If the United States government got out of the way, things might get worse before they get better. With the government in the way, we have only the certainty of worse. Washington is engaged in the doomed project of attempting to re-inflate a credit bubble. Can't be done. But, in attempting it, they're massively expanding government spending and further distorting the rules of the market in the same ways that worked out so well for American home owners.
Mark Steyn [emphasis added] March 2, 2009
Tampilkan postingan dengan label business cycle theory. Tampilkan semua postingan
Tampilkan postingan dengan label business cycle theory. Tampilkan semua postingan
Senin, 02 Maret 2009
Senin, 10 November 2008
2 Trillion dollar bailout; $700 billion bailout; Fractional Reserve Banking; Fulton Bank; Lancaster, PA
The Federal Reserve bailout plan is causing predictable consequences, as spending is out of control:
This item from Lancaster, PA provides some insight into how the money is being spent and a brief mention of the real cause of the meltdown (and the business cycles we have endured for 100 years):
I did not know that the multiplier was as high as ten, but I knew that this process exists. Ask yourself, how does a bank loan "10 times their amount of capital. . . "? Where do they get the money to make such loans, if such loans do not represent actual capital? In the above example, where does the other $3.4 billion come from?
The answer is found in our system of fractional reserve banking. The system (and its consequences) are described (in layman's terms) in "The Bubble that Broke the World" and "America's Great Depression." Knowing how a bank can take $375 Million and create $3.75 billion in loans would be a tremendous step in understanding how our financial system collapsed this year.
The Federal Reserve is refusing to identify the recipients of almost $2 trillion of emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral.H/T Bloomberg
This item from Lancaster, PA provides some insight into how the money is being spent and a brief mention of the real cause of the meltdown (and the business cycles we have endured for 100 years):
The Treasury Department's $700 billion rescue plan is best known for propping up wobbly financial institutions.emphasis added
But the plan also has a provision for healthy ones, figuring they can help guide the economy back on track.
Fulton Financial Corp. said Thursday it has applied to get $375 million in capital under that government-investment initiative, the Capital Purchase Program.
"If we get it, our intention is to use it to provide additional loans," Fulton Financial's Charles J. Nugent said today.
Since banks generally loan 10 times their amount of capital, an extra $375 million in capital potentially could lead to an extra $3.75 billion in loans, he explained.
I did not know that the multiplier was as high as ten, but I knew that this process exists. Ask yourself, how does a bank loan "10 times their amount of capital. . . "? Where do they get the money to make such loans, if such loans do not represent actual capital? In the above example, where does the other $3.4 billion come from?
The answer is found in our system of fractional reserve banking. The system (and its consequences) are described (in layman's terms) in "The Bubble that Broke the World" and "America's Great Depression." Knowing how a bank can take $375 Million and create $3.75 billion in loans would be a tremendous step in understanding how our financial system collapsed this year.
Jumat, 03 Oktober 2008
Classics of Conservatism - Part XXIV - America's Great Depression
This month's Classic of Conservatism is Murray Rothbard's 1963 work, "America's Great Depression."
25 years have elapsed since I read this book, but I will never forget its main lesson (and that of the other Austrian economics books I read at that time). The Depression of the 1930's was caused by the alternating periods of expansion and contraction of the money supply by the Federal Reserve Board. The Federal Reserve, under the leadership of Benjamin Strong (Governor of the Federal Reserve Bank of New York) began a long credit expansion in 1922. This expansion continued until the summer of 1929, when the FED reversed course and began contracting the money supply. Several months later, the stock market crashed. The stock market crash is typically considered the beginning of the Great Depression. In fact the Depression had its roots at the beginning the 1920's. (I am somewhat fuzzy on the dates due to the time elapsed since I read the book.)
MSM/DNC mythmakers usually assign the crash of October 1929 as the beginning and attempt to address stock trading practices as the cause. They have convinced generations of students that the activities of a few stock traders somehow caused the collapse of the entire economy. The "historians" ignore the role of centralized credit expansion on the entire economy over a period of years. The term "fractional reserve banking" never appears in print in today's "newspapers."
Instead of focusing on the period from 1922 through 1929, the establishment mouthpieces have caused the average reader to focus on the activities of a few stock brokers at the very end of the great credit expansion. Even conservatives who try to explain the issue in terms of FED policy blame the FED for contracting in the summer of 1929 instead of blaming the FED for creating the bubble over the course of a decade.
