what is known as taking precautions pending an investigation. Unless something really out of the ordinary occurred, they will re-certify him within a week or two after retraining makes certain that it's not part of a pattern.

With that said, the scenario given is one of those classic nightmares. The controller made about as huge a mistake as is possible, and the "Big Sky" theory doesn't apply on the runway. I never had one, but it's very easy to make this kind of mistake through not being quite thorough enough just once. It doesn't say whether he was working ground control or tower, but ground is usually where troubles occur at commercial airports, as things are usually set up to make things as easy and routine on the Tower controller as possible. On the other hand, (and this is speculation only, I haven't talked to anyone!) for runway crossings many tower controllers will assume when it's busy and they're talking ten miles per minute that a ground controller has checked out the runway (as they should) and won't ask to cross if it's not clear. Unfortunately, sometimes the ground controller misses the plane behind the pillar or the other controller's body blocks it. We're all human. Ground's mistake, Tower's Official Error (although Tower is far from blameless if they gave permission). I've seen any number of deconstructions of these when general aviation is involved. Large commercial aircraft are easier to spot and harder to miss, of course. The number one and two enemies for controllers are routine and complacency, and the most apt job description I've ever seen of the controller's job is "Hours and hours of mindless boredom occasionally punctuated by stark raving terror."

As I said earlier, we're all human. We have no robots to do the job, and robots probably would make a horrible hash of it, as it requires real time reactions to unpredictable events. Most controllers make mistakes; the only question is if they are little mistakes (un-noticeable to the public), mediums (somebody maybe gets delayed when there's no need), or major like this, where it was sheer dumb luck nothing horrible happened. Nonetheless, the FAA would have damned few controllers if they fired someone everytime something like this happened, so they don't (although it is one of the best tickets for promotion into management as the bureaucrats then don't want that controller to have another chance to mess up publicly).

Furthermore, there are supposed to be automated systems up to frustrate precisely this kind of error, but the FAA's procurement process is riddled with all kinds of problems. I wonder if something automated failing was a contributing factor?

AP got this one wrong, and failed to ask any of a host of obvious questions to find out what really happened. If someone with first-hand knowledge wants to contact me, I don't work for the FAA anymore, and there's nothing they can do to me. I'd be happy to report it from an "anonymous" source.

I know others have reported this, but John Roberts has been confirmed and they're planning his oath ceremonies. The vote was 78-22. Now on to whoever our President chooses for Justice O'Connor's seat.


Michael Yon has a new article up about American soldiers and a sick little girl from Iraq. Anybody who thinks our soldiers (or people) are enemies of civilization should read it.

Q and O has some thoughts on the political situation in Iraq and considers the benefits as well as the costs of civil war there.

Proof that even Palestinians can learn, given the proper methods: Hamas says rocket strikes over. Translation into English: They've been getting their heads handed to them.


Something I've suspected but had confirmed: Economy Making Solid Gains Before Storms.

Don't get me wrong. There are sectors that have severe problems (Housing and automobile manufacturing to name two). But when we're talking about making stuff and providing services for business, the things that really make a long term difference, the economy is doing very well, thank you, and if we had a Donkey president, the NY Times and Washington Post and LA Times would be trumpeting these numbers from the rooftops before excusing the storms as "not his fault".


Interestesting: Increase in Oxygen content helped mammals grow larger.


Technology getting cockier: Chip Helps Electric Outlet Go Broadband. I like the idea of the power company being able to compete with the cable company. It certainly can't do anything horrible for either my cable rates or telephone rates. Right now, if I want cable TV or broadband, I have one choice, and I live in a major city. This development means the power company (or their proxy) will automatically be in the business of competing with cable providers.


Going back to my essay on Petroleum and Energy Fossil Fuels Set to Become Relics, Says Research Group.

Unfortunately, the group's homepage is here.

Samples of the forward of some of their publications here and here, here, here

Here is their marketplace of available reports.

Some of their contributor pages: here, here, discussion here

A bio of their founder is here

Make up your own minds, but it looks like agenda driven wishful thinking to me.

This, on the other hand, is both real and hopeful news.


Looks like the US isn't giving away control of the internet without a fight.


Carnival of the Vanities is up!


Powerline now has Senator Frist's statement on the HCA stock situation up. I'm torn between believing it because lying would be stupid, and not believing because they want to maintian the smokescreen just a little bit longer.


I didn't know that! HT to LGF for this Melanie Phillips post about a two century slave trade centered around kidnapping slaves from England. From 1625 to 1816, while England had the pre-eminent navy in the world. I knew about the Barbary Pirates, of course. But I didn't know they actually sailed to England and conducted raids in a manner somewhat similar to the vikings except that they took slaves, not primarily objects. As a history lesson for the uninitated, Thomas Jefferson sent the Navy and Marines after the Barbary Pirates in the early years of his term, culminating (after a gap for the War of 1812) in a small American squadron assaulting Algiers, which victory gave the British and Dutch the guts to go after them and break them forever the next year.

Sorry! Out of time for today!

Games Lenders Play (Part II)

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Here's another advertisement that I've gotten in the mail within the last few days:

"Pick a Pay, Any Pay!' The Revolutionary Option ARM!"

"Start rates as low as 1%!"

Loan amount $100,000 Payment $321.64

$200,000 $643.28

$300,000 $964.92

$400,000 $1286.56

Could this help save you money?

Let's see, given the real rate on these, there is negative amortization of about $500 to start with per month on the $300,000 loan, compounded over the three years the pre-payment penalty is in effect. Cost me $19,000 to save this money - even if the underlying rate doesn't rise. Not counting what it costs to do the loan. Or I refinance out of it and pay a pre-payment penalty of about $9200.

Doesn't matter the friendly sounding name you give it. An option ARM is a Pick-a-pay is a negative amortization loan.

What this guy (in this case) is hoping is that you'll be so enticed by this "low payment" that you won't ask questions. These are easy loans to sell to people who don't understand them, and impossible to those who do unless you're the person it's really designed for. Indeed, many prospective clients do not want the problems with this loan explained to them. It's like they've chosen to be insulated from reality for a time.

But this is no surgical anaesthetic. Most folks are going to want to be homeowners for the rest of their lives, and unless your income has increased commensurate with your loan balance (and prospective interest rate increases) I guarantee you that the pain will go on for quite a long time after the time of "affordable low payments". I'd rather not shoot myself in the foot in the first place.

You could also lower your monthly payments. Free yourself from high interest rate credit cards and debts with a loan that could reduce your monthly payments by hundreds of dollars and leave you with enough cash to buy a car, remodel, or pay property taxes. And don't forget that mortgage interest is usually tax deductible. So you could save more at tax time.

This is all true - and only a part of the story. Remember that the easiest way to lie is to tell the truth - just not all of it. What they're selling you is the seductive "cash now - pay later". This was how you probably got into the situation they're talking about. What most people do is then take the money out and spend it, and then when the payments get to be too much, refinance again. What are you going to do when the overall payments get larger (again) next time. What are you going to do when there's no more equity? What are you going to do when you can't afford the payments?

The consolidation refinance can be a real financial lifesaver, if you do it right, have a plan, stick to it, and pay everything off, or at least pay your mortgage down below where it was before you go acquiring more debt. Fiscal responsibility is not what they're selling here.

You've earned a 30-day break from payments!

By rolling it into your mortgage, where you pay points and fees on it and the loan provider gets a bigger commission because of it. There is no such thing as a free lunch! You'll be better off if you stop looking for it. The bank is never going to give you one day that is truly free from interest, much less thirty. And because you don't make a payment now, you will be paying more later. Probably much more.

You're probably going to see a lot of recurring themes when I do these quasi-fiskings. That's because the lenders and real estate agents and everybody else keeps advertising the same misleading nonsense over and over and over again, they just say it in slightly different ways. As far as I am concerned, anybody who sends out one of these ridiculous things deserves to have their name engraved on my personal blacklist of people I will never do business with. I hope for your sake that you feel the same way.

Caveat Emptor

Data Mining: Russian Style

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Samizdata has a thoroughly chilling (even for me) post on Data mining: Russian style.

Seems a businessperson checked into a hotel in Moscow. Within a couple of days, someone is reading his mail and accessing all of his business information in Beijing.

He tells it from point of view of cybernetic warfare, and that it is. But the capacity to do this is not limited to governments. It most certainly is not limited to totalitarian governments.

Yes, it's a real problem when the totalitarians do this. But with less anonymity and more tracing of pathways, it would be stark raving obvious that someone was setting themselves up to accomplish this.

We need less anonymity, not more. Only then can one user be certain that the data is going where it needs to, and nowhere else.

I'm thinking niether one of these is a welcome development:

Protestants Reject IRA's Disarmament. Well, they're the ones on the scene, who have to live with what they do. If they don't believe the IRA has disarmed, it's up to the IRA to prove they have. On the other hand, a belated demand for the IRA to disband on top of previous demands that they now (may) have lived up to is also unacceptable, although a pro forma "we've disbanded" announcement would mean nothing other than political grandstanding. "Okay, Mike and Paddy, we're not going to go down to the pub to meet our IRA cell anymore. We're just going to go down to the pub to drink and talk with the people who used to be in our IRA cell" is a distinction without a difference.

On the other hand, at least the IRA doesn't have and never had nuclear weapons. Putin Won't Rule Out Third Term in 2008. Yeltsin may not have left happily, but he understood that it was necessary for the long term good of Russia that he leave after two terms. Putin either does not understand this or does not care; he wants to hold onto power. And Russia takes another step back towards totalitarianism.


New Home Sales Fall Sharply in August, more confirmation that things are falling off nationwide, not just here locally.


Neat! Giant Squid Photographed for First Time


Pork Busters may be having an effect: Give up your bike path, bridge for hurricane relief


I was going to write about this, but Forward Biased beat me to it.

These idiots win anytime they go unchecked and unchallenged. If you like living in a country where the facts of life are based upon observable fact and intelligent rational debate, do not allow them to go unchallenged. It happens too much. None of Michael Yon's readers, or any of those who read the milblogs of those present in Iraq and Afghanistan, recognizes the picture painted by the legacy media from their hotel rooms in the Green Zone. But 97 percent of the country does not read blogs regularly; and they don't know any better.


This has implications: MRIs Can Serve As Lie Detectors.

By and large, I think a lie detector would be a good thing. I'm less certain about ordering someone to take one, and completely against "fishing expeditions".



Victor Davis Hanson has some ideas that make sense in dealing with europe and the UN, and another about the problems inherent in affirmative action.


Captain's Quarters has a good article up on the Donkeys preparing a filibuster no matter who President Bush nominates to fill O'Connor's seat. It seems to me that the Donkeys want to lose the fight over nomination filibusters. It'll be a point whereby they can secure more funding and more activism on their behalf by groups such as MoveOn and ANSWER. "Those fascists! They took away the ability of the minority to obstruct them!" Well, until the next election, maybe. Let the people judge, but it's past time for the Elephants to get out in front of public opinion on this one if they're going to. A point can be made, possibly, that this is what recess appointments are about. I prefer a mandatory up or down vote in the Senate within ninety days of nomination, and that failing such a vote, the nomination is approved. Perhaps something like "A move to call the question of the nominee is procedural, always in order, and requires only a majority approval."

Chequer-Board has a different take, noting that when Ginsberg replaced White, there was no frenzy about the leftward shift of the court despite the fact that this did shift the court to the left.

HT to Patterico for this editorial mocking our politicization of our Judicial Branch. I'm embarrassed, but the Aussie has it right.


Stumbled across a good article on the French attempting to reform their unemployment system at Pigilito says. If they actually have the will to carry it out, bravo for them. I'll believe it when I see it.


I truly hope this is true. Jawa Report says that the 7th Circuit Court has ruled the Athiesm is a religion. Well, as practiced by the ACLU, I have to agree.


Armies of Liberation relates that all of Saleh's political opponents have joined forces.


Asymmetrical Information sees increased mobility in the Forbes 400. This is a good thing, you know. It means it's more possible to make it, less helpful to inherit it. She makes a comment about shirt-sleeves to shirt sleeves in three generations, but I don't see any Kennedys hurting. Warren Buffett and others have made a point of saying they intend to leave their heirs "Enough to do anything, not enough to do nothing".


Jackson's Junction has a message that all Americans should, well, I was going to say be exposed to, but there's some nudity. Let's just say understanding it should be mandatory in order to vote.


Baseball Crank and Tigerhawk have excellent articles that, assuming they are true, cause me to retract what I said about Senator Frist Sunday. Both at face value from my securities training and in terms of Occam's Razor, this makes far more sense than what I said then.

HT Professor Bainbridge

DeLay Indictment Roundup

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Michelle Malkin seems to have pretty much the ultimate rundown and roundup of the DeLay indictment. All kinds of useful information there. Note that although Malkin is a noted conservative, in my opinion she does paint a convincing factual picture of this as a political vendetta.

Daily Kosis not nearly so rational. They do note that the prosecutor has gone after Democrats, but fail to mention that until the last decade Texas was a Donkey party fiefdom going back to Reconstruction Era. When you run The Machine, you've got more apparent latitude for corruption. The Kossacks are practicing their usual bile on possible successors as well.

Oliver Willis at least manages to avoid foaming at the mouth, if barely. Oops, cancel that last sentence.

Talkleft seems partisan, but rational.

Powerline has some good comments and information on the politics involved in the indictment of Tom DeLay.

Captain's Quarters has more about the partisan nature of the district attorney who indicted him. We have to give him the latitude to do his job, but this appears to be an abuse of authority.

Michael Barone has more.

Random Fate seems to think there's enough smoke to justify a hypothesis of fire, but offers no evidence.

Justus for All thinks DeLay likely violated the spirit, but not the letter of the law, and will become more powerful as a martyr.

Pubcrawler is not impressed, agreeing that DeLay is likely guilty, but nonetheless a victim of a witchhunt as the laws are so byzantine it is impossible to comply in toto.

Liberty Corner has some worthwhile thoughts on his dislike of both DeLay and the law allegedly violated.

Dean's World points out the same thing Daily Kos does. Once again, this may be factually correct but misleading. The Donkeys owned Texas for a very long time as the result of the "Black Republicans" leading the "War of Northern Agression" from 1861 to 1865. There simply weren't any Elephant office-holders to prosecute until recently.

Me? I think DeLay is most likely guilty, albeit on a technicality, and in a perfect world should be convicted. On the other hand, given the fundraising shenanigans that were violations on a less technical and more substantive level of Al Gore among others, if there is any justice, DeLay will be acquitted or the charges dismissed. I agree with Liberty Corner that fundraising restrictions should be unconstitutional, and that the law should be repealed. I have yet to see ANY convincing argument that "getting the money out of politics" would be beneficial. On the other hand, DeLay will not emerge victorious and more powerful. Wounds of this nature persist, no matter their merit.

UPDATE: Politburo Diktat's post on this subject has been chosen as the Wateringhole topic for Thursday.

From an email:

Anyway, my wife and I are about to purchase a place here in the X area and we've been hearing that "a tough loan" line due to the fact that I'm only 10 months into my new small business although I've been profitable the entire time. We're stuck doing No Doc/Stated Income setups - I think you called these "liars' loans" - and the rates are a bit painful.

My wife's scores... at 720 are the lowest we have and mine are (higher).

Well, the good news is that your credit scores place you in the highest band of credit scores. There is no category beginning higher than 720.

The difficulty is that you're running afowl of one of the background rules of the whole loan process. Fannie Mae/Freddie Mac rules limit A paper loans to those with two years in the same exact line of work. With some limitations, a good loan officer can sometimes get it approved for two years with the same employer, if they've been progressing normally within the company. Changing from a W-2 employee to self employed is a change that cannot be approved, at least from the point of view of A paper. A minus and Alt A rules are mostly similar. So you're looking at subprime if you're documenting income. Let's examine A paper documentation levels to see if they're a possibility.

Full Documentation: Requires documenting two years income same line of work. You can't; you've only been self-employed for ten months.

Stated Income: Requires documenting that you've had the same source of income for two years. Nope. Yes, these and NINA loans are often called "Liar's loans" in the business because the lender agrees not to verify your amount of income. That's because loan officers eager to make a commission on a loan where the client really doesn't qualify use these to qualify the client. The qualification standards are there for your protection as well as the lender's. Just because you can use these to qualify doesn't mean it's smart. Locally where I am we have a huge house of cards because loan officers use these to qualify clients for negative amortization loans. Yeah, the temptation to make a commission is there, but am I really serving the client's best interest by securing them a loan they can't really afford where even the payment they can't afford has them owing more money each month? I submit that the answer to this question is usually no. These are designed for self-employed folks and people on commission who make the money, they just have write offs and such so that they can't really document it. Using stated income to say you make money that you don't is a dangerous game. It's likely to result in foreclosure.

NINA: Requires a good credit score. This might be your ticket. On the other hand, you don't state how much of a down payment you have, percentage-wise. A paper NINA requires some equity in the property; I've never seen an actual A paper NINA approved with less than about ten percent equity. On the other hand, these are very easy loans to actually do. It's trying to qualify you for something better that's hard.

On the other hand, if we move down into subprime, the rules aren't set by Fannie and Freddie. There are subprime lenders with one year same line of work programs, and even a few with six month programs. On one hand, they're subprime loans, carrying a higher rate/cost tradeoff just by virtue of that. On the other hand, because you're documenting your income, you get a break for that.

One of the great universal things of the loan business is this: The looser the underwriting standards, the higher the rate, and the tighter the underwriting standards, the lower the rate. If a given lenders underwriting standards are looser, it's rates will be generally higher.

Now, given that you've only been self-employed for ten months, you're not going to have much of a paper trail. There are three possible ways that banks will accept to document income. W-2? Even if you have them, they're no longer applicable. Income tax forms? Given that it's September, counting back ten months leaves you starting the business in November of last year. Even if you had enough monthly income to qualify for that month and a half or two months, the tax forms effectively spread it across all of last year, and that's unlikely to show enough income. The third method of income documentation, unique to subprime, is bank statements. This, you might be able to do. Most subprime lenders have 24 and/or 12 month bank statement programs, and a large number have six month programs as well. The longer you can document for, the better the rate, but better six months than nothing.

Will this get you a better rate, at a better cost (two questions that always go together), than an A paper NINA? The answer to that is on a case by case basis. There is no way to be certain without pricing it around by the full details of your case, but there's a good chance, and you can get 100 percent financing this way.

I will warn you that bank statement programs (often called "EZ doc" or "lite doc") are THE most difficult loans to actually get approved. There are more problems with these than any other loan type. On the other hand, as I've covered elsewhere, if it gets you a better loan, the effort is likely to be worth it. Furthermore, there is a question of whether you qualify for the loan by the bank's standards. Some banks discount the amount of money coming into the account, some do not.

So which is the better alternative for you? I don't know without actually pricing it. I don't know for certain that either can be done for your situation without information like how much income your bank statements show, and how big your loan needs to be, and how much of a down payment you're making. Get a couple of good loan officers working on it in your area, and find out.

And yes, this is a tough loan situation. Both A paper NINA and subprime bank statement programs have their limitations. Failing that, you fall all the way back to subprime NINA, where somebody with your score can get 100 percent financing no worries, but the rates are rough on the pocketbook.

Caveat Emptor


China is trying to bail a levee breach with a sieve, but don't tell them that. China Imposes New Rules on News Web Sites. It's nice to see a situation where entropy works for civilization and against its enemies. Of course the chinese leaders would never agree with that characterization, but a lot of chinese people might.

Another, similar article. China Wants Only 'Healthy' News.

George Orwell, call your office.


Ack! I've been discovered by spam-meisters! Twenty-two trackbacks to a payday loan scam this morning. I almost deleted Tinkerty-Tonk's RINO sightings trackbank by accident. I am glad Powerblogs will handle this particular offender automatically from now on.


Speaking of RINO Sightings, it's up at Tinkerty Tonk. Recommended: Says Uncle


Carnival of Personal Finance is also up. I would be careful about taking any of the advice that's not backed up with a calculator, however. The post that most says something that most people badly need to hear is Fiscal Times, which basically says "Get off your duff and get started!", but I would never in a million years use sharebuilder or anything similar. Yes, put money in a jar if you have to, starting today, right now. When it gets to be enough, put it in a savings account. When the savings account gets to be enough (You can get started with mutual funds with $1000 once or $100 per month), move it there. Most people should be able to come up with $100 per month, enough to start an automatic contribution to most mutual funds.

Most personal finance writers will do just about anything to keep you away from a professional who really knows what they are doing. The reason is that if you go to a professional, you're not likely to buy personal finance magazines and read them in newspapers, and spend your money on the latest crap by Goober T. Journalist. The reason they send you to a "fee only" advisor when they have to is because all the fee buys is a plan, no execution, and you might still have to read their drivel to make your actual investments. So they focus on not spending money for advice "because you don't need to". Horseradish. Especially when you're first getting started, Class A, B and C loaded mutual funds are some of the best and cheapest ways to get targeted professional advice specific to your situation that you can hold somebody's feet to the fire over if it is incorrect. When I worked on a "fee only" basis, my sole responsibility was that any recommendations I made were appropriate at the time I made them, not did I have any responsibility for updating or staying current on those recommendations, and I'd make $400 or more for not a lot of work. Basically, I'd make my money for responsibility that was somewhere below 1 on the zero to 10 scale. When I worked on an Asset Management basis (percentage of assets per year), my responsibilities were as high as they could be, but you had to have $50,000 invested to be eligible. When I worked on a sales charge basis, my effective responsibilities were about 99% as high, and if the sales charges were a little higher up front, the 12b-1 charges in subsequent years are a fraction of the average investor's asset management fee. Journalists, book authors, newspaper and newsletter publishers? They are explicitly exempted from any responsibility for bad investment advice under the Investment Company Act of 1940.


