Political News & Views: Rep Towns & Subprime Mortgages Pt 1

Political News & Views: Rep Towns & Subprime Mortgages Pt 1

welcome to political news and views with congressman ed towns of Brooklyn New York representing the 10th congressional district programming with your concerns in mind and now your host congressman ed towns welcome to news and views I am so excited today about the fact that we have with us Stacey Tisdale of course in John bright so I just wanted to start with two station let me just sort of a give little bio little information to my listeners because you've done so much I mean in your short lifetime of course enough but I just don't want to share a few things here she has reported on business and financial issues for more than 15 years she looks young but she's been around miss Teasdale offered a book which was released in September 2007 of course the book entitled the true costs of happiness the real story behind managing your money and of course John Wiley & Sons published it in addition she is a financial expert of course on NBC today show and she reports for the American consumer a weekly national nationally syndicated show on PBS Miz Tisdale is also the United States contributor for shattered breaking the glass ceiling a magazine for professional women let me take this opportunity to welcome you to news and views and there's a pleasure to be here thank you let me introduce our next guest John Hope Bryant of course is a entrepreneur and businessman on january 222nd 2008 mr.

America

Bryant was appointed vice chairman of the United States President's Council on financial literacy by president george w bush mr. brian is the founder chairman and chief executive officer of Operation Hope America's first nonprofit social investment banking organ ization and now operating in 51 communities and south africa having raised more than 400 million dollars from the private sector to have empowered the poor he also participated in a young global leader at the world I tell you that you know I'm just so much here but I got it I got to read some more I gotta go into economic forum in Switzerland and Oprah Winfrey gave him her use your life award proving that eradicated poverty is nonpartisan John is also partnered with the former President Bill Clinton and his foundation around financial literacy and economic empowerment welcome Stacy welcome John to news and views let me begin with this question John the subprime mortgage crisis really highlighted the financial financial literacy crisis in this country what are some of the lessons that we learn and what can we do to fix the mess that we in and we on a mess we're going to miss this is a part of the most significant problem in well I'll say respectfully you're in my lifetime and cross-generational probably our parents lifetime going back to the Great Depression as far as severity and this is a middle-class crisis if the perception is when you hear subprime mortgage that it's a poor people's crisis but you have middle-class people who look like us who have the same economic profile who has what was the payment and not what was the interest rate and you never asked what the payment is when there's an interest rate attached so this is massive levels of financial illiteracy yes they were fraud yes there's misrepresentation yeah there was greed and linder in competence in some cases but but people who would have been victimized were also made victims because our larger targets because they didn't know better and so they couldn't do better so his massive levels of financial literacy I was joking with a friend the other day to be a woman and I said you've never called your girlfriend and said my credit score is 500 what's yours people are ashamed to admit they don't understand money and so you combine financial literacy with these overly sophisticated inappropriate and sometimes inappropriate financial products and you've got an economic tsunami there's nothing wrong with responsible subprime lending but it's with this this is just completely so what's going on now something other than responsible subprime lender let me ask you this the people that who have problems and now are not coming forward I mean they're not coming forth because I don't really embarrassed it's a shame oh that's what it is it's a shame that the number you know the great taboo in this country used to be sex and money well now sex is off the hook I mean you had a TV series called Sex in the City for God's sakes a movie actually now are by the same name but but money is the thing everybody wants and nobody understands the number one calls the divorce in America his money no more the reason that black and brown kids drop out of college is not academics it's money number one reason for low morale and employment in this situation is financially related number one groups of bankruptcy filers are senior citizens in America is aging number one number two group of bankruptcy filers are youth between 18 and 24 college students so and Stacy's book speaks to this this the psychology of poverty that I keep saying that there's a difference between being broken being poor that being broke is economic with being poor as a disabling frame of mind and a depressed condition of your spirit you must vow never be poor again so people need to understand there's no shame in having problems there's only shame and not doing something about it we have a crisis hotline at Operation Hope a mortgage crisis hotline and we've taken 25 thousand calls just in Los Angeles and we helped to restructure a lot of those mortgages but you gotta pick up the phone and call there's no there's nothing wrong with having problems well Stacy you indicating your book that I dialogue about money and of course must change I mean what do you really mean by that what I saw I've been a financial journalist for some of the greatest news organizations in the world for more than 15 years Wall Street Journal CBS CNN I've put good financial advice out there anyone can get financial information if anything good came out of this economic crisis it's that we highlighted the financial literacy problem and that there's financial counseling out there some states or even sponsoring it but what I got to see by my work you know interviewing from presidents to people in Africa barely making ends meet is that our relationship with money and what I always found interesting when I worked on Wall Street I worked with a lot of people who would say things like if I had more money I could do the things I want if I had more money I could be a better parent if I had more money I could be a better person these people made millions of dollars a year I go to CBS I move into financial journalism I start examining people from all different walks of life they're saying the exact same things if I had more money I could do the things I want if I could more money I can be happy so this made me very curious because clearly more money was not the answer that everyone thought that it would be and at the same time I was experiencing a lot of frustration and my reporting because in one sentence at one story I'd be giving here's the five easy steps to get out of credit card debt in the next story the average American family has record credit card debt so clearly the answer wasn't in the numbers and that's what made me set out on this research project to find out what's really at work and our choices about making and spending money and it has very little to do with numbers it's about things like role modeling it's about social messages it's really condition patterns of behavior and just a story I'd love to share with you is what I mean how our dialogue has to change this mother really got it right I was recently speaking to a mother whose eight-year-old daughter 8 years old told her I want a flatter stomach and smoother hair eight years old and the mother said this is about money someone told you that you need those things they bet that they could convince you that you need those things and that you give them their money you're smarter than that and the daughter got it what I want to see is it's great that kids are learning what a stock is what a bond is but just like we had that just say no to drugs campaign we have to teach our kids to just say no to these influences so that they could create a set of financial values yeah and what age should we start this I started curriculum for kids or I start giving parents tips to start kids at four years old you have to really help them develop the healthy component healthy financial relationship consists of spending saving and sharing and you have to get that in right away you have to give them different exercises starting when therefore give them a you know clear jar so they can see money building teach them that they have to give some back just you know there's a whole set of curriculums whole different set of exercises in my book but it has to start that early but what parents have to realize is that it has to be constant you can't have they don't spend more than you make talk once it has to be in the example you set it has to be constant dialogue with your child when I say help them create a set of financial values I mean teenagers for example why do you want that particular handbag why do you want those sneakers why do you want that make them answer those questions this is about getting inside their heads that's the only way you're going to help them create a set of financial values that will help them stand up to some of these influences

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