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Eye of the beholder

I'm always amazed at how two people can go through very similar experiences and come out the other side with completely opposite viewpoints. Take, for example, the story on NPR this morning about two people who were mortgage brokers during the housing boom and bust.

Curt Nickisch reports from Boston on former mortgage brokers Laurie Souza and Craig Good. Souza says:

...it's not fair to blame brokers for the housing mess. She says homebuyers were either fraudulent or lazy.

"I wish some of these borrowers would be held responsible," Souza says. "I don't feel bad for those people. I'm sorry, I don't. You bought the biggest thing in your life and you had all this time to understand it, and you didn't! You know, how is that our fault?"

But the other broker, Craig Good, sees it very differently:

"I was greedy," Good remembers. "Boy, I was greedy. And when I came to that conclusion -- you know what? -- it wasn't awesome."

Good says he served as a matchmaker, a conduit between aggressive lenders and risky borrowers, because that's where the money was. He says he did help deserving people get into homes. But Good feels remorse for his part in what he calls the obesity of the time.

Good used to pull in up to $400,000 a year. Now he makes a fraction of that running a fruit stand. More from the story:

... unlike the mortgage business, what he's doing now makes people happy each day, he says. Before, if someone complained, it's not like he could redo a mortgage. But now, he can hand out another mango. Good says he'd rather teach his son the fruit business than the mortgage business.

Souza, on the other hand, is selling -- wait for it -- gold. Her new company, Gold to Green, organizes "gold parties" where friends and neighbors sell unwanted jewelry. She has hired 20 employees, many of them former mortgage brokers:

"We're basically riding a gold bubble that came after a housing bubble," Souza says, "and when this is done, I have no idea what's going to be next. But I'm riding the wave."

Souza used to ride the subprime wave as a mortgage wholesale representative. She was good at it, and she made a good living -- $800,000 in her best year during the housing boom.

"I miss it," she says.

Both Souza and Good say they would go back into the mortgage business if the housing market recovers. But they see that differently too:

Good says he would do it differently. Souza says she's afraid that with the new rules and regulations that have made the business more cumbersome and costly, it won't ever be like it used to be.

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As unfair as it may be, my first impression of Ms. Souza is not a good one.

I like Tony Soprano's wisdom on the situation:

"Hey, there's plenty of garbage for everybody"

Just like there's plenty of blame to go around for everyone for this housing mess.

What these folks have to say seems unremarkable to me. Why they would consent to an interview is interesting and unfathomable. What did they hope to gain?<p>
"no such thing as bad publicity" I guess?

I missed this story -- it's pledge week here. I'm so glad to see this report. The brokers during this period added no value to the economy, as a whole. I am glad that ex-brokers, like Mr. Good, are now adding value and valueS to the country and the economy. I hope there are more like him, and fewer Souzas, out there.

Ms. Souza,

How would you like it if you went to your doctor and he told you that you had cancer and then he told you that he knew 3 years ago that you had cancer but didn't tell you because you were too lazy to figure it our on your own. After all you had plenty of time! Now you only have a month to live.

How much do you know, Ms. Souza, about how to build houses? How much do you know about where your food comes from? How much do you know about medicine, manufacturing, and all the other multitudes of things you rely on everyday of your life? Nothing I would suppose or very little. I bet you're happy someone else takes care of these things so you don't have to know anything about them, so how about you give a little back to the world you've taken so much from and provide a service that's in your client's interest rather than your own. Or better yet, get out of mortgages and work a job that has minimal impact on society and stop endangering the rest of us with your reckless selfishness. If you took a play out of Mr. Good's book you may even become deserving of some sympathy if you were to come down with cancer.

Yes, this was shocking. I'm always intrigued by "after-the-fact-enlightenment" and "my-moral-compass-is-now-fully/partially-restored" stories.

"You're like the thief who isn't the least bit sorry he stole but is terribly terribly sorry he's going to jail." -- Rhett Butler
(sorry, couldn't help myself : )

A bubble in, say, shares, stocks or commodities happens when people believe it will "go up and up" (and is, as a rule, as with housing recently and "tech" stocks at the beginning of the millenium, again mainly driven by money inflation). Gold in contrast is a hedge against inflation and against <a href="http://crisismaven.wordpress.com/2010/02/08/bloom-of-doom-v-we-have-cont... sovereign defaults</a>. Inflation by definition is the increase in money supply. There's no doubt that this has happened several fold in only two years. So there is inflation. <a href="http://crisismaven.wordpress.com/2010/01/24/do-we-see-a-gold-bubble/">Hence there is no gold bubble</a>, as gold has not appreciated by a tenth even of what the monetary base has expanded!

Wow - I applaud Mr. Good's sentiments and adherence to values. I think we can just wait for Ms. Souza to be arrested at some point for crossing a legal line!

While Ms. Souza's point of "lack of responsibility" by borrowers has validity, there is also a responsibility of the lender. I know if I were lending these large amounts of money, I would want to know if they could pay it back, i.e., do a good credit check first. My impression has been that lenders did not take this responsibility seriously

Because the person lending the money often didn't care if it would get paid back because the loan wouldn't be serviced by his/her own company.

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