If fractional reserve banking did not exist, the economy would not grow nearly as fast as it has during the various bubbles of the 20th (and 21st) century, but the inevitable collapses would not have occurred either. Growth would be slow, steady and safe. We need not fear the crises that have plagued our economy on a regular basis since 1913 (and the inevitable and predictable crisis that now threatens to destroy the economy completely).
Rothbard is one of the few writers to explain the Depression in terms of the 1920's credit expansion instead of the non-issues that the most writers and teachers focus on. In Rothbard's book, you will not read first hand accounts of bread lines and soup kitchens. Nor will you see a rehash of such events as the "bonus army" or the creation of the WPA. These events were the results of the policies that created the Depression. Most writers focus only on these results and teach nothing about the causes.
Rothbard explains the business cycle theory and its application to the credit expansion of the 1920's.
We all acknowledge that today's crisis results from bankers making bad loans to unqualified individuals. But very few have bothered to ask why so many lenders made these mistakes at the same time. This is the question that Rothbard asks in America's Great Depression. Like anyone else, businessmen will make mistakes (and usually pay the consequences). But the business cycle over the past century features all businesses making the same mistakes at the same time. Whether these mistakes include risky lending, overproduction, investment in unprofitable lines, overspending, etc., the mistakes are coordinated throughout the economy and are not limited to one region or one city or one sector. Rothbard shows that this phenomenon occurred even in the 1920's - well before today's "global economy" existed. The one factor that tied all of these errors together was Federal Reserve policy. And Federal Reserve policy has served this function in every recessionary cycle since the FED was created in 1913.
If you are not sure of the extent of misinformation that relates to the Depression, ask a friend if he knows when the Federal Reserve Board was created. Far too many people will say that the FED was created by FDR as one of his many reforms following the stock market crash. Only when one realizes that the FED existed 16 years before the stock market crash will one see an example of how common beliefs about the Depression and economic conditions have become so muddled.
Rothbard provides detail and documentation to demonstrate where the blame truly belongs. After reading America's Great Depression, you will realize that today's crisis was inevitable decades ago and that modern policies and "solutions" will only make the problem worse.
For further reading on the business cycle and the role of a central bank, see Ludwig von Mises' "Theory of Money and Credit." For more history of the Depression and how it related to credit policies following the creation of the FED, see Garet Garrett's "Bubble that Broke the World."
25 years have elapsed since I read this book, but I will never forget its main lesson (and that of the other Austrian economics books I read at that time). The Depression of the 1930's was caused by the alternating periods of expansion and contraction of the money supply by the Federal Reserve Board. The Federal Reserve, under the leadership of Benjamin Strong (Governor of the Federal Reserve Bank of New York) began a long credit expansion in 1922. This expansion continued until the summer of 1929, when the FED reversed course and began contracting the money supply. Several months later, the stock market crashed. The stock market crash is typically considered the beginning of the Great Depression. In fact the Depression had its roots at the beginning the 1920's. (I am somewhat fuzzy on the dates due to the time elapsed since I read the book.)
MSM/DNC mythmakers usually assign the crash of October 1929 as the beginning and attempt to address stock trading practices as the cause. They have convinced generations of students that the activities of a few stock traders somehow caused the collapse of the entire economy. The "historians" ignore the role of centralized credit expansion on the entire economy over a period of years. The term "fractional reserve banking" never appears in print in today's "newspapers."
Instead of focusing on the period from 1922 through 1929, the establishment mouthpieces have caused the average reader to focus on the activities of a few stock brokers at the very end of the great credit expansion. Even conservatives who try to explain the issue in terms of FED policy blame the FED for contracting in the summer of 1929 instead of blaming the FED for creating the bubble over the course of a decade.
If fractional reserve banking did not exist, the economy would not grow nearly as fast as it has during the various bubbles of the 20th (and 21st) century, but the inevitable collapses would not have occurred either. Growth would be slow, steady and safe. We need not fear the crises that have plagued our economy on a regular basis since 1913 (and the inevitable and predictable crisis that now threatens to destroy the economy completely).
Rothbard is one of the few writers to explain the Depression in terms of the 1920's credit expansion instead of the non-issues that the most writers and teachers focus on. In Rothbard's book, you will not read first hand accounts of bread lines and soup kitchens. Nor will you see a rehash of such events as the "bonus army" or the creation of the WPA. These events were the results of the policies that created the Depression. Most writers focus only on these results and teach nothing about the causes.
