Reading Response 2 / Madeleine Lyon

Can Jokes Bring Down Governments? by Metahaven provides an interesting insight into how something often portrayed to be absurd and irrelevant is actually a very real depiction of society’s current status and their opinions of important topics, such as their current government. It is striking to see how this publication, penned years in advance, yields information that is almost prophetic to the current rise the highly meme-based organizations that have started to gain traction in our society. Throughout these selections, Metahaven discusses a few key points as to why jokes are so effective.

Firstly, jokes are free of charge. Anybody can afford to use them or enjoy those of others whether or not they are short of time or money. Not only can they be created and applied with relative ease, they can also be viewed with little to no cost. With the internet, creating, posting and viewing these ideas requires very little effort and immediately exposes content to the rest of the world, often free of charge as well.

Jokes are approachable to the general audience and thus can be extremely contagious. The advent of the internet has pushed this even further, providing a breeding ground for ideas, including jokes, and organizations that create and support them. Advents of technology such as the creation of the printing press and the Internet have allowed ideas, including jokes to spread like wildfire. Online anonymity, or at the very least a distancing from the physical act, allows for people to express their ideas freely in a way that they wouldn’t be able to face-to face. When people feel less responsible to contain themselves within the societal norm, some rather toxic ideas can be spread and fester. Others can counteract them but in most cases, one must fight metaphorical fire with fire, subjecting themselves to a popularity contest that ultimately determines what the online majority is willing to accept.

Jokes adapt and evolve. With the production of jokes being as quick, simple and accessible as it is today, a myriad of ideas can be drafted and even published. Out of that gargantuan amount of content, a handful is almost sure to gain traction and a loyal following. Those people can then modify this “template” and apply their own knowledge to it to hit niche audiences harder than the original joke might do if it was just left alone. Often times, jokes, especially memes in the internet, develop from basal forms and are eventually adapted to suit a wider audience and even transfer to analog pieces.

Secondary Research – Individual / Madeleine Lyon

Spotlight on the Housing Market in Cincinnati-Middletown, Ohio-Kentucky-Indiana

Thesis: The 2008 recession not only marked a spike in foreclosures but also a drop in the general population, leaving many homes-even new ones- abandoned.

Useful information:

  • The Cincinnati MSA did not see the rapid appreciation of the house price bubble; yet, local house prices have fallen below their 2000 levels.” (ibid)
  • “Declining property values in Cincinnati were fueled in part by excess housing construction in the years prior to the housing crisis, but mainly by rising defaults, driven first by unsustainable mortgages, then by the economic downturn and climbing unemployment.”(ibid)
  • distressed mortgages : 90 or more days delinquent or in foreclosure (ibid)
  • “…excess construction…contributed to an oversupply of housing…may have led to steeper price declines after 2006. According to the Census Bureau, the number of vacant units in Cincinnati increased by an average of 3,300, or 6.1 percent annually during the 2000s, higher than the national rate of 4.4 percent during the same period.” (ibid)
  • “…investor home purchases in Cincinnati represented a relatively small share of total purchases in the years leading into the crisis…” (ibid)
  • “…subprime lending increased significantly in the Cincinnati MSA … data prepared by the Cincinnati Enquirer shows that the number of subprime mortgages increased from 5,836 in 1995 to 15,969 in 2005 and that one in every seven new local borrowers in 2005 received a subprime loan.” (ibid)
  • “…job losses were significant… the region averaged 35,900 jobs lost, or a 3.4 percent annual decline…” (2)
  • “Existing home sales began a steep decline in 2006 but have leveled off since 2008. New home sales also fell sharply from 2006 through 2008 and have continued a slow decline.” (2)
  • “Cincinnati homeowners continue to struggle with high mortgage delinquency and foreclosure levels….CoreLogic data since 2000 show that the rate of mortgages at risk of foreclosure in Cincinnati had been consistently higher than the nations’ before mid-2008…” (2)

Source: US Department of Housing and Urban Development

Date Composed: 2012

Cincinnati Sues Seller of Foreclosed Homes, Claiming Predatory Behavior

Thesis: Cincinnati is trying to prevent opportunistic investors such as Harbour Portfolio Advisors from neglecting purchased properties acquired from the 2008 foreclosure crisis and using them to exact predatory pricing tactics on their poor, disadvantaged customers.

