Last year I wrung several good posts from the Obama Administration’s doomed-from-go scheme to get banks to modify mortgages. It was good material for me. I got to mock both those few who were clueless enough to
think it might work and the great many people who were too polite or too loyal to the White House to admit that they understood that the program’s outlook was grim.
After a while, I got bored of beating that particular dead horse. So many other things to mock.
But I realized recently I never really addressed the basic conceptual flaw in the Home Affordable Modification Program. This came to me as I was reading a recent guest post at Smart Spending, a blog that carries many thoughtful guest posts.
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The article is ominously entitled When Student Loans Live On After Death. And it begins, dramatically, thusly:
In July 2006, 25-year-old Christopher Bryski died.
His private student loans didn’t. Mr. Bryski’s family in Marlton, N.J., continues to make monthly payments on his loans—the result of a potentially costly loophole in the rules governing student lending.
And what, you may ask, is the nature of this hitherto obscure loophole that The Wall Street Journal heroically exposed this weekend? Turns out, if a loan has a cosigner, and the borrower dies, that cosigner is considered liable for the debt. This was a surprise to both Mr. Bryski’s father, who cosigned his student loans, and Mary Pilon, who wrote the article.
Are you freakin’ kidding me?
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On Friday WalletPop broke the news that IRS data shows that some millionaires claimed unemployment benefits in 2008. Using the increasingly rare definition of millionaire as a person or household with more than a million
dollars in income, rather than net worth, it disclosed that according to IRS data (found here on table 1.4) 2,840 returns showing more than a million in adjusted gross income reported some unemployment compensation.
So the secret is out. I certainly did not qualify as a millionaire under the income test in 2008, but, as I have previously confessed, using the commonplace net worth criteria I do clear the (lower) bar. And, if you must know, I drew unemployment benefits for pretty much the whole of 2008. Oh, the shame!
I realize that few of you readers are part of my elite economic strata. So let me share some of my world with you. Not only do we fat cats draw unemployment when unemployed, when old we get Social Security and Medicare. Some of us even send our kids to public school. We drive our luxury automobiles on public roads and when our mansions catch on fire we call the municipal fire department to put it out.
Shocking, I know.
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It is time to make another visit to the bounty of information that our nations’ intrepid polling companies gather for our enjoyment. I usually start these visits with a short proviso about how survey data about what people say to strangers who call them on the phone can’t hold 
a candle to data about what people actually do. Often I point out that survey respondents tend to be neither candid nor thoughtful in their responses.
Today I am going to skip all that. I will just give examples.
The Rich are Optimistic?
On July 12 Gallup found that Upper-Income Americans See Living Standards Improving. Depending on your outlook, that might have given you a sense of second order optimism, after all, those rich folks must know more than the rest of us, or perhaps bitterness of the-rich-just-get-richer sort.
In either case the feeling was likely short-lived because four days later The New York Times carried the front page headline Wealthy Reduce Buying in a Blow to the Recovery. The Times story was largely a compilation of anecdotes and quotes from assorted “analysts” who like to see their names in print. But the gist was that rich folks are pessimistic enough about the future to cut back on spending.
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Today is the first anniversary of the posting of one of my few evergreen items, When to Start Collecting Social Security. Coincidentally, just yesterday I
came across an item in Smart Money that made me realize I needed to update my analysis to include an interesting wrinkle in the Social Security rules.
To recap, a person is allowed to decide when to start drawing Social Security payments from the government. You can get them at 62, at 70, or anyplace in between. There is an obvious attraction to getting it sooner rather than later, and about 45% of those eligible choose to start getting the checks on their 62nd birthday.
The reason that the other 55% hold off is that the older you are when you start, the bigger the checks become. The payments for a person starting at 70 are about 70% higher than for a person starting at 62. (But relatively few hold out all the way until 70. The median age is 63.)
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think it might work and the great many people who were too polite or too loyal to the White House to admit that they understood that the program’s outlook was grim.
Government, Housing, PF Blogs | Frank Curmudgeon | 
September 24, 2010 11:59 am | 
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