Posted by
SkiCougar on Wednesday, December 19, 2007 4:50:58 PM
Well, it seems that these days you can't swing a dead cat without seeing a story on how the sub prime loans have put the economy and financial markets on shakey ground, much the same as the beginning of this summer; you could not get by Al Gore taking his favorite Lear jet around telling you how fast the the coastlines were going to be new territory for sharks to swim in.
Well, much the same the hysteria has been blown up as the worst ever; when it was not even the worst this decade.
According to the WSJ editorial by Mr. Weicher on August 29th; todays delinquencies pale by comparison to just 5 years ago.
In '05 and '06 the rate was 6% and it's 8% so far this year. However, the delinquency rate from 2000-2002 was 12%.
And the foreclosure rate for the past 2 years was 1.5% and is about 2.5% this year, but ranged from 2.5% to 3% from 2000-2002.
And in 2000-2002; the no money down, 100% financed, you got a job, you can get a subprime were about 1/3 of new loans. Ten years, they were less than 5%.
Currently, they are about 44% of new loans; or they were earlier this year.
So, the Housing market was in worse shape just a little while ago; with a much worse overall economy. I am quite secure in saying that you can proceed to call this nothing more than the latest overhyped story to which you can site these facts and be called cruel and heartless for the little guy just like you are for mother earth.
Hmmm. Some people/businesses got bit by not being personally responsible to make sure they could afford a house; and now we have to bail them out. No, this never happens.