How the mortage crunch toppled the US economy


	How the mortage crunch toppled the US economy

chaynepain

9-18-2008 1:56 AM

306 views

tags:

us economy, mortage crisis, real estate crisis, housing slump

chaynepain says:

it wasn't global warming, world food shortage or crude oil supply that got the US into the economic quagmire it's in now- it was bad investment and planning in the housing sector.

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<div style="margin: 12px 0px; font-family: arial; color: #333333; background: #ffffff; border: solid 4px #e5e5e5; width: 100%; clear: left;"><div class="CM_CTB_Content_Wrap" style="margin: 0px; padding: 0px;background-color: #ffffff;"><div style="border-bottom: solid 1px #dcdcdc; white-space: nowrap; margin-bottom: 8px; background-color: #eeeeee ;background-image: url(http://clipmarks.com/images/source-bg.gif); background-repeat: repeat-x; height: 24px; line-height: 24px; vertical-align: middle; padding-bottom: 4px; color: #666666; font-size: 10px;" ><a href="http://clipmarks.com/clip-to-blog/" title="see clips that are hot right now"><img src="http://content.clipmarks.com/blog_embed/add657cf-44d3-4722-b25a-0b0108dd9c92/9D356456-C031-4DB3-9442-C7265AA8C1BE/" alt="" width="19" height="19" border="0" style="vertical-align: middle; margin: 0px 4px; display: inline; border: none; float:none;" /></a>clipped from <a title="http://finance.yahoo.com/banking-budgeting/article/105782/How-We-Got-Here-It-Is-Housing-Stupid" href="http://finance.yahoo.com/banking-budgeting/article/105782/How-We-Got-Here-It-Is-Housing-Stupid" style="font-size: 11px;">finance.yahoo.com</a></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://finance.yahoo.com/banking-budgeting/article/105782/How-We-Got-Here-It-Is-Housing-Stupid"><P>The nation's financial system is in the midst of a massive shakeup and many on   <SPAN id="lw_1221685049_0" class="yshortcuts">Wall Street</SPAN> and in <SPAN id="lw_1221685049_1" class="yshortcuts">Washington</SPAN> are pointing fingers and looking for someone to   blame.</P><P>But in the end, it all comes back to one issue - housing</P></blockquote><div style="height: 2px; font-size: 2px; background: #dcdcdc; border-bottom: solid 1px #f5f5f5; margin: 2px 4px;"></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://finance.yahoo.com/banking-budgeting/article/105782/How-We-Got-Here-It-Is-Housing-Stupid"><P>Earlier this decade, it was much easier to get a mortgage. Home prices soared   about 85% from 1996 through 2006<STRONG> </STRONG>in inflation-adjusted dollars, creating   a bubble.</P></blockquote><div style="height: 2px; font-size: 2px; background: #dcdcdc; border-bottom: solid 1px #f5f5f5; margin: 2px 4px;"></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://finance.yahoo.com/banking-budgeting/article/105782/How-We-Got-Here-It-Is-Housing-Stupid"><P>Then the bubble popped. And the fallout isn't over yet, experts say.</P></blockquote><div style="height: 2px; font-size: 2px; background: #dcdcdc; border-bottom: solid 1px #f5f5f5; margin: 2px 4px;"></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://finance.yahoo.com/banking-budgeting/article/105782/How-We-Got-Here-It-Is-Housing-Stupid"><P>But once prices topped out and began falling, loan defaults and foreclosures   started shooting higher as homeowners found it more difficult to sell their   house. This created problems not just for subprime borrowers but even for those   with good credit and income.</P></blockquote><div style="height: 2px; font-size: 2px; background: #dcdcdc; border-bottom: solid 1px #f5f5f5; margin: 2px 4px;"></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://finance.yahoo.com/banking-budgeting/article/105782/How-We-Got-Here-It-Is-Housing-Stupid"><P>This <SPAN id="lw_1221685049_23" class="yshortcuts">credit crunch</SPAN> in of itself slowed the economy, leading to job losses and   more defaults, feeding a downward spiral that has been difficult to stop.</P></blockquote></div><div style="margin: 0px 6px 6px 4px;"><table style="font-size: 11px;border-spacing: 0px;padding: 0px;" cellpadding="0" cellspacing="0" width="100%"><tr><td style="background:transparent;border-width:0px;padding:0px;">&nbsp;</td><td align="right" style="background:transparent;border-width:0px;padding:0px;width:107px" width="107"><a href="http://clipmarks.com/share/9D356456-C031-4DB3-9442-C7265AA8C1BE/blog/" title="blog or email this clip"><img src="http://content9.clipmarks.com/images/c2b-foot.png" border="0" alt="blog it" width="107" height="17" style="border-width:0px;padding:0px;margin:0px;" /></a></td></tr></table></div></div>

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