Rothbard explains the business cycle theory and its application to the credit expansion of the 1920's.
We all acknowledge that today's crisis results from bankers making bad loans to unqualified individuals. But very few have bothered to ask why so many lenders made these mistakes at the same time. This is the question that Rothbard asks in America's Great Depression. Like anyone else, businessmen will make mistakes (and usually pay the consequences). But the business cycle over the past century features all businesses making the same mistakes at the same time. Whether these mistakes include risky lending, overproduction, investment in unprofitable lines, overspending, etc., the mistakes are coordinated throughout the economy and are not limited to one region or one city or one sector. Rothbard shows that this phenomenon occurred even in the 1920's - well before today's "global economy" existed. The one factor that tied all of these errors together was Federal Reserve policy. And Federal Reserve policy has served this function in every recessionary cycle since the FED was created in 1913.
If you are not sure of the extent of misinformation that relates to the Depression, ask a friend if he knows when the Federal Reserve Board was created. Far too many people will say that the FED was created by FDR as one of his many reforms following the stock market crash. Only when one realizes that the FED existed 16 years before the stock market crash will one see an example of how common beliefs about the Depression and economic conditions have become so muddled.
Rothbard provides detail and documentation to demonstrate where the blame truly belongs. After reading America's Great Depression, you will realize that today's crisis was inevitable decades ago and that modern policies and "solutions" will only make the problem worse.
For further reading on the business cycle and the role of a central bank, see Ludwig von Mises' "Theory of Money and Credit." For more history of the Depression and how it related to credit policies following the creation of the FED, see Garet Garrett's "Bubble that Broke the World."
Kamis, 02 Oktober 2008
Quote of the day - Spengler
Paulson's dreadful scheme will become law, because Americans love their bankers. The bankers enable their collective gambling habit. Think of America as a town with one casino, in which the only economic activity is gambling. Most people lose, but the casino keeps lending them more money to play. Eventually, of course, the casino must go bankrupt. At this point, the townspeople people vote to tax themselves in order to bail out the casino. Collectively, the gamblers cannot help but lose; individually they nonetheless hope to win their way out of the hole.
Spengler - 9-23-2008
Spengler - 9-23-2008
Minggu, 24 Agustus 2008
Garet Garrett - The Driver
Take a moment from the idiocy that is about to descend upon us in the form the DNC convention this week and read about a novel published in 1922 with implications for Ayn Rand's later novels as well as the business cycle that plagued the American economy throughout the 20th (and into the 21st) century.
Selasa, 01 Juli 2008
The War of the World; Niall Ferguson; PBS; The 100 years war.
The PBS documentary "The War of the World: A New History of the 20th Century" has generated some controversy this week, as conservatives have been critical that the documentary has attacked American war efforts in WWII. The documentary has been criticized for attacking America's alliance with Stalin.
I saw the first part of this series last night. Part I did not include most of World War II. Part I takes the viewer from the beginning of the 20th century through the beginning of WWII.
So far, the documentary has been somewhat instructive. The documentary was critical of the Bolshevik revolution, especially the brutality of Lenin, Trotsky and Stalin. The documentary pointed out that the Bolsheviks did not control the territory outside of the Russian cities for some time after the Bolshevik revolution. The narrator indicated that opposition forces were on the verge of deposing the Bolsheviks when the Bolsheviks reversed the course of the war by using "terrorist" tactics on their own people, including soldiers and farmers.
This harsh treatment of the Bolshevik revolution would never have been allowed in the western MSM/DNC when the Soviets still controlled Russia. I had heard of some of these facts, but never in a television documentary.
The documentary also spent a great deal of time on the Turkish persecution of Armenians and Greeks in the immediate aftermath of World War I. While the documentary did not explicitly point out that this persecution constituted muslim persecution of Christians, the existence of this story on PBS is new and significant.
The main point of Part I was the length of the wars of the 20th century. "The War of the World" views the 20th century wars as a 100 year war. The narrator deals with these wars as a continuation of the same war. For too long, we have tried to analyze these wars separately. In doing so, we miss the real causes of the wars. Authors analyze the pros and cons of World War II in a vacuum, thereby missing the real culprits, such as the rise of totalitarianism worldwide over a 20+ year period prior to the War and continuing well beyond the War's official "end." I have always believed that World War II was the hottest part of the Cold War, during which (and immediately afterward) the Soviets made their biggest territorial gains. We will see how the documentary treats that subject in Parts II and III.
