Why Obama and Romney won't talk about housing

The candidates may fear offending banks, and a distracted press just ignores the issue.

By MSN Money Partner Oct 25, 2012 4:43PM

This post comes from Marilyn Lewis of MSN Money.


Image: Aerial view of Houston neighborhood © Ocean/Corbis/CorbisWho's the best candidate to fix the economic mess? That's supposed to be the big theme of this presidential election. But you won't catch Republican  candidate Mitt Romney or President Barack Obama making a peep about housing.


The housing and mortgage bubbles were behind the Great Recession. In spite of the bidding wars you hear about in a few cities, housing still is in deep trouble. It's just less deep than a few years ago.


"I find that shocking" that neither candidate mentions housing market issues, Nobel Prize-winning economist Joseph Stiglitz told Reuters. "It is one of the things that precipitated the crisis."


Stiglitz and other observers charge that both candidates are afraid of offending the banking industry, which contributes to both parties. Bank of America, for example, has made $2.13 million in contributions this year, 26% of it to the Democratic party and 74% to the GOP, according to 24/7 Wall St.


Goldman Sachs has spent $4.77 million on party donations, 29% to the Democrats and 71% to the Republicans.


What stops them?
Here's the housing scorecard to date:

  • Americans have lost $7 trillion in home equity since housing tanked, says DS News.
  • Some 3.8 million homes have been lost to foreclosure and an additional 1.3 million are in the foreclosure pipeline, according to CoreLogic.
  • A fifth of households, with about $689 billion in mortgages, are under water -- their loans are worth more than their homes, Corelogic says.
  • Qualified borrowers can’t get mortgages, and that effectively locks them out of what is arguably the only consumer benefit to come from the recession, discounted housing.

In short, there's plenty for the candidates to talk about and lots of room for them to disagree. Why don't they?

"In some sense, they don't want to offend the banks," Stiglitz said. The banks, he said, are "a major problem to doing something about the problem."


"There are some good ideas about the restructuring of mortgages, but neither candidate is addressing them," Stiglitz said.


PBS put the question to two experts whose views on housing policy closely resemble the candidates'.


Mark Calabria, the director of financial regulation studies at the Cato Institute, said he'd like the housing downturn to be allowed to run its course, free of government intervention, a position he said Romney initially adopted and then abandoned. "I think he started to recognize the politics of it after that," Calabria said.


Calabria said:

There is no way to just bring that wealth back. Ultimately, you need to have that market recover. And that is going to be painful.

Reporters' failure
Jim Carr, senior fellow at The Opportunity Agenda, a policy and advocacy group, says government should do more. Administration programs have had a "significant" effect but "we need to step up the game on the foreclosure mitigation initiatives, and really stem this foreclosure crisis."


Carr added:

I think one of the reasons is that candidates haven't been held accountable by the press, by the media. You look at the fact we have had three presidential debates and not a single question on the state of the housing market.

The GOP divide

Housing's touchy for both candidates, since some voters want government help and others are tired of bailing out their neighbors. Added Calabria:


I will note as well a lot of the real estate industry, the realtors and homebuilders tend to be very small businesses that tend to be very pro-Republican. So, partly, what Romney is trying to balance is, I don't want to irk the Tea Party folks by saying I'm going to go out and give bailouts and try to lift up the housing market. But at the same time, I don't want to talk it down too much because my friends in the real estate industry, they want to see the market prices go up.


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Oct 26, 2012 9:59AM
As long as the goal of lowering manufacturing wages to comply with the goals of the New World Order continue to be the unwriten/unspoken  rule there will be no recovery of the housing industry as we know it.  The ability of the Internationals to move freely without the issue of differential wage rates by borders and the idea of removing autonomous governments interfering with this plan is the present goal.  By neither candidate expessing an opinion tells me Romney is now on board as we all know  Obama is and has been.  This secrecy is sooo unAmerican and unsavory.  We no longer have a representative government.  I see home prices returning to mid eighties levels. Nothing ever goes straight up or down but when you clearly see the end goal then understanding the big picture and the bumps and ups and downs over time become so much clearer. There will be NO recovery in home prices.  It is not possible for two reasons.  Firstly it is clearly not possible to lower basic workers wages and expect more income to be available for a mortgage payment, and secondly increases in interest rates; which are inevitable, will constrict the amount availabe for the principle payment resulting in lowered principle loan availablity. JMHO
Oct 26, 2012 10:06AM

