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May 9th, 2008

CURMUDGEON’S CORNER.

by Sean Jaeger

Too bad the phony patriots who are preaching prejudice and waving ragged flags in front of the Seven Eleven while stealing and soiling the glorious name of the minutemen can’t bother to read more of the document that those brave rebels fought and died for.

Remember the Declaration of Independence?

We hold these truths to be self evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are Life, Liberty and the pursuit of Happiness...note that the “pursuit of happiness” line didn’t say anything about barbed wire border fences.

Just a few lines further the declaration turns to a ringing indictment of the King of England, including this: He has endeavored to prevent the population of these States; for that purpose obstructing the Laws for Naturalization of Foreigners; refusing to pass others to encourage their migrations hither.

The founding fathers were definitely open border, pro-immigration types.

The real illegal immigrants in the Hamptons are the infiltrators from Bay Shore–that’s where the instigators of the rabble rousers in front of the Seven Eleven come from, infiltrators in the trade parade who think they have the right to drive in on the Sunrise Hiway and impose their will on the Hamptons. They come in from Crookhaven, so maybe they should try and fix that first!

The anti-immigrant agitators keep repeating the word “illegal” like a mindless mantra. None of our ancestors came here with visas. So the problem is not bad people who are illegal; it is bad laws making good people illegal– and the problem with bad laws is that they attempt to obstruct progress. You know, like prohibition, or the Jim Crow segregation laws that espoused the idea that African Americans were separate but equal. That kind of bad laws.

Remember, the Declaration says “ALL men are created equal.”

Everywhere you look there are signs showing that once more the immigration code of the East is a giant con, stirring up controversy and confusion without offering any solutions.

All over the East End the farms, bars, restaurants, resorts and hotels are in trouble because a new law says they can’t hire the seasonal workers, the same workers that have kept them in business for years. Even circuses are having trouble hiring the roustabouts that put up and take down the big top tents.

Then there is the enforcement code caper. Half the illegal rentals in the Hamptons have been Irish bartenders – often illegal immigrants themselves, as well as group house hell-raisers.

It is worth remembering that as late as the 1970’s the Catholics in Northern Ireland did not even have the right to vote. Another case of bad laws.

Now all of a sudden the Hamptons have their own Black and Tans-constitutional rights-busting code enforcers barging into homes at dawn, taking names and kicking butt, always in the service of some political goal, like scaring out Latinos, (legal or illegal) or group rentals from the house of a competing landlord, or to embarrass a political opponent. Another set of laws designed for persecution more than prosecution.

These days you don’t have to be an illegal immigrant to lose your home. Almost any citizen with a mortgage can end up homeless. The panic has hit the real estate market, not just in Detroit and Sacramento but right here in the Hamptons, where housing prices are crumbling as fast as some of the beaches.

Time to change the vocabulary. This isn’t a bubble bursting, with a dainty plop. This is a case of bombs bursting in air, with real casualties, and the suckers are taking the blame while the perps walk away with all the money.

Blaming the victims makes a great strategy, if you can make it work.

The great American robber barons of the 21st century are making it work like a charm. They rape the American middle and lower classes and then blame them for trying to grab just a tiny piece of the American dream.

The best way to find a thief is to follow the money. If you follow the money in the great mortgage meltdown and credit crunch that the entire country is now facing, just where do you think you are going to find the pot of gold? Has it somehow trickled down into the hands of the relatively few people losing their homes, their life savings, and their credit rating, with foreclosure signs on their homes? These people are mainly victims, sold a bill of goods in the form of predatory mortgages, only to find their very future foreclosed and their dreams declared DOA.

Mortgage brokers and hedge fund managers would like to tell you these people are fools, folks who tried to cheat the system and who are getting no more than they deserve. But the majority of these sub prime mortgages went to sub prime houses and ended up with mafia like interest rates, not the 4- 6 per cent mortgages the well-off could get, but rather high cost, high fee loans with rates spiking up to 15 per cent. This served to drive up the rate of return…and the rich got richer.

The real money came in the form of commissions, fees, and interest differentials. Did the money go to the mortgage brokers and bankers and the Wall Street brokerage houses, hedge funds and private equity funds that bankrolled them? Of course it did. They are all making billions in the great mortgage scam of the 21st century. Financial wizards sliced and diced these mortgages into neat little bundles called CDO’s (collateralized debt obligations); the key is to skim off every penny from fees, commissions and management charges they could and then sell these bundles as investment instruments–magic mountains of paper that will pay investors a very high rate of return. But when all the fees are skimmed off where is the moneygoing to come from to pay those high rates of return? The only place it can come from is the poor suckers trying to pay off their over-priced mortgages on their over-priced tract houses in Detroit, Atlanta, Las Vegas, and Sacramento–not to mention the fast-flipped condos in Florida and California, where the prices are now pancaking.

It’s not that there is a lot of real money lost down there at the bottom of the mine, where the houses touched the ground. Homeowners are becoming homeless but the houses are still there. The real products getting flushed down the toilet are those piles of paper, sold on the promise that they would pay big interest. If the interest slips, even a little bit, then the paper gets shredded. The paper is losing a lot more money a lot faster then the relatively small decline in the value of relatively few foreclosed houses. After all the houses are still there and the land they sit on is still there. Some of them might have been over-appraised, shall we say. But not nearly as over-appraised as the big money players who are walking away with billions of our dollars.

Of course the Wall Street crybabies have gone into panic mode, selling everything they can get their hands on to save their own money and their own careers while buying nothing, thus sending the credit crunch into overdrive.

And all the while lending nothing. In their panic to avoid any risk of their own they have frozen the credit market. They want to tighten loans standards instead of writing mortgages to get money back into circulation so people can buy and sell homes.

Isn’t it convenient that the ever-cooperative Fed has lowered interest rates at record speed, but only for banks?

Money is cheaper for the banks but how about other interest rates? They continue to ratchet up -not just on adjustable rate mortgages, but even more so on the adjustable rate credit cards that more and more Americans are forced to use as financial life preservers. Those interest rates can top 20 percent in the blink of an eye. They used to call rates like that loan-sharking. Maybe they still should.

In the meantime, the second home owners in the Hamptons could get more for themselves and for everybody by registering to vote in the Hamptons instead of in New York City or New Jersey. A few hundred votes in the Hamptons could drive a revolution. Where do you think your vote will count most?

Filed Under: Articles | Commentary | New York | News | Politics | the Hamptons

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