This is both well and properly done: SEC chief recuses self from Frist stock probe. What the headline didn't say was that the SEC has begun an investigation. The Bush administration is not shielding Frist, at least as far as the evidence to date shows.


Bush Drops 'Diversity' Hint About Nominee. I'm hoping Janice Rogers Brown. Anybody that can get these moonbats all stirred up. and these. Wikipedia, hardly a right wing publication, debunks both if you read it. And nine years as a Justice of the California Supreme Court is hardly a disqualification, and remember that the California Supreme Court is almost as far to the left as the Ninth Circuit Court of Appeals; saying a justice is the lone dissenting vote on that court is akin to saying that a justice has some connection to reality.

I did like Gay Orbit's reaction, though. As long as any criterion other than "Who will do the best possible job?" is even acceptable, we are a discriminatory society.

Resistance is futile likes her, too.


More on the mess here in America's Finest Banana Republic City. 'Unanticipated events' may delay S.D. audit. If you want to know how bad it is, read this article: Runway paved with neglect. There are problems with the location at Brown. A three thousand foot mountain on final approach, albeit several miles out but still a real factor for all of it's traffic (As Reba McIntyre, among others, could tell you). Tijuana's main airport is only about a mile away, meaning that instrument approaches have to be timed so that they don't conflict, as do instrument departures (Normal separation rules for instrument traffic is 3 miles or 1000 feet). Since almost all commercial traffic is required to be on instrument flight rules, these are issues. In fact, the only Instrument approach to Brown is an overhead VOR approach. But with all that said, it's an 8000 foot runway and until the stupidest City Council on the face of the planet wasted the opportunity, it was a real option for all of the air cargo to go down there. Now, of course, it's solid development all around. But ten to fifteen years ago there was both an opportunity and an obvious need. Anyone who's ever flown into San Diego's primary passenger airport, Lindbergh, knows it's a white knuckle experience (a 747 among other planes, would actually HIT a parking garage if it flew on glide slope to the default runway). It would never be accepted if it were being certified today. Plus it's only a single runway, and there's another hill off the west end. The FAA is doing the best they can with what they have, but it's the city's responsibility to find the land for an airport if they want one.


Today is the anniversary of the end of Sir Francis Drake's finishing his great voyage around the world.


Dog lovers, watch out for your pets! Report: Mysterious Disease Is Flu Strain. I've already spent $5000 on vet bills this year. I really don't need any more vet bills right now, thank you.


If the greeks can launch satellites to check for illegal aliens, why can't we require employers to just not hire them?


Yeah, Hamas, keep selling the fantasy that you drove the Israelis out of Gaza like you have, and pretty soon you'll be driving the Palestinians out as the Israelis counter-attack.


To contrast advocacy BS with useful information, Watchful Investor has two articles worth reading: Panic Now and Beat the Rush on the mortgage debt situation and Hocus Pocus on technical analysis.

Captain's Quarters has the most coherent take on the possible scandal involving Senator Frist and the HCA stock he's alleged to have sold. If this is true, it's a lot more serious than Trent Lott being nice to an old man at his retirement dinner, and Senator Frist should resign his leadership post as well as facing criminal charges. This is securities fraud. The worst problem apparent with this article is that the trustee improperly notified Senator Frist of a specific investment in the trust, something for which the senator is likely blameless. Now if that had been what happened, the Senator would have been morally correct (I don't know about legally) to order it sold so that he would no longer be aware of what was in the portfolio. That it coincided with an insider selling binge would likely have been pure coincidence. The senator evidently has family active in the corporation, making insider information likely.

RULE: If you find out something not only unknown but unknowable to the general public, don't change anything with any investments you have (or don't have) in the company. The SEC is serious about insider trading, and any profit you make will likely be spent several times over on lawyers fees and fines. One more reason why most people should consider mutual funds and similar investments rather than individual stocks.


Regarding Texas oil country and my recent "Petroleum and Energy" article, it looks like we may have gotten lucky. Signs Encouraging From Texas Oil Patch. Everything I wrote is still true. We just don't have quite as large a bottleneck in refining as I thought we might.

On the other hand, ROFASix wrote something agreewing with my post, albeit with less detail.

Willisms has the first Houston area coverage of Rita's passage I've seen. Seems like we dodged a bullet. Whether Texas would have been okay on it's own, or whether it learned from Louisiana, is not important. They did things more right than otherwise.

Wizbang makes a point that I've made too often to count in other venues. Civil Defense in the United States should be a national joke with the state it's in. It is a national disgrace.


Victor Davis Hanson has an article up debunking those who want us to change strategies.

Indepundit has a letter from a soldier in Iraq and more background on why the professor is right.

Now this guy has the right idea in how to support the troops. Invent a better detector for IEDs.

While we're on the subject of the war on Terror, Captain's Quarters also has a story on Hamas using unstable rockets on parade. They exploded, killing 15 and wounding 80. They also committed acts of war against Israel, firing rockets over the border, which missed.

A few more like this, and even the people of Palestine will be calling them the Bozo Brigade.

Boxing Alcibiades is recommending a Darwin Award. I agree, in both the biological and political sense.

Michael Barone has an article urging the Bush Administration to send someone high level to assist negotiations between the Palestinians and Israeli's. I think this would be smart, also. At least this way when the Palestinians violate the truce, they won't be able to claim they didn't understand they weren't supposed to shoot Israelis.


This article about a conference on the massacre of Armenians by the Ottomans in 1915, is both good news and bad news. Good news because it shows that there are people who will speak out for allowing the truth to be spoken. Bad news in how vehement and organized the would-be repressors are.


Captain's Quarters has two stories on Able danger developments between the Pentagon and the Senate. Keeps looking more like rope-a-dope to me so far.


HT to DANEgerus for showing my Brainster debunking a study in California accusing the state of racism in applying the death penalty.


World According to Nick covers Senator McCain and five GOP allies calling for a 5% cut in all non-defense, non-entitlement spending. Well, it's a start, and better than anyone else has done.

If all we have to praise is baby steps, praise the baby steps.


Respectful Insolence has a post on another reason to love the Harry Potter Books: teaching genetics to children! I love it! Take that creationists!


Q and O has a good piece examining judicial activism in light of the Constitution. Those promulgating judicial activism come up short. Of course, that's kind of like saying if you drop something, it'll fall.


Pigilito says links a study that says, not surprisingly for anyone paying attention, European universities are still lagging american ones when it comes to attracting talent, graduating qualified professionals, etcetera.


Cool! My elven name is Elessar Elensar. My wife is Tari.

On the other hand, my hobbit name is Till Hamwich of Buckleberry Fern.

Always knew I was an Elf trapped in a hobbit body.

HT to Ogre.


Art of the Blog has a short post up speculating that the media saying that Bush has lost his invulnerability is a sign he's lost it, politically. He says "The lady doth protest too much," and I agree. Seems like they're trying to make it true by repeating it until everybody believes it.

At the risk of violating Godwin's law (in spirit), I ask my readers rhetorically, who pioneered the use of this particular technique in modern politics?


Wizbang has an article on the value of failure that I agree with in its entirety. I have said similar things in the past, I will continue to say similar things in the future, and given todays "all viewpoints are valid", "We all win", culture, I'm always gratified to know I'm not the only one who has retained my sanity on this point.


Last but certainly not least, check out Armies of Liberation. She reports on:

The Heroes of Yemen, about how the Yemeni parliament rejected the resignation of one of its members, and was doing the right thing thereby.

Furthermore, she must be having an effect because the regime is getting mad at her! Keep it up, Jane! You've got them worried! Not all by yourself, of course - there are heroes aplenty. But when they mention you by name above all of their domestic heroes, you're having an effect.

Petroleum and Energy

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Judging by all the furor about the cost of gas recently, nobody remembers the Arab Oil Embargo in 1973 and 1974. The cars back then were just as big, and they got worse gas mileage than modern SUV's. And the price of gas may have been under fifty cents per gallon, but that's about $1.92 today. Until recently, gas was cheap on that scale.

Overnight, cars shrank. Or at least the cars people actually drove. People went from talking about upgrading from 6 cylinder to 8 cylinder cars to trading those 8 cylinder cars in on 4 cylinder vehicles. This lasted until OPEC basically disintegrated in the mid 1980's. Gas went from $1.30 or so ($2.25 today) per gallon back down to under $1.00, and only came up slowly from there. And overnight we had SUV's popping out of nowhere. My marketing teacher when I went back for an Accounting degree told the class how there was more and more in proven oil reserves in the world all the time as a justification for using all he wanted.

Well, this ignores several factors. The first is that, however much there is, the oil supply is finite. Our "lake" of oil is limited, and once it's gone, it's gone. Even if the Earth was 99 percent oil by volume, there would come a day when it was gone. Well, the Earth is not 99 percent oil by volume. That there is apparently enough for the next several decades at current rate of use in no way changes the fact that someday, it will be gone. Finally, the reason why oil is such an attractive energy source: Unlike everything else on this list, it can be hauled around from the point of production to the point of consumption in more or less portable containers and used to power stuff pretty much anywhere by equipment available to the average individual. We're not getting away from oil completely until we've got something else that meets this requirement.

Furthermore, there are other, better uses to which our children may need to put petroleum. Everything from building materials on the less important end to food on the more important end, depending upon factors we cannot determine at this point. We can recycle most other petroleum products, but not petroleum we use for fuel. I drive an automobile myself, but our current behavior is like a billionaire who converts his holdings to cash and burns the cash because he can. That we can currently afford this in no way alters the fact that our descendants will likely curse us one day because of it.

Yes, There are great untapped reserves. There are reasons for this. In every case, the world price to make them economically viable is above current market price. I've seen estimates that range from $50 or so per barrel on some stuff (and some of these reserves are being started up now), all the way up to $120 or $130 to make them economically viable. These reserves do no good if price is below economic viability. Nobody is going to produce oil in order to sell it below the cost of pumping it out of the ground. Even if the one trillion barrels of extractable oil in the article at the start of this paragraph is true, at 73.2 million barrels per day, that work outs to only 13,600 (thirty-seven years) days of world supply at current levels of usage. But current usage is increasing. It's likely more like twenty to twenty five years. If Colorado is only one of a dozen such fields, that may work out to 150 years supply or all told. It still says "we're going to run out, and there may be things our decendants wished they had that oil for."

Furthermore, there are at least two bottlenecks in the stream of oil available to us. The first is getting it out of the ground. Even if it becomes economically viable, the fact that we have one trillion barrels of oil in the ground in Colorado does not mean that we can get it all any old time we want. Nor does it guarantee that foreign oil producers will remain stable politically (Iran and Venezuela are obvious current producers who are candidates for civil war, and the former central asian soviet republics around the Caspian Sea aren't rock steady, either). So getting it out of the ground is subject to both technological and political constraints. It's hard to pump oil faster than it will come out, and it's even harder to pump at all when other people are shooting at you. It looks like we've got a capacity of a little over 80 million barrels per day right now, and are looking to expand that to about 101 million barrels per day by 2010. But Projected Demand is expected to increase sixty percent by 2020. I realize that the time frames involved are different, but this paints a clear picture of demand increasing faster than supply in a time when we appear to have a larger than normal increase in supply capacity under construction. We can't use it when it's sitting in the ground. Somebody's got to get it out first. And when demand rises faster than supply, Economics 101 teaches us that the result is rising prices.

The second bottleneck we have is refining capacity. We can't use oil in the form that it comes out of the ground in. It's got to be refined. Despite reports of intentionally limiting refinery capacity, a large portion of the refineries we do have have either been shut down by Katrina or are in Rita's path. I think the future isn't quite as calamitous as the folks over at Peak Oil are predicting, but the fact remains: we're losing a lot of capacity at a time when we're already running at full capacity, and no new refineries have been built since 1976. Our refinery capacity has decreased while domestic and world demand have increased. Result: shortages and price increases that are only going to get worse unless and until new capacity comes on line. Which will be years if not decades down the line as everyone agrees we need new refineries, but everyone also screams that they don't want them anywhere in their neighborhoods. By the time the EPA and the courts rule on the matters, twenty years can easily have passed before construction begins, and there will likely be further problems from those most determined to keep them from their county after that.

Look at this projection of energy demand showing a 40 percent increase in petroleum demand by 2025 (coincidentally, twenty years from now). In such a case, price is likely to increase by a lot more than 40% if demand can't keep up with supply. Ask youself how much you'd like $6 or $8 per gallon gas - in today's dollars. Nor are we merely talking about gas. We're talking about electricity and other power needs as well. We've watched how much California businesses have suffered due to rolling blackouts a few years ago. Transfer that to the country as a whole at a scale that California has not yet experienced, and watch what happens. In two words, economic disaster. Widespread inflation and unemployment to make the late Carter years seem like a dream of paradise by comparison. And before we move away from this point, here's one more factor to consider on top of all that: Gasoline Supplies Threatened Anew as Texas Refineries Brace

For those of you such as myself who are ecologically minded, ecological nightmare as well. Poor hungry people trying to keep warm and feed their family don't care that the spotted owl is endangered. They'll shoot a whole family of them for food and burn down the tree with the nest to cook it and stay warm. Try and stop them, and they will kill you, shoot law enforcement, fight the army to the death. However overwhelmed they may be, the worst that can happen is exactly what will happen if they do nothing.

Okay, nightmare projection over for now. What can we do about it?

First, we can do what it takes to get refineries built. This means everybody has to give a little, and they have to give it now. Regulatory obstacles to refinery construction are popular, as it makes the NIMBY's happy with the politicians who write laws and agencies who write regulations. It's past time for this to change. Everybody is an environmentalist when it comes to their own neighborhood. But the refineries cannot be built in Generic Location USA, they have to have an actual address and physical location. First, pass laws that state that states, counties, cities and even neighborhoods that permit refinery construction get things like priority use of the products of that refinery get, discounts on the products, or even property tax rebates. Make them economically attractive to the neighbors.

Nothing is going to make them ecologically attractive, I'm afraid. But there's got to be steps taken to cut through regulations and drastically shorten the time to approve construction. If you're one of those people such as myself whom this really bothers, consider the alternative disaster I described above. You don't get to pretend you're living in a perfect world. That's the child's approach. If you want a say, come down out of the treehouse and pick a real alternative and deal with the consequences like an adult. If there's anything that the environmental movement should have learned by now, it's that environmental consciousness is a rich man's concern, and only a rich man's concern. Put the most avid Greenpeace activist in a situation where it's eat a spotted owl or starve, burn a bristlecone pine or freeze, and the vast majority will do it, and they would be moral in doing so.

Now I want to take a moment to compliment the oil companies. Given the regulatory and legal hurdles we have made them jump over and through, they have done nothing less than an outstanding job of keeping us supplied and at a better price than we have any reason to expect. When I hear various bozos talking about alleged oil company collusions and conspiracies and such, and I ask for evidence, it always devolves into a complaint about gas prices and calls to regulate the price. It's exactly comparable to the circular logic of the various anti-semitic groups. Newsflash: The laws of economics have not been repealed because you're paying more than you like for gasoline. Regulating the price is the worst thing we could possibly do. If we set the limit price above market price, it will accomplish nothing except add some federal bureaucrats to the situation. Either costs or taxes or more likely both rise by an indeterminate amount, depending upon how obnoxious the regulations are. If we set it below the market price, we get shortages. Not enough oil available for sale in the United States. And because the price is artificially low, the alternatives to oil cannot compete as well economically, and they do not develop as much as they otherwise would. Result, insufficient energy to maintain our economy and our standard of living. But the europeans, chinese, indians, and rest of the developed and developing world would thank us very much for freeing up oil for their use and keeping allegedly free US Citizens from bidding on it above a certain price. All the more for them.

It is time we took as many steps away from oil dependency as possible. The standard line about wind and solar power is nice, but both of these fall woefully short. In all of California, there are three viable windmill farms, and whereas I think they're beautiful, most of the citizens of the areas where they're located consider them eyesores despite lower power bills. Well, going back to above points, tough. But this is still woefully limited.

The solar constant is 1370 Watts per square meter. But this is the total energy hitting the earth, which reduces to an average of 341 Watts per meter due to the fact that it hits only half the planet and that half is a sphere, not a flat surface. But that's what strikes the upper atmosphere; in fact thirty percent is immediately reflected, and is further reduced to about an average of 1020 Watts per square meter, which reduces by the same calculations to an average of 255 Watts per square meter theoretically available at sea level. Mind you, this is a lot of power. Put 100 square kilometers of actually producing surface and it'll generate up to 2.55 terawatts of electricity (okay, actually the theoretical limit is between 8 and 9 Terawatts when there's an unobscured sun in the sky). But this has environmental consequences of its own. Take that average of 2.55 terawatts of energy out of the Mohave desert or off the surface of the ocean and put it in Los Angeles and you have a recipe for both environmental and climate change. This is about the energy of two small atomic bombs per second on average, albeit without the radioactivitiy. Nobody knows what would happen.

US Energy consumption in 2004 was 99.7 Quadrillion BTUs. A BTU is 1055 Joules. If usage was constant from second to second, this computes to an average of 3.34 Terawatts, or using a population estimate of 300 Million, 11.2 Kilowatts per person average usage. For the City of San Diego with a population of 1.3 Million, that's an average energy usage of 14 Billion Watts plus, nearly forty for the county, and 450 for the state. So at first glance, it looks like 100 square kilometers would more than serve. But that's average usage, every second of every day, and peak usage is a different matter altogether. Just as importantly, there's the problem of getting it from where it is to where it's going. We just don't have the transmission technology to handle that kind of load. Not to mention the fact that the political and environmental opposition to a refinery may be more vehement, but it's confined to a concentrated area that can be considered more or less a mathematical point. You've more or less got one fight on your hands. The opposition to power lines runs along a mathematical line of width w for the full length of the transmission lines, and if any opponents anywhere win, the whole line fails, and you don't even start to build until you've essentially won everywhere.

Final problem with solar: it's not available twenty-four hours per day, it's subject to blockage, and we don't have any good mechanisms for storing the kind of power we would need to. Stored energy requirements for overnight at half the usual usage equals 5600 kilowatts per person, for twelve hours. The energy storage required for a million people would be 241 Tera Joules - the size of a small atomic bomb. We can't do this currently.

So we move the solar power to orbit. Needless to say, we can't do this yet, but we need to learn how not only to build them, but how to transmit the energy back earthside safely. This would allow us to even out the load and increase the efficiency by a factor of as much as four, as a good orbit for them should be in sunlight pretty much constantly, and with good gyros and engineering, should be able to be held face directly towards the sun all the time. How long will this take to do? If we'd started back in the seventies when we first had the toehold, we'd likely be close by now. Serious estimate: twenty to thirty years minimum to build the stuff to get it up there and then engineer the solar technology we already have to that scale and that environment. People who are middle aged now may or may not see it accomplished in their lifetimes, even at current life extension projections. Not a viable short term solution.

Nuclear power is something we should also work on. Yes, it generates radioactive waste. This is a problem. Nonetheless, once built and fueled, a nuclear plant runs for years with output variable within broad parameters. It's cheap, it's reliable, and there are large supplies for a long time in nice stable countries. The real problem? It takes years to fight the NIMBYs and get the permits and more years to build the plant. This will work shorter term than solar power satellites, but not in the next ten years.

Geothermal has a lot of potential, but there are engineering problems. Geothermal needs to be generated where conditions are right. The conditions require termperature gradients, and the steeper the better. This means hot rock or water or whatever close enough to the surface to be accessible, rather than many miles deep. These sorts of conditions tend to happen in areas of geological instability. This means earthquakes are a major design problem, and when you have an earthquake you're likely to lose this part of your energy supply right when you cannot afford to.

Finally, there's biomass. This basically generates heat from decomposing matter by a process that's basically composting. This one draws more objections from the neighbors than almost anything else, because it smells about like you'd expect it to. Newer technologies contain the smell, but escape happens, and whereas you can just not look at anything else, you can't ignore That Smell when it happens. Not to mention the fact that we're trying to reduce our biomass waste.

Then there are new technologies. Stuff we don't know how to do yet. Controlled fusion is the one of these that everybody should know about. Eventually, we'll figure it out. But there are still breakthroughs necessary before we even know how to do it right, much less make it commercially viable. You can't whistle up genius to order and until someone makes those breakthroughs, this isn't going to happen. One day it'll be cheap and practically unlimited power, but today is not that day, and we don't know when that day will be.

I have no idea about other sources of potential power generation. I don't think antimatter is coming any time soon, nor vacuum energy, to use common real theoretical possibilities contained in science fiction. But I do know that they won't be developed until they are not only practical, but economically viable.