The documentary analyzes the 20th century wars as part of a continuing battle between East and West. Will Durant's eleven volume series on the history of civilization does the same thing - and even traces the East vs. West conflict back to the Trojan War (circa 1100 B.C.). By using the East vs. West analysis, the currect conflict involving Islam (as well as issues relating to China) make more sense. The Cold War makes more sense when we see that its roots go back to World War I - instead of merely to the Berlin Wall or Korea.
Part I was deficient in that the author appeared to be too rooted in socialism, including fawning attention to H.G Wells. But this is to be expected on PBS (and almost all television in general).
The author also could have easily tied WWI to the financial crises of the 1920's and 1930's. The connections definitely exist and would prove the author's point even more strongly. The timeline runs basically as follows: (1) World War I and the financial bubble that paid for it led utlimately to the financial collapse in the West that we refer to as the Great Depression (1929 - ?) (the collapse began earlier in Europe). (2) The economic upheaval of the 1920's and 1930's in Europe and the West led to the rise of Hitler and Japanese expansion, which the remaining powers did not have the will to resist (due to the economic upheaval) until it was too late to avert another war. When combined with the rise of Soviet Russia (a direct result of WWI), the perfect storm was created.
For more on the effect of the bubble and its roots in WWI and its consequences in the Great Depression, see Garet Garrett's "The Bubble that Broke the World."
See "America's Great Depression" for a detailed discussion of how the bubble led to our own depression.
Both of these books hold implications for our current economic situation.
While the PBS documentary misses that point, the pros outweigh the cons thus far. "The War of the World" can be a beginning point for a greater understanding of the past 100 years.
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visit counter added July 1, 2008
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Part II of War of the World
I saw the first part of this series last night. Part I did not include most of World War II. Part I takes the viewer from the beginning of the 20th century through the beginning of WWII.
So far, the documentary has been somewhat instructive. The documentary was critical of the Bolshevik revolution, especially the brutality of Lenin, Trotsky and Stalin. The documentary pointed out that the Bolsheviks did not control the territory outside of the Russian cities for some time after the Bolshevik revolution. The narrator indicated that opposition forces were on the verge of deposing the Bolsheviks when the Bolsheviks reversed the course of the war by using "terrorist" tactics on their own people, including soldiers and farmers.
This harsh treatment of the Bolshevik revolution would never have been allowed in the western MSM/DNC when the Soviets still controlled Russia. I had heard of some of these facts, but never in a television documentary.
The documentary also spent a great deal of time on the Turkish persecution of Armenians and Greeks in the immediate aftermath of World War I. While the documentary did not explicitly point out that this persecution constituted muslim persecution of Christians, the existence of this story on PBS is new and significant.
The main point of Part I was the length of the wars of the 20th century. "The War of the World" views the 20th century wars as a 100 year war. The narrator deals with these wars as a continuation of the same war. For too long, we have tried to analyze these wars separately. In doing so, we miss the real causes of the wars. Authors analyze the pros and cons of World War II in a vacuum, thereby missing the real culprits, such as the rise of totalitarianism worldwide over a 20+ year period prior to the War and continuing well beyond the War's official "end." I have always believed that World War II was the hottest part of the Cold War, during which (and immediately afterward) the Soviets made their biggest territorial gains. We will see how the documentary treats that subject in Parts II and III.
The documentary analyzes the 20th century wars as part of a continuing battle between East and West. Will Durant's eleven volume series on the history of civilization does the same thing - and even traces the East vs. West conflict back to the Trojan War (circa 1100 B.C.). By using the East vs. West analysis, the currect conflict involving Islam (as well as issues relating to China) make more sense. The Cold War makes more sense when we see that its roots go back to World War I - instead of merely to the Berlin Wall or Korea.
Part I was deficient in that the author appeared to be too rooted in socialism, including fawning attention to H.G Wells. But this is to be expected on PBS (and almost all television in general).
The author also could have easily tied WWI to the financial crises of the 1920's and 1930's. The connections definitely exist and would prove the author's point even more strongly. The timeline runs basically as follows: (1) World War I and the financial bubble that paid for it led utlimately to the financial collapse in the West that we refer to as the Great Depression (1929 - ?) (the collapse began earlier in Europe). (2) The economic upheaval of the 1920's and 1930's in Europe and the West led to the rise of Hitler and Japanese expansion, which the remaining powers did not have the will to resist (due to the economic upheaval) until it was too late to avert another war. When combined with the rise of Soviet Russia (a direct result of WWI), the perfect storm was created.
