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Politics : American Presidential Politics and foreign affairs
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To: DuckTapeSunroof who wrote (44640)8/3/2010 11:29:11 AM
From: TimF  Read Replies (1) of 71588
 
So... her argument (after examining the same data) is that "the rich" ARE defaulting at a higher rate than the general population is --- but that there is no real way to tell if those are predominantly "strategic defaults

No.

The "no way to tell if these are strategic defaults", is part of it but the main point is that the data is not about "rich vs. non-rich", but about very large mortgages vs. smaller morgages.

Someone who used a "liar loan", or just loose credit standards, to get a huge mortgage on a house they couldn't afford, or someone who has lost their income (business gone bust, lost high paying job...), and can no longer afford the house, may own a very expensive house (even with post-crash prices being considered), but be far from rich, not having a particularly high income, and having a negative net worth.

Also McArdle was not asserting that the rich do not default at a higher rates, only that the date presented by those who say that they do, actually shows no such thing.
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