The upshot? No single technology can handle the necessary increases in the short term. Indeed, it's not certain that all of them together can. We need to develop all of these technologies to the maximum extent practical, right now. If this means cutting a few corners, both in regards to relaxing the more extreme environmental regulations and in regards to how far NIMBY suits are allowed to go, so be it. We need to get cracking. We've allowed ourselves to be complacent for too long about our energy supply. The alternative is much worse than the nightmare scenario I illuminated earlier. Literally everything in our economy depends upon having enough energy. If we don't do what is required to make enough energy available, there will be shortages, and they will get worse, because every time we have a shortage that hurts our economy, we become less able to compete with those economies which have made the choices to keep up with energy demand. We get poorer, they get richer. They can afford more energy, we can't afford as much, and we as a nation go though cycle after cycle of this, and the energy shortages get worse with every cycle to the point where only the most critical things get any at all. No energy, we go back to horse-drawn plows to farm. No energy, we can't get the food to market while it is fresh. We definitely can't store it the whole year around. All of the neat chemicals the farmers rely on to increase yields? Gone. All those wonderful fresh foods we're accustomed to eating? Available for maybe a few weeks per year. Food production also plummets. Without energy and everything it does for food production, not only does the supply get smaller, but the distribution network collapses. We here in the US are fortunate in the amount of arable and productive land we have; I think we could actually survive, and the rest of the world certainly isn't going to be so stupid as to let this happen to them. Nonetheless, the price of food here in the US goes up by a lot, and it goes up noticeably worldwide. Those less well off tighten their belts, and the amount of hunger and starvation in the US multiplies. Now as to our research industries, biotech, computer companies, chemicals, what heavy industries we've got left, what happens to them? They move overseas, where the enerygy policies aren't so stupid as to constitute a bullet to their head. These companies may or may not invite their american employees to go along. Personally, I don't think they'll take very many, but they might decide to be generous.

It would also kill the climate for capital investment here. Right now, the banking, securities, and insurance industries are so efficient and so computerized that they've helped us create more jobs than we've ever lost to moving them overseas. But if the manufacturing and research companies go, these lose their capital base. Drastically less money to invest, and what they've got is far less efficiently used because the computers and transportation dries up.

Speaking of transportation, I shouldn't have to tell adults this, but motor vehicles vanish or become much more and more progressively expensive. Everything from commuting to shopping becomes more time consuming, more difficult, and you have fewer options because now you have to walk, or maybe take a public conveyance drawn by horses, or if you're really lucky, a light rail. Not only are there fewer jobs than people to fill them, but the only way to get to the ones that there are is to live near them.

All of those nice medicines we've got now? Gone, except for the very upper crust who travel to China and India, much like well-off foreigners come here now. Our medical people emigrate, as they have no problem convincing other countries that they will be productive citizens. Standards of health care plummet. Infant mortality and disease mortality skyrocket. Lifespan plummets to something like that of Mauretania. Our hospitals start to look like Cuban hospitals, and their ability to assist us in our times of medical need is greatly compromised.

The environment? We'd need to put more land into farming. Uproot the citizenry and plow over the suburbs. of course, but I'm not certain I want to eat wheat grown where people were throwing out their old oil. More likely, we'd take land that is currently reserved for parks or recreation area and turn it into farmland, especially where there is water, as our irrigation system depends upon energy.

Housing goes back to nineteenth century tenements if we're lucky. You need to be within walking distance of work if you've got a job, or on a public transportation line. This means that land around jobs providers get relatively much more expensive, and we can't afford the steel to build more than six stories up. So we go from 2800 foot McMansions back to 700 or 800 square foot apartments for families. The buildings themselves will be beehives of unreinforced masonry, and entire cities in earthquake zones die the next time they have one.

Women, be prepared to die in childbirth more often, suffer more complications we can't deal with in pregnancy. And since more of the children will die, be prepared to have more children, because you want to be taken care of in your old age, which starts sometime around fifty. Abortion may still actually be legal, but I doubt it. If you don't want the child, somebody looking ahead to their old age does. Our primary method for 99 percent of the population of surviving into what is now late middle age will be having children to take care of them when they are too feeble to perform the backbreaking work that agrarian economies such as I've described require. You're an accountant, realtor, financial planner, a member of any number of office staff professions? Be prepared to become a dishwasher or a day laborer or a chicken plucker (or unemployed and destitute) in conditions that haven't been seen since the turn of the twentieth century. Authors, writers, consultants, and college professors? The vast majority of you are among the unemployed as the national budget for your work (both private and governmental) shrinks to a fraction of its current size. Even if you have tenure, nobody will care. We won't need office workers, and other countries have no shortage of you; they don't particularly want you for a citizen. Oh, and employers have more power than they've had in a century, also. You think 5% unemployment is bad; wait until you see forty. The Mexican government uses the Rio Grande to keep Americans out.

Now for the next obvious point. All those wonderful people in China and India and Brazil and elsewhere? They want our current standard of living, too. Actually, they want better than that if they can get it, and they will unless they're as stupid as we have been for the last forty years. Just because we're stupid enough to make a choice that means we're going back to a manual labor economy doesn't mean they will. Matter of fact, I'll bet money they don't. This has implications. For the global economy, what happens when every one of six billion people is using 11 kilowatts of energy per capita? Demand goes up. Way up. Factor of ten or more up. The supply isn't getting any bigger as we sit here; matter of fact, the chokepoints are becoming more pronounced. Price goes up, and what energy companies we have left are willing to sell even less to the United States because they'd rather sell it elsewhere. Our natural reserves will become our only source of foreign capital. And they're not as great, and not as easily accessible without high energy, as they once were. We have a national debate about strip mining Yellowstone, which we decide to do. As a matter of course, we dam both Hetch-Hetchy (again) and Yosemite for hydroelectric. People start dying (again) from all kinds of conditions we haven't seen in a generation as the strip mines we decide we need more of again have their effect on the environment.

I really hope I'm getting through to the environmentalists and capitalists among you. We can start being more hospitable to industry now, or we can go back in time 120 years within the next generation, and I don't think we'll ever get back to the point we are now, or even anything resembling what our alternative option of being a little more accomodating to industry looks like today, and the longer we wait and the more you stall, the worse the equilibrium is going to get.

Now I'm going to talk to the patriots, and the human rights activists, among you. Military power flows from economic power. So does every other form of geopolitical clout. No high energy economy, and we become about as relevant to most of the world as Brazil was sixty years ago. Our position atop the geopolitical pyramid is taken by China. Yes, the people who gave you Tianamen Square 1989, and ongoing racial and religious persecutions and forcible third trimester abortions, and executions of any determined foe of the regime they can get their hands on. The United States is far from perfect, but China's modus operandi where it comes to human rights is their rulers are human and have the rights to do anything they want. The idea that the world will be better off if the United States is taken down a peg or removed from the board altogether is bullshit, and deep down most people in the civilized nations know it's refined and concentrated bullshit. But among the less progressive nations of the world, Iran takes the opportunity for as much danegeld (in whatever form) as they can get, as does every terrorist organization we've hunted, and of course the nascent democracies in Iraq and Afghanistan collapse. Taiwan is toast; on the other hand without us Israel may finally develop the guts to deal with the Palestinian problem and nobody will give a damn except the Arabs. Nobody will help us; we can't do anything for them anymore, and a lot of old alleged allies like the French and failed enemies like the Russians don't bother to hide their glee. About the only bright spots are Japan and South Korea, which is too big and prosperous for North Korea to take down.

I could go on, but that's the stick. We don't take immediate steps to preserve our economy, it will happen, to a greater degree or lesser. On the other hand, we have the carrot: the continued growth of our society as our economy grows. More of what we've come to expect: increasing affluence, increasing lifespan, increasingly good environment despite relaxing a few regulations, increasing options for our citizens, etcetera, etcetera.

Well, what is it going to be? Are you going to make a choice and live with it like an adult, or are you going to be one of those reading this who is convinced there is a secret hidden formula for converting seawater into super-powered gasoline, and if only we can break the oil company monopoly we'll all be living in paradise within a few years? The children among you may buy off on that bit of petulant fantasy, but the adults know that if there was such a formula the oil companies could easily become a hundred times wealthier by using it, and all without paying OPEC a dime.

Those who provide power are not your enemies. Whether you realize it or not, they're among your very best friends. It's time we started acting like it.

From an email:

I was wondering if you could tell me whether the following ways to save on interest are actually possible. If they are what are the penalties typically associated with these suggestions. I know you have mentioned a pre-payment penalty but what amount is reasonable?

1) Pay a certain amount over your monthly mortgage payment to pay your mortgage off sooner, pay more in principle, and to save on interest. Example: Your minimum monthly payment is $2000 so you pay $2200 a month instead.

2) Pay your mortgage twice a month so that more principle is paid off before interest catches up. Another nice thing about this is that most people are paid twice a month.


Prepayment penalties are something that is associated with the loan your loan officer chooses for you when you sign up. They become set in stone when the documents are signed, the loan is funded and the documents are recorded.

Sad to say, only a very small minority of clients ask about pre-payment penalties at sign up, and judging from my experience with people at a later time, most people either cannot spot it in the documents (there should be a section entitled something like "Pre-Payment" or "Borrower's Right to Pre-Pay". On the other hand, you need to read the whole Note that you're signing enough to understand what every piece says).

As I've said in this article, pre-payment penalties are a function of the market you're shopping in. Not necessarily the best market you can shop in, but most loan officers are going to looking to make money, not necessarily to get you the loan that's really the best possible loan. Pre-payment penalties add to what they get paid, and it's invisible to the client unless you go looking for it. In all markets, there is a trade-off between what you pay in up-front costs to get a given rate on a given type of loan, and what rate you get. Adding a pre-payment penalty (or not removing one) adds to the loan provider's commission, sometimes multiple points, and out of this they give you back a half point or so to make their loan look more competitive. A Good Question to ask and catch many loan officers off-guard is "and what is it without any pre-payment penalty?"

Pre-payment penalties are a thing to avoid if you reasonably can. On the other hand, circumstances can force you to accept one. No loan officer works for free, and if about all you've got is the money for the down payment, accepting a two year pre-payment penalty (meaning it is in effect for two years) can get the loan officer paid while you still get a affordable rate.

Here in California, the maximum pre-payment penalty is six months interest, and that is the industry standard for when there is a pre-payment penalty. A few lenders will pro-rate it, but for the vast majority, they will charge the same penalty on the day before it expires as on day one. This is pure profit, and they're generally not going to turn down pure profit any more than most people will turn down a bonus. So if your interest rate is 6 percent, you're going to pay a 3 percent pre-payment penalty if you sell or refinance before the pre-payment penalty expires. For Negative Amortization loans, the pre-payment penalty is based on the real rate, not one percent, of course.

On some loans, the pre-payment penalty is triggered by paying any extra money. One extra dollar and GOTCHA! But probably eighty percent or so give you the option of paying it down a certain amount extra each year, usually 20 percent, without triggering the pre-payment penalty.

Now as to the alternate payment schemes you mention, the first method, paying extra, is very possible and recommended with most mortgages. Anything extra you pay should be applied directly to principal. Especially in the early years of the mortgage, this has a multiplier effect, as now that you don't owe that money any more, your interest charges in the future will be less so less of your payment goes to interest and more to principal. On a $300,000 30 year mortgage at 6%, your monthly payment is $1798.65. Of this, $1500 is interest - which you're paying just to break even - and 298.56 is principal, which actually goes to pay off your loan. Let's say you pay $200 per month extra. If you're one of those extremely rare people who actually pay off your mortgage, you'll be done in 278 months - 82 months early. Almost 7 years. The interest you pay drops from $347,514 to $256,000 - you saved $91,514 in interest charges by paying $200 per month early.

If, as is far more likely, you refinance after 2 years, instead of owing $292,404, you'll only owe $287,284, a savings of $5120, which means you owe $5120 less on your refinance, and might get better terms because of it. Or you have $5120 more in your pocket if you sell. So it's only a 7.5% rate of return - it is guaranteed. If this mortgage outlasts 95% of all loans and makes it to five years - sixty months - you'll only own $265,114 instead of $279,163, a difference of $14,049. This is money in your pocket or money you don't owe on the refinance, which you're not paying fees on, and which might get you a better deal. Or it's $14,049 more from the sale of your property to buy another one. It's a 17 percent overall return on every penny in you added in five years, including the last payment you made. That's better than you'll do with CDs with the first month's money.

Suppose you only make one extra payment, once. Let's say you make the first payment at the end of the month when you buy or refinance instead keeping the money in your checking account until the end of that month. Making that one payment saves you more than five months at the end of your mortgage if you keep it the full thirty years. Let's say you just pay $200 extra once, that first month that you actually make a payment. You owe $225 less after 24 months, $270 less after 5 years, and $1207 less in the last month of your loan.

Furthermore, the higher your interest rate, the more difference these payments make. Right now rates are still historically quite low.

Your second question, about paying your mortgage twice a month, is trickier, and here's why: What most people who do this are doing is actually making payments every two weeks, which means you're making an extra payment a year in pure principal. To separate the two phenomena, let's drag the calculator out. Cut the interest rate in half, cut the payment in half, and double the number of payments. Punch in n=720, i=3%, and let's see what happens. The payment comes out to $898.92. Double this to $1797.85. This is about 81 cents per month difference. If you pay half of the $1798.65 twice per month, you shave less than half a month off of your payment schedule.

On the other hand, make 13 payments in 12 months, and (to make things simple for a simple calculator) that's roughtly equal to making payments of $1948.54 per month, which has you done in the 295th month - almost five and a half years early.

So you see, the twice a month schedule really does comparatively little for you - it's the fact that you are making an extra payment per year that really helps in this case.

So with some banks charging hundreds of dollars to sign you up for things like this (I know of lenders who charge $400 and up), I'd suggest instead to instead spend the sign-up money on a direct pay-down of your mortgage (providing you don't have one of those "one extra dollar" prepayment penalties), and keep making those monthly payment with a little extra on the side instead.

This "service" banks provide for their customers is nothing more than a cash-cow fee to pad their own bottom line.

And for the rest of you out there, I say the same thing I said to this person "Please ask if you have further questions you'd like answered"

Caveat Emptor!


I suspect that this guide to remaining anonymous online is going to be featured by a lot of people today. Given what it is intended to accomplish, the enabling of reporting from within regimes that repress free reporting, I support it wholeheartedly. We're not talking about an ideal situation where everybody is free to write what they want subject to few restrictions having to do with issues of responsibility such as not yelling "Fire!" in a crowded nightclub unless there is one. Given that these people are in a situation where officials will harass and persecute them for reporting the truth, they have good reason to remain anonymous.

With that said, the credibility of anyone who comes out of the shadows and puts their name and credibility on the line for something is always greater than someone who does not.

Even if it's Ted Kennedy talking about lifeguard training.


Looks like it was an airplane day yesterday.

First, JetBlue emerges pretty damned well from a scenario that's kind of a nightmare for everyone who works with airplanes. It's one thing when they collapse upon landing. Okay, scary surprise etcetera. But if you know about the problem ahead of time you're playing lawyer-ball. (and by the way, gear fatalities and injuries are much more rare than most people think.

The thing that I don't understand is that they were watching the reporting on their situation on television. Why? You're not going to learn anything. I learned a long time ago how incompetent the legacy media is when reporting airplane incidents. I don't think I've ever run across one where they got any the main points of the story approximately correct. Maybe it's some sort of "Look, Mom! I'm on TV!" I'd have insisted on being somewhere where I didn't have to be subjected to coverage of "...and we're going to show you the fiery crash landing live as it happens!"

On a lighter note, Jet Fakes Emergency for Gambia Soccer Game. Okay, the flight crew would face an inquest if it were here in the United States, and I certainly can't think of any sports contest that important. Furthermore, as someone who's dealt with a few real emergencies of this nature, I'd be angry as hell to discover one was faked, not to mention potential impact on other aircraft, who also have some reason to be angry. There's still something inside me chuckling a little bit.

Congratulations to One Man's Trash for his first airplane flight. Looks like a Beech Skipper from the photos (Piper Traumahawk has a 3/4 T tail). When I was a controller, I always wanted to be able to say just once, "Gilligan 123, number three follow the Skipper turning base." Or something similar.


Combs Spouts Off has some good coverage of preparations for Rita. What a difference having competent state and local government makes. How much the failures of Louisiana and New Orleans vice Katrina is motivating them is uncertain, but it can't be hurting.

HT to Mover Mike for this link to a Storm Track article on Eyewall Replacement

On Hurricanes: Stocks Dip As Wall Street Braces for Rita . This often means it's a great time to buy as long as you stay away from stuff in its path, and maybe even then if it goes low enough and you have a certain tolerance for risk. Short term "trader" psychology always over-reacts. Think like a long-term investor, don't try for the quick kill, and you'll end up miles ahead.

Recovering Democrat has an article making fun of the blame game. At least I hope it's intended to make fun of it.


This is utterly cool! Classic Video games! Many classic video games! For about $30! I want! Speaking as a member of the first video-game generation, there is something amusing and challenging about those old games that's sadly missing from many of their successors. Yeah, the graphics and sounds are cheesy by today's standards. But they were fun, and they had to be cleanly designed. It didn't take six months to learn how to play halfway decent.

I wonder if Ripoff, Circus and Joust are included? Asteroids and Space Invader would be kind of de riguer, but my very favorite games weren't, by and large, the most popular.

And on the other end of the spectrum, I am kind of looking for a MMORPG to try. I'd prefer fantasy, non-class based, unlimited advancement. Something based on a Mage would be perfectly in line with my role-playing preferences, but that's hard to program, and I realize I'll probably be stuck with something D&D based.

I wouldn't object to a good sf-type fighter pilot game, either. My favorite PC game of all remains the not very well known Stars!, which I happend to stumble across one day about ten years ago. I don't play online or multiplayer, because it doesn't go fast enough at the beginning and goes too fast at the end when the empires get too cumbersome to do a turn per day, but if you're looking for a strategic conquer the galaxy game, it's wonderful. Last I checked it was still available as shareware, and there was still hope for an eventual sequel.


People pulling crap like this is part of the reason houses are so expensive. Appeal made against houses on ridgeline. I'm glad that they didn't get away with it this time. The two council members who voted in the minority should be ashamed of themselves and I hope they are defeated for re-election and never elected to anything else ever again. Bravo for the Mayor and two responsible council members of Escondido!


More on the financial meltdown in America's Finest Banana Republic City. Memo shows system 'in shambles,' Aguirre says. Looks like some moderately severe and easily prosecutable securities and banking violations to me. Maybe more. If the SEC, Treasury Department, and IRS aren't pretty much a part of the investigations, they should be.

Other related articles here.


Forward Biased has a heck of a suggestion regarding a Porkbusters bill. Is it likely to pass? No. Is it worth the effort? YES. The Coburn amendment is one of those small strokes of genius that change things by just enough to make a major difference. And because Congress is dominated by Elephants, my local Moonbats may even sign on.


Captain's Quarters is calling for subpoenas for DOD personnel involved in Able Danger and their superiors. I agree. That I think the game is likely a giant rope-a-dope doesn't mean I don't want it to come out.


Michael Barone talks about interviewing John McCain. Even before I got to the bottom of the article, I had concluded he's running in 2008, and Barone thinks so too. I think McCain's got problems with the Elephant base and a lot of First Amendment types, and the number one thing he could say to burnish his chances would be "I made a mistake with McCain Feingold"

Patterico elucidates.

UPDATE: Decision '08 has a post on the same subject with similar conclusions.


Air America, panhandler. I've got a better place to donate anything I can spare to than a group of shills for a con-game.


Finally, Part Time Pundit asks if corporate fraud is worse than rape.

At the risk of sounding insensitive to rape victims, very possibly.

I'm not talking the small, penny ante $2000 tax defrauder here.

I'm talking the Ken Lay kill a company, rape people away from benefits they have earned over the course of years and may not have the time to earn again. I'm talking people who lose anywhere from hundreds to hundreds of thousands of dollars.

The pain there isn't as concentrated as one rape victim, whose plight I'm not denigrating in the least.

But just because the pain is spread out over thousands of victims doesn't make the aggregate pain any less, or the wrongdoing any less heinous. To see why, I ran across some comparisons of the energy released by a hurricane today - through a couple calories per cc of water, spread out over a large number of cc's of water, you get the energy to kill entire cities and level counties. The people killed by Katrina are no less dead than those killed by stabbing, beating, or shooting. And the death toll is over 1000. DU notwithstanding, nobody can create a hurricane or control its path. But, suppose for a moment, someone had built Katrina and aimed it at the Gulf Coast. What single murder could possibly compare?

As a society, we're far too complacent about crimes committed against the aggregate. They are not victimless. The victims have names and faces and lives, and they very often suffer for the rest of them as a result of this kind of malfeasance. If I were ever made dictator for life, I'd have made damned certain Ken Lay et al paid for the damages they caused to the last penny, and if they ran out of assets first, there'd be a lifetime lien against their earnings as well as a prohibition against serving in certain capacities.

(And I didn't have a penny in Enron that I'm aware of, nor TYCO, nor WorldCom).

Games Lenders Play Part I

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I was a little shy of ideas of stuff I wanted to write about, and too lazy to finish my research on some stuff I'm working on. But: I get the same junkmail and spam most of you folks do. They don't know who I am when they send it out. It's just that I know what's going on behind the scenes with this stuff.

So I thought I'd get out my calculator and deconstruct what's going on with the advertisements I've gotten in the mail over the last day or two.

The first one starts with "30 year fixed rate 5.125% (APR 5.42)" Well, computing that out, it converts to 10,100 of nonexcludable fees on a $300,000 loan (UPDATE: actually, I discovered later in light fine print that the APR is based on a loan amount of $359,650, the so called "maximum conforming" loan, which means the imputed number of points are slightly higher). This works out to 2.71 points, assuming they get it done for the same $1700 or so of non-excludable fees everyone else has (Title, Escrow and appraisal charges are excluded from APR computation). I've got that rate at 2.25 discount points right now, so they're making about half a point if there's no prepayment penalty. So not a bad loan, except that I called and found out there's a five year prepayment penalty on it. That's a good healthy (or unhealthy, depending upon your point of view) cha-ching of about two and a half or three points to the loan provider. Not to mention that the postcard was "old and the rates are higher now" according to the voice, "so you should start the loan now before the rates go higher." The lowest rate they could do as we were talking? 5.375, which I could do for 0.75 discount points as I was talking to them - giving them as a loan provider almost two points in their pocket without the 2.5 to 3 points for a five year pre-payment penalty.