BINGO!  this is what is unstated behind closed doors and is affecting the world's cash flow


""As long as the goal of lowering manufacturing wages to comply with the goals of the New World Order continue to be the unwriten/unspoken  rule there will be no recovery of the housing industry as we know it. ""

Oct 26, 2012 12:04PM
Trying to tax yourself to prosperity is like standing in a bucket and trying to lift yourself up by the handle. - Winston Churchill
Oct 25, 2012 8:52PM
Here is a direct comment to BOTH candidates... everyone who can and WILL end bankers and the terror attack on housing is still around. How idiotic can it be to blockade all those who were it in from the beginning in favor of corrupt losers who started something they couldn't stop. Jim Cramer said it today... no one is in jail for it. We are past jail... it's time for sail-- off the rooftops of ivory towers. No wings? That's YOUR problem. The whole nation knows that neither candidate is a winner, so warm that Oval Office executive seat all you want, the door will lock from the outside if the inside doesn't grow a pair and take down the BANKS. We don't need them. An article in Secondary Market Magazine this month cites that the fewest number of Americans EVER have bank accounts. There is no good reason to keep The Tax Reform Act... our home values are dismal and why offer a tax deduction when many just walk away and get a new mortgage without a hitch? Why maintain the Gramm Leach Bliley Act now? Irresponsible Congress failed to intercede in the taking of America and what legally belongs to Americans by financial CROOKS. We watched the Occupy Wall Street kids get their assses kicked by NYC Terror Cops, but we didn't see Exxon Mobil's castle get stormed when gas prices went up a dollar in two days. We haven't seen bankers get imprisoned for their roles in ANY scams. That's okay... even if a sufficient number of voters give either LOSER a win, the LOSER's side will create war right here in America over the dumbest of things... dollars that are no longer currency. We want GEORGE W. BUSH hauled out of seclusion so he can open his eyes and answer some questions. We could care less about Obama's school records, but we need to know a whole lot more about offshore bank accounts, dark pools and why the values in the Hamptons and on Nantucket Island remain astronomical. BE President... either one of you. Enjoy that plaque on your desk... but if you don't take out banks, end the Federal Reserve, get rid of corrupt Wall Street and throw every CEO who mass-terminated America out of the country with only the clothes on their backs... then you are meaningless to us. FOUR YEARS of playing politics at a terror level. FOUR YEARS out of the lives of families. FOUR YEARS of inheritors manipulating and controlling. These are NOT the foundations of our society. WAKE UP, LOSERS. Ask not what you can do for your country, if by now you can't figure it out-- WALK AWAY AND DO NOT RETURN.
Oct 26, 2012 6:31AM

"Stiglitz and other observers charge that both candidates are afraid of offending the banking industry, which contributes to both parties. Bank of America, for example, has made $2.13 million in contributions this year, 26% of it to the Democratic party and 74% to the GOP"


Bank of America being the giant conglomerate bank that prides itself on over-charging and tacking fees on everything it does. Just yesterday came an article that says-- we're suing B of A for $1 BILLION over the Countrywide mess. One BILLION. Say it like Dr. Evil did in the Austin Powers comedy. He had just woke up from the 1960s. ONE BILLION... for a disaster that cost America and Americans TRILLIONS. They make that in FEES each month.


Tell us in a joint news conference Mr. President and Mitt Romney... WHY IS IT MORE IMPORTANT to have giant banks that harm America in every possible way, instead of financial segregation and an economy that works for everyone? WHY? Romney... your answer needs to be 3 times better than the President's answer because banks give you that much more. No flip flop answers please, and no, you can't change your mind and align with the President after he gives his answer.


Close the banks, end the Federal Reserve, get RID of Wall Street. Each of these pariah and the Law Firms that get rich because of them... need to GO. REstore America. Recover jobs. Use the wealth of hired-in and inheritor pariah to fund it. In the end, there can be only one America, not a Two Class Upper and Lower America. Like it or leave it rich people, you didn't earn it.

Oct 25, 2012 9:16PM

"Goldman Sachs has spent $4.77 million on party donations, 29% to the Democrats and 71% to the Republicans."


