Study: US preparing 'massive' military attack against Iran

http://rawstory.com/news/2007/Study_US_preparing_massive_military_attack_0828.html

Think that the so-called "opposition party" is going to stop Bush? Hardly. They march to AIPAC's tune. The idea that there is an "Iranian threat" has been drummed into the American people's heads for quite a while now by the mainstream media. I have also been grimly amused by the assertion that unsubstantiated Iranian culpability in attacking our forces in Iraq justifies this, since the fact that we attacked Iraq in the first place is in clear violation of international law and the UN charter.

But, hey, we all now live in BushWorld.

Of course, the consequences of this neocon wet dream will make the disaster in Iraq look like a barroom brawl. The idiots who are planning this make the same mistaken assumptions about the Iranian people's response as they did about the Iraqis. They also fail to take into account the response of other countries, like China and Russia. Not to mention the impact this might have on oil prices and the global economy.

Say goodbye to the world we once knew, folks. The lunatics are runnning the asylum.

It seems to me that there is really nothing Bush or the Fed or anyone can do to stop the inevitable. While there may be political points (and some small delay) to be gained by "doing something", the reality is that the mortgage mess is not limited to subprime. As millions of ARMs reset, pushing good folk into insolvency, this disaster will unfold as it must. Any attempt to allow troubled homeowners/speculators to re-fi using government money is doomed to failure, becuase it ignores the simple fact that present prices are totally out of whack. This is even more true now that lending standards for would-be homeowners are tightening, returning to traditional requirements for down payments, income-to-debt ratios, etc. A return to traditional lending standards neccessarily means a return to traditional pricing. Thus, even if people can manage not to default on their home loans, they still will never be able to sell their place at today's artificially inflated prices because no one can qualify to buy it, nor will the source of lending that pumped prices up to the current level any longer be there.

There is also the business of the utter lack of availability of jumbo mortgages which, in places like California and here in Hawaii, are required since the average home price has been inflated upwards of half a million dollars.

Here on the island of Oahu, your basic dilapidated sugar shack now lists for ~$600K. Of course, the only way this happened was the availability of zero-down, interest only, low initial interest rate ARMs, etc., and the foolish expectation that housing pirces would continue to rise at such a clip that if the homeowner got into trouble he could quickly sell the place and realize a tidy profit to boot. Think about it: The average income on Oahu is only ~$38K, yet literal shacks were pushed up in price to $600K!

The party is over, but no one wants to admit it. Bush and the Fed are the equivalent of the band playing on the deck of the Titanic.

re: "I disagree that these homes will *never* sell for what they were bought for.

I must've missed that part where you explain precisely how, under traditional lending standards, people buy hyper-inflated homes.

Do the math for us on a $500K home. 10% down, fixed 30, etc., and you will see that normal people cannot even think about buying such a place. Hell, normal people cannot even think about a place half that price under traditional lending standards!

What you fail to recognize is that virtually no normal person has any money saved. Everyone is in hock up to their eyeballs. Not only that, wages are stagnant. Thus, qualifying to buy a hyper-inflated home under traditional lending standards is impossible.

Once again, the ONLY way this game lasted as long as it did was by virtue of (a.) easy credit, no-down, interest-only, etc., type financing and (b) the full expectation that prices would continue to climb at a rapid clip forever, providing instant and substantial equity to cover the borrower's rear end should he need to sell.