Then, after a faint dotted line designed to be overlooked, they tell you all about payments. $250,000 is $632.14 per month, $300,000 is $758.57 per month, etcetera. Going over to the calculator (even though I can tell you what's going on without it), I get a negative interest rate when I punch in thirty year amortization. I shouldn't need to explain to adults that something is wrong with that picture. Well, what's likely going on is that this is a forty year amortization, and indeed, when I punch in a forty year amortization I get an interest rate of 1%. So on top of being on a forty year amortization, the payments they are quoting are on a negative amortization loan. It is neither on the same rate nor term as the previously talked about loan. And that's the purpose of that thin dotted line that's designed to be missed. They want you to think payment B is connected to loan A, when in fact they are talking about a completely different loan. And indeed I can find that in small, very light print on the other side of the card, under some darker print about about $1000 "Best price guarantee." Voice on the phone explained that, "If you close and subsequently prove you qualify for a better rate with someone else, we'll pay you $1000." Well, first off, if they pay you $1000 to make three points on the loan, they are still $8000 to the good, and if I were the sort to be giving that sort of guarantee I'd have no problem wriggling out of it on any of several fronts. And if you refinance or sell within five years, you're out over $7600 in prepayment penalty. Since 95% of all clients sell or refinance within five years, if you've got to have the 5.125% rate, statistically you're better off paying somebody honest one point of origination as well as the lender discount points for no prepayment penalty. One point of origination works out to a little over $3000 on a $300,000 loan. This is less than the difference between the loan they advertised and the loan they theoretically had when I called the day after I got the card.

But the rate is voodoo magic to most people. Theoretically, you've got to be able to understand some mathematics to graduate high school, or at least be able to figure out how to get numbers out of a calculator. Nonetheless, what most people "buy" loans on is payment. This is well known factual information to everyone in the real estate industry. Very few people ever call saying, "Give me that rate." What most customers want is the payment. And when the advertising apparently links the cheap payment on a negative amortization loan to the "Thirty year fixed rate of 5.125%", most companies are doing what I call "lying by association". Most clients want to believe that the one goes with the other and that the listed item is a pretty good bargain, when in fact I have shown that not only do they have nothing to do within each other, but also that they are both the sort of loan I would wish my worst enemy in the loan business would get for some enemy of civilization like Chairman Mao. Then when Chairman Mao gets a lawyer (and enemies of civilization never have a problem getting competent lawyers), I get to watch the whole thing blow up on both of them from safe on the sidelines.

Oh, and this postcard also talks about "skip one or maybe 2 payments." As I cover in the second through seventh paragraphs of this article, you never really skip any payments, EVER. You can either pay them out of pocket or roll them into the costs of the loan. Anybody who represents otherwise is lying, with malice aforethought, unless they're going to whip out a checkbook and pay it out of their pocket. How likely do you think that is?

To avoid this trap: First, don't "buy" loans based upon payment. Second, get (or find) a calculator and use it, or even learn to do the calculations yourself. Third, ask the prospective loan provider the hard questions, and make sure that the question they answer is the one that you asked. Fourth, Shop Shop Shop around for a loan. And apply for a backup loan.

Caveat Emptor


Carnival of Vanities is up at the skwib. Recommended: Free Money Finance, Forward Biased,


Here we go again! Rita is now Category 4 and headed for Galveston and Houston.

Michelle Malkin has a great round up of Rita posts. If you're in the area, pay special attention to this post with actual comparative numbers from a Houston area lawyer.

Indepundit hopes for a "do over" with regards to the political fingerpointing post-Katrina. You might guess I agree with him (as I've said several times here, I am not interested in playing the blame game until the emergency is completely over, as in all refugees have either returned to their previous life or have made a new one, which Katrina's is not yet, and Rita's has yet to begin. I can hope we'll all do better this time, but I'm prepared for that hope to be disappointed.

Holy Blow The Man Down Batman! Hurricane Rita has unexpectedly grown to Category 5!. Scroll down for projected storm track. If this is you, Get. Out. Right. NOW.


Captain's Quarters notes that the levees protecting new Orleans from Lake Portchartrain failed well within the parameters they were designed to withstand. Possible reasons: bad design or faulty construction. Given New Orleans' and Louisiana's political history, is there anybody who wants to bet money on the first of the two possibilities?


Nifty! Mars Orbiter Spots Changes on Red Planet. Now that we've got a long term orbiter surveying the planet, I'll bet we find a lot more of this.


Captain's Quarters talks about Environmental Moonbattery and Hillary Clinton. I think that her opposition to ANWR drilling is pure political calculation: The issue that connects her best to the leftist base while alienating her least from centrist voters. Certainly I can't pick a better issue.

I agree with Captain Ed when Hillary talks about doing other stuff instead. Precisely what is your plan, Ms. Clinton? You and your husband had eight years to catch the national ear while he was in office, and you've had four and a half in the Senate since he left. All you've done is obstruct a plan that may not be perfect, but is both reasonable and the only plan put out there to increase domestic production. Nor have you done anything to significantly bolster alternative energy sources, in the sense of said alternatives being able to furnish a significantly larger share of our energy needs. Put up, shut up, or admit that you're voting against due to a desire to appeal to a certain stripe of voters.


Victor Davis Hanson has a good essay up on how the media use their outlets to shape public opinion.

In the same vein, Cox and Forkum on Tal Afar.


Captain's Quarters also talks about the Roberts Hearings and the Democratic responses to President Bush nominating an extremely qualified jurist who happens to be moderately right of center. Which is the consequence of the american public electing a right of center president and coincidentally, legislative branch. All the Donkeys can do is try to filibuster and generally act like spoiled children on the way to the dentist.

Looks like they are trying to motivate the President to name someone further to the right for his next nomination, as I speculated he likely would back on July 20th, if Roberts faces significant problems.

Queen of All Evil said it more pithily yesterday.


Michael Barone joins those who want education schools reformed along strictly scientific grounds or abolished.

Speaking as someone who's done a fair amount of instruction (although not professionally), I want to know why we have an actual education degree, particularly for front line teachers. Yes, they must know how to teach, but that can be learned very quickly. They must also know their subjects, and the number of teachers with degrees in mathematics or science is falling and has been since I was in high school. Now a first grade teacher should be able to handle addition or subtraction with general knowledge - but a high school teacher has to know not only algebra and geometry, but the concepts behind them, in order to teach well. And the degree of scientific illiteracy in physics, chemistry, and economics among the teaching profession is astounding. My older girl is just starting school, but some of the things that have supposedly come out of the mouths of those teaching the older children of friends and family would be cause for doubting their competence in random adults walking around on the streets, let alone those charged with educating our young.

Learning how to teach should be easily contained in a laboratory sequence in the final year of college, where the assignments consist of "Get up and teach your classmates a class on what the professor assigns." Other than that, teacher candidates should concentrate on learning the subject they intend to teach.


Governor Romney of Massachusetts isn't backing down. I believe that mosques and churches are public places, and hence covered by my writings here. So as you might guess, I like the way Governor Romney thinks, at least on this one issue, and not just because it's a mosque.


Mudville Gazette spots a story of a true American hero.


Dr. Sanity liveblogged the Able Danger hearings.

Strata-Sphere has more on the Pentagon pulling the rug out from under the hearings.

Captain's Quarters has another angle.

Okay, so I don't want classified intelligence and intelligence gathering methods aired in open hearings. There remains the option of going to closed hearings for classified information and procedures.

Now here's the question just begging to be asked:

What could possibly cause the Pentagon to stop its officers from testifying before Congress on something this important?

It's got to be big, and it's almost certainly political, especially if the orders came from as high up the chain of command as Donald Rumsfield, as has been alleged.

It's got to be a failure of some sort. If it was a success, somebody would be leaking a la Mark Felt (aka Deep Throat).

It's got to be something that's worth the certainty of the feeding frenzy that will be stirred by trying to find something hidden.

I don't think even a concrete 9/11 warning delivered to the president himself in person qualifies. I might have believed it and taken action in defiance of political repurcussions, but then, I don't want to be president. Given the situation and the mindset of the country on September 10th, if the President had so much as put undercover skymarshals on allegedly fingered flights and nothing had happened, the press would have crucified him worse than they used to treat Reagan every time he said something true in a straightforward fashion. Yeah, it'd hurt him - hurt him a lot - but it wouldn't be fatal. The fact is that nineteen crazies did hijeck four jets and did successfully murder thousands. We figured out Pearl Harbor a few hours early, too, and nobody blamed Roosevelt that the warning was muffed.

But let's put those last two data points together. Suppose the Eeevvvill Karl Rove™ has a Plan©. Think "selling rope." Get the Legacy Media so convinced there's something you want hidden, that they will dig themselves into such a hole that when the story comes out, it can't be ignored or wallpapered over. Then when the Real Story hits, and it's so damaging to the Donkey Media Darlings that their careers are effectively over, it can't conveniently fall down the memory hole. And the Elephants get to say, "But we weren't playing politics; we were trying to protect them!"

In other words, please Br'er Fox, don't throw me into that stickerbush!

I like it!

I thought I would give a local fan run science fiction convention a free plug. Conjecture will happen October 7-9 at the Double Tree in Mission Valley. Guest of Honor is Jack McDevitt, whose work I've loved since I started reading it. Assuming the universe doesn't laugh at my plans and I can get a kitchen pass from my wife, I'm going to try to attend Saturday.

(And if you have a FAN run type con to publicize, I'm perfectly willing and happy to give a quick link.)


Now this is cool! Israeli archeologists unveil Byzantine mosaic, table


Regarding the North Korea deal I spoke on yesterday, they've reneged (well surprise, surprise, surprise!), or at least upped the ante on the shakedown. North Korea rocks nuclear deal. They now say they're going to keep their weapons until we give them reactors. Thank you soooo much, Mr. Clinton, for allowing this petty tyrant to develop nuclear weapons. Because you couldn't be persuaded to do your job, the people you were supposed to serve are now in greater danger indefinitely, and your successors' options are horribly bad, sickeningly bad, and even worse.

AP has a slightly different version. Chequer-Board has a different take, while Captain's Quarters amplifies.


Captain's Quarters notes that the Attorney General (Alberto Gonzales) has given the FBI a new, higher priority in dealing with porn. This is stupid political pandering, plain and simple. In case Mr. Gonzales hadn't noticed, we're in the middle of a war on terrorism in which the FBI is a front line defense. Once enacted though, it's one of those things that's politically impossible for anyone to rescind. I wonder how politically popular this will make Mr. Gonzales should the diverted resources have a role in causing a terrorist attack to get through?

Pardon me while I go outside and scream. I formerly thought Mr. Gonzales wouldn't be a bad candidate for SCOTUS, but he has now demonstrated judgement that's about as actively bad as possible, accentuating a personal political goal at the expense of the national necessity. I certainly don't want someone whose priorities are this messed up on the highest court in the land for the rest of his life.


If there were justice in the world, flags would be flying at half-staff worldwide. Simon Wiesenthal has died. This is the man who became the spokesman for six million murdered human beings, and helped bring over 1100 of their murderers to justice. Fare thee well, sir. You will be missed.


Captain's Quarters also has a very good article on Air America, and how even one of it's own executives was strongarmed into silence.


La Shawn Barber has an article about Black Americans and party allegiance, and how those still wedded to the Donkeys accuse those who leave of wanting to swap one plantation for another.

Judging by a compare and contrast of New Orleans with many other cities in the US, I think I'd prefer the putative Elephant idea of plantation to the real, demonstrated one of the Donkeys.

Or has anyone else ever heard of Stockholm Syndrome?


The feces have officially hit the fan. FEC Sues Pro-Republican Political Group.

For balance, the FEC offical statement is here and the Club for Growth response here

Any why are Club For Growth's relatively small expenditures the first to come up for legal action? Could it be that they're generally regarded as a conservative group, and we all know that is all about helping the good guys? Especially as there is an obvious prima facie case for coordination against MoveOn in that several affilated persons were also affiliated with Democratic campaigns? Or is it "Get control of the guardians of the political process, and you may not always win, but you'll always get the benefit of the doubt where your opponents won't"?

HT to Michelle Malkin.


Michelle Malkin doesn't like Bush's new nominee for Immigration and Customs Enforcement. Looking at all the evidence she's assembled against Ms. Myers, I certainly understand why. This looks like a crony appointment, and Michelle says she's gotten emails from rank and file ICE folks who say she's minimally qualified. I suspect Ms. Malkin is correct, but let's give the lady a chance to show us in confirmation hearings that she can handle it. Unlike Supreme Court justices, this appointment doesn't depend upon being impartial with the wisdom of Solomon. It depends upon you being an effective executive with a strong agenda that can make your agency work, and some of our best executives have been minimally qualified by past experience. So, questions for the Senate to ask: Ms. Myers: Do you have a plan? What is your enforcement agenda? How are you going to allocate your resources? What areas do you see ICE falling short in, and what are your proposals to remedy this? What organizations are a threat? How do you propose to deal with them? What holes in ICE do you see, and how do you propose to plug them?

One hopes you get the idea. It looks and smells like a crony appointment, but if she can convince us she can handle the job, let her go for it. The burden of proof is on her; let's see if she can lift it. If she can't, everybody else is better off for finding out now.


Mark Steyn has an interesting and well-reasoned take on the German elections.


HT to LGF for the link to Daily Cuz article on parallels between Germany pre WWII and Iran today.


Jane Novak over at Armies of Liberation has been called a "Zionist" by the Yemeni ruling party's newspaper.

Congratulations, Jane! Considering the source, it's a wonderful compliment, and you're in world class-company!


OK Cupid Politics test

I am a Social Liberal

(71% permissive)

and an...

Economic Conservative

(85% permissive)

You are best described as a:


You exhibit a very well-developed sense of Right and Wrong and believe in economic fairness.

HT to Eric's Grumbes


Iraq the Model has a good post on Zarqawi targeting the Shia and prospects for Iraq.

Jihad Watch notes problems in Indonesia. In case you were unaware, Indonesia is the most populous Muslim country in the world, and one of the most prosperous, especially in real terms of the population actually producing stuff that other places want as opposed to merely pumping oil out of the ground. Problems there have the potential for a very long reach.


Buck Sergeant has a great response for a one-winged Moonbat.


Jawa Report has the text of an excellent speech about the Constitution. He's right in that the whole idea of Constitution Day is itself, unconstitutional, and he makes several other valid points as well. The Federal government does have the right to encourage where it is forbidden to compel, but that's not the way the legislation was written.

How Loan Providers Make Money

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In an attempt to debunk some of the slanders that are floating around out there, this article is an itemization of how lenders and brokers make money on loans.

The first method is obvious: Origination or discount points charged to the consumer. This is money that the person getting the loan is paying, or someone else is paying on their behalf. One point is one percent of the final loan amount, two points is two percent, and so on and so forth. There is an actual difference between origination and discount points, but they have become almost interchangeable in their usage by many lenders and loan officers. Origination has to do with the fee charged for getting the loan done. It's not a trivial amount of work to get the loan done, and unless you're a close relative or have repeatedly saved their life, the person doing the loan is going to get paid somehow (and often, those are the loans where they make the most). If you're uncertain just how they are making money, you should ask. Discount points are theoretically a rate that the actual lender is charging in order to give you a rate better than you would otherwise get, but many brokers camouflage origination points as discount points and many banks camouflage origination points as discount points. The former makes you think the bank is making the money when it's the broker, while the latter makes the consumer feel like the lender isn't charging them origination, but that you are actually getting something most consumers quantify as real for their money (This also makes you feel like you're getting something for nothing, always a good selling point to anything).

Related to this are junk fees or markups of legitimate fees that are required to get the loan done. I do not believe I've seen a fee that some lender or another hasn't tried to mark up. If in doubt as to whether there's a markup, insist upon paying it directly. If they can't explain exactly what it was for in easy to understand words, it's probably a junk fee. Again, real fees usually run to about $3400 on a loan, although many lenders and loan officers are adept at hiding this.

The second way that lenders and loan officers make money is in rebates, also known as yield spread. This is pretty much limited to brokers, as neither traditional lenders nor packaging houses get direct rebates from lenders. Once again, rebates can be thought of as negative discount points and discount points can be thought of as a negative rebate. There should never be both discount points and a yield spread on the same loan. It is fundamentally dishonest. If there is a yield spread, you are being charged origination, not discount. Period.

The third way that lenders and loan officers make money is in the sale of the loan. This is only applicable to actual lenders, whether traditional or packaging house. Mortgage loans, particularly grouped in vaguely compatible bunches varying from $50 million on up, are among the most secure of all investments (indeed, in terms of historical risk, only US Treasury bonds are superior). Because they are very low risk, the lender makes a nice premium on them. As I'm writing this, CMO bonds trading at 5% even are basically at par, while 6% bonds are earning about a 3 percent premium. At par means the bank gets the face value of what they're selling, whereas a 3% premium means they get an extra $30 for every $1000 of bond value. For a $50 Million CMO offering, this is $1.5 Million. (There are other factors such as underlying quality, whether there is a pre-payment penalty, what tranches they may be assigned, and so on, but this is a basic article on the phenomenon.) By comparison, on a fairly good "A Paper" lender's pricing sheet (the first one I grabbed), 5% is not available and 5.25% carries a discount point and a half while carrying a premium on the secondary market of half a percent or so, so the lender is making two full percent on that loan at a minimum, and unlike a broker's yield spread, this is never disclosed to a client. Nor is there any limit as to how much this can be, but with even decent to good A paper lenders getting 2% or more, it shouldn't stretch your mind too much to find out that this number can go to 6 or even 8 percent in the subprime and negative amortization markets. 6 percent on $50 million is $3 Million dollars the lender gets for selling $50 million worth of loans - this translates to about 100 regular 3 bedroom homes here in California. $30,000 each, over and above any points and fees these people may or may not have paid, and for holding onto the loan for maybe one month. Believe me, your lenders are not hurting - and many even have the guts to badmouth brokers who may make $5000 while cutting the consumer's cost by $7500 to $10,000 and the bank still makes $20,000 per loan. (Note: these spreads and premiums used to be much larger 30 years ago when people didn't reliably refinance or move about every two years).

What brokers do is essentially play these lenders off, one against another on a professional basis, to see which one will cut the best deal on your behalf, because brokers are never captive audiences while the lenders regard you as theirs from the time you walk in the door.

Also, the point needs to be again that cost of a rate is always inverse to the rate for precisely the reasons of yield spread and bond premium. The lower the rate, the higher the cost. The higher the rate, the lower the cost. Some lenders and brokers may have better cost/rate tradeoffs than others, but there is always a trade-off.

The last method of receiving traditional income is to actually hold the note and receive the interest. This is actually rare these days. More often, what the lender will do is sell the loan itself while retaining servicing rights (for which they are paid, of course). Most often, the lender can make more money by selling the note to Wall Street - whether or not they retain servicing - than they can by holding the actuial note themselves. Keep in mind that the premium they get from sale of the note is immediate, and they can "sell the same money" several times per year, as opposed to just holding on and collecting the interest as it accrues.

How can (and should) you compare a broker's offer, where compensation is disclosed, with a bank's offer where it is not? First off, make sure that they are on the same type of loan at the same rate. My questionnaire here is a good start. Note that the last explicit question, "Will you guarantee this rate at this cost and cover the difference, if any, yourself?" should be answered in writing, and if the answer is "No," that's a red flag as to what their business practices are. They know what it's really going to take to get the loan done. They know what rates are available for locking today, right now. If it's not locked, it's not real, and they're playing games with your loan. As to prospective loan providers who won't guarantee their Good Faith Estimates, I have a retort I use with potential clients, that runs something like "Well, if he's not going to guarantee you a 5.75 30 year fixed with one point, how about if I don't guarantee you a 5.5 30 year fixed with no points?" If it's not personally guaranteed in writing, chances are they are jerking you around to get you to sign up. None of the standard federal or state forms are binding in this sense; not the Good Faith Estimate, not the Mortgage Loan Disclosure Statement, not the Truth-In Lending form, and not to application form itself. Furthermore, keep in mind that for all third party items, such as title, escrow, attorney fees, appraisal, etcetera, they are able to exclude them from the precomputed costs of doing the loan, so most lenders and loan providers do. Not coincidentally, these are the biggest items in the closing costs section of your loan. Insist upon full disclosure of each item, and ask them to guarantee the total.

And once you are certain that the loans you are being told about are actually the same loan or the same type of loan, then you can make the decision as to which is better by choosing the one that actually gives you, the prospective client, the better loan.

Caveat Emptor


Well, today marks three months since I started this thing. Seems to be working out okay.


Shakedown successful: North Korea Pledges to Drop Nuclear Program. This is one small reason why we want to deal with Iran now before they get the technology.

Scrappleface has the correct take on the issue.


I don't know enough about German politics to comment intelligently about their chances for a coalition, but I'm thinking this whole situation can't be good news for Schroeder.

HT to Dean's World for linking Peaktalk (who hails from the area originally) about the German elections, and David's Medienkritik who comments on the likely coalitions.


RINO Sightings is up!

Carnival of The Capitalists is up.

