On Nov 2, 11:26 am, "Elle" <honda.lion...[at]nospam.earthlink.net> wrote:

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Thanks.

"Thumper" <jaylsmith[at]comcast.net> wrote
E wrote
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Where single parent families with working mothers and
poverty income are common? Did you really not consider that?

On Fri, 2 Nov 2007 12:03:06 -0500, "Elle"
<honda.lioness[at]nospam.earthlink.net> wrote:

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Yeah? Try sending your kids to an inner city public school.
Thumper

"Sgt.Sausage" <nobody[at]nowhere.com> wrote
E
On financial planning education:
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As I indicated in my post to jIM, I think more focus must
be placed on educating parents about how their involvement
is the best predictor of their kids' educational success,
from reading, writing, and arithmetic to, as Skip calls it,
"street smarts." (The high falutin' synonym for "street
smarts" is perhaps "logic and critical thinking skills,
applied especially to real life situations.")

Motley Fool plugged the following not-for-profit financial
planning education (for young people) organization recently:
www.jumpstart.org (a.k.a "jump$tart.org)

I agree one way people learn is by getting burned. But I
think a kid can get (seemingly) "burned" at a very young
age, losing what to him or her is a large amount of money
but in fact is tiny on an absolute scale. Much education can
be delivered in this fashion. I still remember a sibling
winning some five dollars or so from me in poker when I was
around ten-years-old. (I guess that would be around $50,
worst case, in today's dollars.) I hated this experience so
much that I have never been to a casino nor otherwise
gambled since.

Aside: It is "who" not "whom" above. Rephrase to figure out
the case of "who" in such situations. E.g. "You think [they
or them?] are in need of it?"

"jIM" <noreplysoccer[at]hotmail.com> wrote
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Studies show that the best predictors of a student's success
in primary and secondary school--any primary/sec school--are
socioeconomic status; parents' education; and parental
involvement. If parents want to be certain their kids get an
education in financial planning, they need to be involved.
This of course can take many forms, from dinner table talk,
to time dedicated to reviewing the monthly budget; to
setting up the kids with their own allowance and requiring a
budget; etc.

That the public school system, and not bad parenting, is
chiefly to blame for inadequate educaiton is unfortunately
one of the biggest urban legends today.

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I live in SW Ohio, and during the last 7 years I have bought my first
house, refinanced it, sold it, bought a second house and refinanced
it.

During the whole process I learned a few different things. First
house was bought with a buy down on the interest rate (2 points 1st
year, 1 point second year, normal payment the third year). Loan had
PMI. The ratios as listed above were calculated, known and quite
tight (we had to do some funny math to make ratios work prior to
closing).

Learned to avoid PMI

refinanced to lose PMI. Had a first and second fixed rate loan.

Bought a second house with a 30yr fixed first and 15 year ARM of some
sort for second. I quickly learned the second is not what I thought
it was, and refinanced whole mortgage bundle (1st and 2nd) within 14
months. This time the ratios weren't an issue- I'm sure they were
calculated, but few people within the loan process discussed them.

After the ARM got larger, I recalculated the budget and ratios, and it
was clear to me I needed to do something.

During the 4th time, I was able to ask lots more questions based on
the experience of first 3. 4th time we bought the rate down, we
avoided PMI, both loans are fixed rate.

At same time I watched the budget and ratios.

My point is that we did get sucked into some of this, but if a person
is on top of things (persnal finances), they can get out with common
sense (as Skip alluded to 2 pages above).

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Learning the math is the responsibility of the public school system.
But math is only a tool- learning how to apply mathematical principles
is something most people lack, in my opinion.

I teach adults and kids for a living. There are skills which people
need to succeed in anything. But true mastery of anything (decision
making) is knowing when to apply what skill to a given situation.

Experience teaches us most of this skill application, but mentoring
can also point us to which skills to apply when in doubt.

"Elle" <honda.lioness[at]nospam.earthlink.net> wrote in message
news:13ii7bcq9cma329[at]corp.supernews.com...

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I think I'm finally getting that through my thick skull.

