Subprimes: From Bad to Worse

I can't believe the gvt is bailing these idiots out. Let them fry or spend a few nights out on the street. Freezing rates for 5 years is only prolonging the inevitable. I have no sympahty for people who can't control their spending or think they should be in a house 10 times there salary just because they can. If you're not smart enough to understand the product or how it works, don't sign the dotted line. As a real estate investor though I've been waiting for this time for the past few years. Nothing better than seeing what foreclosure does to home prices. Only problem is you can't get your hand on any money right now.

94000 hired for the Christmas season that's about 1500 per STATE real big deal, temp jobs don't pay unemployment so in Jan 95000 unemployed WITHOUT unemployment! Just another load of Jack Sheite like the houseing problem, protect the lender,shaft the lendee! Like we should exspect different from G.Wawa. Bush and company. Not even a Band-Aid bandaid, he's now using generic bandaids, that don't stick! In the 60s we said "make love, not war" today we say "buy what you can't afford, not make war" and still so arrogent to do both!

Packaging loans and selling them to investors "hides the weenie". As the ratings on those investments remains substantially disconnected from the true nature of the beast - investors will continue to buy. The real-estate and assessment "team" has an interest to see values increase without a basis in reality. Too many people enroll in the fantasy of everybody gets paid... as long as you can find new suckers to buy your story the money will changes hands. Few in control of this enterprise will challenge it because it is a "free market" solution that pays everyone very nicely - for now. Reality sinks in slowly while fortunes are mined from the process. Anybody interested in some tulip bulbs?

Packaging loans and selling them to investors "hides the weenie". As the ratings on those investments remains substantially disconnected from the true nature of the beast - investors will continue to buy. The real-estate and assessment "team" has an interest to see values increase without a basis in reality. Too many people enroll in the fantasy of everybody gets paid... as long as you can find new suckers to buy your story the money will changes hands. Few in control of this enterprise will challenge it because it is a "free market" solution that pays everyone very nicely - for now. Reality sinks in slowly while fortunes are mined from the process. Anybody interested in some tulip bulbs?

I agree that both greedy mortgage lenders and magically thinking consumers who rely on the stability of teaser rates is to blame here, but so is the government. Deregulation gave lenders a much wider girth to do whatever they wanted while at the same time changing bankruptcy laws that added insult to injury. Now the government is putting a band-aid on what amounts to an amputated limb to cover for the free reign they gave to the lending industry. That's all right, though. The middle class never minds paying for these things.

The mortgage lenders are directly responsible for the this mess by lending to people whose credit is marginal. Also to blame here is the consumers who are borrowing a lot more than they can afford and not researching and planning for the raise in their mortgage. People should realize that markets dont continually go up. The markets go up and down and America has been riding a wave of increase for years, a correction was bound to happen eventually. Lets be realistic here, people need to be responsible for their actions and if the government comes in and bails them out it teaches us all its ok to be irresponsible. All the government is doing is prolonging the problem down the road for some, and bailing out the irresponsible.

Great comment jhoffman. The Thomas Jefferson quote on the private banking system is so real today. Alexander Hamilton would be proud of the Corporate elite. There are solutions and the American people saying no to Corporate like Corporate is saying no to Customers,consumers,workers, and the American people is the key to ecomomic freedom for all. The willingness of the American people to let corporate have complete control must stop.

We have been hearing about the collapse of the consumer credit market for years and years now. This is the zillionth 'sky if falling'. The collapse is just not going to happen. People are smarter than all these journalists think. There will be always be a few who get caught, but the majority of people seem to be able to manage. I would really like to see different statistics than averages. They are pretty meaningless when most people are more or less ok and only a few are really screwed.

Greed is rampant, both in the unchecked, short term profit mentality of corporate Americe and in the willingness of the American people to allow themselves and their government to go ever deeper into an indebted condition from which there can be no recovery.

Corporate America should be seen as a "Giant Steam Roller" which has crushed our Government Regulatory Agencies and is slowly and steadily squeezing every drop of liquidity out of every consumer. This is why, for many years, I have not considered the soaring stock prices the increase of profits or the growth of consumer spending to be a good sign or a sign of a healthy economy.

Consumers are in fact "Crushed Grapes" with no more ability to consume. Todays "Crushed Grapes" are tomorrows "Grapes of Wrath."

Agree. this is one of many symtoms that is sending Americans into poverty while a few have rooms of cash.
No time now to comment on why i think all this happened, but one can start with 1999 gramm/leach/billey modernization law and a series of other modernization laws in early 2000's.
The solutions to this mess can be found, but corporate will not agree to these solutions. The American people must take our OWN action if Conress will not

Funny thing, no income increases plus much higher debt ration leads to higher defaults! Well duh! All the companies who were so proud of thier consistent stock dividends because of "tight" internal cost control aka - no significant raises for employees are getting the back end result. Employees are more like customers than shareholders and if they're hurting to where they need two jobs just to say afloat/current this is a particularly bad omen. If you're an employer and this scares you, good, about time you felt the effects of those internal cost controls.