Congressman Souder Meets With Local Builders
July 28, 2016 at 4:25 p.m.
By Jennifer [email protected]
Souder met with a group of approximately 40 local realtors, builders, and Builders Association of Kosciusko-Fulton County members at the 2517 in Warsaw and spoke for 2-1/2 hours.
Joni Truex, executive officer of the Builders Association, said the association requested Souder to meet with them to discuss the economic stimulus package.[[In-content Ad]]The National Association of Home Builders has been advocating for a targeted, temporary stimulus to restore home buyer and consumer confidence and stimulate housing demand for a fix housing first initiative.
The organization is advocating for an enhanced home buyer tax credit that does not have to be repaid; increases the dollar amount to at least $10,000; is available until the end of 2009; can be used at closing; and is available to all home buyers.
Dennis Spidel, president of the Indiana Builders Association, said builders and remodelers from the association in Indiana will meet today with Senators Richard Lugar's and Evan Bayh's offices to discuss the association's fix housing first initiative to the stimulus bill.
"The first stimulus package passed by the house included very little for housing and we'd like to see more included," Spidel said. "This is not a bailout, but a way to get the economy moving again to try to get existing inventory sold and get consumer confidence brewing again."
"The stimulus package is a fraction of the amount of money that the federal government has in the gain. Right now we are in about $2.7 trillion supporting the credit markets. The stimulus package is quite frankly a political afterthought to what is really happening underneath the economy," Souder said.
Souder said it is imperative that the credit market is established or nothing will work.
"It doesn't matter if we do tax credits or we do first-time home buyers or anything for housing because if you give someone $1,000 that they can't leverage in the credit market, it won't matter what we do in the stimulus package," Souder said.
He said that is why he believes the stimulus package is irrelevant until the government gets the Troubled Assets Relief Program figured out.
TARP is a U.S. government program to purchase assets and equity from financial institutions in order to strengthen the financial sector. It is the largest component of the government's measure in 2008 to address the sub prime mortgage crisis.
Souder said Republicans have been hammering for tax credits and capital gains changes because, in those, the dollar will be leveraged and move through the economy.
"There hasn't been a single recession in American history where reopening the credit market isn't the challenge to ending the recession. Recessions are caused because credit gets too liberal and you find a boom where someone has been manipulating the credit market and went too generous with the money," Souder said.
He said the challenge of a government is how to reopen the credit market.
"To me, the most extraordinary question in the American economy is how can we have floated over two trillion dollars in trying to prop up our current system and have interest rates so low," Souder said.
He said what has happened is that world capital has bought U.S. bonds at 1 percent because their economy's can't get 1 percent in their economy.
When the housing market doubles over a number of years and the growth rate is 3 percent, a person knows there was some kind of scam occurring, Souder said.
"One of our biggest challenges right now is that like all of American history, this money is so interconnected," Souder said.
He said if China or the Middle East stops purchasing U.S. bonds, there will not be worries about tax credits for homes. Instead, people will be worried about 15 to 20 percent interest rates because the housing market will not reopen if the interest rates increase.
"We are on a very tight rope right now trying to keep the total credit market from collapsing. Last July they couldn't convince any of us in Congress that we were in trouble let alone the public," said Souder. "By August we started to sense it."
He said he had never received as many calls in his office from specific businesses saying that some banks were foreclosing on them.
"We had a near absolute catastrophe in one week that one major corporation in America in that stretch went to do their payroll and the bank they went to had no credit line that was working to do payroll. They had to borrow it from Romania so people could get their paycheck," Souder said.
He said the reason homes are able to be built are not because of cash-only payments or proceeding with caution, but because the U.S. participated in world markets that added to its wealth.
"The frustration that we have in Indiana is our housing crisis never went up as much as it went up in other areas, yet we are getting punished just as much as the other areas because our capital was mixed up with their capital," Souder said.
"As a committed Christian, I believe money is the root of all evil and, without personal accountability, if you don't have a society that accepts values than government becomes their moral standard," Souder said.
He said the fundamental question right now is what is the role of a so-called moral hazard; that at what point, when you mess up, should you have to pay for it.
"The challenge that we have in the United States is the idea of you're too big to fail. If we let the financial economy go down, we will go down the most," Souder said.
In the housing crisis, the number one question is if we can stabilize the banking system, he said.
He said everything that has been done so far is a loan.
"I believe most of it will be paid back. There is $7 billion in the TARP and 2 trillion to keep the credit market going and stabilize it. Money is not a hard commodity, money is a trust that other people are going to come back with the money," Souder said.
