8 votes

Romney's EXTREMELY poor grasp of economics

Hurt him badly in his own wallet.

Romney splashed out $12m on a new house in California at or near the very top of the housing market.
The house lost 38.7% of it's value in 2 years.

If someone is this stupid with their own money, just imagine how stupid he would be with yours.
If someone is this stupid about basic economics imagine how much he would hurt America.

Romney should have bought some Gold instead :)

http://www.latimes.com/news/nationworld/nation/la-na-romney-...

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?

He's worth $255M. He buys a house for 12% of his net worth. I think his net worth dropping a percent or two isn't going to phase him and isn't the 'bad economic' decision you claim it to be. It was conservative, they clearly can afford it, and... drumroll please... they sound like they wanted a house. When you have $250M and you want a house, you buy a house. You don't rent a house.

Can you actually admit you are suggesting someone with $250M rent a house to avoid the possibility of a few million dollar loss? You want to know the conspiracy stories that would fly if he did actually do that? Yeah, there's no collusion between the banks and politicians when our politicans magically all rent houses during downturns. And, you think it's worth a few million to him to have a landlord? Silly.

I am suggesting

he should have waited a year or two and saved himself $4.5 million dollars.
If he wastes his own money like that, what will he do with yours?

"In the end, more than they wanted freedom, they wanted security. They wanted a comfortable life, and they lost it all -- security, comfort, and freedom. When ... the freedom they wished for was freedom from responsibility, then Athens ceased to be free."

Yeah..

The purchase was probably less about capital gains, and more about tax evasion. He may have figured out that he could go from paying no tax, to having the IRS pay HIM by living in California.

Yep, Mitt, I called you a tax cheat. Come at me, bro.

McCain's grasp was

no better. Remember Ron Paul's Sunshine Rule question directed at McCain during the 2008 debates?

They are not chosen to win an election but merely chosen as place holders so the people think they have a choice.

The law cannot make a wicked person virtuous…God’s grace alone can accomplish such a thing.
Ron Paul - The Revolution

Setting a good example is a far better way to spread ideals than through force of arms. Ron Paul

that's a stretch...

A) Nobody, even Ron Paul, knew exactly when the collapse would happen. If you needed to buy a house, you buy a house.

B) To Romney, that amount of money is chicken scratch. So what if it's worth less, he got a nice house, still has it, and will still be enjoying it while the rest of us suffer.

That doesn't make him economically ignorant, just rich as hell.

'Cause there's a monster on the loose

I knew and a bunch of ppl on financial boards knew as well

We were watching charts of sub prime teaser rate resets per week.
There was a sudden increase of over 10 times in 4th qtr 2007 and continued high well into 2008.

These were mortgages that went from around 2% interest to 8-12% overnight when the teaser rate finished.
They were not called teasers for nothing.

We were also watching charts of avg house price / avg wages in a number of countries.
They had been at all time highs for some time.
It didn't take a genius to work out that housing was over priced.

Romney presumably employed investment advisers to manage his wealth.
They should have advised him against laying out $12m on an additional house.
Goldman Sachs were shorting the housing market from about mid 2007.
A number of hedge funds were shorting it too.
Evidently Romney does not hire good economic advice.

I predicted the stock market peak as 2nd week October 2007 - in August of that year. (Pretty much in line with the house price peak.)

It's not so easy to predict when the Euro bust is going to happen though.
It is more dependent on politicians hot air, but it will go pretty soon.
Maybe Obama can keep the stock market up until the election, maybe he won't be able to.

"In the end, more than they wanted freedom, they wanted security. They wanted a comfortable life, and they lost it all -- security, comfort, and freedom. When ... the freedom they wished for was freedom from responsibility, then Athens ceased to be free."

Could you pat yourself on the back any harder? :)

For somebody worth 230 million, laying out 12 million for the house he wants, even though it may fall a little in value, doesn't constitute financial ignorance. He wants it, he gets it, doesn't matter what the trivial little cost is.

'Cause there's a monster on the loose