That works out to 80,000 mortgages that are late. Assuming a 200,000 mortgage, that works out to about $16 Billion that is late.
The question is ... can the economy handle a $16 Billion default?
Are you kidding? The S&L industry was estimated to be $400 billion when it went under (of course, that was way over-hoopla-ed, just like this market is). We barely noticed it.
“The question is ... can the economy handle a $16 Billion default?”
If it’s a $16B problem then why did the Fed and ECB throw $100B combined at it in one day! Obviously someone’s arithmetic is way off.
In the time it took me to type this, the US Government spent $16B. Yeah, we can handle that piece of chump change.
Now, the tighteneing credit market and a 10% correction in the Real Estate, Debt, and Equity markets...
Well, pretty soon you’re talking about real money.