Useful information:

  • “In a sweeping lawsuit, Cincinnati took aim at one of the nation’s largest sellers of foreclosed homes, Harbour Portfolio Advisors, saying that the firm owes more than $360,000 in unpaid fines, fees and violation notices. The firm failed to properly maintain dozens of homes, the city claims, leading in one case to a child’s testing positive for lead poisoning.”
  • “…new market has become a money trap for many poor families.”
  • “ The lawsuit against Harbour, which is based in Dallas, is the first of several that Cincinnati plans to file against out-of-state firms…”
  • “Investment firms like Harbour scooped up the run-down, foreclosed homes at bargain prices, selling them to families who could not get conventional mortgages but were desperate to own homes…Harbour, city lawyers said, has been selling “substandard” homes to buyers in Cincinnati who often default on the contracts because they cannot pay for the repairs or keep up with the monthly payments.”
  • “…Harbour “intentionally fails to disclose known defects about the properties, including building code order and other violations.” Even after being warned by Cincinnati and charged with violations… went forward with sales of the properties that had incurred violations…a long list of fruitless attempts it made to get Harbour…to make repairs to homes and pay fines.”
  • “Harbour’s contracts are “predatory and unconscionable” in part because the firm sells homes for up to five times the price it paid for them and holds the title to the residence until the final payment is made — which rarely happens.When the contracts for deed fall through, Harbour “churns the property through the process anew,” often to a new prospective homeowner.”
  • “In its investigation, The Times found that Harbour had bought around 7,000 single-family homes in bulk sales from Fannie, the large government-controlled mortgage finance firm. Harbour often paid $10,000 or less for these homes. Buyers said they were surprised to find homes that lacked working plumbing, furnaces and electrical systems.”
  • “…Vision Property Management, which is based in Columbia, S.C., and also operates in Cincinnati, has sold homes in rent-to-own deals that require tenants to make property repairs.”
  • “…some nonprofit organizations have recently tried using the arrangement as a vehicle to help get homeless families into homes.”
  • “For investment firms, the business model can be profitable…estimated in an unpublished research paper that a firm like Harbour could generate an annual return of at least 28 percent based on the way it prices homes….Harbour, which raised more than $60 million to buy homes, last year began to sell off, to other investment firms, hundreds of houses with contracts for deed in place.”

Source: New York Times / Matthew Goldstein and Alexandra Stevenson

Date Composed: April 20th, 2017

A DECADE OF FORECLOSURES AND THE CRISIS CONTINUES: A STUDY OF FORECLOSURES IN HAMILTON COUNTY, OHIO IN 2012

Thesis: The year of 2008 marked the highest annual rate of completed foreclosures in Cincinnati and the city is still recovering from this.

Useful information:

  • “Since 2002, the number of completed foreclosures has continued to rise, reaching a peak of 3,086 in 2008 and then declining over subsequent years.” (4)
  • “…Hamilton County saw its highest annual number of completed foreclosures in 2008…” (5)

Source: Working in Neighborhoods (organization)

Date Composed: 2017

Synthesis / Overview

All three of these observed sources indicate that the City of Cincinnati suffered during the financial crisis, but not as much as the areas around it. It did, however, have an abnormally large amount of foreclosures compared to other areas due to slight to negative population growth and a huge undertaking in new house construction at that time.

 

Taylor Frank – Secondary Research Individual

“After the Crash: The Lingering Results of the Foreclosure Crisis in Our Communities”

Source: Working In Neighborhoods (WIN)
Date Composed: 2015

Thesis: Cincinnati families were losing their homes, number of vacant properties grew, leading Working in Neighborhoods organization to map out all the vacant properties and gather documented foreclosures that grew rapidly from the financial crisis.

Useful Information:

  • Completed Sheriff’s Sales in Hamilton County fell 27 percent, from 2,418 completed Sheriff’s Sales in 2013 to 1,766 in 2014. This is the lowest number of completed foreclosures in the county since 2002
  • New foreclosure filings in 2014 fell 21.5 percent compared to new filings in 2013, from 4,268 to 3,350.This is the lowest number of new foreclosures filed since 2002.
  • Foreclosures filed by six lenders account for more than half (51 percent) of Hamilton County properties sold at Sheriff’s Sale in 2014. Banks completing more than 100 Sheriff’s Sales in 2014 include: US Bank (195), Bank of America (183), Wells Fargo (151), Fifth Third (149), CitiBank (117) and JP Morgan Chase (113).
  • Mortgages that were originated between 2005 and 2008 made up 35 percent of all completed Sheriff’s Sales in Hamilton County in 2014, according to County Auditor property transfer records. This number does not include mortgages that were refinanced or properties that acquired second mortgages during this time period.
  • Tax foreclosures made up 22.1 percent of all new foreclosures filed in 2014
  • The number of third-party tax lien certificate sales ending in Sheriff’s Sale has increased for the fourth year in a row, from 1 in 2011 to 42 in 2014.

