Norway boycots U.S. mortgages

good. the us mortgage system is a joke. those 0%, 3%, and 5% down schemes created the housing bubble

LOL -- as if NORWAY were a shining example of fiscal fortitude.

Norway: AAA rating, outstanding debt/GDP at 55%, unemployment less than 3%, inflation less than 2%, annualized growth at 5%, no banking crisis, current account surplus and a sovereign wealth fund that could pay off virtually all sovereign debt.

Which developed country in your crack-smoking head would be a better example of fiscal fortitude?

> LOL -- as if NORWAY were a shining example of fiscal fortitude.

wow, how much ignorance!

> LOL -- as if NORWAY were a shining example of fiscal fortitude.

one of the beauties of that country is that it didn't fall into gerontocracy unlike most developed countries with aging population, in which the fiscal mess going forward will come from entitlements the young will not receive.

NORWAY instead is SAVING (yes, that thing over here is so unheard of) and get this one: on behalf of the retirement for the YOUNG. go figure. if their natural resources were in USA, they would be plundered by a private company and to hell with the young and future generations.

A point is being missed here. People think refinancing a mortgage is free money. It is not.
On the other side of every refinance is a portfolio,pension, Insurance Fund etc that
is losing out. The low rates and gov't sponsored refis are not free-market.The gov't
is stealing from the TIA CREFS retirment fund,IBEW retirment fund,etc and handing the money over to Joe Smith as a refi.

It shouldn't be shocking that economic policy has varying impacts on different parties. Thus they are the subject of countless debates. But to characterize it as "stealing" is absurd.

Norway perennially has a government budget SURPLUS. And in fact its national debt is LESS than its sovereign fund plus funds invested directly by the government. Hence, it has a NEGATIVE national debt AND a negative deficit. It's government is a net CREDITOR. Its the most fiscally responsible nation on Earth.

Matt is a complete idiot. Not that he will ever admit he is wrong on this topic.

"NORWAY instead is SAVING"

Unlike Alaska, which saves some, but writes checks to residents for most of it. Alaska's wealth fund is based on Norways, but they pay out quite a bit every year.

Norway is the model EVERY economist sites when discussing what resource-rich nations SHOULD do with their oil/mineral/etc wealth.

"Norway perennially has a government budget SURPLUS. And in fact its national debt is LESS than its sovereign fund plus funds invested directly by the government. Hence, it has a NEGATIVE national debt AND a negative deficit. It's government is a net CREDITOR. Its the most fiscally responsible nation on Earth."

Norway's a false budget. It's like being on rent control/stabilization.

It's amazing how easy it is to balance a budget when you essentially don't have to pay for a military; Norway knows that Britain and the U.S. will take care of covering its ass if and when the shit starts to fly.

At first I thought Matt was being facetious by saying one of the world's shining examples of fiscal fortitude was not a shining example of fiscal fortitude. I should have known...

But to characterize it as "stealing" is absurd.

Ok, call it a gov't directed forced redistribution.

"At first I thought Matt was being facetious by saying one of the world's shining examples of fiscal fortitude was not a shining example of fiscal fortitude. I should have known.."

Should have known ... what?

Holding up Norway as a "shining example of fiscal fortitude" is akin to someone with a rent-controlled lease on a Classic Seven on West End Avenue paying only $500/month in rent crowing about how easy it is to live on $25,000/year in Manhattan.

Norway is a member of Nato in good standing, has sent troops to Iraq and Afghanistan, has naval vessels patrolling for Somoli pirates, and spends between 1-2% of GDP on defense - about the Nato average.

Even if spent 4-5% like the US, it would STILL run a budget surplus, as their budget surpluses are generally around 5-10% of GDP.

And lets not forget - Iceland spends zero percent, while Greece spends a much larger percent. Disproving your thesis both ways.

You have failed epically.

"Even if spent 4-5% like the US, it would STILL run a budget surplus, as their budget surpluses are generally around 5-10% of GDP."

You are manipulating the numbers improperly.

More accurate to look at defense spending as a percentage of the budget.

