Tuesday, August 24, 2010

Economy Falters? Maybe Because ......

REUTERS - July home sales hit 15-year low - 8/24/10 - response to other commenters

GARY 54 minutes ago Report Abuse
Don't know how to break this to you folks, but there will be no coming out of this collapse this time.... the banks, and the media with all of their focus on doom and gloom
You follow the MSNBC Kudlow way - the market should always go up, the economy will be fine if people will just keep buying things BEYOND their means, etc.

REALITY is that economies generally go up, but when irrational spending goes wild, the economy JUMPS, but when the debt starts to 'hit home' people pull back. They realize that paying 30% of their income to a credit card company is STUPID.

House prices in some markets went up 2%/yr, but other's 10%-20% per yr or more -- an unrealistic increase fueled by speculation, house flipping, low ARM % with owners planning to sell before the rate increased. Add to that the ones buying with no hope of ever paying because 'brokers' made loans that should have been illegal, and you had a condition that had to die. These 'brokers' made money on every 'closed deal', with no connection to the house, bank, or anything else.

It goes on and on -- if you can't follow, blame your "representatives", parents and schools. A BASIC education should have taught you that "what goes up must come down" and "bubbles break". That includes the results of bad banking, etc.

No comments:

Post a Comment