The future belongs to those who create it!

Transcription

1 The future belongs to those who create it! Why Homeownership Matters June 25, 2012 Mortgage Bankers Association of Missouri Tino Diaz Managing Director Charis Pros

2 The future belongs to those who create it! Why Homeownership Matters Challenging Environment Demographic Trends Founding Principles Call To Action

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4 GDP Picture April 2012

5 Economies are slowing

6 and the Euro? Source: The Economist June 23, 2012

7 Euro GDP

8 Apr 2012

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11 How many pension dollars are there? Source: The Economist

12 29 Jan 2012

13 US Economy Losing Steam Source: Wall Street Journal

14 Home Prices

15 Home Construction

16 Americans saw wealth plummet 40 percent from 2007 to 2010, Federal Reserve says By Ylan Q. Mui, Published: June 11 The recent recession wiped out nearly two decades of Americans wealth, according to government data released Monday, with -middle-class families bearing the brunt of the decline. The Federal Reserve said the median net worth of families plunged by 39 percent in just three years, from $126,400 in 2007 to $77,300 in That puts Americans roughly on par with where they were in 1992.

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18 Drop in Median Net Worth Source: Federal Reserve Bulletin, Changes in US Family Finances 2007 to 2010, June 11, 2012

19 ..about 1/3 in financial assets Source: Federal Reserve Bulletin, Changes in US Family Finances 2007 to 2010, June 11, 2012

20 ..about 2/3 in non-financial, the biggest HIT is in home net worth Source: Federal Reserve Bulletin, Changes in US Family Finances 2007 to 2010, June 11, 2012

21 Basel III Source:Congressional Research Service CRS Report for Congress,, The Status of the Basel III Capital Adequacy Accord, Nov 2, 2010

22 Dodd-Frank Wall Street Reform and Consumer Protection Act

23 Dodd-Frank Wall Street Reform and Consumer Protection Act Estimates of Rulemaking By Agency Significant increase in compliance burden and costs Agency All Rulemaking* One-Time Reports / Studies New Periodic Reports Bureau CFTC Council FDIC Federal Reserve FTC GAO OCC OFR SEC Treasury Total** * This estimate only includes references to explicit rulemakings in the Act, and thus likely represents a significant underestimate. ** The Total count eliminates double counting for joint rulemakings. Source: Davis Polk: Summary of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Enacted into Law on July 21, 2010

24 Administration Paper HUD & Treasury on GSE Reform February 11, 2011 Its like 2 documents. #2 Here are 3 options for future consideration #1 As a preamble, in the meantime, here is what we should do now

25 Administration Paper on GSE Reform February 11, Even tighter underwriting standards and higher credit score requirements 1/5,23/4 11/2, 2. Higher down payment requirements 1. At least 10% for Fannie Mae and Freddie Mac 1/5, 2. Reduced maximum LTVs for FHA 20/1 3. Special high-cost area conforming and FHA loan limits to expire (Oct 2011) without renewal and further reductions likely 13/3 4. Increased GSE guarantee fees and loan-level price adjusters 11/2 5. Additional credit-loss protection for Fannie Mae and Freddie Mac 24/1 6. Increased FHA Mortgage Insurance Premiums (annual MIP increased effective 4/18/11) 14/2 7. Targeted focus for FHA with borrower income limited to median level for the area, shrink its market share 14/1, 19/4, 21/4 8. Expedited run-off of the GSEs portfolio, potentially flooding the market and impacting other MBS pricing 2/1, 13/4, 15/1

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27 Saturday, Sep. 11, 2010 The Case Against Homeownership By Barbara Kiviat Homeownership has let us down. For generations, Americans believed that owning a home was an axiomatic good. Our political leaders hammered home the point. A house with a front lawn and a picket fence wasn't just a nice place to live or a risk-free investment; it was a way to transform a nation. Houses owned by the people who lived in them, we believed, created social and financial stability more-involved citizens, safer neighborhoods, kids who did better in school. No wonder leaders of all political stripes wanted to spend more than $100 billion a year on subsidies and tax breaks to encourage people to buy. (See pictures of Boise's struggling housing market.) But our leaders, with our encouragement, went much too far. The dark side of homeownership is now all too apparent: foreclosures and walkaways, neighborhoods plagued by abandoned properties and plummeting home values, a nation in which families have $6 trillion less in housing wealth than they did just three years ago. Indeed, easy lending stimulated by the cult of homeownership may have triggered the financial crisis

