[Rummenigge]

And the liar loans (subprime) are not even the biggest problem.

They represent only the smaller part of americas 7.800 billion housing market.

While they often get foul the people who are actually paying them allready pay quite high rates of interest.

If loans in general get more expensive then the cheap prime loans that don't run fixed rate for the whole time will surprise their holders with brutal raises of interests. They will then not even be able to sell the house to get rid of their loan. CAn't sell, can't pay, can't refinance.

This lock ups could hit every fith loan taker.

In this lies potential for a true economic crisis.

[Bittersweetmd]

In this lies potential for a true economic crisis.

I think there are states that don't allow the type of loans that cause such problems. I think Wisconsin has laws in place that don't allow such scams. But not sure.

[investigateworld]

I think the big banks saw this coming which is why they had CONgress re write the bankruptcy law.
They spread so much cash around, even that noble - even a paragon of public service, William Jefferson, D-LA, voted for it ;^)

[investigateworld]

I think the big banks saw this coming which is why they had CONgress re write the bankruptcy law.
They spread so much cash around, even that noble - even a paragon of public service, William Jefferson, D-LA, voted for it ;^)

[RobRoy]

>>In this lies potential for a true economic crisis.<<

Yep. Not guaranteed, but it is there. It could be one part of a "perfect storm".