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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Tommaso who wrote (48166)	12/25/2005 10:30:07 AM
From: Wyätt Gwyön	Respond to of 110194

will American borrowers be able to pass the buck when the SHTF? will American creditors rely on the borrowers' sense of obligation to maintain their part of the bargain? creditors have paid lobbyists to bribe politicians to pass stricter bankruptcy laws which will force borrowers to keep from passing the buck. will this be successful? i doubt it will be successful enough to allow the finance sector to remain as large as it is, relative to US GDP.

To: Tommaso who wrote (48166)	12/25/2005 12:04:41 PM
From: Jim McMannis	Read Replies (1) \| Respond to of 110194

RE:"I wonder how people in the U. S. will handle it--probably by just walking away." True, that's a big difference between the US and Japan. Don Green would know, he used to live in Japan. The new bankruptcy law could also place a big "gotchya" on walkers as well. Even if they bought free and clear...it's not going to sit well if the house is worth less. Don't have to walk. Taxes will be a big insult as well.

To: Tommaso who wrote (48166)	12/25/2005 1:41:08 PM
From: SeaViewer	Respond to of 110194

Americans will rent it out.<g> There are a couple of condo flippers I know paid $575k. They tried to flip them out, but couldn't. So instead of taking a loss, they decided to rent them out. They could get $1500/month rent. The property tax and HOA fee is about $1000/month. So they get back $500 net plus tax deduction on their interest payment on their $575k investment. They don't want to miss the RE appreciation opportunity. As everyone knows RE price always go up.