28 Social benefits of homeownership Some of the documented social benefits include: Increased charitable activity Civic participation in both local community and national issues (including voting) Greater awareness of the political process Higher incidence of membership in voluntary organizations and church attendance Greater social capital generated Greater attachment to the neighborhood and neighbors Lower teen pregnancy by children s living in owned homes Higher student test scores by children s living in owned homes Higher rate of high school graduation thereby higher earnings Children more likely to participate in organized activities and have less television screen time Homeowners take on a greater responsibility such as home maintenance and acquiring the financial skills to handle mortgage payments and those skills transfer to their children Lower teenage delinquencies General increase in positive outlook to life

29 Social benefits of homeownership continued 14. Homeowners reported higher life satisfaction, higher self-esteem, happiness, and higher perceived control over their lives 15. Better health outcomes, better physical and psychological health 16. Tremendous wealth gains for homeowners under normal housing market conditions (outside of the terrible bubble/bust housing years) 17. Homeowners not only experience a significant increase in housing satisfaction, but also obtain a higher satisfaction even in the same home in which they resided as renters 18. Family financial situation and housing tenure during childhood and adulthood, impacted one s self-rated health (in particular, the socioeconomic disadvantaged indicated by not being able to save any money or not owning or purchasing a home are less likely to self-rate their health as excellent or very good). 19. Less likely to become crime victims 20. Homeowners better maintain their homes, and high quality structures also raise mental health -renter-occupied housing appreciates less than owner-occupied housing 21. Housing prices are higher in high-ownership neighborhoods 22. Maintenance behavior of individual homeowners is influenced by those of their neighbors

30 The case against The case against homeownership Assumptions for our example: Assume two 22-year old kids graduate college and begin their lives. They both start out renting a small place for a few years. At age 29 they both settle into larger homes. One decides to buy, putting 10% down and obtaining a 30-year mortgage at 6%; the other rents at a typical price-rent ratio. At about the time the kids move out, and a few years before retirement, the renter downsizes to a smaller place. The owner s home is almost paid off, so he decides to stay put. They both live to be 81 years old. Inflation holds steady at 2%/year during their 59 year adult lives. Source: Chris Butterworth, Chris & Heather, The Phoenix Agents at Thompson s Realty

31 Source: Chris Butterworth, Chris & Heather, The Phoenix Agents at Thompson s Realty s.com

32 Source: Chris Butterworth, Chris & Heather, The Phoenix Agents at Thompson s Realty s.com

33 The case against The case against homeownership Results what can we take away from the table above? Owner had to save $25,000 during the first 7 years in order to make a 10% down payment on his $250,000 house. At age 58 Owner pays off his mortgage. His home is worth $455,000 and he no longer has a housing payment. Owner retires comfortably without having to make a housing payment. Renter s social security checks go directly to paying his housing expense. Owner dies at age 81, leaving his family a house worth $721,000. Renter dies at age 81, with no real estate to leave his heirs. During their lifetimes, Renter spent almost $500,000 MORE than Owner on housing payments! Owner s grandkids will remember him fondly, as that $721,000 house now rents for over $3,000 per month! (remember that Renter downsized in his 50s but Owner did not.) Source: Chris Butterworth, Chris & Heather, The Phoenix Agents at Thompson s Realty

34 Homeowners Paying for the Unemployment Benefit Extension Senate Clears Tax-Break Extension, Spending Bill December 18, 2011 Wall Street Journal The Senate Saturday approved a two-month extension of payroll tax breaks and unemployment benefits, providing a measure of relief in a struggling economy However, many families will feel the pinch of another provision of the compromise that imposes a higher fee on new mortgages. To offset the cost of the payroll and unemployment benefits extensions, the bill includes a bipartisan proposal also backed by the administration-- that would raise the fees that Fannie Mae and Freddie Mac charge mortgage lenders. That charge, likely to be passed on to homebuyers, will apply only to new mortgages, not existing ones, Senate aides said. The administration estimates that it would add as much as $15 to the monthly payments of the average homebuyer with a $200,000 mortgage. The proposal would raise an estimated $36 billion over ten years more than enough to cover the $33 billion cost of the bill. 10 bps all new mortgages for next 10 years

35 Homeowners Paying for Gulf Cleanup U.S. Senate passes RESTORE Act for Gulf Coast states Published: Wednesday, March 14, 2012, 11:54 AM The bill passed 74-22, including yes votes from Shelby and Sen. Jeff Sessions, R-Ala. (Bill Nelson, D-Fl) Sen. Shelby & Nelson joined in an defeated effort to have 7.5bps added to all new mortgages to finance the costs!! RELENTLESS Attacks on Homeownership no signs of easing!!