For more on the effect of the bubble and its roots in WWI and its consequences in the Great Depression, see Garet Garrett's "The Bubble that Broke the World."
See "America's Great Depression" for a detailed discussion of how the bubble led to our own depression.
Both of these books hold implications for our current economic situation.
While the PBS documentary misses that point, the pros outweigh the cons thus far. "The War of the World" can be a beginning point for a greater understanding of the past 100 years.
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visit counter added July 1, 2008
----------------------------------------
-------------------------------------------------
Part II of War of the World
Minggu, 22 Juni 2008
Spengler; Asia Times; Kung Fu Panda; the end of slacker culture
"Spengler's" column in Asia Times should be regular required reading for all of you. This week, Spengler writes of the slacker culture in America end predicts said culture's demise. He ties in everything from the Kung Fu Panda movie to current trends in unemployment and the banking collapse:
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Kung Fu Panda - symbol of a dying culture?
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While Spengler's outlook is grim, I would be relieved if the only consequences for the western world are those outlined in Spengler's article. Read it all.
Two events on June 6 might denote the death of the "slacker" as an American cultural archetype. . . .
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America might be the first country in recorded history whose culture celebrates not only indolence but also the sheer absence of ability. Byronic loafing is the birthright of genius, but slacking has become the entitlement of every young American.
Kung Fu Panda - symbol of a dying culture?----------------
It is hard to think of a comparable case in social history: a country borrows from foreigners to lend money to its young people to spend four years binge-drinking at a university that pretends to prepare them for the world.
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So-called home equity loans, or second mortgages on homes, are the cause of the crash of US bank stock prices during the past few weeks. The well is dry. That leaves the youngsters in the lurch, which is precisely where most of them deserve to be.
A profound sense of panic appears to have gripped American youth, which might explain why so many of them are seeking a messiah in Democratic presidential candidate Senator Barak Obama. But there isn't much that Obama or anyone else, for that matter, can do to help the slackers.
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While Spengler's outlook is grim, I would be relieved if the only consequences for the western world are those outlined in Spengler's article. Read it all.
Rabu, 16 Januari 2008
Michelle Malkin needs a man; Leftist proposals prolong housing market crisis
Not literally. I, too, was disappointed to discover what she really meant:
Michelle needs a man
In fact, she has presented the only solution (not only to the real estate bubble collapse, but to the entire economy). All of these "stimulus" packages not only are going to create further federal debt and erode our currency and our future, but they are delaying the real solution - a price correction.
By bailing out the homeowners, the government is delaying the inevitable drop in prices and preventing market forces from working. If prices could drop from the ridiculous levels to which government sponsored currency inflation has driven them, those of us who have saved our money could snap up some deals. The new mortgages would reflect actual values instead of inflation inspired fantasies. The sooner we endure the pain, the better. The sooner that the fools among us lose their properties or write off inflated mortgage values (or some combination thereof), the sooner that the thrify among us can be rewarded for our thriftiness. The price correction would have the added benefit of allowing the normal volume of sales to go forward, instead of this stalemate that has resulted from expectations of bailout or a vain attempt by individuals to hold on to unrealistically expensive homes.
All of us are going to have to go back to square one to counter the "stimulus" propaganda over the next few months. If the idea of a price correction scares you, take a look at the following short, simple books.
By educating yourself now, you are preparing for the onslaught so that you won't find yourself swept up by "stimulus" hysteria. Learn the basics so you can be the man Michelle wants you to be.
Michelle needs a man"I need a man. A man who can say “No.” A man who rejects Big Nanny government. A man who thinks being president doesn’t mean playing Santa Claus. A man who won’t panic in the face of economic pain. A man who won’t succumb to media-driven sob stories.
A man who can look voters, the media, and the Chicken Littles in Congress in the eye and say the three words no one wants to hear in Washington: Suck. It. Up."
In fact, she has presented the only solution (not only to the real estate bubble collapse, but to the entire economy). All of these "stimulus" packages not only are going to create further federal debt and erode our currency and our future, but they are delaying the real solution - a price correction.
