Wednesday, July 06, 2005

Paper of Record Editorial

The NY Times’ lead editorial today concerns the risky mortgages that are helping to fuel the housing bubble. In general, I think the NY Times, the Wall Street Journal and the Washington Post have doing a good job of keeping people informed about the bubble. On the other hand, as has been pointed out, there are a lot of people out there who have no clue as to what is going on because they don’t pay attention to the news.


“What makes this boom particularly unnerving is that it owes much of its longevity to the explosion in the number of risky mortgages. Many borrowers are likely to be pinched, if not creamed, when interest rates rise or housing cools, leaving them unable to make payments, refinance on favorable terms or sell at a profit. Lenders may be even more vulnerable than borrowers, which may mean an economywide disruption if - or when - housing prices stagnate or decline.”



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