36 The future belongs to those who create it! Why Homeownership Matters Challenging Environment Demographic Trends Founding Principles Call To Action

37 Demographics Historic Demographic Trends Faster growth in minority segments with lower homeownership rates U.S. Population, by Race and Ethnicity 2000 and 2010 (thousands) % of Change White 194, ,818 2, % Hispanic 35,306 50,478 15, % Black 33,948 37,686 3, % Asian 10,123 14,465 4, % American Indian and Alaska Native 2,069 2, % Some other race % Native Hawaiian and Pacific Islander % Two or more races 4,602 5,966 1, % U.S. Population Change TOTAL 281, ,746 27, % Notes: Racial groups include only non-hispanics. Hispanics are of any race. Source: Pew Hispanic Center tabulations of U.S. Census Bureau Redistricting_Files-PL_ for states PEW HISPANIC CENTER - March

38 Demographics Projected Demographic Trends Faster growth in minority segments with lower homeownership rates Table 4-H. Projections of the Population by Sex, Race, and Hispanic Origin for the United States: 2010 to 2050 (Resident population as of July 1. "000") % of Pop Net Change % of Sex, Race, and Hispanic Origin to 2050 Change TOTAL 312, , , , % 145, %.Hispanic 50,918 90, , , % 92, %.Asian 14,584 24,939 30,928 37, % 22, %.Black 38,147 46,125 49,789 53, % 15, %.Two or More Races 4,769 8,450 10,844 13, % 8, %.White 201, , , , % 4, %.AIAN 2,394 2,953 3,167 3, % %.NHPI % % 1 Hispanics may be of any race. 2 'In combination' means in combination with one or more other races. The sum of the five race groups adds to more than the total population because individuals may report more than one race. Abbreviations: Black = Black or African American; AIAN = American Indian and Alaska Native; NHPI = Native Hawaiian and Other Pacific Islander Suggested Citation: Table 4-H. Projections of the Population by Sex, Race, and Hispanic Origin for the United States: 2010 to 2050 Series (NP2009-T4-H) Source: U.S. Census Bureau, Population Division Release Date: December 16, 2009

39 Demographics Projected Household Formation 2010 to 2025 Low Immigration Projected Household Growth SUM Projected homeowners based on 2011 homeownership rates 2011 HO rate Homebuyers % Non-Hispanic Black 1,122, % 1,069, % 984, % 3,176, % 45.4% 1,442, % Non-Hispanic Asian /Other 846, % 897, % 962, % 2,706, % 58.0% 1,569, % Hispanic 2,112, % 2,356, % 2,618, % 7,087, % 46.9% 3,324, % Diverse Markets Total 4,082, % 4,323, % 4,564, % 12,970, % 6,336, % Non-Hispanic White 1,922, % 1,473, % 1,117, % 4,513, % 73.8% 3,331, % Total 6,004, % 5,797, % 5,682, % 17,484, % 66.1% 9,667, % Renting Never Funded: A college education! A business! Retirement! Homeownership 9,667, % RENTERS 7,817, % Total New Households 17,484, % Rents should rise significantly! Source: Updated Household and New Home Demand Projections, Sept 2010 Joint center for Housing at Harvard, US Census - homeownership rates 2011 Copyright Copyright (c) CharisPros USA,Inc, Inc. All rights All rights reserved, reserved, duplication copying not or distribution allowed without not allowed express without written express permission permission.

