Obama mortgage plan: Every American with a mortgage should call their lender

When I first watched commodities traders at Chicago’s CME denounce President Obama’s Homeowner Affordability & Stability Plan, I was on board with the traders. “How dare anyone ask that I help pay off my neighbor’s mortgage? If they bit off more than they could chew, that’s their fault!” But I began to have second thoughts . . .

. . . whose misdeeds in this crisis are worse? How are the mistakes of individual home buyers morally or financially worse than similar miscalculations by these very commodities traders or by Lehman Brothers, GM, Chrysler or Citigroup? These companies and professionals are also losers, aren’t they? They arguably took risks that they should never have taken, in many cases totally abdicating their professional duties of care and due diligence, going deep into debt to buy stuff they did not understand and could not afford. Continue reading

Raising capital in a down market? Beware securities law traps!

Raising start-up capital is a tough job even in good economic times.  These days, with credit so scarce, it can seem nearly impossible.  Unfortunately, when entrepreneurs want to get things done “in the worst way,” they sometimes run out of patience and do just that.  Raising capital in 21st century America is a bit like taking a road trip across Iraq. The road is strewn with booby traps. Continue reading

Price of oil falls, U.S. SEC to investigate short-sellers

Well, not really. But you’d think, based on the SEC’s virulent reaction to the decline in banking stocks, they or the Treasury or DOJ or somebody would act to protect oil investors, as well.  These poor souls lost another $4 per barrel on Tuesday. But maybe not all investors are created equal after all. If you invest in oil and get caught in the market whipsaw, you deserve to lose money. Or maybe if you short-sell oil futures, you deserve to make it.  Either way, the government’s response to the crisis in mortgage banking seems dysfunctionally two-faced.