So is Carnival of Personal Finance


I'm as big a space buff as anyone, and bigger than most. But if this article on US to send four astronauts to moon in 2018 and this one about a cost of $104 Billion are correct, I'm not impressed given the advances since Apollo was designed in the late 1950s and early 1960s. We've had a resuable craft for the last twenty years, and going to "Apollo on steroids" is going backwards. Although the end of the cost article hints at reusable compenents, the way to do it is likely what the original plan was for going to the moon: assemble the thing in orbit. Put up a real space station and assemble the pieces there. Then use the station as a base (Orbit is halfway to anywhere in the system, enerygy-wise). Trying to blast off from earth direct to lunar touch down and back is kind of like trying to use the same vessel as a locomotive and a sailing yacht. If I had my way, we'd forget about the moon until we had orbital catapult or orbital tower technology down, and go straight to the asteroids, which is what is most likely to best fuel The Third Industrial Revolution. Moon and Mars can wait. Once space is shown to be profitable there will be demand for them as destination. Let's go to the asteroids. The round trip is easier (although longer time-wise than the Moon), and likely to be more productive.


Jawa Report makes some good points about both sides of the political spectrum in regards to Katrina response.


Peter Porcupine tells us of the likelihood of disaster on Cape Cod. I agree with him that far. However, when he starts talking about spreading the risk that Cape Cod's homeowners to all policy holders of the state's FAIR plan, that's where I disagree with him. These people have voluntarily bought property on Cape Cod. Nobody held a gun to their heads (most of them are pretty well off, too, but that's a different argument). They voluntarily assumed the risk that a Hurricane will demolish their property in ways that an inland property holder has not - and they want the increase shared among those who bypassed that risk, also? I don't think so. That's a violation of the principles on insurance, which is based not only upon the law of large numbers, but also upon the risks you choose to take.

And with any other company, the raise would be disastrous. Underpriced insurance seems like a wonderful idea - until the time comes to make a claim. In this case, the taxpayers of Massachusetts would be on the line for claims that would break a regular insurance company, and he wants to hold the line on price increases?

If Insurance issues cause a lowering of home values in the area, well I'm sorry for the people who lose out, but better that than what happens if the price of the insurance is not adequate to pay the claims.


Professor Bainbridge links to a lengthy article about the consequences of Fannie Mae and/or Freddie Mac failing. It does fly under most people's radar, but with both Fannie and Freddie under indictment from the SEC among others for poor disclosure, and some of the froth in the housing markets around the country, it's one more factor turning the whole real estate value sector in the United States into a house of cards.


Armies of Liberation has another article up on Yemeni corruption.

(So why does it sound so much like New Orleans?)

(For the rhetorically challenged, the answer is "extended period of one party rule")


Beldar baits one of the Miscreants from Massachusetts.


No Angst Zone has an excellent article on BRAC (i.e. Base closings). Okay, Clinton may have started it but the current BRAC has only itself to blame for its gutlessness. As he says:

I must be confused, I was under the impression that the purpose of the United States Armed Forces was to defend this country, not to sustain the economy of tiny towns in the middle of the desert. Apparently, the BRAC Commissioners felt otherwise:

Problem is, there's lots of people watching after preserving a few jobs here and an cash cow there, but nobody watching after the overall interests on the United States.

President Bush Gets Another One Right.

OK, so the response to Katrina has been unacceptably slow. So the president has decided to do something about it. No, not floggings. They're going to review disaster plans before something else happens, so that a) everybody at all levels of government is playing from the same piece of music and 2) weaknesses get spotted now, before other disasters strike. And other disasters will strike. People fifty years from now will owe their lives to Katrina and the rational way President Bush is dealing with this - rather than point fingers and blame somebody else and stonewall (as he well could because he's never running for anything else), he's trying to fix the problems before more disasters happen. And the cost, although not trivial, is so cheap it's hard to argue against it.

Is President Bush perfect? Hell no! His immigration policy is more of the "bury my head in the sand" we've had since Johnson, and his spending policies are a disaster in progress. Is he closer to rational on more issues than any president we've had since at least Truman? Yes. Does he actually get things done better than any president we've had since at least Theodore Roosevelt? Yes again. Once a problem becomes apparent, does he do his best to actually deal with and fix it better than any president we've had since Lincoln? Damned straight! Barring a future disaster in the War on Terror or something else unforseen, I have good evidence to believe that in two generations time our current President will be looked on as belonging in the very top tier of past presidents, and on the day he hands the office over to his successor he will have more to be justifiably proud of than any president in living memory.

To this, let us append a "credit where credit is due!" Bravo, Donna Brazile!

On the other hand, DU Reacts


The Moderate Voice has some reasons why the democrats should support Roberts, in amplification of the ones from the Washington Post. I said much the same thing back on July 20th. Elections have consequences and one of the consequence of being elected President is that you get to choose who you want on the Supreme Court. Roberts is a very mild choice compared to some the President might have chosen. Furthermore, he is about as qualified as they come. If the administration is going to face a nasty knock-down drag out fight no matter how reasonable their nominee, why should they not nominate a more polarizing figure. It's not as if they can't get anyone confirmed if it comes to a party line vote. The so-called nuclear option (actually, a majority of senators requesting the close of debate about an issue), if likely to be successful, both publicly and legislatively.

Dean's World suggests that Bush's next nominee be Janice Rogers Brown. I think Ms. Brown would be an excellent nominee (she's a lot more centrist than most leftists give her credit for, but keep in mind her experience is in California where it seems more right wing), but Dean thinks the Donkeys will pull at least a short filibuster on anyone following Roberts to satisfy their base. Additionally, keep in mind that it hasn't been all that long since we here in California recalled Rose Bird and her two minions from the California Supreme Court, all of whom must stand for periodic re-confirmation from the public. As I recall, Ms. Brown beat back such an attempt on her career a few years ago. A conservative demogogue could not have survived any serious recall effort - California as a whole is way too liberal for that. If Rose Bird had been even vaguely reasonable, she would never have gone down to defeat

Justus for All has more on Roberts and the likely aftermath. His conclusions match mine.

Below the Beltway also agrees.


Jihad Watch talks about hard liners in Iran consolidating power. I think they're circling the wagons, trying to hold off revolution and the United States long enough to develop nuclear weapons. Not to put too fine a point on it, with democratic Afghanistan and Iraq to either side, the theocracy in Iran is doomed without some kind of trump card.


Chapomatic has a worthwhile suggestion for those wishing input into the US political process: have your country apply for admission as a state. Face it: if the US is so powerful that you find yourself withing to be able to vote for our leaders, this says something good about our system.

Or to revert to lowest common denominator language: If you want a say, you have to agree to abide by the results.

HT to Enrevanche


Ogre has a point in regard to forceably evacuating even those who aren't victims of Katrina. A very palpable point. If you're going to pull anything "state of emergency" you have to limit it to places where there actually is an emergency. If there's no threat to her, she's getting supplies, and she's not bothering anyone, leave her alone. Can you imagine them pulling this excrement on Paul over at Wizbang? Enoughfirst level readers there to make it uncomfortable for anyone, and with the second level links of people who go there all the time, enough to make it an act of slitting your own throat. What's the difference between the two? Well, nothing, really, once the story starts making the rounds. The one would just get off to a faster start than this one did.

On the plus side, looks like Louisiana Libertarian is going home to Slidell. He likes what the President said, and castigates the Louisiana governor for empty words.


Part of an old debt repaid: Target Centermass covers the dedication of a memorial to those who fought in the Battle of Britain.


Watchful Investor has a worthwhile post on Greenspan and the fiscal situation. I disagree on some particulars, but the whoe thing is well worth reading, and I'm too tired to articulate well my disagreements.


I suppose I should apologize for light apparent activity. I just got too stressed out these last two weeks with trying to run two businesses (one a pre-start-up) in only five hours a day left over from childcare that some other things fell by the wayside, and this weekend I mostly fell apart. Starting tomorrow, the childcare situation should be abated so I hope for more time and activity here.

Yeah, Joe Biden has that effect on me, too.

Seriously, Dread Pirate Judge Roberts appears to be doing well in the hearings. Not that he has any serious or principled or intelligent opposition.

Captain's Quarters has a good analysis of what's gone on in the hearings so far.

Volokh Conspiracy has a spot-on editorial about Roberts, the senators, and politics.

Althouse has a worthwhile article on the hearings as she sees them.

SCOTUSBlog (has more for some reason they put it there rather than the SCT Nomination blog)


Google has a new blogsearch function. I'm not impressed.


The three year anniversary of Carnival of Vanities is up.


Captain's Quarters dissects the 9/11 commission on Able Danger.

Strata-Sphere has another take.

Speaking of the War on Terror, Jawa Report has more on the situation in Iraq, including a declaration of jihad on all Shia Moslems, plus executions for apostasy. I've talked about this. Victor Davis Hanson has talked about it, Bill Whittle has talked about it, all varieties of people from all points on the political spectrum have talked about it. If you don't know about it by now, you aren't paying attention. Islam does not recognize an ability to leave the religion. Islam does not recognize (in any sense that would matter if Islam were victorious) an option to remain apart from their religion.

While you're at it Mudville Gazette has any number of fascinating things on the military side of things. Just click on over and keep scrolling down. Also, If you missed his post about "You make the call - if you've got the guts" having to do with Katrina second guessers, he's got an update up.


La Shawn Barber takes on illegal immigrants and those who would accomodate them. Of course, this would all go away with meaningful employer sanctions. But Americans do not appear willing to give up their cheap manual labor.

With this in mind I realized it had been a few days since I visited The Immigration Blog, which has some interesting insights.


Jihad Watch has a story on a minor but telling point of CAIR's antics: Photoshopping for official effect.

Jihad Watch also adds more evidence to the scale against those who continue to believe that Israel is the problem. I realize that most of those folks are intentionally blind to evidence against them, but let's keep piling on.

HT to Michelle Malkin


La Shawn Barber notes some signs of civilization decline. For the record, I disagree with her about homosexuality. It isn't wrong, just different. Her history also has some gaping holes in it, which Dean's World drives some rather impressive trucks through. Other than that, she has some very valid points which Dean does not debunk. Yes, the Romans did everything under the sun, sexually, whether they were married to others or not. That's not the point. The point is that marriage as an institution was respected. Marriage was regarded as the institution in which to bring up healthy young citizens. One set of two parents, together raising the children. Marriage was regarded as an ideal to be aspired to, whatever else you did sexually before during and after. I do not believe the state should have any significant involvement in marriage (implied general power of attorney and implied inheritance and rights to assets in the case of death about covers it), but that doesn't mean that society should not regard marriage as beneficial, to be encouraged, and something that we should be very careful about extending any benefits which we have seen fit to extend it to adherents of other institutions meant to tear down, replace, or redefine an institution which has been the greatest constant in all great human civilizations since the dawn of time.

With that said, the sign I see that worries me most is that too many people are out after the welfare of their own sub-group, first and foremost. Very few champion the overall benefit of the United States of America above that. And I don't mean mouthing platitudes. I mean where the rubber hits the road, giving up something (or not asking for, or opposing) goodies to your individual or subgroup's benefit so that the entire country may be better off.


Michelle Malkin has the goods on a second Air America officer at Gloria Wise.

Radioblogger asks some questions, and deserves a link anyway for his part in Malkin's report.

It is no longer a credible contention that it was "just one person" doing all this stuff. It was organizational.


Armies of Liberation has all kinds of good stuff on Yemen. I can't pinpoint one post as especially worthwhile, so just hop on over and keep scrolling down.


Roger L. Simon makes a heck of a good point about what you should do if you really want to abolish world poverty. One world leader has made the proposal. Want to guess who? No fair looking first!

President Says Iran Willing to Share Nukes. Read the article. Basically it has him saying "We don't have them and we don't want them but we'll share them with our fellow Muslims"

One response to this is not to choose not to confront them over the mere acquisition of nuclear weapons. That seems to be the way europe wants to handle it. That way leads inexorably to Iran, an intolerant theocracy run by jihad preaching mullahs, having nuclear weapons, and if the story today is to be believed, to every other Islamic nation as well. I don't object to Turkey having them, but that's about the only Islamic nation with a significant history of acting like a civilized nation in recent memory.

A second response would be active confrontation. Stop or we shoot. The US could topple the regime in Iran, and I believe the Iranian people would even be grateful for the most part. However, there would still be a twenty year civil war there that made the one in Afghanistan look mild. Europe could do the same if they had the will, which they don't. A broad alliance for the purpose would

drastically reduce the civil war, but the public in either the United States or Europe hasn't the patience to support it at this point.

Third response would be to say, "We believe you but we still want to verify that you're not creating nuclear weapons." If anybody actually believes this, I own some dry land just outside the New Orleans levees. Nonetheless, we can make it the pravda, official truth, if we and the rest of the developed world are willing to enforce real inspectors, who unlike the Iraqi ones of the last decade have a right to go anywhere any time with zero notice, upon the Iranians. Furthermore, it would take an automatic and binding agreement to undertake any necessary corrective action if violations are discovered. Cost: significant and continuing, but not as much as a war. Nor do I believe the Iranians would agree (we wouldn't), but it might be worth trying just to see if they're willing to do anything to back up their claims of not wanting nuclear weapons. Refusing this would strip away any pretensions they have.

The final option is pretend we don't see. Bury our heads in the sand and hope it goes away. The result? Within a few years, Iran has nuclear weapons, and if the article is to be believed, so does every other islamic nation. What happens then? Our options in responding to them get a lot more difficult and scary, and it stays that way forever. It is entirely within their expressed and espoused philosphy to give a nuclear bomb (or several) to terrorists, and disclaim responsibility with an "Oops! Clumsy me! They managed to steal/hijack them!" defense. It serves their expressed goals of carrying Islamic society to all corners of the globes, and weakening other civilizations who do or might oppose it.

Option two and Option three are "Right now" options. We must execute them prior to Iran gaining control of nuclear weapons - within five years at most. That I believe the Iranian theocracy is doomed unless they acquire these weapons is a side issue. If they hang on long enough to acquire nuclear weapons, they can suppress revolution with thm, or the threat of them. Unlike the people who pulled the attempted coup that killed the Soviet Union, the theocrats will use weapons upon their own people rather than give up power.

Option one and the similar option four give us some time, at the large and longer term cost of needing real defenses against nuclear weapons, either by ballistic or smuggler's delivery. Furthermore, the fact is that we are further away from a reliable defense than they are from the weapons. There will be at least a window where we have defenses clearly insufficient to the task. I'll admit that the idea of letting a theocratic state of terrorist sponsors have nuclear weapons doesn't sit well with me, either.

These are the only options I can come up with. If you think you've got a fifth option (or a sixth, seventh, etcetera), speak up.

So what's it going to be? The time to have this discussion and make this decision is now. Otherwise, we're choosing option one or four (they're differentiated mostly by nuances in our attitude) by default.

Minorities get higher rates.

They add that the fact minorities are more likely to borrow from institutions specializing in high-priced loans could mean they are being steered to such lenders or that some lenders are unwilling or unable to serve minority neighborhoods.

This is called redlining. It is illegal. HUD really gets their panties in a bunch over it, too.

One thing that the article explicitly said: This does not include/compensate for credit scores. Working with people in the flesh, I have experienced the fact that there is a difference between how various groups handle credit. Often, the urban poor have some difficulty in meeting the requirements for open and existing lines of credit. Often, they are more poorly educated about their options or think they're a tough loan when they're not. This extends into the general population, although it's less prevalent. I have a friend I went to high school with. He and his wife make over $160,000 per year between them in very secure jobs they have held for over a decade each. Their credit score is about 760. The loan officer they were originally working with told them they were a tough loan to try and scare them into not shopping with anyone else. The reality is that the only question is what loan is best for them because they easily qualify for anything reasonable. This is far more common than most people think. The current standard is that if you have two or three open lines of credit and your credit score is above 640 - sixty plus points below national average - I can get 100 percent financing, and the possibility doesn't disappear completely until you go below 560 (whether it's smart is a question for the individual situation, but I can get a loan done if it is). With increasing equity, I can usually get a loan done even for credit scores below 500 (two hundred points below national average!). Now, the better your situation, the better your loan (e.g. rate, terms, closing costs, etc.) will be, but the question is not usually "Can I do a loan for these folks?" but "Can I find them better terms than anyone else?" and "Should I do this loan or is it really putting them in a worse situation than they're in?"

Quite often, the loan provider that urban poor go to is the one who advertises where they see it - basically, the lender who chases their business. They think "This guy wants my business. He does business with people like me all the time. He can get me the loan." The problem is that all too often, this loan provider has chosen this market precisely because the urban poor do not understand they've got other choices, and do not understand effective loan shopping, and so this loan provider makes six percent (the legal limit in California) on every loan plus kickbacks and arrangements under the table. They make more on one loan than I do on half a dozen for roughly the same amount of work, and the loan they do are not as good for their client as others that can easily be found.

Most people are better loan candidates than they think they are, and qualify for better loans than they think they do. It's more often the property they have chosen that creates an untouchable situation than the people themselves. Even then, there are usually options available.

(I got a ten minute lecture a few months back from a nice young couple telling me they "deserved" a rate of four to five percent on a 100% loan for a manufactured home sitting on a rented space. Well, if it had been on a regular house sitting on owned land I could have gotten them that loan on very desirable terms, but nobody does 100 percent on manufactured homes, and if there's no ownership interest in land involved then it's personal property, not real estate, and it becomes essentially a personal loan, for which the rates are much higher.)

So keep this in mind if and when you're in the market for a real estate loan, and shop hard. Remember that all of the times your credit is run in a two week period for mortgage purposes only counts as one inquiry, whether it is just once or whether it's five dozen times. A loan provider does not have to run credit themselves to get a quote, but the information must be complete, accurate, and in a form they can use.

Keep in mind that the loan market changes constantly. A quote that's good today almost certainly will not be good tomorrow. If it's not locked, it's not real, and a thirty day lock is not valid unless extended on the thirty-first day, for which you will pay an extension fee if necessary. So shop hard, with a real sense of urgency, get it done quick, and make your loan provider get it done quick. Any additional stress will more than pay for itself (and the longer the loan takes, the greater the opportunity for stress, too). Sight unseen, I can bet money that a loan done in thirty days from the first time you shop or lock is a better loan than the loan that takes sixty days or more.

Caveat Emptor


Most people tend to shop for a mortgage based upon the payment. They figure the lowest payment will be the cheapest loan.

This is the way most people make banks rich. Because they are looking for the loan with the lowest rate and the lowest payment, they choose the loan with two or three points that's going to take twelve years to pay for its costs, and then after they've sunk all those costs into the front end of the loan, refinance within two years and sink a whole new set of costs into the loan. The bank gets all this lovely money, and then the consumer lets them off the hook by refinancing, and the bank doesn't have to carry through on the full amount of their end of the bargain.

In point of fact, when shopping for a mortgage loan, there are at least four factors the consumer should consider. The best loan for a given consumer in a given situation at a given time is based upon all of these factors. Each varies in importance from loan to loan.

These factors are:

The monthly payment

The monthly interest charges

The costs that are sunk into the loan in order to get it

How long you're likely to keep the loan.

This is not to say that only these factors are of importance. For example, the possibility of "back end" costs when you refinance is likely to be a critical factor when considering a loan that has a prepayment penalty. If you know there's a good chance you're going to get hit with an $8000 charge for paying it off too early, that needs to be added into the likely costs of the loan.

The monthly payment is important for obvious reasons. If this is not something you're comfortable paying every month for month after month and year after year, then getting this loan is probably not something you should do. The costs of getting behind in your mortgage are significant, and the costs of going into default are enormous, and both may likely continue even after you have dealt with them. I talk with people all of the time who say, "We've got to buy something now, before it gets even worse!" Many agents and loan officers will happily put someone who says this into a home, with a loan payment that looks affordable on the surface, but isn't. If you don't examine the situation carefully, you're likely to be getting into something you cannot afford, and is likely to have huge costs and ramifications for years down the line. Neither of these people is your friend. They are each making thousands, often tens of thousands of dollars, by putting you into a situation that is not stable, and that you're going to have to deal with down the line, while they're long gone and putting some other trusting person who doesn't know any better into the same situation as you. If the situation is not both stable and affordable, pass it by.

With that said, the monthly payment is usually the LEAST important of these four factors. As long as it's something you can afford, do not charge straight ahead, distracted by the Big Red Cape of "Low Payment" while you are being bled to death by other things. Many of these Matadors (which means killers in Spanish) will bleed you to death while acting like your friend by distracting you with the "affordable low payment". Due to lack of a real financial education in the licensing process, a disturbingly large number do not realize they are bleeding people, but that doesn't help their victims. A loan payment that is higher but still affordable may be a better loan for you - and in fact this is more likely true than not.

The three other factors are each far more important than payment. Payment is important. People who are unable to make their payments are called insolvent. Many of them file bankruptcy, have liens placed upon them, wage garnishments, suffer for years because of bad credit ratings, etcetera. But just because the cash flow is better right now does not mean the situation is better - that way lies the Ponzi scheme, Enron, and many other famous wrecks in the financial graveyard.

There is no universal ranking of which of the remaining three is the most important. They must be compared as a group in the light of a given situation: YOUR situation.

The monthly interest charges are simple. Principle balance times interest rate. This starts at the amount of the new loan contract (with all the costs added in, of course) times the interest rate.

The costs sunk into the loan shouldn't be any more difficult to compute, but they are. As I have gone over elsewhere, it is an unfortunate fact that rarely does a mortgage provider tell the entire truth about the costs of the loan until it's too late to do anything about it. If you have an ethical loan provider, the amount on the Good Faith Estimate (or Mortgage Loan Disclosure Statement here in California) should match what shows on your HUD 1 at the end of the process. Please remember to note any prepayment penalty or other back end charges as a separate dollar amount.

