Actually, your angle is just as good. My point was that these people are like those who won the ‘free car’ on Oprah and then learned they couldn’t afford the ‘free car’ due to taxes, etc. It’s not that these people didn’t wind up with a ‘chair’, the problem is that they did. They would have been far better off had they not.
A lot of the so-called "subprime" crisis stems from federal banking regulations enacted during the Carter administration. Legislation passed way back when forces banks to make a certain percentage of loans to "underprivileged" home buyers. If the banks don't meet this certain percentage, they are not allowed to expand their businesses. It's very similar to the credit card regulations that allow deadbeats to walk away from credit card debt if they make a "good faith" attempt to pay back a fraction of what they owe.
There are a couple of bills floating in Congress right now that would extend these same insane banking regulations to the mortgage industry. If that happens, you can bet we will see a mortgage crisis the likes of which no one has ever seen. Can you say 30% mortgage interest rates? If this happens, it will bring the construction industry, and every industry related to it, to a screeching halt. Then, you'd better have a good way of feeding yourself, because it's going to make the Great Depression look like a cake walk.
It all boils down to the fact that we have the best goobermint that money can (and does) buy.....
That is true, especially in light of an overheated, overinflated housing market. In most places the subprime boom was very inflationary and jakced up taxes and interest costs. I agree that when the music stopped they were stuck with a too-expensive house and payments and their equity stake was too little to motivate a lot of people to fight out of it. My point is that the govt. should stay out of it and let this situation play itself out. Intervention now extends the pain. There will be pain regardless. I am troubled by the number of people who don’t feel obliged to ‘work’ their way out of their credit problems.