Goldman Sachs IPO'd in 1999 nearly simultaneous with the sneaky enactment of Gramm Leach Bliley. GLBA was the Act that legalized collusion in the financial sector and suppressed the Glass Steagall Act. Glass Steagall was written in 1932 and lasted from then to 1999 keeping financial sector pariah from colluding to destroy America through currency manipulation. Its more than coincidental that with the Goldman Sachs IPO and passing of GLBA... a Mark to Market credit facilitation processes replaced the time-honored warranties and representations and quality assurances that kept credit integral.That's right... it was GOLDMAN SACHS that kicked off the collapse of housing by letting BANKS write bad loans without ANY diligence and get paid directly from Wall Street. Where did those bad mortgages go? Into the securities that the likes of Goldman Sachs offered to your employer, your city, your pension and retirement fund and countries all over the globe. Including those in Europe right now struggling for survive from financial strangulation.


Who sells their soul for money? Politicians, Prostitutes and Bankers. Not much difference. Would it also interest you that Hank Paulsen TOLD Congress to fund T.A.R.P.? Hank was our Secretary of the Treasury but before that-- he was the CEO of-- you guessed it-- Goldman Sachs.


Mr. President... Mitt Romney... we aren't interested in any more debates. We want to know what you know about banks and what you intend to do about them. Once outlined, give it to us in writing and get it notarized. PROMISE away but that becomes your mandate. 2012-- elections. 01/01/2013... the end of banks, the Fed and Wall Street. Recovery NOW... BS can wait this time.

Oct 26, 2012 9:46AM
A qualified borrow can always get a loan.

The definition of qualified is what is now in question.   Banks want people that will pay back what they owe, not deadbeats.   They are demanding people stop gambling with their depositors money  and have the means to withstand market trends.

In short they are demanding 3 years of provable earnings, 20-25% down payments (margin), and credit scores in the 700+ range.    Plus the banks want to insure the sale price is not for more than the property is worth.

All of these things are reasonable.  The one rule that MUST be absolute, is that 'NO REAL ESTATE LOAN CAN BE MADE WITHOUT 20% DOWN MINIMUM'.

Oct 25, 2012 10:01PM

You may not be able to control the bankers, however, they were just in it for a buck.  Thats their job make money.

OTOH, people who were sold arm loans that would increase up to three times in two or three years are at fault.  I have a friend who is a realtor.  the loans went thru on people who could not possibly pay when the arm loan jumped.  And a lot of their stories were, we will live great for about 5 years until they take it back. 

Its real simple.  they can apparently mandate health insurance as a tax. Outlaw arm loans balloon loans, and any type loan except for 30 year fixed rates morgages.  and insure that the buyer has 40% of his takehome not used for credit cards and signature loans.  If there is a 10% downpayment make sure the borrower does not go out and borrow the 10%.  Real simple.  Make that law, and you can quit worrying about the banks making bad loans.  And when they do tack on a 5 year sentence for each violation. that should stop it. So why cant washington figure this out?

Oct 26, 2012 11:44AM

how can people not see outside their borders for good examples?


Oct 25, 2012 9:03PM

"I will note as well a lot of the real estate industry, the realtors and homebuilders tend to be very small businesses that tend to be very pro-Republican. So, partly, what Romney is trying to balance is, I don't want to irk the Tea Party folks by saying I'm going to go out and give bailouts and try to lift up the housing market. But at the same time, I don't want to talk it down too much because my friends in the real estate industry, they want to see the market prices go up."


Every industry you named was born from Sprawl. Sprawl was corruptly designed by moguls who had the cash to build malls highways light industry and churches way far away from cities. The idea was to get mom and dad into the family car (an unnecessary luxury that cleverly did away with mass transit) and out to the mall on a Sunday. Subdivision models were open. Everything was crafted around the impulse purchase prompted by a subliminal need to keep up with the Joneses. All this exploitation helped--- BANKS. When they bled cities dry of neighbors, they tapped bank accounts there to fund more Sprawl. That's why the Community Reinvestment Act came to be AND why the banks fought it. In fact... every attempt to suppress compete stifle regulate and oversee BANKS has been met with untimely disaster. FLAT OUT... close the banks, end the Federal Reserve and get RID of Wall Street. These things don't help Americans or America, they hurt us. Recover jobs NOW and heave the bastards who mass-terminated America OUT. You can't inherit freedom but you can have it if you believe in it and some inheritor isn't shoving New World Order and Centrtal Bankers in control down our throats.