Souder met with a group of approximately 40 local realtors, builders, and Builders Association of Kosciusko-Fulton County members at the 2517 in Warsaw and spoke for 2-1/2 hours.
Joni Truex, executive officer of the Builders Association, said the association requested Souder to meet with them to discuss the economic stimulus package.[[In-content Ad]]The National Association of Home Builders has been advocating for a targeted, temporary stimulus to restore home buyer and consumer confidence and stimulate housing demand for a fix housing first initiative.
The organization is advocating for an enhanced home buyer tax credit that does not have to be repaid; increases the dollar amount to at least $10,000; is available until the end of 2009; can be used at closing; and is available to all home buyers.
Dennis Spidel, president of the Indiana Builders Association, said builders and remodelers from the association in Indiana will meet today with Senators Richard Lugar's and Evan Bayh's offices to discuss the association's fix housing first initiative to the stimulus bill.
"The first stimulus package passed by the house included very little for housing and we'd like to see more included," Spidel said. "This is not a bailout, but a way to get the economy moving again to try to get existing inventory sold and get consumer confidence brewing again."
"The stimulus package is a fraction of the amount of money that the federal government has in the gain. Right now we are in about $2.7 trillion supporting the credit markets. The stimulus package is quite frankly a political afterthought to what is really happening underneath the economy," Souder said.
Souder said it is imperative that the credit market is established or nothing will work.
"It doesn't matter if we do tax credits or we do first-time home buyers or anything for housing because if you give someone $1,000 that they can't leverage in the credit market, it won't matter what we do in the stimulus package," Souder said.
He said that is why he believes the stimulus package is irrelevant until the government gets the Troubled Assets Relief Program figured out.
TARP is a U.S. government program to purchase assets and equity from financial institutions in order to strengthen the financial sector. It is the largest component of the government's measure in 2008 to address the sub prime mortgage crisis.
Souder said Republicans have been hammering for tax credits and capital gains changes because, in those, the dollar will be leveraged and move through the economy.
"There hasn't been a single recession in American history where reopening the credit market isn't the challenge to ending the recession. Recessions are caused because credit gets too liberal and you find a boom where someone has been manipulating the credit market and went too generous with the money," Souder said.
He said the challenge of a government is how to reopen the credit market.
"To me, the most extraordinary question in the American economy is how can we have floated over two trillion dollars in trying to prop up our current system and have interest rates so low," Souder said.
He said what has happened is that world capital has bought U.S. bonds at 1 percent because their economy's can't get 1 percent in their economy.
When the housing market doubles over a number of years and the growth rate is 3 percent, a person knows there was some kind of scam occurring, Souder said.
"One of our biggest challenges right now is that like all of American history, this money is so interconnected," Souder said.
He said if China or the Middle East stops purchasing U.S. bonds, there will not be worries about tax credits for homes. Instead, people will be worried about 15 to 20 percent interest rates because the housing market will not reopen if the interest rates increase.
"We are on a very tight rope right now trying to keep the total credit market from collapsing. Last July they couldn't convince any of us in Congress that we were in trouble let alone the public," said Souder. "By August we started to sense it."
He said he had never received as many calls in his office from specific businesses saying that some banks were foreclosing on them.
"We had a near absolute catastrophe in one week that one major corporation in America in that stretch went to do their payroll and the bank they went to had no credit line that was working to do payroll. They had to borrow it from Romania so people could get their paycheck," Souder said.
He said the reason homes are able to be built are not because of cash-only payments or proceeding with caution, but because the U.S. participated in world markets that added to its wealth.
"The frustration that we have in Indiana is our housing crisis never went up as much as it went up in other areas, yet we are getting punished just as much as the other areas because our capital was mixed up with their capital," Souder said.
"As a committed Christian, I believe money is the root of all evil and, without personal accountability, if you don't have a society that accepts values than government becomes their moral standard," Souder said.
He said the fundamental question right now is what is the role of a so-called moral hazard; that at what point, when you mess up, should you have to pay for it.
"The challenge that we have in the United States is the idea of you're too big to fail. If we let the financial economy go down, we will go down the most," Souder said.
In the housing crisis, the number one question is if we can stabilize the banking system, he said.
He said everything that has been done so far is a loan.
"I believe most of it will be paid back. There is $7 billion in the TARP and 2 trillion to keep the credit market going and stabilize it. Money is not a hard commodity, money is a trust that other people are going to come back with the money," Souder said.
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