Prepare for a storm
Cato Institute
by Steve H. Hanke
04/02/07
In late February Alan Greenspan warned of the possibility of a recession. The next day the markets took a dive. Since then anxiety has set in and market volatility has increased. Even Panglossian brokerage houses have warned that if a recession occurs, house prices could tumble 10% this year and the stock market could decline by 30%. We must, of course, add to this noise some nasty facts about subprime lending, which constituted as much as 20% of U.S. mortgage lending in 2006. And that’s not all: Another 13% of mortgage lending was to borrowers with only slightly better credit than subprime. There’s a tendency for these borrowers, and their lenders, to live in a delusional world in which an inability to service the debt is papered over with refinancings and creative repayment schedules...
http://www.cato.org/pub_display.php?pub_id=8166
Informant: Thomas L. Knapp
http://freepage.twoday.net/search?q=mortgage+lending
by Steve H. Hanke
04/02/07
In late February Alan Greenspan warned of the possibility of a recession. The next day the markets took a dive. Since then anxiety has set in and market volatility has increased. Even Panglossian brokerage houses have warned that if a recession occurs, house prices could tumble 10% this year and the stock market could decline by 30%. We must, of course, add to this noise some nasty facts about subprime lending, which constituted as much as 20% of U.S. mortgage lending in 2006. And that’s not all: Another 13% of mortgage lending was to borrowers with only slightly better credit than subprime. There’s a tendency for these borrowers, and their lenders, to live in a delusional world in which an inability to service the debt is papered over with refinancings and creative repayment schedules...
http://www.cato.org/pub_display.php?pub_id=8166
Informant: Thomas L. Knapp
http://freepage.twoday.net/search?q=mortgage+lending
rudkla - 3. Apr, 15:41