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Then, how do you suggest we provide said financial
education to those whom you think are in need of it?

"Sgt.Sausage" <nobody[at]nowhere.com> wrote:

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What would have happened if, after your purchase (while you still had
the ARM) the rates had started going up and property prices had started
going down?

On 2007-10-31, Sgt.Sausage <nobody[at]nowhere.com> wrote:
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Now you are shifting your claims. That is a much easier calculation
than the future value of money, which is what you first claimed was
taught to everyone by 7th grade.

Your claim is false. Repeating it won't make it true.

"joetaxpayer" <joetaxpayer[at]nospam.com> wrote in message
news:0rednZuny4GoD7vanZ2dnUVZ_vyinZ2d[at]comcast.com...

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They'll only self-regulate if you let them feel the pain.
Let a few banks go under. The rest won't be in such a hurry
next time to write bad paper.

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I'm saying: Yes, the only way to avoid it is Govt. Intervention.
I'm also saying, No -- that's exactly the wrong thing to do.

Back up a few posts. I said "let them feel the pain". It's the
only way (outside of Govt. mandate) that they will self-regulate.
Why should they regulate if someone comes in and bails 'em out?
They won't have any reason to. The obvious answer: Don't intervene
and let 'em feel the pain. They'll be sure to self regulate next
time (at least for a while, anyway).

"joetaxpayer" <joetaxpayer[at]nospam.com> wrote in message
news:kJednRL4VPiMz7vanZ2dnUVZ_gmdnZ2d[at]comcast.com...

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Nor was I -- <deity> help us if he does.

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They should have, but they got greedy. Such tends
to happen. Bailing them out, though, would be an
even bigger mistake.

[snip]

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Only to those in denial of reality. To the rest of us
(you, apparently included) knew (or should have known)
better.

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We rode the refi train all the way down. Initial ARM to
get the low "introductory" rate. Refi to 30 year at 7.75%
Refi to 20 yr at 6.25%. Refi to 15 yr at 4.99%. Not once
during those refis did we "cash out". When everyone and
their brother was getting into an ARM, we were getting
out.

Nothing wrong with ARMs, per se -- we used one to start,
we just didn't try to take advantage of the situation, (by
using the low intro rate to get into something we couldn't
afford). No. We knew how to run the numbers ourselves and
kept it affordable, fixing the rate as soon as rates were
favorable and riding that train all the way to the bottom
of the rate curve.


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Agreed -- but it shouldn't be. Folks *can* understand this.
It ain't RocketScience(tm) -- they simply choose to ignore
the facts and stick their heads in the sand.

"Greg Hennessy" <greg.hennessy[at]localhost.localdomain> wrote in message
news:slrnfiehcb.2rr.greg.hennessy[at]localhost.localdomain...
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While I've got no reason to exclude those folks (green is,
after all, green) regardless of where it comes from ...

There is absolutely nothing to stop me from choosing not
to loan to, say, folks from Outter Mongolia simply because
I may or may not like the slant in their eyes or the color
of their skin. (FYI, I *would* loan to an Outter Mongolian,
I'm just making a point here).

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I'll give you the banks. You got me on that.

I won't give you me. He still has no legal right to tell
you and me how to make a personal loan. We don't fall under
those rules.

Speaking of which, those rules don't even apply to banks
in terms we're speaking of. The rules you cite deal with
race, religeon, ethnicity. There are no such rules defining
who's a good credit risk and who's not -- and more to the
point, defining who a bank chooses to loan to based on
the assessment of said risk. Wrong rule book, Greg.

"Sgt.Sausage" <nobody[at]nowhere.com> wrote
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Whence we are back to the judgement that any five-year-old,
aided only by the public school system and regardless of the
presence of bad or no parenting, is a deadbeat when she or
he does not know how to choose wisely at that age and then
build on those choices.

We disagree.

Financial education is not taught strictly through the
public schools. I would say most education, of any flavor,
is not delivered through schools (public or private).