Recovery: “Cincinnati — Sustained Growth from a Solid Foundation”

Source: Federal Reserve Bank of Cleveland
Date Composed: March 2016

Thesis: Cincinnati metro area’s economy continues to deliver strong econonmic results, particularly with growth in the leisure and hospitality and construction sectors. These sectors, supported by a diversified manufacturing base, provide opportunities for the region to grow long into the future. Employment growth is strong and the unemployment rate has declined to its lowest level in more than ten years, remaining among the lowest of the metro areas in the Fourth Federal Reserve District.

Useful Information:

  • Cincinnati has yet to recover its pre-recession employment levels, but job growth remains solid.”
  • “Through the end of the third quarter of 2015, employment in the metro area stood approximately 0.5 percent below its pre-recession level. This performance was in line with the rate of recovery in Ohio, but lagged the recovery pace for the average of nearby metro areas and the United States, which have seen increases of approximately 1.5 percent and 3.0 percent, respectively.”
  • “The Cincinnati metro area and the nation continue to see stronger income growth per capita than the state and nearby metros. Since the end of the recession in June 2009, income per capita in the Cincinnati metro area has increased by 4.6 percent. This is in line with the national average, which has increased by 4.7 percent.”
  • “Remaining above its post-recession low, homebuilding in the greater Cincinnati region is gaining steam. Housing supply remains tight, helping to prop up house prices. Multifamily vacancy rates remain low as apartment construction has yet to catch up with the growth in regional demand.”
  • “According to 2014 US Census Bureau estimates, Cincinnati is the 28th largest of the 381 metropolitan statistical areas in the United States.”

“Economic Growth Drives Demand in Cincinnati Commercial Property Markets”

Source: Colliers International
Date Composed: 2015

Thesis: After the 2008 FInancial Crisis, the Cincinnati Commercial real estate market witnessed growth across occupancy in office, industrial, retail and multifamily properties; some to historic levels as in the case with industrial.

Useful Information:

  • “The story of the year is job growth as the region’s unemployment rate dropped 90 basis points to 4.3 percent by the end of December, while the labor force increased by 2.2 percent.“
  • “REDI Cincinnati’s year-end report indicates that more than 14,000 jobs were created or retained during the year, of which 7,700 were new jobs.”
  • “Along with job growth, personal income is forecast to grow an average of 5.7 percent over the next ve years, outpacing both the U.S. and Midwestern projected averages.”
  • “In Cincinnati, occupancy increased during the the year by 120 basis points to 95.5 percent. Rents increased by 3.1 percent year-over-year; above the market’s ve-year average of 2.6 percent.”
  • “Cincinnati’s multifamily construction activity and quarterly deliveries remain above average, with 250,000 permits forecast to increase by nearly 70 percent in 2016”

Overall Synthesis: Cincinnati was effected by the financial crisis in 2008, but was one of the cities that was least effected comparable to the other cities throughout the United States. The data and research found from the resources above show that Cincinnati is recovering well from the financial crisis, in some cases such as the increase for the demand of industrial industry has made strides of success. There are still some foreclosures around the city, but foreclosure filings have gone down through the years, a 27% decrease in filings from 2013 to 2014. Even the jobs in Cincinnati has grown since 2008, but is only 0.5% under the pre-recession line in 2015. Cincinnati has been making strides to build their economy stronger than pre-recession, and continues to build it.

Reading Response 1 / Madeleine Lyon

Wall Street and the Financial Crisis: Anatomy of a Financial Collapse

The reading Wall Street and the Financial Crisis: Anatomy of a Financial Collapse  primarily serves as a recap of what are thought to be four major determining factors in the great recession of 2008. Firstly, banks were developing an extraordinary reliance on the use of high risk lending for a quick profit, disregarding safe, slower-growing options even at the expense of their client. One of the largest culprits at the time was a bank called Washington Mutual, or WaMu for short, who, with its subsidiaries, engaged in reckless trading for their own gain on Wall Street. Lax restrictions made by government regulators along with an unfounded trust in large lending companies to police themselves and even outright lying for personal gain allowed such practices to go unpunished. Companies such as S&P and Moody’s, who were responsible for rating portfolios and other options from banks such as WaMu inflated their ratings because they found it to be profitable for them on Wall Street and also kept them in good graces with important investors. There were also outright abuses of the system occurring at places like Goldman Sachs in which insiders would bank on the failure of this delicate system of high-risk loans and even on the financial demise of clients among other deeds that were most likely illegal.

