Posts Tagged ‘ moral hazard ’

Real Estate 360 Live With Louis Cammarosano 5/14/12

On Monday May 14, 2012, Louis Cammarosano, General Manager of HomeGain, was a guest on the Real Estate 360 Live radio show on The Big Talker 1580 WHFS AM, hosted by Ryan Sloper.

Listen to the show.

Part 1 (14:47)

Ryan notes that one of the Facebook co-founders is renouncing his US citizenship to avoid taxation. Louis notes that the US is the only country that lays a claim on its citizens’ world wide income. Louis notes that if the US wants to be competitive world wide they need to reconsider their taxation policies.Louis that for over 100 years people from all over the world wanted to come to the United States.

Louis notes that the powers in Europe are spending a lot of money to keep Greece in the Euro. Louis notes that RE Radio discusses events in Europe because they have a direct impact on US interest rates. Louis notes that opposition parties in Europe are against austerity programs and that the situation in Europe helps the US as Europe has to debase the Euro by printing more money to bail out its member states. Louis notes that the US is also in the race to debase.

Louis notes that JP Morgan’s losses are probably greater than the $2 billion stated. Louis notes that this situation may pose the need for another bailout, which if were to occur would probably drive more investors into the “safety” of US treasuries and drive interest rates lower.

Louis notes that the journalist coverage of JP Morgan’s trading loss is general and that the specifics are not know. Louis speculates that the loss if probably far greater than reported to date. Louis notes that JP Morgan’s CEO Jamie Dimon is on the board of the NY Federal Reserve. Louis notes that the Federal Reserve is a private bank. Louis notes that depositors don’t keep tabs on their banks’ trading activities because they are satisfied with FDIC insurance. Louis notes the revolving door between the big banks and the US government.

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Posted by: HG Blog Admin on May 20th, 2012 under Louis Cammarosano on Real Estate Radio

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Real Estate Radio With Louis Cammarosano 11/7/11

On Monday November 7, 2011, Louis Cammarosano, General Manager of HomeGain, was a guest on the Real Estate Radio show on The Big Talker 1580 AM, hosted by Ryan Sloper.

Listen to the show.

Part 1 (13:55)

Ryan notes that there is a city near Detroit, Hyland Park that has turned off the city’s electricity and pulled out the street lights because they can not pay the electric bills. Louis notes that this is considered “austerity”. Louis notes that local governments should be able to provide the necessities(fire, police, water and lighting) if the money was managed properly.

Instead local governments rely on bond issues and getting money from Washington to pay for government services. Louis notes the irony of hiring local politicians to get money sent to Washington back to the local municipality. Louis also notes that governments generally don’t threatened to cut the non essentials and when they are short on cash, but rather threaten the essential services in order to extract more money. Ryan and Louis discuss the raising of bank fees on consumers and the backlash that it has created, leading to the Bank of America has retracted their intention to charge consumers to use their bank cards.

Louis notes that the entire episode was the unintended consequence  of government intervention. Ryan discusses the best way to shop for a mortgage. Ryan discusses factors that impact mortgage interest rates. Ryan notes that the treasury will sell $72 billion of bonds. Ryan notes the change of government in Greece and that the contagion has spread to Italy. Louis notes the the Greek crisis has been lingering because the central bank has been propping them up.

Louis also notes that if more municipalities can not provide services, the Fed may provide a bail out. This would lead to higher interest rates and inflation. Louis predicts that the dollar will out last the Euro in that it can probably print more money and that eventually, entities including sovereigns, must be allowed to fail. Louis notes that the Federal Deposit Insurance Corporation creates a moral hazard. Louis and Ryan discuss fractional reserve banking and its role in creating the potential for bank runs.

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Posted by: Louis Cammarosano on November 20th, 2011 under HomeGain on Real Estate Radio, Louis Cammarosano on Real Estate Radio

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