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Politics : View from the Center and Left

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To: epicure who wrote (35778)	3/26/2007 11:27:55 PM
From: Cogito	Read Replies (3) of 541955

>>At this point, I don't see how it can't be really bad. Scenario 1, we get a recession- which torpedos the weak hands in the housing markets because they lose their jobs. Scenario 2- we get inflation and growth, and these same folks get torpedoed because they can't keep up with their adjustable mortgages.<< Iktomi - You could be right. On the other hand, I've read that the actual number of sub-prime mortgages is only 2 to 3% of the total mortgages in the US. This may mean that even though a lot of people have used their homes as cash machines, as you said, and even though many of those people may even find themselves with mortgage loans that are under water, the great majority of them will still be able to make their payments. They may be forced to curtail their spending to some extent, but they won't default. As far as I'm concerned, predatory lenders should be allowed to suffer the consequences. If we're really only talking about 3% of the mortgages in the US, that shouldn't be catastrophic. - Allen

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