By bailing out the homeowners, the government is delaying the inevitable drop in prices and preventing market forces from working. If prices could drop from the ridiculous levels to which government sponsored currency inflation has driven them, those of us who have saved our money could snap up some deals. The new mortgages would reflect actual values instead of inflation inspired fantasies. The sooner we endure the pain, the better. The sooner that the fools among us lose their properties or write off inflated mortgage values (or some combination thereof), the sooner that the thrify among us can be rewarded for our thriftiness. The price correction would have the added benefit of allowing the normal volume of sales to go forward, instead of this stalemate that has resulted from expectations of bailout or a vain attempt by individuals to hold on to unrealistically expensive homes.
All of us are going to have to go back to square one to counter the "stimulus" propaganda over the next few months. If the idea of a price correction scares you, take a look at the following short, simple books.
By educating yourself now, you are preparing for the onslaught so that you won't find yourself swept up by "stimulus" hysteria. Learn the basics so you can be the man Michelle wants you to be.
Quote of the day - Pat Buchanan
This self-indulgent generation has borrowed itself into unpayable debt. Now the folks from whom we borrowed to buy all that oil and all those cars, electronics and clothes are coming to buy the country we inherited. We are prodigal sons, and the day of reckoning approaches.
Pat Buchanon - January 14, 2008
Pat Buchanon - January 14, 2008
Selasa, 25 Desember 2007
The Boomsday/banking double-whammy
Sorry to be gloomy on Christmas, but the following articles caught my attention:
Here comes Boomsday - just in time for the mortgage/banking crisis.
Does anyone still think they have "too much equity?"
The first of the vast US baby boom generation goes into retirement in January, setting off a demographic tidal wave with wide-ranging economic, political and social implications.H/T Breitbart
Here comes Boomsday - just in time for the mortgage/banking crisis.
Does anyone still think they have "too much equity?"
Minggu, 09 Desember 2007
Quote of the day - Mark Steyn
Democrats bemoan the lack of "affordable housing" while simultaneously demanding government rescue home "owners" with unsustainable mortgages. But saving the latter obstructs the former: the principal benefit of a property-bubble correction is, after all, much more "affordable housing."
Mark Steyn
Mark Steyn
Selasa, 24 Juli 2007
Real estate bubble continues to burst; Countrywide Financial Corp.
The real estate bubble continues its slow pop as conditions worsen around the country:
With increasing defaults and foreclosures, banks will tend to dump properties on the market, as they attempt to sell their foreclosed properties. Even a small number of such dumpings will create tremendous downward pressure on prices. Lower prices will make it impossible for owners to sell or refinance "upside down" properties, as the debt on those properties will exceed the market value.
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Previous - May foreclosures
Too much equity?
Worldwide bubble
Countrywide Financial Corp. said Tuesday its second-quarter profit shrank by nearly a third as softening home prices led to rising delinquencies and mortgage defaults among the most creditworthy borrowers.Yahoo News
Lenders sent California homeowners the highest number of mortgage default notices in more than a decade during the second quarter, the result of flat or falling prices, anemic sales and a market struggling with the excesses of the 2004-2005 home-buying frenzy, a real estate information service reported.Inman News
The foreclosure rate on Wisconsin homes remained high throughout the first half of 2007, driven by rising interest rates and the soft housing market, an industry monitor reported Tuesday.Business Journal of Milwaukee
Wisconsin as a whole had 9,229 foreclosure filings in the first half of 2007, up nearly 23 percent compared with 2006, a year in which foreclosures jumped 34 percent, according to newly released data compiled by ForeclosuresWI.com, a provider of Wisconsin foreclosure resources and statistics.
Filings for the month of June 2007 were up more than 8 percent from May.
Milwaukee County foreclosure filings are nearly 48 percent higher compared with the first half of 2006.
With increasing defaults and foreclosures, banks will tend to dump properties on the market, as they attempt to sell their foreclosed properties. Even a small number of such dumpings will create tremendous downward pressure on prices. Lower prices will make it impossible for owners to sell or refinance "upside down" properties, as the debt on those properties will exceed the market value.
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Previous - May foreclosures
Too much equity?
Worldwide bubble
Rabu, 13 Juni 2007
More bad foreclosure news
As night follows day, the real estate bubble is bursting before our eyes.
Previous - Too much equity?
U.S. home foreclosures in May jumped 90% from a year earlier, reflecting a poor spring
housing market and foreshadowing even higher levels later in 2007, real estate data firm RealtyTrac said on Tuesday.
Previous - Too much equity?
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