The Epic American Credit and Bond Bubble Laboratory Message Board

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

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To: GST who wrote (36850)	7/24/2005 3:39:26 PM
From: russwinter	Read Replies (2) of 110194

<bail on their mortgage as fast as your article might suggest.> I'm not sure folks walk right away, but do you think they'll just pay 50% of their incomes for housing that is losing value? At minimum, some will try to bail first by selling, as opposed to turning over keys. The big surge in listings in Bubble markets so far seem to be speculators, wallstreetexaminer.com but more and more it will be these overextended types as well. If they decide stay longer, they will have to cut spending elsewhere. The 64k question is will lenders continue to make ultra lax piggyback loans and overappraisals (the end of homes as ATM machines) in excess of the so called collateral value of their homes, especially as they roll over? <lose their job -- and of course that is another snowball that is likely to gather in coming months, but it will not hit with a bang until it has had more time to gather.> I think it goes off with a bang, with a ton of it in financial, and real estate influenced industries, from the MER analysis in Abelson's column: Over 40% of private-sector jobs created since 2001 have been housing-related.

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