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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: John Vosilla who wrote (29247)	3/23/2005 3:38:15 PM
From: kailuabruddah	Read Replies (3) of 110194

I tend to agree... But I am wondering how things could have been different... Many have said that if margin buying in the stock market were tightened in '99 that conceivably could have stunted the boom/bust some... but I don't know about that... many tech crap IPOs were brought public with 3 million share floats so as to game the supply/demand differential... In the RE world of say 2002: 1. If lenders were forced to adhere to 20% down payments - or even 10% down payments 2. If minimum mortgage duration was 5 years - meaning a 5/1 ARM would be the shortest fixed product available (no LIBOR teasers!) 3. And if the favorable no capital gains tax up to $500K minimum time requirement were shifted from 2 years up to 5 years I think those 3 things would have allowed the RE markets to operate in a more "normal" state as opposed to a speculator-driven state... At this point, I can only hope that the pain felt by those unable to flip to a greater fool is not alleviated by some government "solution"... of course the real solution was to not have taken rates down to 1% and left them there!

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