The thing that is most difficult to determine is how long you intend to keep the loan. Most people have no reliable crystal ball to gaze into the future.

The obvious answer to this dilemma is to compute a break even point. This completely falls short with regards to higher costs incurred after disposing of the loan as a result of having a higher balance, but it's a start. If one loan has lower costs and a lower interest rate, there's no need to go through the computations. But if as is common, one loan has a higher sunk cost and the other has a higher monthly interest charge, divide the difference in sunk costs by the difference in interest charges per month. This gives a figure in months that is a break even point. Don't forget to add in any possibility of a prepayment penalty.

With this breakeven figure in months, you can calculate which is likely to be the better loan for you, using your own situation as a guide. If the breakeven is 54 months and you're being transferred in 36, the answer is obvious. If you've refinanced at intervals of twenty-four months your whole life, a 54 month breakeven is not likely to be beneficial. If you're going to need to sell in two and a half years when mom retires, that's a clue, too. And if you're a first time homebuyer starting out, remember that 50% of all homes are sold or refinanced within two years, so unless you have some reason to suspect that you are likely to be different, take that into account. Far too many people waste thousands of dollars regularly by paying the up-front costs for loans that they will not keep long enough to break even.

Caveat Emptor



Due to re-thinking of exactly how I want stuff to go, the main address of this site will be moving over to That is, everything is the same except the extension, .NET instead of .COM Everything else will remain the same. I have staked a claim to both domains, among other extensions. I've checked and except for some minor counters and feeds, it all seems to be working the same, and I will change those over the next few days.

I've decided I want the .COM address to be the main URL for the commercial site that will be developed over the next month or so. The .COM extension will continue to bring you here until the commercial sister site goes live, and there will be a link here even then (we are talking sister site). The original target date was October First, but it appears that's going to have to slip due to factors beyond my control. (The important thing is for it to be right the first time when it goes live).

For those with advertising, you might want to email me specifics about your traffic and your rates. When the sister site is ready, I'm going to want to do some advertising.

(Word to the wise: Don't trust Sitemeter statistics! I just had a conversation with Chris at Powerblogs, my host for this site, and between the code and his assurances, let me say that compared to his logs for my site usage, Sitemeter is at least a factor of ten low every day. Maybe I've got it set up wrong - I'm not a real techie by any stretch of the imagination, but Chris's data is much more convincing)


A sad day has arrived at last. Chrenkoff signs off.

The Good news is that Good News Central is picking up where he left off in providing us our counterbalance to the police blotter of the legacy Media. I added them to the roll on the right.


Michelle Malkin takes on those playing race baiting politics of the disaster in the Gulf for personal gain. You want despicable? She shows you despicable. "My people" are determined by whether or not they act like responsible adult american human beings. I'm proud as hell just to be part of the same species as this young man. I'm ashamed to be part of the same species as Jesse Jackson.


Syria next? Captain's Quarters says that the US Ambassador has told Syria that we're getting tired of them encouraging terrorists, allowing them to train, etcetera. I (and others) have been wondering if Syria is our next project in the War on Terror since Libya decided to clean up its act. It's no good cleaning up every fever swamp but one, and Iraq is far from the last.


Carnival of Liberty is up! Recommended: Critical Mastiff


Willow Tree asks the question: If this is peace, what is war?

The short answer is that this is war, but those who live in denial, and would have Israel live in denial because it makes their lives easier, have made this into a mockery.

Given the events of the past sixty years, I'd support Israel if they decided to conquer and displace the Palestinians once and for all. Certainly the Palestinians have done their best to convince us that ethnic cleansing is their highest ambition, and Israel has shown more restraint than any human or group of humans should be asked for. No one should have to endure daily attacks. No country's soldiers should be under fire without the ability to shoot back in the manner they deem most effective.

The Palestinians and their leadership have convinced me that the only peace Israel will ever have with them will be that of the grave. Since Israel has proven itself capable of coexisting with civilized human beings while the Palestinians have shown themselves incapable, I'd rather the grave involved was of the Palestinian ambitions than that of the Israeli state and people. Call me callous, call me horrible, call me monster. I do not care.


Watchful Investor has a good piece on Life Expectancy. Mine comes up to 88, which barring greater than expected advances in medical technology is almost certainly an overestimate.


Unrepentant Individual has a good post up about the FAIR Tax and "starve the beast!" libertarians. Speaking as a "starve the beast (at least in most ways)" type myself, I agree with him. The way to starve the beast is change the political concensus, not to avoid growing the economy. Okay, so the government gets 23 cents of every dollar (I think the number is larger, but I'll use his figures); I still get to keep the rest. So I'm better off with that dollar than without.


Tom Rants has an article from September 10th here about a company requiring payment for a house flooded in New Orleans. Yes, Fannie and Freddie have given an automatic three month extension but that doesn't apply to loans held anywhere else. For many lenders, three months of no cash flow could be a real problem, and nobody is looking out for whether said lenders can pay their bills. I haven't worked in those states but in the states I have worked in, foreclosure takes at least 90 days, and that's from when they start foreclosure, whcih means they're usually 90 days past due at least. Regular lenders do not want to foreclose - they're in the business of home loans, not home sales.

Lest you not understand, there are no free rides anywhere. The unpaid interest from those people who aren't making payments is not going away. Somebody's going to pay it. Those who had good credit and had Fannie or Freddie buy their loan are sitting pretty from a cash flow situation, but that doesn't mean it's a good idea not to pay their loan, just that they have that option.

And not all lenders are susceptible to public pressure. If they buy their loans on the secondary market, you can't refuse to do business with them.

Well, time for me to go get the Hilda! Minimum day every Tuesday.

Michael Yon has a new article up on Lieutenant Colenel Kurilla's convalescence. He makes some good points that from recent polls need to be made for the twenty millionth time.

Victor Davis Hanson dismantles moonbattery in a series of responses to mail he's gotten.


Captain's Quarters has a good bit of research on the city and state's plans and lack of adherence to same.

Captain's Quarters also has an excellent article linking Jack Kelly in the Pittsburgh Post Gazette. By any objective measure, the response from the federal government has been excellent.

Louisiana Libertarian has another dispatch. If you're unaware, he was one of those who evacuated Slidell ahead of Katrina.

Wizbang has some thoughts about what a good job was done in responding to the Hurricane and levee breach, and by and large, I agree. He uses the metaphor of a 1 hitter in baseball, which I'm not sure is accurate - more like a 1 run game, which is still pretty good (how many pitchers in baseball have an earned run average of 1.00 or less?), but you don't want anybody scoring on you, whether you're a pitching a game in baseball or responding to a disaster. When I was a controller, I used to use the metaphor of guys on base for little mistakes or sitations that needed to be cleared up, and runs against for allowing it to build into something perceivable by the public. The situation here is a little more critical and less controllable than that, but the analogy holds.

Seems my prediction here was correct. Insurers say Katrina losses worse than expected. This is usually homeowner's insurance speak for "we didn't price major disasters into our policies"

Asymmetrical Information debunks some more myths, in this case that of smarmy europeans.


Armies of Liberation has a post up about the political opposition to the regime in Egypt and Yemen. There's another about the Yemeni Parliament starting to chafe at the bit.


Dean's World has some thoughts on the War in Iraq along the lines of what I wrote yesterday.


Just threw another negative amortization loan wholesaler out of my office. With the softness in the real estate market here in California, those lenders with any sense are backing off on these, so I hadn't seen any of them in a while. After all, a loan where they add more to existing balances every month may not be a good idea where it's likely the house will sell for less than it was purchased for. Just one more example of the power of Denial, I suppose.

I'm sorry, but I'm out of time for today. Recommended Reading for RINO Sightings and Carnival of Personal Finance will have to wait.

Stealth "Cash Out" Loans

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One of the things I hear a lot is that people are getting cash in their pocket from a refinance rate where there is no rebate. "I'm not paying any closing costs!" they proudly tell me, "The bank is putting money in my pocket."

Chances are that's not what's going on. In fact, when the client gives me the chance to investigate, I find out that they are paying huge fees, which are all being added to the balance of the mortgage. But what they remembered was that the lender was also going to give them $1200 or $1500 in cash and add that to the balance on top of everything else.

For "A Paper" loans, Fannie Mae and Freddic Mac define the difference between a cash out and rate/term refinance. On a rate/term refinance, a client can have all costs of the loan covered, both points if any and closing costs. A client can have an impound account set up to pay property taxes and homeowner's insurance out of the proceeds. They can have all due property taxes and insurance paid. The client can have all interest paid for 30 or 60 days. And they have put up to one percent of the loan amount or $2000, whichever is less, in their pocket. In addition to this, of the old lender had an impound account, the client will receive the contents in about 30 days.

Let's say you have a $270,000 loan on a $300,000 home - small for most parts of California and some other places, but large for most places in the country.

Here in California, yearly property taxes would be about $3600 on that. Insurance is about $1000 per year, monthly interest is $1237.50. I'm writing this in September, so if you finish your refinance today, your first payment would be November 1. You'll make five payments before both halves of your property tax are due, and they want a two month reserve, so 12 months plus 2 months is fourteen months minus five months is nine months reserves they will want in property taxes. $3600 divided by twelve times nine months is $2700. Let's say Insurance is due in April, so they'll want eight months of that. $1000 divided by twelve times eight months is $666.67. Plus two points and $4500 in closing costs the lender charges, and they actually may have told you about it, but they emphasized the cash you are getting in your pocket so that is what a lot of people remember.

Even without the cash out, this works out to a new loan amount of $270,000 plus $2700 plus $666.67 plus $1237.50 plus $4500 plus two points which works out to $284,800 as your new balance without a penny in your pocket. If they gave you $1500, your new balance becomes $286,330 (remember the two points apply to the $1500 also!) which will probably be rounded to $286,350. Subtract $270,000, and they have added $16,350 to your mortgage balance but hey, you got to skip a month's payment and got $1500 in your pocket!

As I have said elsewhere, however, money added to your balance tends to stick around a long time, and you are paying interest on it the whole time. Furthermore, lenders love this because their compensation is based upon the loan amount. All because you allowed yourself to get distracted by the cash in your pocket. This is fine if it is what you want to do and you go in with your eyes open, but chances are if someone were to tell you "I'm going to add $16350 to your mortgage balance to put $1500 in your pocket and allow you to skip writing a check for one month!" you wouldn't agree to do it. Even if the rate is getting cut so your payment is $75 per month less.

For loans lower down the food chain (A minus, Alt A, subprime and hard money) the lenders set their own guidelines on what is and is not cash out, but Fannie and Freddie's definition is more strict than the vast majority.

So when somebody tells you they are going to put money in your pocket as part of the closing cost, ask them precisely how much is going to be added to your mortgage balance. Print out the list of questions in this, and ask every single one. Because chances are, they are trying to pull a fast one, and once you are signed up, they figure they have you.

Caveat Emptor


Michelle Malkin has an excellent round up of links to 9/11 memories.

On the evening of September 11, 2001, I posted an essay to a listserv of a science fiction club which I was attending at the time. In it, I talked about some of the warnings we had had over the years, and the changes to our mindset necesary to prevail over those who had done this. I touched only very lightly on the need for a certain degree of unity among ourselves, thinking it should be obvious to anyone with any grasp of history what happens to a people with factions willing to do anything for political gain.

I was wrong. Judging by the evidence, the average american has never heard of Bosworth Field or Manzikert or any number of other historical situations where members of a society seeking political advantage over another member provided the wedge for outsiders to bring the society low and eventually destroy it. It is all very well and good to campaign based upon who will do a better job. It is something else again to continually hound and vilify your leaders, denigrate their decision making, require that they sat a "timetable for withdrawal" (for the terminally clueless, withdrawal means retreat) thus telling out enemies that they only have to hold out until a certain date. Last I checked, we still have bases and troops in Germany and Japan and we haven't fought either of them since 1945.

I've often speculated on how the societal inability to carry extended projects to completion is rooted in the rise of the 30 or 60 minute television program, where the situation at the end of the program has all been resolved due to some artifice of the writer and everything is exactly as it was at the beginning of the program. This is the generation that crippled President Nixon's attempts to deal with the Vietnam situation because they presumed when he said he wanted to end the war he would just wave some kind of magic wand and the troops would all be out by dinner time on Inauguration day just like on their favorite TV program.

I've linked Bill Whittle's essays over at Eject! Eject Eject! before. If you haven't, I suggest you read all of them. In his most recent, Tribes, he talks accurately upon the unwillingness of the sheep to believe that there really are wolves in the world. People are both profoundly lazy, and at the same time want to believe that they are safe, regardless of whether or not they are. It is easy to pretend you don't see clear evidence that there are people in the world who will do anything to get what they want, and who do not care if they hurt others in the process. Some of these want direct personal power (Hitler and Stalin come to mind, and Mugabe and Kim today). Others want their pre-eminence and worldly dominion for their religion (Savanarola, Torquemada, and Mohammed historically, Khameni and Bin Ladin today) and personal power may only have been a byproduct of that.

The more I look around and consider the situation, the more convinced I am that the die-hard left of today is different only in degree, not in kind, from these individuals and their followers. The immediate "don't question my/his/our patriotism!" before anybody has is only the first confirmation. Many times I have seen them throw this out when nobody has questioned their patriotism, only their judgment. There is a line out of Shakespeare, "The lady doth protest too much," which deals precisely with this sort of situation.

Well for me, that all ends today, right now. Everybody has a right to wonder at others motivations, and should have the ability to speculate as to the true causes and roots of motivation for this. When every action you undertake supports a hypothesis of "You seem motivated to sabotage the current leadership of the United States no matter the cost to your fellow citizens and our military and our long term well-being as a country", that is a mindset of treason, and whether or not the actual crime of treason has been committed, should be noted and broadcast so that our fellow citizens are aware of your predilections.

Criticize the mistakes of the administration all you want. That is your right under the Constitution. I myself criticize the administration on several fronts (immigration, spending, trade policy, etcetera). I'll criticize needless mistakes in the War on Terror as they occur, but keep in mind that this is a war, and the next war where there are no major mistakes made will be the very first in the history of all the world. In the War on Terror, this administration "gets it" in a way that I can't point to in any back to at least Truman, and before him not back to Lincoln. Trying to undercut them on this one point puts yourself on the same moral level as Ducas at Manzikert. He got power out of it, but destroyed the Byzantine Empire just as certainly as if he'd overrun it with a Mongol horde. Whether you like it or not, we are committed to this war. If we stop prosecuting it to the maximum and most effective level, we will lose troops and fight (and lose) battles that we otherwise wouldn't. If we don't fight it effectively enough, the real fundamentalist hordes will take us over, compared to which Pat Robertson and his ilk are but ill-behaved children to compared to true psychopaths. If you love our artwork, look at what the Taliban did to Afghanistan's. If you love high culture and civilization, compare modern day India to Pakistan, and consider that they were one society until the British left and placed the Hindus in charge of one and the Muslims in charge of the other. Consider what Pakistan did to what is now Bangladesh until India intervened. If you love female equality, look at how it exists in Iran today. If you love the ability to dissent from official truth, look at how it existed in Iraq under the Ba'athists, and contrast with how it exists in the same place today. If you want homosexuals to be able to participate freely and openly in society, look at anywhere in the Muslim world, and compare it to here, where various cities host quite "in your face" gay pride festivals and it is those who would sequester homosexuals who are marginalized to the shadows. If you love the ability to ignore what the priest who may not even be of your religion says, look at what happens here versus what happens in Iran, or Saudi Arabia, or even Indonesia. These vermin are saying exactly what they want to do to us, and if they don't want to actually do it, then I must say their actions belie this desire.

To ignore the evidence that the War on Terror is necessary is to go beyond an inability to see, to an unwillingness to see, or hear, or even consider. Anybody who tries to sabotage the War on Terror is not my friend, nor are they my children's friend, and they are definitely not my country's friend. Our ways, the very ways they are trying to end, require us to allow them to talk. But those same ways allow me (and others) to point out these facts as well; censorship is denied not only for me but also for thee.

And your attempts to shame or guilt or intimidate us into silence tells me that you can't meet us on the ground of open debate, either. But only sheep think that way, and those of us who support the President in the War on Terror are not sheep, not matter how much it may comfort you to think it so.

Well, the Do-not-call violations have slowed down. The browser window is still open today, though. I'm sitting at 36 calls, 31 complaints filed, including one guy who evidently did not understand what I told him and called back to solicit me again, and so got turned in twice for two solicitations. He and another guy whined about how could I be "so callous to a fellow agent". Very simple. This exactly is what the Do Not Call list is about. I don't see where I should be any softer on a guy looking to make thousands of dollars per transaction for themselves than the company paying a ten dollar an hour telemarketer hoping to make fifty. In case you're unaware, I can find predictive dialers (what telemarketers use) in most real estate and mortgage offices, as well as other places. If anything, the requirements for big transactions should be tougher, as the guy looking to make the thousands of dollars per transaction needs to check fewer numbers to make the same money. The Do Not Call lists are equally available, and I happen to know that most of these companies subscribe. The State of California makes certain you know about the requirement. The violations are willful - they didn't accidentally dial my number. I let the ones who did not explicitly solicit me off the hook, and I did not lead any of them into soliciting me. My exact question was "What is this call about?" and let them take it from there. It was their decision to solicit my business when they clearly should not have.

Personally, I find cold call telemarketing somewhat repugnant, and wholeheartedly support the do not call list, as you might guess. I have made a choice not to telemarket, despite the fact that it is the most cost effective method of gathering business. If I did telemarket, I would want to check every number before I dialed.

I'm also fed up with professional incompetence and misrepresentation in this field. Agents and Loan Officers promise clients something that can't be done, and they know it can't be done, or they make promises that are not theirs to make. Some of these are truly outrageous claims, not just marginally impossible but out of the solar system in which possibility is found. Clients who don't know any better believe them. I haven't heard of anyone literally promising the moon yet, but I wouldn't be surprised if I did. The reason this happens is simple. Homes are an emotional issue for most people. Getting people to sign up with you is usually all about being personable and charming and promising a Bigger Better Deal, not whether you can actually deliver. Agents and Loan Providers can blow all the pink smoke they like out of their hat which is in the immediate vicinity of their tailbone, and the client signs up. Then they basically welsh - they either fail to deliver what they told the client they would in order to get them to sign up, or they deliver it with an ungodly GOTCHA! This is not coincidence. Demons did not possess them and force this person to give out wrong or bad information. Demons most certainly do not do it on a repeated basis (like every time they talk to a prospective client, by an amazing coincidence). It is either incompetence or deliberate misrepresentation. In either case, it needs to stop. It is rarely a lie that they can be accountable for in either the legal or civil sense, so they see no reason not to do it. No loan officer can ever guarantee a loan will go through (only an underwriter can do that). But we can give a guarantee that if it goes through it will be on a given set of terms (assuming the client tells the whole truth and nothing but). If I can eat the difference when I'm wrong (which isn't often), and I'm down at the low end of profit margin (which I am), somebody who makes two to three points on every loan and every sale certainly can. And they can certainly check the do not call database, rather than relying upon an appeal to pity. "I'll never do it again! (Until next time) Please don't turn me in!"

I want to call them twits, but that would be insulting the twits of the world. They are lazy vultures, which means I wouldn't be giving them any of my business anyway.


Captain's Quarters has an article about the difficulties Christians are facing in the West Bank. First glance, I agree that it looks like what would have been called a pogrom in Russia a century ago.


Seems to me as if all sorts of things are seriously out of whack. I've been checking the RINO and LLP blogrolls today, starting with what Blogrolling is telling me are the most recently updated. Some are updated. Some are days old while others not showing as recently updated are, including some Powerblogs based which like mine automatically ping Blogrolling. There's always some of this, but it's gotten really bad. TTLB hasn't been updated in over a week, although I can understand that due to the Katrina efforts he put in.


Neat! Astronomers Find Infant Star System. I suggest reading the links out of the article to other stuff as well.


I think that Israel means it, folks. Israel Warns Gaza on Any Future Attacks. The only justification for Israel giving the territory up to the Palestinians or for the Palestinians getting control is for there to be peace. If that doesn't happen (Does anyone think it will? Buehler? Anyone?) Israel will be fully justified in permanent conquest or anything else they decide is in their best interest.

The question every good loan officer hates the most is "What is your lowest rate?"

First off, everybody doesn't get the same choices. As I've said before, somebody who can prove they make enough money, has a history of paying their debt, and offers the lender a situation where there's 30 percent equity (or more) gets a different set of choices than somebody who can't prove they make enough money, has a questionable history of paying debt, and wants to borrow 100 percent of the property value (or more).

Second, different loans get different rate-cost tradeoffs. The loan that most people seem to consider the most attractive loan, the thirty year fixed rate loan, is always the most expensive loan out there. It always has the highest set of cost/rate tradeoffs. Why? Because on top of the cost of the money, you are essentially purchasing an insurance policy that says your rate will not change for thirty years. Even when long and short term rates are inverted, as we may see soon, there is a premium charged for the thirty year fixed rate loan. It makes a certain amount of sense; insurance policies are never free, and the thirty year fixed rate loan is the most desired loan out there. Simple economics: Higher demand equals higher price. Goods perceived as more valuable carry a higher price tag. So if you're looking for a thirty year fixed rate loan, and all you say is "What is your lowest rate?" you are likely to get quoted a rate from a Negative Amortization loan, the least desirable loan out there, because it carries the lowest nominal rates. If this is your only datapoint from the various loan providers you talk with, you are likely to do business with the one who quotes you the negative amortization loan, not the thirty year fixed rate loan. Matter of fact, the loan provider who tells you about the loan that you really wanted is least likely to get your business in this scenario, because you're focusing in on the red cape of rate and payment when you should be paying attention to other things.