Oct 26, 2012 12:40PM
Just read an Article in regards Boeing encouraging their suppliers to outsource to Mexico. Just more pressure on lowering workers wages.  I think most bankers are aware and a part of the New World Order, at least a few and those at the top..  They try and give off the idea they have raised loan standards to inhibit risky real estate loans.  However you have to ask yourself if they are aware of the pressures to lower wages and thusly the ensuing lowering of home values would it not seem more logical and prudent that they would be reluctant to loan knowing home values are very likely to decrease because of government commitment to free trade and outsoucing?  Two plus Two equals 4 and therein lies the reality.
Oct 26, 2012 3:04PM
Yes, he told us in advance what he planned to do. Few were listening.

The following is a narrative taken from a 2008 Sunday morning televised "Meet The Press'.
From Sunday's 07 Sept. 2008 11 : 48 : 04 EST, Televised "Meet the Press" THE THEN Senator Obama was asked about his stance on the American Flag.
General Bill Gann' USAF (ret.) asked Obama to explain WHY he doesn't follow protocol when the National Anthem is played.
The General stated to Obama that according to the United States Code, Title 36, Chapter 10, Sec. 171...
During rendition of the national anthem, when the flag is displayed, all present (except those in uniform) are expected to stand at attention facing the flag with the right hand over the heart. Or, at the very least, "Stand and Face It".
'Senator Obama replied :
"As I've said about the flag pin, I don't want to be perceived as taking sides". "There are a lot of people in the world to whom the American flag is a symbol of oppression.." "The anthem itself conveys a war-like message. You know, the bombs bursting in air and all that sort of thing."
Obama continued : "The National Anthem should be 'swapped' for something less parochial and less bellicose. I like the song 'I'd Like To Teach the World To Sing'. If that were our anthem, then, I might salute it. In my opinion, we should consider reinventing our National Anthem as well as 'redesign' our Flag to better offer our enemies hope and love. It's my intention, if elected, to disarm America to the level of acceptance to our Middle East Brethren. If we, as a Nation of warring people, conduct ourselves like the nations of Islam, where peace prevails - - - perhaps a state or period of mutual accord could exist between our governments ......"
When I become President, I will seek a pact of agreement to end hostilities between those who have been at war or in a state of enmity, and a freedom from disquieting oppressive thoughts. We as a Nation, have placed upon the nations of Islam, an unfair injustice which is WHY my wife disrespects the Flag and she and I have attended several flag burning ceremonies in the past".
"Of course now, I have found myself about to become the President of the United States and I have put my hatred aside. I will use my power to bring CHANGE to this Nation, and offer the people a new path. My wife and I look forward to becoming our Country's First black Family. Indeed, CHANGE is about to overwhelm the United States of America "
Yes, you read it right.
I, for one, am speechless!!!

Dale Lindsborg , Washington Post
Oct 26, 2012 12:20PM
"We can agree on a strong dollar and an end to the unaccountable FED.  We need to stop the presses, and we need sound banking."

It's more than sound banking. Glass and Steagall recognized the need to segregate money touchers and maintain regulation to prevent future catastrophes based on irresponsible money dealings. the banks had already been bailed ONCE before the Great Depression and the whole 10% down payment on stock purchases thing smacks of derivative formulation today. Even Sandy Weil (former CEO of Citi) agrees that suppressing Glass Steagall was a bad move and HE was the guy who made it happen! Credit isn't super hard to figure out because Risk is logical. Either the collateral exists or the trust does. It cannot be automated-- EVER. Nobody in Goldman Sachs has the slightest bit of actual Credit Risk skill. You don't get it at the Wharton School of Business, you get it pulling up to a drug den address where your defaulted customer was supposed to live-- that YOU trusted instead of obtaining collateral on. Mortgage, Insurance, Deposits, Trust, Short Term and Revolving Credit, Commercial, Investment, etc... these aspects can only be stable when separate. Financial abuse is too easy and so it attracts the lowest of character and ethics. BANKS... never learned how to deal with money handling and touching. We really don't NEED banks. We absolutely NEED regulation and oversight.

