Could we get this troll--Mr. Williams--out of here please? Foreclosures are currently running at 3 times their normal rates not because there has been an outbreak of cheating and dishonesty on the part of America's borrowers, but because the unemployment rate is not its normal 5% but is instead 10%, and housing prices are not at the prices that borrowers and lenders both expected them to be five years ago but are rather 30% lower.
We collectively have a choice. 1. We could refinance a huge chunk of mortgages in America to levels that people--many of them unemployed, most of them with significantly lower earnings prospects now than lenders counted on and expected when they made their loans--will pay. 2. We could put 1/4 of the houses in America through the default-and-foreclosure process, in which homeowners default on their mortgages, banks foreclose, and then everybody moves one house to the right and buys the house next to the one they used to own at a lower price. The second costs us all about $40K extra in waste, legal fees, paperwork, moral hazard, etc. If we do the first, then we all collectively have an extra $1T of real wealth to use on things that actually make us better off rather than on paperwork, etc. Yours, Brad DeLong On Wed, Oct 20, 2010 at 10:45 AM, John Williams <jwilliams4...@gmail.com>wrote: > On Wed, Oct 20, 2010 at 10:00 AM, Nick Arnett <nick.arn...@gmail.com> > wrote: > > It was not an easy decision to seek a loan modification. But the > > ethics of it are not as black-and-white as you say. > > It absolutely is that simple. A honest, responsible person does not make > an agreement and then refuse to honor it. An honest person admits that > they made the agreement of their own free will, a responsible person > accepts the consequences of their actions, and an honorable person does > everything in their power to keep their word. > >
_______________________________________________ http://box535.bluehost.com/mailman/listinfo/brin-l_mccmedia.com