Third, and most importantly, for every situation and every loan type, there is more than one rate available. Why is this, you ask? It seems obvious to you: Why not just choose the lowest rate, which has the lowest payment? It takes a little examination to see why.

The difference between the rates is in cost of the loan. There will be a rate called par. This is the rate at which the lender will give you the money straight across. They don't charge you any money (discount points) to get a lower rate. They don't pay any of the costs of the loan. Getting a loan done really does take a minimum of about $3400 in costs (actually, the quote is for California, which believe it or not is one of the cheaper states to get everything done in - every other state I've done business in costs more). Whether points and closing costs are paid out of your pocket or added to your mortgage balance, you are still paying them (When shopping for a mortgage, the phrase "nothing out of your pocket" from a prospective loan provider should immediately put you on guard).

For rates below par, you must pay discount points. This is an upfront incentive to a lender to give you a rate lower than they otherwise would. Every situation is different and should be analysed with numbers specific to that situation, but as a rule of thumb: Unless you're getting a thirty year fixed rate loan and you have a history of keeping loans at least ten years before sale or refinance, you should avoid paying points if you can. The lower payments you get, quite simply, are usually not worth the cost of adding points to your mortgage balance. People who don't qualify for A paper may not have this option, but more people qualify A paper than think they do.

For rates above par, the lender will actually pay part or all of your closing costs. It's rare that they will actually put money in your pocket, but it can happen. Note that this is different from a stealth "cash out" loan that adds the cash you get to your mortgage balance, charges you closing costs, and often puts a couple points on the whole amount of your new mortgage, and so where you've been told you're getting $2000 in your pocket, there may be $20,000 or more added to your mortgage balance. This is where the lender is actually paying part or all of the costs of the loan, so it is neither coming out of your pocket nor being added to your loan balance. This is called a "rebate". A rebate can be thought of as the opposite or negative of discount points, and discount points can be thought of as a negative rebate. There are never both discount points and a rebate on the same loan, although there can be origination points on loans where there is a rebate. I think that this is a material misrepresentation, but it is legal.

Now here is the critical fact that most consumers never figure out for themselves, and certainly never realize the implications of: The vast majority of people don't keep their mortgage loans very long. The median age for a mortgage is roughly two years; fewer than 5 percent of all loans are five years or older. If you're the exception, bully for you. Otherwise, take heed and remember this fact: Whatever costs you pay for a mortgage are sunk at the beginning. This money either comes out of your pocket, or goes onto your mortgage balance. If it goes onto your mortgage balance, it sticks around a very long time and you pay interest on it. When you sell or refinance, (or when your rate starts adjusting), the benefits stop. They are over. Done with. If you haven't recovered the costs you paid to get a lower rate by that point in time, you have made a losing investment. Period. End of story. No chance for recovery. Matter of fact, even if you are technically ahead at that point in time, you can go negative later.

Let us consider a $270,000 loan. Very small for California, but large in most other areas of the country. As I said earlier, real closing costs of doing this loan are somewhere in the neighborhood of $3400. Here are some real options that were available from one lender a few days ago:

You could do a thirty year fixed rate loan at par of 5.75 percent. Or you can get a one point rebate at 6.25, or you can pay one point and get 5.25 percent.

Assume you roll any costs into your mortgage like most folks do. Your starting loan balance will be $276,162 if you choose the 5.25% rate. If you choose the par rate of 5.75%, it will be $273,400. If you choose the one point rebate rate of 6.25%, your balance will be $270,666. These are real examples off the first rate sheet I happened to look at.

Let's compute the linear break evens: The 6.25% rate cost you $666 to get. You pay $1409.72 in interest the first month. The 5.75% rate cost you $3400, and you pay $1310.04 in interest. The 5.25% loan cost you $6162, and you pay $1208.21 interest the first month. Difference in cost divided by difference in interest.

6.25% versus 5.75% loan: $2734/$99.68 = 27.42 months.

5.75 versus 5.25 loan: $2762/101.83 = 27.12 months

5.25 loan versus 6.25: $5496/201.51 =27.27 months.

Actually, the break even is likely to come a month or two earlier. But let's compute what happens if you refinance into a 5% fixed rate loan for zero real cost right at breakeven time, 27 months.

The 6.25% loan leaves a balance of $263,241. The new monthly interest charge will be $1096.84.

The 5.75% loan leaves a balance of $265,193. The new monthly interest charge will be $1104.97. The extra money on your balance costs you $8.13 per month, almost $100 per year. Plus you still owe almost $2000 more.

The 5.25% loan leaves a balance of $267,104. The new monthly interest charges will be $1112.94. The extra

money on your balance costs you $16.10 per month, $193 per year, from here on out. Plus you still owe almost $4000 more.

These are actually favorable assumptions compared to the real world in that they treat the 5.25% loan option much more kindly than it deserves compared to the 6.25% loan.

Most people have done this multiple times. $10 or $15 per month doesn't sound like a lot, but do it a couple times and you have $100 per month, and owing tens thousands of dollars more than if you'd gotten a cheaper loan that carried a slightly higher payment in the first place. I believe in offering choices, but I also know which I recommend and choose for myself.

One point that needs to be made again is sometimes costs get built into the back end of a loan, via a pre-payment penalty. Most loan officers will not volunteer whether there is a pre-payment penalty, and many will lie even if you ask, just to get you to sign up, knowing that once you sign up you will likely consider yourself committed. This may not be legal, but it happens, and is another reason to apply for at least two loans, so that you've got a backup option just in case the first loan goes sour or the lender told fibs. Reading the Note carefully at signing of final documents is the only way to be sure that there is no prepayment penalty.

Caveat Emptor


I'm a bit late to the party, but Carnival of The Capitalists is up. Sorry, but I haven't had time to slog through for worthwhile posts.


I've added another resource website to the list on the right: California (and many other states) have a website location where you can look up a real estate agent or mortgage provider's license information (once again, it's the same license in most states). For California, it is You can get to it off the main DRE website, but I had a complaint that it's a pain to find, and the person who complained is correct. Anybody wants to send me the website to check for other states, I will post them there also.


Looks like Schwarzenegger is likely running again. Schwarzenegger to Veto Gay Marriage Bill . If he wasn't running, he likely wouldn't fight this fight.

I have to admit that I'm not certain about gay marriage. For me, it's not about rights, it's about benefits extended that other people do not have, in return for existing in a state whereby children - the state's future productive workers - are likely to grow up to be better, more productive citizens. In short, it's about future economic benefit and whether the state should extend those benefits to gay people who are not primarily about child rearing, and so not often providing those benefits back to the state. I want to see gay people who desire the benefits of marriage to do a better job convincing me that it makes economic sense, and not shilling about "rights."

If you want to get into the issue of whether marriage should be recognized by the state, that's a different question, to which I think the answer is mostly no (I am married with two children, so I think you should see that saying this goes against my self-interest), but that's not where we are, and that's not the argument we're having.

Were the people of the state right to vote to ban same sex marriage? My answer is I think not - I voted against the ban, but - and get this through your head because this is what elections are about, and just because you or I don't like it doesn't mean it's eeeevviiiillll - the majority of the people of California disagreed with me.

So the gay activists, instead of taking their case back to the people in public, tried to put political pressure on the legislature. Well, special interests get their wish from the California legislature every time (and Congress, and every other legislative body that I've ever heard of). This doesn't mean they should get their wishes, especially when the people have directly over-ruled the legislature. This is reprehensible.

Therefore, while I'm not certain about gay marriage in the first place, I want this piece of legislation buried as a matter of governmental principal. The highest authority in the state has spoken, and even though I disagree with the way it went, having the legislature attempt to circumvent the will of the people in this manner (or any other) simply because it's politically convenient or they can score brownie points with one constituency is something that can not be tolerated.

So assuming Arnold follows through (which he has a good track record of doing), I support his veto.


By the way, to all those who keep insisting on bring "Blame person X (or group Y) for the Katrina damage," I am telling you again that I am flat out not interested. Matter of fact, you're getting me angry. This problem has been known for a long time. Everybody who has been in any related office on a local, state, or federal level since at least 1927 shares some of the blame for failing to fix the problem before it happened (If anything, I am less inclined to blame recently elected current officeholders due to lead time required between authorization and funding and actual completion of the work). If somebody wants to fire an emergency management person (or several) for bad decisions made on the crux of the crisis, that's fine and something that should be done. Failing to prepare? There's more than enough blame to go around to everyone. Failing to take proper political steps when it became obvious we'd finally lost the crapshoot? There's time enough to deal with that later. Assigning blame is never an emergency. Rescuing people is.

So, donate money if you can. Physically help if there's something needed that you can do (Email me if there's something people 2000 miles away can do beyond money - I've already given all I can right now). Let's get the people out of harm's way and get the mess cleaned up while we decide what to do. If you're in charge of disaster management, do your job. If you're in charge of those people, fire incompetents or resign yourself if you're clueless as to what to do. Otherwise, SHUT UP!

UPDATE: This is an example of somebody thinking about ways to help.


As a follow up to this post, I am sitting here on-line with the "Do Not Call" website opened in its own browser window today. Seems I had a property listing expire today. In this market, with this kind of property, it happens unless you're priced under the market. No big deal. But the contact number for showings is listed on the "Do-Not-Call" list. So I've had 24 calls (and counting), including two before 8AM, which is a separate violation of the 1990 telecommunications act, soliciting me for the listing. First off, they are idiots wasting their time as the listing says I am a licensed agent. But even if I wasn't, just because a number is listed as a contact for showings does not invalidate its "do not call" status. If you do telemarketing (I never call without a request or explicit permission), you must check each and every number unless you have something from the person involved saying they want you to call. Meanwhile, the property is still for sale. I'm as polite and cooperative as anything to these people until they tell me the reason for the call is that they want to be the listing agent, not that they have an interested buyer. I'm pretty certain that the two I allowed to wriggle off the hook had that as their motivation as well (they didn't make appointments to show), but unless they made an explicit solicitation, I let them go. As of right now I've made complaints about 22 different real estate agents today - including six from the same office - to the Do Not Call enforcement. I did think of (but rejected) an idea of offering not to turn them in for proof of a $1000 donation to the Red Cross Katrina fund, but decided that would be likely be extortion, and so a road better not travelled. But this could be up to $242,000 (and counting) in fines from people who didn't mind their legal and professional duties. It took me all of 20 minutes while I was on the phone with other folks to make the 22 complaints. Think of it as doing my part to defray the federal government's expenses of Katrina while giving people incentive not to improperly telemarket (I could double my income if I was willing to telemarket. I'm not). I don't think there's any provision for people in my position to get compensation, but if I do get anything I will donate it to charity. Hurricane Relief if it's timely, but even if I get something it's likely to be a long way down the line.


Pigilito has a neat link with commentary on large scale evolution.


Tom Rants has a good piece on how Oil reserves are up. There's been a lot of speculation, even before Katrina hit. Lot of people could lose lots of money.


Don Surber has a post about the good we have done coming back.

He also make a point about the limits of the blogosphere. Given the limitations of Sitemeter, I think Don gets more hits than he thinks, but the point is still well made. The blogosphere is where to go to debunk the BS. I spent Tuesday evening with a group of acquaintances. All of them blaming Bush for Katrina in best parrot of MSM party lines. All of them ignorant. I eventually got tired and left what I hoped would be a nice evening of conversation because it wasn't. But these people are mostly internet savvy technical folks. They just want to be spoon fed rather than looking for their news. I'm afraid this categorizes a majority of the population.


Done with Mirrors has another good response to the chickenhawk meme. Of course we are way past the piling on stage, but this is the meme that will not die. Probably because it's adherents will not think.


Sorry that activity has been light. I've got several balls up in the air that I'm not at liberty to discuss right now.

Volokh Conspiracy has a post on the ACLU banning communists in 1940. Pity that they haven't stuck to their guns since.


SCOTUSblog has a good post on why the nomination to Chief Justice was necessary. There is no nominated replacement for O'Connor currently. SCOTUSblog thinks she'll tender an immediate resignation sometime soon; I think we need to wait and see. I don't always agree with Justice O'Connor, but I see her not wanting to leave a vacancy unless she has no choice. This is the same obligation any ethical official feels. Before you go "off duty," the situation must be under control and there must be somebody there to control it when you have gone. That there are other officials doing the same task does not justify dumping your work on them.


Damned Lies and the Lying Liars Who Tell Them: Michelle Malkin blows what's left of Al Franken's cover to smithereens.

Radio Equalizer has part II


Hostage Roy Hallums has been rescued in Iraq! Jawa Report has more!

Victor Davis Hanson has an excellent comparative essay up.


For anybody who still doubts that the Palestinians are the problem in the Israel/Palestine conflict, I suggest reading Jackson's Junction.


Armies of Liberation has more on the lack of progress in Yemen.

I'm back. I took the weekend mostly off, and that turned into a couple extra days due to circumstances. Word to those whose children have yet to start school: NEVER take a school official's word for something until you've got the paper to prove it. I thought something was taken care of and I turned out to be mistaken. I have only myself to blame, of course. Things might be a little unsettled until I finish dealing with that problem but that's life.

I apologize that I do not have a specialty post up this morning. I hope to have something later today, or tomorrow for certain.


Now this lady has the right idea as to how to deal with rape.


It appears that President Bush has decided he wants to avoid an extra fight. Bush nominates Roberts for Chief Justice. If confirmed before the Court starts its session at the end of the month, this means that there are no vacant seats (Sandra Day O'Connor's resignation is effective upon the confirmation of her successor, remember). I agree that Roberts is qualified, and the kind of justice I want to see. The additional difficulty I see is that with only two years as a member of the judiciary, nominating him for the Chief Justice's spot raises a psychological bar. It's not insurmountable - Thurgood Marshall got over it easily. I admit that I do hate to see Thomas and Scalia passed over, but as I said Saturday night, promoting either of them to Chief Justice adds a bruising confirmation battle to the list of problems on the President's plate. Robert's relative inexperience as a judge is really only a psychological problem, not a political one.


Bill Whittle has a new essay up on the subject of our Tribes. Go Read The Whole Thing. NOW!.

He uses a metaphor of "grey" versus "pink" people. I have spent time in both "grey" and "pink" worlds; I have seen the actions Mr. Whittle's words describe. I was a controller for twelve years. The people on the front lines of the FAA are some of the most "grey" people that you will ever meet. They are controlled by "pink" people in the world of politics. The is significant tension between the two, and those who advance off the front lines in the FAA tend to be people who will tell the "pink" people what they want to hear, whether it is the whole truth or not. The FAA has some fine people working for it, but one of these days there will very likely be a disaster brought on by the fact that the "pink" top echelons do not understand that they head a "grey" agency. 9/11 was one small window; nobody told the controllers what was happening, and supervisors refused to kick the alert up off the control floor until it was too late for action.

Since I left that during the Clinton years, I have spent my time in the world of financial planning, and the very "pink" world of real estate. In both cases, the most successful in most circumstances are the people who can blow the most "pink" smoke. They're charming, they act like your friend, they get you to sign on the dotted line because they are so personable, and most of them don't care what happens to you two minutes after they get the commission check. The pink people have been on top for a long time in the real estate world, and we've got a huge looming problem partly because of it. In the investment world, the pink people were completely in control the entire Clinton presidency, and they never really lost their control, they just had to act responsible for a couple of years.

Grey people have it harder in both professions. The reason I quit financial planning was not that I didn't enjoy it (I do) or that I wasn't very good (I was). It was that I tried to give a full and accurate picture. People get nervous when they see the whole picture; they want something that looks like a sure thing and will do business with the person who says they will always make twenty-five percent a year, every year. Well, no matter what I tell you, you are not likely to make twenty-five percent most years. Would you rather do business with someone who tells you the truth or with someone who makes you feel good? But most people who hear the choice between a truthful "average of ten percent per year" and a liar who says "twenty-five percent every year" will choose the liar because it sounds so good and they don't bother to learn that it's BS.

Similarly, in the real estate and mortgage world, you'll hear, "No problem! Buy the big house, you can afford it, and I can get you the loan!" Well, with stated income and similar tricks, the question is not "Can I get the loan?"; that usually only requires the loan officer submitting the the paperwork correctly for the circumstances. The important question is "Should I get you the loan? Is this something you can really live with, or would this put you into an untenable situation?" This is not a question to be asked for my benefit, either as a agent or as a loan officer. It is for the client. Too many have been put into untenable situations in the last several years by agents and loan officers who saw only their commission checks. Only a prolonged period of rapid inflation of real estate prices has made it seem beneficial until now.

It seems to be an inflexible rule that if the "pink" people are left in charge too long, things suffer. But people need to find it out themselves from time to time.


RINO Sightings is up! Recommended: Dean's World debunks the blame game, Politechnical, Tinkerty Tonk, aTypical Joe who adds his observations to some of mine above (and whose desire but inability to serve I have much sympathy and understanding of for a different reason), Random Fate about who is to blame for the disaster (keep reading. It gets better at the end).

But Argghhh! takes the cake for best of a very good carnival by pounding in the real world logistics of what is going on. Speaking as someone who does that sort of thing for fun at a much lower level of detail (and my qualifications are less than his), there are whole areas he doesn't even touch on. Drinking water. Fuel for transport and cooking and heat. Just the evolving picture of where each small group of rescuers needs to go. Go too slow, and people die needlessly. Go too fast, and the whole thing unravels.


Carnival of Personal Finance is up! Recommended: InsureBlog has a post about using an HSA to fund a Long Term Care Policy. I do not believe that Ohio (his state) has a Partnership for Long Term Care, but it's an even better idea in a partnership state (such as California or New York). If you have a partnership for Long Term Care available in your state (CA and NY I'm sure of, I believe NJ and IN are the other two, and that WA and IA have something as similar as they legally can get, coming to the party after the donkeys in the House of Representatives stopped any future plans), a partnership policy is likely to be more important than any tricks and twists for a fully paid up premium in 10 years.


Carnival of Liberty is up. Recommended posts: Kira Zalan, Eidelblog

Sites That Cover Specific Issues


This is intended as one of those resource posts, a list of which blogs and personal websites make a habit of covering certain issues, or a list of "Go To" blogs and websites for various issues.

I intend to update and re-post regularly.

1) Qualifying sites must be updated most days (minimum of about three new posts on different days)

2) You must reliably cover the issue or angle. You don't necessarily have to be out front, and this certainly doesn't have to be your only source of stories, but you've got to make a habit of covering it. If I go look the day after some newsworthy happening relevant to your thing, I should expect to see an interesting, relevant article with something worth passing along.

3) One issue per site may be self-submitted. For multiple issues from the same site, I want a third party nomination.

4) You may nominate another site, indeed, this is encouraged.

5) Third party submissions will be tracked. If I suspect a pattern intended to game the system, perpetrators will be delinked.

6) Those desiring duplicates of the list for their site should send e-mail requests, and indicate if this is a one time request or a continuing request. Hotlinking will be frowned upon.

7) If you are linked, and do not wish to be, all such requests will be honored. If you later change your mind, I will re-link.

8) For issues with swarms of people covering them (politics, military, guns), I require third party submissions in order to link. If, however, you've got a narrow angle on a popular topic, that may be self-submitted.

I would prefer nominations and requests for this be sent to "issues at searchlight crusade dot com". Don't read any endorsement of A over B into the order - it's intentionally alphabetical.

US National Political Issues:


Immigration Blog

Race Relations:

La Shawn Barber

Supreme Court:


Supreme Court Nomination Blog

Tax Policy:

FAIR Tax Blog

2008 Election:

Decision '08

US Regional Political Issues:

North Carolina:

Ogre's Politics and Views

West Virginia:

Don Surber

US Minor Party/Non-partisan Political:


Stop the ACLU

Individual Rights:

Eric's Grumbles

Jacqueline Mackie Paisley Passey

Q and O

Military Personnel:

Mudville Gazette

US Other issues:

General Consumerism:

Consumerism Commentary

Environmental Issues:

Environmental Republican

Financial Market Issues:

Watchful Investor

Financial Planning Issues:

In Cash Flow We Trust

Searchlight Crusade

Gay Issues:

Gay Orbit

Insurance Issues:

Searchlight Crusade

Legal Issues:



Volokh Conspiracy


Dr. Sanity

Real Estate and Mortgage Issues:

Searchlight Crusade


Chaos Manor

Eric's Grumbles

Foreign Politics/Governments:

Australian Government:

Tim Blair

Iraqi government:

Iraq the Model


Willow Tree


Armies of Liberation

Other Foreign:

Authoritarian malfeasance:

Armies of Liberation


Counterterrorism Blog

Jihad Watch

Liberals Against Terrorism

General Resources:


Bug Me Not

Carnival Submission Form




The Truth Laid Bear

Some Vile Misrepresentations

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Two absolutely vile things in the mortgage field that I've heard with my own ears in the last few hours (I'm setting this to post on Monday, but you get the idea). The first, a radio ad, hyping a loan as a thirty year fixed loan, giving a rate that, checking that lender's rate sheet, was for a thirty year loan all right, fixed for two years with a three year pre-payment penalty. So yes, you could say that it is a thirty year fixed rate loan, but that's not what everyone thinks of as a thirty year fixed rate loan, and it definitely isn't the industry standard name for what they are selling (which translates into polite english as "feces").