"Greg Hennessy" <greg.hennessy[at]localhost.localdomain> wrote in message
news:slrnfiegtc.2rr.greg.hennessy[at]localhost.localdomain...

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Most of the necessary calculations are "pre" algebra.
Simple arithmetic, really. You're telling me you were
in high-school before you could calculate the difference
between 4% and, say, 9% of $200K? No algebra involved in
that one, and that's the one that's putting so many of
these folks into foreclosure and bankruptcy.

"Daniel T." <daniel_t[at]earthlink.net> wrote in message
news:daniel_t-F03807.19064829102007[at]earthlink.vsrv-sjc.supernews.net...
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It, in fact, goes farther with me.

"oh those stupid borrowers"
Who borrowed the money.

"oh those stupid brokers"
Who found the (equally stupid) folks to loan the money

"oh those stupid bankers"
Who initially put up the money to loan.

"oh those stupid investers"
Who put up good money to pay for bad paper and relieve
the bankers of their risk.

It extends from the bottom to the top -- all the way
up and back down again.

They were all ignorant.

My only hope is that it doesn't eventually lead to
"oh those stupid taxpayers" who bail out any of
the above mentioned ignorant folk. Sorry. No bailouts
for anyone. That's the only true solution.

"Elle" <honda.lioness[at]nospam.earthlink.net> wrote in message
news:13id0uhabvs5iee[at]corp.supernews.com...
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You seem to be ignoring the fact that I wrote that
every single kid who attended public schools in America
(probably any time in the latter half of the last century
through this very day, today), in fact, *did* have the
necessary education but *chose* to ignore it.

It's simple 'rithmatic. Plusses, minuses, a few ratios,
quotients and multiplications. More complex (compound
interest, time value of money (present value/future value) --
*all* is taught to every single kid by early high school.
I have my mathematics textbooks from the seventh grade.
All of this is in there. All was taught, and tested,
in grade school. The education happened. The results
you're looking for based upon said education did not.

It is not an education issue. These folks were educated
and had the necessary tools, but chose denial instead.


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I'm not saying that at all. I'm saying that most people
wouldn't be helped. The fact that some are coming to
this particular forum and others like it -- that specifically
excludes 'em from the "most people" category. "most people"
don't actively seek out information. "most people" just let
life happen to 'em. "most people" will fall for any salesman's
pitch. "most people" won't back up the saleman's BS by crunching
the numbers themselves. "most people" have the necessary
cognitive development and skills to handle this, but *choose*
to ignore it. By definition, the folks actively seeking out
information are *not* these "most people".

The folks who come to this forum certainly ain't "most
people".

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On Oct 30, 11:57 am, Greg Hennessy
<greg.henne...[at]localhost.localdomain> wrote:

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Nice for who (or is it whom, I can't remember)? The "no such thing as
a free lunch" principal applies here. Company expenses are increased
by errors and omissions coverage, ethical and fiduciary training,
compliance with regulatory agencies, et cetera... Corporations, being
the profit-seaking entities that they are, pass these expenses on to
us, the consumers. I personally don't care to pay higher fees, closing
costs, intrest rates, whatever... just to ensure that an "uninformed"
borrower doesn't hurt himself.

There may be more factors at work than Sgt. Sausage includes in his
analysis but for the most part I agree with him (I do think that some
of Elle's points are also very valid). I have a feeling (not proof,
just a feeling) that the majority of borrowers that lose their homes
in this mess will not willingly get caught up in it again. I hope
their children, friends, and family that watched on in horror will
also "learn by watching others get burned."

-Just my $0.02

On 2007-10-29, Sgt.Sausage <nobody[at]nowhere.com> wrote:
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If you believe that, why don't you try advertising "Loans
available. No Blacks, Women, or Jews need apply."

I think you will find that Uncle Sugar does the the legal right to
tell you how to loan money.

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That ship sailed long ago.

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I'd disagree. I never saw those types of calculations until
college. I never saw algebra till high school.

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Of course it might be nice of mortgage brokers had a fiduciary
responsibility to recommend suitable mortgages to those who paid them
money, but they don't.