40 The pace accelerates lost: homeowner gained: renters Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

41 Gap Widens Between Demand & Supply of Affordable Rent Units Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

42 Household Growth is in Lower Incomes Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

43 ..but the pace of Household Growth has not recovered Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

44 ... and the Boomers no longer dominate new homes (80.8 million) Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

45 Minority Home Losses Large, but ownership still higher than 1994 Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

46 Hispanics take the biggest hit to wealth Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

47 Mortgage affordability increases Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

48 but banks tighten lending standards Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

49 Minorities rely heavily on gov. backed loans Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

50 Source: The State of The Nation s Housing 2012, Joint Center for Housing Studies of Harvard University

51 Demographics Table 1. Homeownership Percentage Rates by Race/Ethnicity Faster growth in minority segments with lower homeownership rates Year All Households White Non-Hispanic Hispanics Black Asian/Other est. Sources: State of the Nation s Housing 2010, Joint Center for Housing Studies, Harvard & US Census Homeownership and Vacancy data

52 Demographics Homeownership Builds: Wealth, Stability, Opportunities!!!! November 16, 2010 By Danielle Hale, Research Economist National Association of Realtors Source:

53 Demographics 145x to 85x Impact on Hispanic Net Worth Moving from Renter to Homeowner!!! 54% of Renters are Hispanic!!!! 45.4 million Hispanics will be renters by 2030 Source: Pew Hispanic Center tabulations of SIPP data. ^ National Association of Hispanic Real Estate Professiosnals Note: Estimates for 1996 to 1999 are based on the 1996 SIPP panel and estimates for 2001 and 2002 are derived from the 2001 SIPP panel.

54 Demographics

55 Values, Beliefs, Aspirations of First Generation To come to the Unites States of America: They come: To: Not To: Build a better life for their family Work Contribute Plant Expect a windfall of good fortune Enjoy Take Reap Capitalize on opportunities / freedom Live off entitlements Build a legacy Enjoy an inheritance and. with a Judeo / Christian faith

56 The future belongs to those who create it! Why Homeownership Matters Challenging Environment Demographic Trends Founding Principles Call To Action

57 Founding Principles We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, And for the support of this Declaration, with a firm reliance on the protection of divine Providence, we mutually pledge to each other our Lives, our Fortunes and our sacred Honor.

58 25, 2012 The Declaration of Independence: A Transcription IN CONGRESS, July 4, To prove this, let Facts be submitted to a candid world. 1. He has refused his Assent to Laws, the most wholesome and necessary for the public good. 2. He has forbidden his Governors to pass Laws of immediate and pressing importance, unless suspended in their operation till his Assent should be obtained; and when so suspended, he has utterly neglected to attend to them. 3. He has refused to pass other Laws for the accommodation of large districts of people, unless those people would relinquish the right of Representation in the Legislature, a right inestimable to them and formidable to tyrants only. 4. He has called together legislative bodies at places unusual, uncomfortable, and distant from the depository of their public Records, for the sole purpose of fatiguing them into compliance with his measures. 5. He has dissolved Representative Houses repeatedly, for opposing with manly firmness his invasions on the rights of the people. 6. He has refused for a long time, after such dissolutions, to cause others to be elected; whereby the Legislative powers, incapable of Annihilation, have returned to the People at large for their exercise; the State remaining in the mean time exposed to all the dangers of invasion from without, and convulsions within.

59 7. He has endeavoured to prevent the population of these States; for that purpose obstructing the Laws for Naturalization of Foreigners; refusing to pass others to encourage their migrations hither, and raising the conditions of new Appropriations of Lands. 8. He has obstructed the Administration of Justice, by refusing his Assent to Laws for establishing Judiciary powers. 9. He has made Judges dependent on his Will alone, for the tenure of their offices, and the amount and payment of their salaries. 10. He has erected a multitude of New Offices, and sent hither swarms of Officers to harrass our people, and eat out their substance. 11. He has kept among us, in times of peace, Standing Armies without the Consent of our legislatures. 12. He has affected to render the Military independent of and superior to the Civil power. 13. He has combined with others to subject us to a jurisdiction foreign to our constitution, and unacknowledged by our laws; giving his Assent to their Acts of pretended Legislation: 14. For Quartering large bodies of armed troops among us: 15. For protecting them, by a mock Trial, from punishment for any Murders which they should commit on the Inhabitants of these States: 16. For cutting off our Trade with all parts of the world:

60 17. For imposing Taxes on us without our Consent: 18. For depriving us in many cases, of the benefits of Trial by Jury: 19. For transporting us beyond Seas to be tried for pretended offences 20. For abolishing the free System of English Laws in a neighbouring Province, establishing therein an Arbitrary government, and enlarging its Boundaries so as to render it at once an example and fit instrument for introducing the same absolute rule into these Colonies: 21. For taking away our Charters, abolishing our most valuable Laws, and altering fundamentally the Forms of our Governments: 22. For suspending our own Legislatures, and declaring themselves invested with power to legislate for us in all cases whatsoever. 23. He has abdicated Government here, by declaring us out of his Protection and waging War against us. 24. He has plundered our seas, ravaged our Coasts, burnt our towns, and destroyed the lives of our people. 25. He is at this time transporting large Armies of foreign Mercenaries to compleat the works of death, desolation and tyranny, already begun with circumstances of Cruelty & perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the Head of a civilized nation.