> It's amazing how easy it is to balance a budget when you essentially don't have to pay for a military; Norway knows that Britain and the U.S. will take care of covering its ass if and when the shit starts to fly.

no country is forced to waste money on an over-extended military. nor to tell they poor young "go fight, and i'll give you a chance to go to college". i'm all for Norway when it comes to how the young are treated. it's great that USA have such a great example to follow, maybe the young can force some pro-young reforms if they keep on occupying.

what about not being the last country on earth to have maternity leave at the federal level? that could be challenging, as Swaziland and Papua Guinea could get it done before USA. cause remember as the GOP teaches us, here in USA that move would be "bad for business" or as the old say "it's your kid, not mine" while cashing in entitlements the young pay.

what about universal childcare? well... that's too much for sure. universal health care? ok, now i'm dreaming. ok, i'm done. that's my 2011 rant :-)

Gay marriage is legal in Norway. Having been prompted by this thread to read a little about the country, it sounds pretty cool to me. Iceland was mentioned above. Also a pretty cool country (again, gay marriage is legal). Anyway, seems kinda weird to beat up on Norway--seems they are doing plenty that is right. Certainly are easier targets for criticism out there.

Norway is a poor example for everything. THey've hit lotto.
As much Oil as the lower latitude areas without the penchant for attracting wars being so far from the equator.
As the Swiss, so full of themselves for being so neutral which is how they are so wealthy because their "neutrality" is the product.

"As much Oil as the lower latitude areas without the penchant for attracting wars being so far from the equator."

Yeah. Like Russia.

"A point is being missed here. People think refinancing a mortgage is free money. It is not.
On the other side of every refinance is a portfolio,pension, Insurance Fund etc that
is losing out. The low rates and gov't sponsored refis are not free-market.The gov't
is stealing from the TIA CREFS retirment fund,IBEW retirment fund,etc and handing the money over to Joe Smith as a refi."

Every buyer of a mortgage knows they are exposed to prepayment risk. That's one of the reasons rates are higher than govt bonds. If you don't want to be exposed to that risk, then you shouldn't be buying mortgages but rather govt bonds. For the person w/ the mortgage, refinancing isn't free money. Rather, it's excercising an in-the-money option that they already paid for in the form of a higher-than-otherwise interest rate.

If you want to talk about govt influencing the mortgage market, why talk about interest rates where it only has secondary control? Why not talk about guarantees of Freddie/Fannie, which have benefitted those same pensions by forcing the taxpayer to cover the losses on the mortgages?

Whatever you think about the hand of the govt using these markets for public policy, it's silly to start crying on behalf of mortgage buyers now. They got into a position that benefitted them due to a whim of public policy intended to support homeownership -- protection from losses. Now that public policy dictates low interest rates to support housing, it's a bit late to be calling for free markets.

"You are manipulating the numbers improperly.

More accurate to look at defense spending as a percentage of the budget."

No it isn't. NOBODY expert on Earth would look at defense as a percent of the budget. Its a percent of GDP. Always. In every Janes report. Whenever the US complains about its allies not spending enough. In every news story on the topic. You are a moron who won't admit you are wrong.

And it does not MATTER that Norway has oil. This is what makes them SO extraordinary. Because every other country with such a lopsided resource-based GDP is utterly corrupt. The UK, Canada and Australia do not come close to being a resource-dependent as Norway, BTW. I am talking Nigeria, Saudi Arabia, the UAE, Venuzuela, , etc.

If you want to talk about govt influencing the mortgage market, why talk about interest rates where it only has secondary control?

That's conventional wisdom , but if the government is able to undercut the offering rate of all private capital this goes out the window. And gov't through regulators force institutions to hold treasuries or insured mortgages. Why else would any sane bank invest in 3% 30 year Fanni Mae pools?

So we have more than a few ways, the gov't is increasing the value of convexity and screwing those short the prepay option. An investor of callable debt understand supply and demand, what's egregious is how gov't is stepping in and controlling/influencing the process.

The cost of money is no longer subject to free market principles.

"Why else would any sane bank invest in 3% 30 year Fanni Mae pools?"

The same reason why you won't take out 3% Fannie-backed debt but want to pay down your debt, I imagine

Maybe those poor investors at TIAA-CREF should just move on to something with higher yields ... like MF Global.

Oops. 3% ain't looking so bad this week.

If you think the casino is rigged the smartest thing is to not play.
Fed and Treasury manipulating bond markets, stock markets. Nothing sacred.

If you make your living by playing, not playing is not really an option. Besides, this is why those guys get paid the big bucks right?

the dealers should just post vigs and get done with it.