Let's never forget that the likes of Goldman Sachs thought an Option A.R.M. was a good idea... even though it caused tremendous harm BOTH of the prior times it appeared in the market. An ARM requires diligence that covers the Worst Case Scenario as a qualifier. Educated IDIOTS by-passed all of that warning and caution for-profit. Yea... I don't have an Ivy League degree but I can write a valid credit file from blank paper. Goldman Sachs NEVER employed anyone who knew credit at that level. That's GROSS NEGLIGENCE and WILLFUL MISCONDUCT. So why are they still in business and no one is in jail for causing the worst financial crisis in American history?
Oct 26, 2012 7:41AM

One of the most important aspects of political ignorance relative to banks isn't limited to a party, it's a cultural problem that suggests career politicians, lobbies and banks as cartels... need to go.


How many times now have we seen the Dow lift or reverse a loss to a gain STRICTLY because banks borrowed from the Fed to pull their own sector back up? Answer-- WAY too many times. The Party of NO in Congress and many career politicians got caught Inside-Trading using confidential information for personal gain. You don't write a new Act for that, you FIRE the crooks! It's bad enough when there is competitor collusion, but the financial sector STINKS with nepotism, collusion, terrorists in groups (that includes alumni) and compromising relationships. How many Lobbyists are related to or married to either their Congressional target or client? ALL of this is the exact same culture that caused Pilgrims to come to America and peoples worldwide to leave homelands for the Land of the Free and Home of the Brave. It can only be one or the other... America- the way the whole world knows it needs to be as a blended cultural melting pot... or a New World Order that NO ONE but bankers, lobbyists and career politicians (and their money daddies) want. I say we STOP the elections, leave Obama in place and begin the gutting of organized administrative criminal acts undermining AMERICA. WORK FOR IT... and that doesn't mean scheme your way to riches.


Dump the Dollar because Greenspan and Bernanke broke it. Start a new currency that mandaes a FLOW not a hoard to cesspools of corruption. Close the banks, end the Federal Reserve and get RID of Wall Street... the source and fountain of all corruption. Colleges need warranties not alumni associations. Law Firms are a Militia... dissolve them. Corporations beyond the Founder are not good for America, they are GREAT for the Board Directors and hired-in executive prostitutes who sell their souls for a wealth status. GET OUT, PARIAH.  

Oct 26, 2012 9:09AM

Neither candidate will talk about housing because there is no 1 answer and either will lose in responding as their answer will not cover some other part.

If cash for clunkers was such a big hit, why would we not use it on the housing front? Start bull dozing down abandoned houses. Destroy them just like cash for clunkers.

Ending the Federal Bank is a great idea. Andrew Jackson knew it and done it.

But just writing checks to people or forgetting their debt is not going to work by itself. Our money has been so devalued it is very weak.

Oct 28, 2012 11:32AM
Why isn't the so-called main stream media covering the huge scandal in Libya? It is beyond belief that the networks and major newspapers of this country are aiding and abetting Obama by not reporting on what is probably the biggest government scandal since Watergate---perhaps even bigger since no one died in the Nixon scandal.

Folks - The answer to the "housing crisis" is jail time for the fraudsters - large and small. Dont; fine the corporations. The corporation is a piece of paper. The piece of paper did not commit the crime, the employees did. Put'em in jail and those in the future will get the message.

The buyers of the mortgage backed securities are the idiots here. WOuld you buy a car without looking at it, driving it? The banks, investors, 401k managers bought these securities and never even looked at them.

"OK Mr. seller, you say this $100,000,000 bundle of mortgages is A-1 Prime? Ok, here's your check."

Well, here's your sign! You dummies or crooks.

We do not need more regulatuon nor bailouts. Let the damned RE market collapse. It will rebuild itself within 18 - 24 months IF America does not go broke from all the debt and borrowing.

A Real Estate Broker

Oct 30, 2012 8:20PM
Oct 29, 2012 2:55PM
The article states there are good ideas to deal with housing problems.  None were cited.   The president and his competitor don't talk about it.  Ignore it and the problem will go away by itself?
We've got too beauts running for the presidency; neither one has a real clue about coping with this major issue.  Just don't rock the boat with potential voters.

Oct 25, 2012 9:32PM

let's talk about the detroit paper endorsing ROMNEY AND RYAN!!! HAHAHA...





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