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

To: GraceZ who wrote (54224)	2/18/2006 8:18:35 PM
From: mishedlo	Read Replies (1) \| Respond to of 110194

Most of the mortgage debt is held by a small minority of homeowners. 40% have zero mortgage debt, half of the remaining homeowners have better than 50% equity, that leaves 30% of the homeowners with most of the mortgage debt. 30% is pretty intense concentration if you ask me. Not only that but 30% is a pretty large number as well. That is far worse in terms of default risk than if it was evenly spread out. Lots of equity out there to tap, but there is a mismatch between those who might need to tap it and those that have it. Exactly, and headed into a recession that mismatch can have extreme impacts. Mish

To: GraceZ who wrote (54224)	2/19/2006 1:31:39 AM
From: FiveFour	Read Replies (1) \| Respond to of 110194

30% of the homeowners with most of the mortgage debt. The percentage of those with high risk levels of housing expense among homeowners is less than 10%. would think that even a portion of the 10% coming to market in a compressed period may be enough to cause havoc in a local market.

To: GraceZ who wrote (54224)	2/19/2006 5:01:00 AM
From: Mike Johnston	Read Replies (2) \| Respond to of 110194

Lots of equity out there to tap, but there is a mismatch between those who might need to tap it and those that have it. There is always lots of equity to tap at the top of the cycle. What will happen at the bottom ? If the economy was really booming, we would not be discussing people's needs to borrow money against their homes. With retail sales up 10% y/y, one would think that consumer confidence would be much higher, IMO skyrotecting retail sales number is a reflection of higher prices paid and inflation, as opposed to a booming economy.