The other thing was waiting in line, I heard the guy in front of me (who worked for Big Name Major Bank) bad mouthing brokers, saying "They can charge anything they want, where it's our policy to never charge more than two points." Well, they may not charge the customer more than two points, but they do put them in a higher rate that would get a broker a six point rebate - if the broker was allowed that after charging a customer two points up front, which would be illegal and also not every broker wants six points total compensation for every loan (Most don't. The average loan I work on is about one point total compensation, and less than that for purchases where I'm the buyer's agent). Then, because Big Name Major Bank is a direct lender they sell the note to a third party at even more of a markup. One hopes you see the extent of the mind games this guy was playing. I said, "Excuse me, but don't you hate it when someone slanders your profession by telling half-truths that give a completely false impression? Then why did you just do it to me?" I managed not to call him slimeball to his face, but he deserved it.

The fact is that you need to shop around. Every profession has its scoundrels, and mine is unfortunately no exception. Many of them masquerade as your friend, but aren't. I suggest using my list of questions to ask prospective loan providers here, but remember that the stuff they quote to get you to sign up may be lies, so sign up for two loans. The way to avoid the problem posed by the smooth talker in the second instance is to evaluate all loans by the criterion that matters to you - which means by the loan you are getting, and what it costs you, not by what somebody else is making. If you can buy a widget at store A for $12.00, or at store B for $13.00, and they are in all other ways equivalent, why do you care that store A bought it for $9.50 while store B bought it for $11.00, and so store A is making more? The bottom line is you get the same widget for less money at store A, even if the store makes fifty cents more per widget. The principle is the same whatever you're buying.

Caveat Emptor

Updated here

Chief Justice Rehnquist

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For those who missed it, Chief Justice William Rehnquist has died.

Go in peace, sir. Fare thee well where ever you may be. You will be missed.


Tactically, the president now has to choose whether he wants two fights or three. As I have said before, I'm a big admirer of Justice Thomas, but I can't see anyone wanting to rehash the whole Anita Hill thing when it does him no good beyond prestige.

Scalia would be, if anything, a tougher fight than Thomas to elevate. Has a strong claim to being the foremost constitutional scholar, but he's written too many opinions, and too many Donkeys really have something personal against him. The whole hunting trip with Cheney would come up again and again ad nauseum, and everything he ever said against abortion or for personal responsibility or the intent of the framers. Nasty fight, nothing significant to gain.

The president could either re-nominate Roberts for the chief's seat, or nominate another justice direct to the chief's seat (Janice Rogers Brown springs to mind as appropriate for this).

Finally, the president might make a deal. He'll elevate one of Clinton's associates to chief in return for enough votes to confirm his favorite new associate justice. I think if the President made a deal to elevate Ginsburg in exchange for Luttig or some similar conservative, this might be his biggest gain for the least fight. Roberts is so squeaky clean there's nothing to fight, but he's only got two years on the bench, which would produce a certain prejudice against making him Chief Justice. Anyone else, particularly anyone attractive to conservatives, is going to have a fight on their hands UNLESS the president can short circuit it. This isn't the nomination that's likely to overturn Roe vs. Wade; the Chief was a steady vote to overturn. At most, the struggle to overturn breaks even.

This suggestion gets a woman Chief Justice, so the donkeys have something to feed their base. It doesn't make any real difference to the balance of the court, and the President gets easy confirmation for a judge of his choice.

I don't know that he'll do this of course. It's certainly harder with the excessive partisanship of late, which is the constraint the president is working against. In another era, this would have been a much easier deal to actually do. But if he can keep the Republican senators in line and get Joe Lieberman and a few others to sign off on the deal, this would be a win for everyone.

UPDATE: The President has renominated Roberts for Chief Justice. I can't fault his reasoning, but others will. With only two years on the Judiciary, naming him as the foremost judge in the nation raises a psychological bar, no matter how qualified. Never mind that a Chief Justice has no more real authority than an Associate Justice. There is a psychological difference between being one of the gang and being the titular leader. It is possible this will snatch defeat from the jaws of victory on Roberts' confirmation. There is no vacancy (currently) in O'Connor's seat. Her resignation was effective upon confirmation of successor. Barring further developments, should Roberts be confirmed to Rehnquist's chair, we'll have a full court when it starts its term, whether or not O'Connor's replacement is there.

A few points as to what's likely to happen with this.

Hurricane is not a named peril on most policies.

Fire, Lightning, and removal (i.e. moving stuff to a safer area after a partial destruction) are three named perils that are universally covered under National Association of Insurance Commissioner (NAIC) rules. You can get more inclusive coverage that insures for more perils. Here in California, the policies are standardized and homeowners have several levels of coverage to choose from (HO1, HO2, and HO3 are for single family residences in ascending order of coverages. HO6 is for individual condo owners, and the association is legally required to carry a master policy for the whole complex. There is also an HO 15 endorsement that many single family homeowners might wish to consider). The peril likely to result in valid homeowners claims is wind. I actually imagine that the insurance companies are going to be fair about where there is a credible claim for wind damage. As always, some will be less so, but others will likely actually go somewhat overboard in granting claims, something like AAA did here in San Diego for the wildfires in October 2003 (They paid full amount of damages for people who were underinsured, treating it as a problem they should have caught in underwriting).

From my understanding of the situation, however, the thing that caused most of the damage is flood. This is a specific exclusion from most homeowners policies. The homeowners insurance is not going to pay - you don't have this coverage with them. Flood is a separate insurance policy. Here is the FEMA website on the issue, and here is the explanation page one click away.

So unless people who bought flood insurance as a separate policy, they are likely not to be covered for what happened to their property,

(As a general rule, a lot of water related stuff is a big pain and and its insurance and other issues are a whole separate headache.)

On a meta-level, homeowners insurance is generally underpriced. People will not pay what it really costs, so insurance companies who sell it for some short term cash flow often get burned when there is a major event like this. In the wake of Hurricane Andrew in 1992, some insurance companies paid out what had been fifteen to twenty years worth of their entire national profits on homeowners claims. I remember at least one formerly well capitalized company went bankrupt, and many homeowners insurers left the state. All remaining companies raised their rates within Florida, some nationwide.

Homeowners insurance being underpriced sounds like a good idea, until you think a bit about what happens when you need it. Charges for insurance are supposed to be calculated to pay not only administration, but the costs of all claims as well, and for a little bit of profit even if your insurer is a mutual association like AAA (Pretty much every year, I get a policy rebate). If there's an insufficient reserve for claims, the claims don't get paid, and the insurer goes out of business. Not so great if that was your insurance company (Here in California, insurers are required to pay into an insurer's insurance fund to cover this, but that typically pays only part of a claim). On a not so severe cash shortfall, the claims get paid and the insurance company leaves the homeowner's market. Now you need another insurer, and you may not be able to get one. Without insurance, no lender will finance a property. Even if you buy it free and clear, without insurance, if something else happens you are out of luck. Nor will you be able to sell it for anything resembling a market price.

So maybe underpriced homeowner's insurance isn't such a great idea.

How to Take Steps to get around the problem? Well, there aren't really any indicators which are reliable from a consumer's point of view in this. The various insurance rating agencies can only rate apparent solidity, which is subject to a lot of assumptions that may be unwarranted in this kind of situation. Anywhere your company sits on the axis of insurance providers has its problems. A national multi-lines carrier (i.e. they do all kinds of insurance nationwide) is less likely to be bankrupted by a regional claim, but more likely to withdraw from your market in the aftermath. A regional specialty carrier (they only do one type of insurance, and may only be in one state) is less likely to withdraw afterwards, but more likely to go bankrupt. National specialty carriers and regional multi-line companies fall somewhere in between. As individuals, I'm as lost as anyone.

California has an assigned risk homeowners insurance program, called FAIR. Basically, homeowners who cannot otherwise get homeowners insurance are randomly assigned by market share to one of the insurance companies who does busines in California. That insurance company must take you. The problem is that rates are high and coverage is minimal, and the risk is spread out between all policyholders. Because the assingments are based upon market share, all companies are hit proportional to the business they do. The difficulty, of course, is that people insist upon building in areas with a problem. Well, areas with a problem are cheaper, and where people can more easily afford to live, until the problem manifests.

New Orleans is pretty much a City with a Problem. It's settling 3 feet per 100 years. Most of it is between five and ten feet below sea level. Unless we render it uninhabtable by opening up the levees and causing silt to be deposited, the problem is only going to continue and get worse. Of course, every time we'd open up the levees for silt deposit, the land would flood. This is the Horns of a Dilemma. The only way to escape it is not to rebuild, or only to rebuild where the land is solid and will support it, which isn't very many places.

Let's face it: The Army Corps of Engineers has done wonderful work to keep New Orleans in place and inhabitable for the last seventy years. But now that the hammer has fallen, rebuilding it would be an exercise in futility.

Recycled Terrorists

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Pundit Review had Michael Yon on; they have a audio file of the interview. Go to about twenty minutes in. They talk about the terrorists who were released from Guantanamo Bay who go straight to Iraq and combat with our troops. Michael Yon says that some of them were released as a result of pay offs, some released for reasons unknown.

I WANT INVESTIGATIONS INTO EACH AND EVERY ONE OF THESE INCIDENTS, DAMMIT! THESE TERRORISTS ARE BEING RELEASED TO KILL OUR PEOPLE! I DEMAND TO KNOW WHO DID IT, AND WHY! If there is any significant doubt, why are they being released? We didn't release Germans or Japanese during World War II. We didn't release Germans during WWI. We didn't release Confederates during the Civil War. WHY ARE WE RELEASING THESE SCUMBAGS? I want to know who is responsible, and why they made each and every one of these mistakes. If it is at the request of "allies", maybe we shouldn't honor these requests any more. If it at the request of "neutrals," they sure don't look neutral to me. If it is at the request of enemies, I want to know the quid pro quo and whether it was honored (I suspect not). If it is as the result of "guidelines," those guidelines need to be changed YESTERDAY and the people responsible disciplined.

I'm generally against back seat drivers and people trying to run a war from 8000 miles away, but this is one thing that people at home can do without one bullet coming their way, and that will actually hep without distracting our soldiers at the front: Find out why these bad guys were released to shoot at our soldiers. We can get some retired or wounded soldiers and marines on the case, who may not be up for combat but they can handle shuffling through a paperwork investigation just fine. They also have motivation to get to the bottom of things, and not to accept any Male Bovine Fecal Matter.

I know the president and Rumsfield have taken a lot of political heat about Guantanamo from useful idiots in our own Congress, press, etcetera. That doesn't mean we should let the terrorists write our policy manuals. What good is whacking a mole when your own side just lets him go again?

HT to Dean's World

Links and Minifeatures

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I'm recommending two charities for Katrina victims. The first is the American Red Cross. The second, for those who remember that humans are not the only ones who suffer, is the AKC CAR fund, which is promising that 100% of everything they get will be used for disaster relief.

Instapundit's round-up is here


Anarchangel has a good post on the economic realities behind market speculation. I have some quibbles: The price I buy the oil at determines the price it is profitable for me to sell the oil at, and similar things, such as I suspect the actual prices where supply and demand would balance out is in the low fifties, but it's worth reading.


I am sorry, but I've had an emergency come up. I have walked a check in to Red Cross, and I mailed another to AKC CAR Fund, but that's all I can do today (the previous two articles were both auto-posted from earlier in the week, and the first two sections of this were written last night). I encourage folks to dig as deep as they can, and then add another few dollars for our non-human companions. Even $10 buys a lot of animal care. May you all be kept safe.

Asset and Income Rentals

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I found this article by Ken Harney in the Sunday paper.

WASHINGTON - Call it funny money for the housing boom: Now you don't need actual cash in the bank to buy a house. All you need is somebody who says you've got money in the bank.

Need a hundred grand on deposit to convince a lender that you deserve a million-dollar mortgage? You've got it . . . even though you haven't really got it because you "rented" it from a company in Nevada for an upfront fee of 5 percent - $5,000.

Sound bizarre? Welcome to the wonder world of "asset rentals" now being investigated by bank and mortgage industry fraud experts. It works like this: Say your loan officer discovers that you lack the financial wherewithal needed to qualify for the mortgage you want. Rather than lose your business, however, the loan officer turns to a service that offers "asset rentals." For a flat fee of 5 percent of the amount you need, the service will verify to anyone who asks that the $100,000, $500,000 or $1 million in bank deposits you've claimed on your loan application documents are yours indeed.

I am sorry to say that this is not the first time I've encountered said phenomenon. Nor lenders. This is why assets require seasoning or sourcing. In other words, the lender requires you to show that you've had it and built it up over a period of time, or they want to know where and how you got it.

Most loans should not require a large amount of assets - A paper loans, the best loans of all, want one to two months Principal, Interest, Taxes, and Insurance (PITI) for full documentation (and I can usually get it reduced), or six months PITI for stated income loans. Neither of these is a large number if you're really making the money, and they can be in a variety of places.

Some sub-prime lenders, however, will take large amounts of money in an account somewhere as evidence that you can afford the loan. These loans usually end up looking more like a propagandized No Income, No Asset loan than anything else. They don't get the best rates and terms, even for sub-prime, and there's likely to be a nastily long pre-payment penalty on them as a GOTCHA! The loan provider, be it broker or lender, is likely to make a lot of money on them - In California there is a thing called section 32 limiting total loan compensation to six points, which on a $400,000 loan is $24,000, and many so-called "discount" real estate agents turn around and require their clients to do the loan with them. It doesn't do you a bit of good to save a couple thousand on the sale or purchase in order to get ripped for twenty on the loan, where it's easier to conceal it. I can point you to many of these so-called "discount" houses who do these loans all day, but they are not loans you should want. If a friend came to me and asked for one, I'd try my best to talk them out of it.

But wait! It gets better!

This and other e-mail pitches, copies of which were provided to me by mortgage industry recipients, carried the sender name of Loren Gastwirth, identified on the e-mail as vice president-marketing for Morgan Sheridan Inc. of Mesquite, Nev. The asset rental attachment carried the name Independent Global Financial Services Ltd., with an address in Las Vegas.

... to a Zexxis Co., with the same Mesquite, Nev., address on Loren Gastwirth's Morgan Sheridan card. When I called the number listed for Gastwirth, I received no reply, but instead heard back from a person identifying himself as Allen Paule. Paule is listed in corporate filings with the Nevada secretary of state as the "registered agent" for Morgan Sheridan, Independent Global Financial Services, and Zexxis Corp.

Paule said the asset rental and employment pitches - including downloadable attachments and forms carried on Morgan Sheridan's Web site - were not connected to his firms. He said, "somebody hijacked our Web site." He confirmed that a Loren Gastwirth works for Morgan Sheridan. And he also confirmed that Independent Global Financial Services, Morgan Sheridan and Zexxis Corp. have overlapping ownership and management. According to Nevada corporate records, a Paul Gastwirth is listed as president and director of Morgan Sheridan.

The Web site of Vault Financial Services Inc. of Las Vegas lists Paul Gastwirth as CEO of that firm, and president of Independent Global Financial Services, "a company specializing in asset rentals and enhanced credit facilities for individuals and companies worldwide."

In other words, they are playing a Nevada Corporation shell game. A long head swallowing tail chain of corporations, each of which is likely to be a shell set up to insulate criminals from the consequences of their actions. The stuff about "somebody hijacked our web site" is almost certainly bogus.

but it gets better yet!

That's where the asset rental service's "VOE" (verification of employment) program comes in. Essentially you indicate on a faxed form what annual or monthly income you or a home buyer client needs to qualify for a mortgage, and the asset rental company will verify to anyone who asks that you have been paid those amounts.

The cost: just 1 percent of the claimed annual income. "For example," says the pitch, "$100,000 of annual income - cost of $1,000. Minimum is $50,000." The e-mail came with attachments that directed payments for asset rentals and employment verifications to an account number at Wachovia Bank in Roanoke, Va

In other words, they're also volunteering to help you circumvent one of the most basic protections to the whole process, making sure for both the lender and the borrower that the borrower can afford the loan. If you cannot afford the loan, you are probably better off without it, although many people don't realize that this requirement is partially for their own protection. If you can't make the payments, you're going to get foreclosed on. If you get foreclosed on, you're likely to lose everything you put into the house and get socked with a 1099 form which the IRS will use to go after you for taxes as well.

Lest you not have realized this by now, all of this is FRAUD. Serious, felony level FRAUD. Lose your home and go to jail FRAUD.

I'm going to share a little secret with you, widely known within the industry but not in the general public. That real estate agent or loan officer getting you your house or your loan may not be the brightest financial lightbulb in the world. Many loan companies and real estate offices select for this, usually by only hiring people who have never been in the industry before. Some of them are even among the biggest names in the business. They select for sales ability and "make sales" attitude, not the knowledge (and more importantly, willingness) to say, "Wait a minute! Something is not right here!" Especially when it may cost them a commission. And hey, if the companies involved lose a few low-level sacrificial victims to lawsuits and the regulators, that's no skin off the owners' noses and they still get commissions out of it. These schemes are pitched to the agents and loan officers as a way to "save" a client. Sounds like it's in your best interest when you put it that way, right? It is not. The bank discovers this (and Nevada Corporations, among others, are a red flag that loan underwriters look very hard at) Most of these deceptions are discovered before the loan gets funded - meaning that the client they were helping to commit FRAUD wasted their money, and they have a case against the agent and employing broker, whose insurance will probably not cover the issue.

The ones that do get funded are even worse. When the bank discovers the FRAUD, they have a right to call the loan. This means you have a few days to repay the loan, or they take the house. All of those wonderful consumer protections the federal and state governments have enacted become mostly null and void, because you committed FRAUD. You can count upon losing all of your equity in the home, and getting thrown out with nothing. Furthermore, depending upon company policy of the lender, you may find yourself sued in court, and possibly even under criminal indictment. Judgements for FRAUD are nasty, and they don't go away. Convictions for FRAUD can really mess up your life completely and forever, not just in applying for credit, but in employment and other ways as well. If your loan is sold to another lender before the discovery happens, the probability rises even further, because the new lender is going to sue the old lender, who is going to take action against you as part of a defense that says they were acting in good faith. The shell corporations that pretended you worked for them or had deposits with them will be long gone (or untouchable) of course. You may have a claim against the agent, loan officer, broker or possibly even original lender, but if someone else beat you to it or they are out of business for some other reason, good luck in actually collecting.

In short, relying upon an agent or loan officer as an expert without doing your own due diligence is likely to get you in hot water. As good rules of thumb: Never lie. Never allow someone to lie on your behalf. No matter how desperate you are, it's likely to buy a lot more trouble than it's worth.

Caveat Emptor


As much as I am aware of common problems in the fields in which I intend to work (or enable others to work), I can't know everything that goes on. To that end, I'm soliciting the aid of the public. Email me your own horror stories. The ones that are common, I will likely post amalgams (in other words, nobody's individual story, but rather a put together one made up of parts of many basically consistent individual ones). The ones that are outstanding, I'll likely post after redacting individually identifying information.

Send these to "dm" at the domain name, (I try to frustrate web crawlers looking for spam recipients to the maximum extent possible, so keep standard email rules in mind when compressing the above. No spaces. @symbol. Ignore stuff that needs to be ignored).

Please include:

Your relationship to those it happened to, if not obvious.

Contact e-mail for you and for the victim (My intent is to ask that the person it happened to verify I've removed the individual information sufficiently BEFORE I post the story, if I do intend to post)

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A simple statement saying that I have your permission to remove personal information and post, or that I do not have your permission to post, as you are sending me this information for background purposes only (i.e. so I know it goes on, and can research and write my own thing from there - still a quite useful bit of illumination).

Please do not get upset if I don't use your individual story immediately. Certain ones I've already encountered many times over. Others may be worthy of attention, but are subject to the limitation that I only get the same twenty-four hours of the day that anyone else does, and in that time, I've got to earn a living for my family at my profession, as well as live up to my other responsibilities to the people most important in the world to me, as well as have a bit of fun lest I go insane.

I am primarily interested in horror stories in the fields of mortgage, buying and selling of real estate, the sales of insurance of all kinds, and of things relating to financial planning and investment advice. I know I said I'm interested in insurance, but don't send me stories of how your insurance won't cover this or that, UNLESS it was specifically represented to you that it was at the time of sale. I'm also interested in expanding this to cover various fields of the law and consulting, but I do not possess professional qualifications there, and until someone steps forward who does, my ability to deal with them is limited. I hope to eventually expand this blog to cover all consumer and small business services, so I am interested in almost any story. At a minimum, I can post it in Horror Stories as a warning to the readers of this site not to make the same mistakes.

I do intend to add value to these stories, suggesting red flags for this sort of behavior and strategies to avoid or deal with problems. The idea is not to laugh at people for making mistakes that anyone can make, but to look at what happened with an eye to keep it from happening to other people.

One last word: This is not, and it most certainly is not If you DON'T want me to remove all individually identifying information, including of the low down good-for-nothing dirty rat that did this to you, you're going to have to furnish me with identifying details, documentation, and everything else that you'd expect a fraud investigator to ask for. Basically what you'd need to convict the culprits in a criminal court, and maybe a lot more. Don't send it until I ask for it, however. The point of this site is to educate consumers and provide a better environment in which everyone does business, not to punish alleged malefactors. Other people get paid for that, so it's not my priority, and if I get to it at all, it will be in my own time. I am personally aware of many companies that Cannot Be Dealt With On A Reasonable Basis, but I am not legally charged with punishing their misdeeds, and must be careful in what I publish about them, lest someone punish me for my misdeeds.

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