Mandeville, LA – Exclusive Transcript – Of course, ladies and gentlemen, there is no FHA, there’s you. You and me are the FHA. If somebody goes belly up on an FHA-guaranteed loan, guess who gets to pay it? Are you looking in your rearview mirror as you drive right now, friend? Give yourself a gold star and a pat on the back. Take another swig of coffee. Yes, that’s you. Happy? Check out today’s transcript for the rest…
Begin Mike Church Show Transcript
Mike: I mentioned the effect of the Federal Reserve and its quantitative easing and that it’s felt all over the world. I have this story here from my buddy Mish Shedlock at Mish’s Global Economic Trend Analysis. He posted this yesterday, “FHA Swamped by Defaults.” There’s another story out there today about student loans that are defaulting. Did you know there is over $1 trillion in student loans outstanding, and that the number of defaults rises every single day, to the point where let’s just say a third of them are in default. What is the mechanism that Congress is going to use to enforce that? How are they going to collect the money, especially if young people aren’t working or won’t? That’s another thing, they won’t do the jobs that are actually out there. We have a last train to Brokesville news segment here. “FHA Swamped by Defaults; Congressional Report Shows FHA Could Suffer Losses as High as $115 Billion; Shut Down Fannie, Freddie, FHA.” I’m interested.
An alleged “worst case scenario” shows the FHA could lose as much as $115 Billion. Since these worst case scenarios are always famously optimistic, the best course of action would be to shut the agency down.
Mike: That’s not gonna happen. Could you imagine banks and people with gold and silver and Krugerrands and assets and what have you actually loaning money to people for mortgages? Shudder the thought. That will never work. That has never worked in the history of — wait, it did. Why don’t we just print the money and have the Fed loan it out under various non-governmental organizations, NGOs?
I was quoted as saying just that by the Heartland in Congressional Report Raises Spectre of FHA Bailout. [Mike: I thought the housing industry was boomtown. I thought they were kicking butt.]
The Federal Housing Administration’s (FHA) losses over the next 30 years could be much higher than originally projected, according to the findings of a congressional committee.
Mike: Of course, ladies and gentlemen, there is no FHA, there’s you. You and me are the FHA. If somebody goes belly up on an FHA-guaranteed loan, guess who gets to pay it? Are you looking in your rearview mirror as you drive right now, friend? Give yourself a gold star and a pat on the back. Take another swig of coffee. Yes, that’s you. Happy…
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