What Mortgage Crisis?

What Mortgage Crisis? by Bill Roberts.

Let's face it. If the market hadn't gone flat and then turned south we wouldn't have a mortgage crisis.

There is an old saying "a rising tide lifts all boats." Do I need to explain this to you?

If The Fed hadn't raised rates so fast most of this wouldn't have happened. Flippers could have gotten out of the market. The prices might have stopped going up, but would have only gone sideways instead of straight into the toilet.

Nobody would be yelling "Fraud, fraud, fraud" and nobody would be saying all our problems are the result of greedy Realtors, Mortgage Brokers, Banks, and anybody else they can think of to vilify.

Well maybe it's time to call a spade a spade. 
Our problems all stem from our money crisis. We spend more than we make. Our country buys more than it sells. Oil is almost $100 a barrel. A $100 for black crap that oozes out of the ground. Before Jimmy Carter it was only $2 which is more like what it's worth. We're "allowing" Cuba to sell leases for drilling right off Florida to the Chinese, and we won't allow our own oil exploration companies to do the same. What's up with that?

Europe practices socialism. They are very inefficient manufacturers. Their workers make more money than our workers, they only work 35 hours per week, and have many weeks of paid vacation. Yet the Euro is worth more than the Dollar. What's up with that?

If our economy was strong and moving up as it should be, there would be no mortgage crisis. You wouldn't need to ask "who's to blame for this mess?"

I've read all the posts this week on the "Mortgage Crisis" here on ActiveRain. Everybody wants to blame the other guy. The truth is there is a little bit of truth in all the arguments, but that doesn't mean that any of them are right.

Not one of the industry segments is to blame. Realtors sold houses at ever escalating prices. Nobody said "Whoa, we gotta stop this craziness."

Mortgage Brokers arranged the financing for all these buyers. Nobody said "No, I won't make this loan for you even though the bank is willing to lend you the money."

Wall Street kept up the pressure. They had an insatiable appetite for more loans to bundle and slice. The buyers of MBS wanted all they could get.

Don't Stop The Carnival.

But the Fed did stop the carnival. They raised rates. The real estate market hiccupped. So they raised the rates again. This time the market actually coughed. But they weren't through yet. They raised the rates again.

The Federal Reserve Board of Governors Open Market Committee kept raising rates until the market was DOA.

Put the blame where it belongs. Not on each other, but on these guys that sit on the Open Market Committee, specifically, the Fed Chairmen Greenspan and Bernanke.

Greenspan, The Evil Villain  

If you want to take advantage of this market call Bill Roberts (619) 244-4610.