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To: Bucky Katt who wrote (10827)	4/16/2002 1:50:02 PM
From: James Strauss	Respond to of 13094

A few statistics highlight the huge buildup of mortgage debt. Twenty years ago, annual consumer-debt payments -- basically mortgages, credit cards and auto loans -- stood at around 60% of disposable personal income. That ratio has since risen steadily to slightly above 100% of personal income in the fourth quarter of last year, according to the latest Fed data. At $5.6 trillion, mortgage-debt accounts for the lion's share of total household debt of $7.7 trillion. Good article William... Interestingly, such a huge debt load when interest rates are low doesn't bode well for those carrying adjustable rate mortgages when interest rates start to climb... We could see a vicious cycle of more homes being put at risk through home equity loans just to get cash to meet prior debt commitments... This could put upward pressure on interest rates further exacerbating the situation... The end result could be a rash of foreclosures that bodyslam the housing market with oversupply that deflates housing prices... To combat this the FED may artificially keep rates lower... Jim