My stance on the information given is that from what what was happening with the reckless disregard for other peoples’ finances was morally unsound and should have been found out. However, I could see how there may have been a demand for a quick return on investment and there could have been a lot of pressure placed on people to proceed with these unsound practices especially since they were even carried out by senior staff members. It certainly doesn’t help that the regulatory policies were slim to none yet on the flip side opposing parties would see the act of keeping such a close eye as government funded hand-holding. Furthermore, the act of properly regulating gargantuan companies like WaMu would be a large investment in time, finances and resources on both sides even though it may have prevented this crisis or at least sounded the alarm far earlier. There are just so many factors. These don’t just include the participants directly or indirectly responsible, whether willing or unwilling. It also includes the work in which such a convoluted system would create. Once the fragile financial infrastructure was put in place it was not only hard to remove because of the human aspect, but because there would be some sort of financial repercussion. Even if it would have been significantly smaller in the beginning it would still loom over the heads of those involved and some would only see a loss regardless of its size. Those who saw the structure as fragile and chose to bet on it would be sure to facilitate its growth so that it has an even more spectacular fall.

In a piece by artist Molly Crabapple called Debt and Her Debtors, the victims of the recession are depicted as mice and the profiteers as cats. They are being persuaded to climb to the highest point of a statue vaguely resembling Lady Liberty and leap off with a small balloon after a bit of reassurance from a feline at the top. This reflects the behavior of unknowing customers leaving their trust in investors who in turn leave them with extraordinarily high-risk loans. This leaves them feeling like they are in a place of power with a seemingly high rate of return, but things drastically change during the test of time as indicated as when the mice fall. The cats, in their great wisdom, keep the most accommodating investment opportunities to themselves and in doing so take the opportunity of profit from their victims. They gracefully float to the bottom with their large balloons that have been generously filled with the helium that might have saved the mice from their plight.

The 2008 Housing Crisis

The 2008 Housing Crisis by The Center for American Progress focuses on the plight of homeowners as a result of the great recession of 2008. It also touches on other social issues related to housing that have contributed to an even greater struggle to attain the pre-recession for some.

As opposed toWall Street and the Financial Crisis: Anatomy of a Financial Collapse, this article does contain  pretty recognizable bias, as there is an “us and them” mentality throughout the piece with the “them” being conservatives. This, however, does not mean that the article should be disregarded as cited arguments are made for certain topics in which they believe there are misconceptions.

Also unlike Wall Street and the Financial Crisis: Anatomy of a Financial Collapse, The 2008 Housing Crisis places more of a focus on Fannie May and Freddie Mac, which have become a point of contingency for many people as they are seen as part of the reason the financial crisis occurred. The Center for American Progress argues that Fannie May and Freddie Mac were not responsible for the housing crisis. In fact, more established homeowners were more affected than the new homeowners that had been using their services. Fannie Mae and Freddie Mac had in fact worked to keep housing affordable for the middle and lower classes by allowing loans to be taken out instead of immediately placing a huge down payment on a house. Being able to have a mortgage on a house also opened up opportunities for minorities who had disadvantages finding high paying jobs to be buyers and having difficulty courting sellers with what they had to offer. After having read both passages and speaking to the friend, I am still having a bit of difficulty seeing the link between Fannie Mae, Freddie Mac and the rest of this conundrum.

Ultimately when it comes to the question of housing, The Center for American Progress believes that more government regulation is needed to make sure that lending businesses don’t get drunk with power and go awry. This correlates to what was stated in Wall Street and the Financial Crisis: Anatomy of a Financial Collapse in which a lack of oversight was listed as a major contributor in the crisis. Government establishments have been created to promote liquidity within mortgage as to give it greater stability.

I for one do believe that there could be a benefit in increased regulation if the result of little to none is something akin to a major financial crisis. However, I do not entirely agree on having mortgages be so incredibly low and so incredibly long that people with lower income are stuck paying for the rest of their days. There is something to say about the amount of financial responsibility for a permanent living space that one intends to own the entirety of one day. This article is right when it says that it a house is a huge investment, which is why steps should be taken to make sure that said investment is actually fulfilled.

With that said, it would be nice to see some smaller establishments being made that are relatively tasteful and actually affordable from the start with maybe a small loan. I do feel like sometimes there is this obligation to buy a huge house in a fancy neighborhood whether or not one can afford it. America does seem to be a place where bigger is often better. For all of the gargantuan McMansion facsimiles I see in Turpin Hills I don’t often see a lot of quaint housing options. Maybe I am looking in the wrong places but is a small, tasteful house in a decent neighborhood completely unattainable nowadays?

As stated by a few posters before me, Crash Course Economics made a lovely video about the 2008 financial crisis. It helped clear up quite a bit of the terminology for me and made the narrative a bit tighter than it was when I was just reading passages in silence. In this video, the concepts of Perverse Incentives and Moral Hazards are introduced during the takeaway moments.

If you were interested by the video I just mentioned, you may also want to check out The Causes and Effects of the Financial Crisis , which was visualized by John Jarvis. It tackles the issues a bit differently.