Originally Posted by brewmenn
Just keep in mind that those "retarded people's problems" can become your problem if it causes property values to drop to much. Although I have zero confidence in Kwame and crew's ability to solve the problem I'm glad to see people talking about it and trying to do something before it drags us all down.
Bruce, it already is my problem. My property value has decreased 15% in the last 3 years (based on what the condos in our neighborhood are seeling for).
the problem I see is this: People are in trouble, most because they were not smart enough to weed out the BS the lenders fed them, or gambled on property values going up so they took out "interest only" loans. If these morons are bailed out, they will have learned nothing, nor be held accountable for their stupidity.
I am trying to get my hands on some data so I can post it here; it shows the types of mortgages that are currently out there and projects what will happen in the next 10 or so years. Basically, the ARMs, ballons, interest-only and other BS loans will decline over the next 5 years, as the 15 and 30 years conventional will start to "take over" as the housing market recovers.