61 26. He has constrained our fellow Citizens taken Captive on the high Seas to bear Arms against their Country, to become the executioners of their friends and Brethren, or to fall themselves by their Hands. 27. He has excited domestic insurrections amongst us, and has endeavoured to bring on the inhabitants of our frontiers, the merciless Indian Savages, whose known rule of warfare, is an undistinguished destruction of all ages, sexes and conditions.

62 Founding Principles We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, And for the support of this Declaration, with a firm reliance on the protection of divine Providence, we mutually pledge to each other our Lives, our Fortunes and our sacred Honor.

63 Founding Principles A free people cannot survive under a republican constitution unless they remain virtuous and morally strong. "Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other. John Adams Quoted in John R. Howe, Jr., The Changing Political Thought of John Adams, Princeton University Press, Princeton, N.J., 1966, p. 189.

64 Founding Principles The most promising method of securing a virtuous and morally stable people is to elect virtuous leaders. "But neither the wisest constitution nor the wisest laws will secure the liberty and happiness of a people whose manners are universally corrupt. He therefore is the truest friend to the liberty of his country who tries most to promote its virtue, and who, so far as his power and influence extend, will not suffer a man to be chosen into any office of power and trust who is not a wise and virtuous man. Samuel Adams (Wells, Life of Samuel Adams, 1:22.)

65 and Ben Franklin warned us of this!

66 Founding Principles Without religion the government of a free people cannot be maintained. "Of all the dispositions and habits which lead to political prosperity, religion and morality are indispensable supports... And let us with caution indulge the supposition that morality can be maintained without religion... Reason and experience both forbid us to expect that national morality can prevail to the exclusion of religious principle. "It is substantially true that virtue or morality is a necessary spring of popular government. George Washington, Farewell Address Basic American Documents, pp

67 Founding Principles Without religion the government of a free people cannot be maintained. The first amendment was not written to protect people and their laws from religious values, it was written to protect those values from government tyranny

68 Founding Principles Life and liberty are secure only so long as the right to property is secure. Land and the products of the earth were considered a gift of God which were to be cultivated, beautified, and brought under dominion. All property is an extension of a person's life, energy, and ingenuity. Therefore, to destroy or confiscate such property is, in reality, an attack on the essence of life itself. "The moment the idea is admitted into society that property is not as sacred as the laws of God, and that there is not a force of law and public justice to protect it, anarchy and tyranny commence. Property must be secured or liberty cannot exist."charles Francis Adams, ed., The Works of John Adams, 10 vols., Little, Brown and Company, Boston, , 6:9, 280; emphasis added.

69 Values, Beliefs, Aspirations of First Generation To come to the Unites States of America: They come: To: Not To: Build a better life for their family Work Contribute Plant Expect a windfall of good fortune Enjoy Take Reap Capitalize on opportunities / freedom Live off entitlements Build a legacy Enjoy an inheritance and. with a Judeo / Christian faith

70 The future belongs to those who create it! Why Homeownership Matters Challenging Environment Demographic Trends Founding Principles Call To Action

71 A Century of Quantum Progress In the 20th century, America has led in virtually everything... growth, productivity, incomes, new products, new processes, applying new ideas first or most effectively even if it did not invent them. The Economist Magazine , P.7. In 1900 per capita incomes in the United Kingdom and Australia were higher than in the USA By the late 1900 s US incomes were substantially higher than those two countries 2005 per-capita GDP: USA = $41,800, Australia = $32,000, UK = $30,900 US Industry grew so internationally dominant it is recognized as the sole dominant economic superpower Source: Its Getting Better All the Time by Stephen Moore & Julian L. Simon, CIA World Fact Book

72 Why did so much progress originate or reach its pinnacle in the USA the last 100 years? The nation remakes itself through the blood of new immigrants: The cream of the rest of the world. Americans are self-selected problem solvers and progress seekers (Ellis Island or Rio Grande) Source: Its Getting Better All the Time by Stephen Moore & Julian L. Simon

