Quote:
Originally Posted by spence
Often people couldn't pay the bill because of misleading ARMs that blew up or inflated prices plunged and put their houses under water. Money was so easy that predatory lending became common as risk was obfuscated.
Many markets had outpaced the average consumer.
I've repeatedly said that irresponsibility was certainly an issue for some, but the real crisis was due to a system that encouraged lending into a market that needed cheap credit to exist. It was like a coke head that just needed more coke to keep from crashing.
-spence
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"Often people couldn't pay the bill because of misleading ARMs "
They are not misleading if one is responsible about the contract they are getting into.
"Many markets had outpaced the average consumer."
That's true. But when that happens, intelligent people wait for the inevitable correction. They don't buy $600,000 houses on a $45,000 income.
"It was like a coke head that just needed more coke to keep from crashing."
Using that analogy, if the addict's problem is that he can no longer afford the price of coke, why is it a good idea for the feds to lower the price of coke to make it affordable?