73 Why did so much progress originate or reach its pinnacle in the USA the last 100 years? Europe turned to socialism & totalitarianism while the USA consistently cultivated free markets! Unique American formula of individual liberty and free enterprise has cultivated: Risk taking, experimentation, innovation, and scientific exploration on a grand scale that has never occurred anywhere else in the history of the planet.- no other place cultivates the entrepreneurial spirit and inventiveness like the USA. Economic freedom and freedom from government repression US Gov. laid down a reasonable rule of law, providing a well balanced equilibrium between liberty and order and gotten out of the way Source: Its Getting Better All the Time by Stephen Moore & Julian L. Simon

74 What Makes ANY Free-Market Work? One of Adam Smith's key insights: True he claimed that self-interest leads to the common good if there is sufficient competition; but also, and more importantly, He claimed that this is true only if most people in society have internalized a general moral law as a guide for their behavior. (Smith, Adam: An Inquiry into the Nature and Causes of the Wealth of Nations, Published: London: Methuen and Co., Ltd.,1776.)

75 What Makes ANY Free-Market Work?...Truth, trust, acceptance, restraint, obligation These are among the social virtues grounded in religious belief which...play a central role in the functioning of an individualistic, contractual economy... The point is that conventional, mutual standards of honesty and TRUST are public goods that are necessary inputs for much of economic output. (p. 141, Hirsch, Fred. Social Limits to Growth, Published: Cambridge, MA: Harvard University Press, 1978). (p. 141, Hirsch, Fred. Social Limits to Growth) (Cambridge, MA: Harvard University Press, 1978)

76 What Makes ANY Free-Market Work? Business is all about TRUST.. if you earn the trust, you get the business! When TRUST is lost you lose the business - market

77 The One Thing What the whole world wants is a good job Gallup Organization Jim Clifton, the "Six years into our global data collection effort, we may have already found the single most searing, clarifying, helpful, world-altering fact...

78 The One Thing What s getting in the way?

79 The One Thing Key Assumptions #1 Innovation is not scarce ENTREPRENEURSHIP is scarce Spent billions, wasting years of conversations on innovation and it is not paying off. Great business people are more valuable and rare than great ideas!!!!

80 The One Thing Key Assumptions #2. Staggering Mistake: Spending all our time on the cart and little or nothing on the horse. We have it backward. Spending time, money, strategies, and especially policies on those who need 'help' getting a job. A useful way to look at any citizen is this, 'Can she herself create jobs or does she need a job created for her?' SIX million active businesses in America. 99% small businesses The horse (small and medium business) has stopped, yet we fix the cart (jobs).' If we change all our strategies and policies to favor the job creators (small and medium businesses) the horse and cart will get moving again. We have our compassion right, but the logic is staggeringly stupid.

81 The One Thing Key Assumptions #3. Imagining that Washington has solutions. Job creation is a city problem.!!!!! Great variation in job creation by city: San Francisco (valley) pumping away Detroit isn't. Austin's cart works Albany's doesn't. Cities need to look inwardly and say What can we do to create great economic energy, to bring new customers for all existing companies and start-ups?

82 The One Thing Key Assumptions #4. Believing that the purpose of business is to create jobs Businesses exist to create a product/service that people want to buy and they do it so well that they earn a reward profit Profit is not a dirty word.. Its an incentive to risk capital, to make you want to grow and as a result you employ more people to do it.

83 The future belongs to those who create it!!!! What are you going to do about it?

84 The future belongs to those who create it!!!! What we are called to do: From our abundance of talents and wealth we are called to do our best: Not just to sustain our present way of life, but to meet our responsibilities to our families and the less fortunate to enable them and us to have a better life and compete in the World economy. To help our children, families, neighbors, our communities and our great Nation to remain a beacon of hope and prosperity for the World

85 The future belongs to those who create it!!!! What we are called to do: To ensure that our National Treasures are kept safe and perpetuated (gifts entrusted to our care that are much greater than any one of us): 1. That as participants and stewards of the free-market in homeownership we ensure that freedom - a vibrant free market remains strong for the for the next generations That we engender TRUST by exemplifying principles of diligence, honesty, truthfulness, fairness»that we root out unprofessional and unscrupulous practitioners from the homeownership industry 2. That we continue to help families attain the dream of homeownership in safe, decent and attractive communities

86 The future belongs to those who create it! Why Homeownership Matters June 25, 2012 Mortgage Bankers Association of Missouri Tino Diaz Managing Director Charis Pros