Commonly Given Reasons For Foreclosure Crisis
The most commonly given reasons for the foreclosure crisis is predatory peddling of sub-prime mortgages (ARMs) to gullible ignorant buyers. Those who contracted the mortgages are not above blame – they falsified their incomes, wrongly took the help of unscrupulous appraisers to raise the value of the houses being mortgaged so as to avail of generous loan amounts. The lenders too turned a blind eye and allowed this to happen. The same can be said of the government that decided to look the other way indirectly permitting such laxity. Despite these obvious reasons there is more to it than meets the eye. The question is – what is the deep rooted malaise rooted in the economy of the country that has exploded into this foreclosure crisis? Foreclosure is merely the symptom of the disease.
Americans in generally are weak in financial education and do not know about the nitty-gritty of budgeting their own income. They have been easily lured by a cleverly manipulated media, into a devastating loan culture. The politicians lack statesmanship. They are more like dons controlling mobs without having hindsight or foresight. Thus leaders and followers only live for the present. This has led to massive over spending by the warlords ruling Washington, hand in hand with the bureaucrats. They spend more than what the tax kitty holds. To make up for the shortfall they borrow from China and other countries. When even this does not suffice then Washington pressurizes the Federal Reserve to print more money. The result is inevitable – there is inflation and the value of the dollar tumbles. Immediately prices of essentials like fuel and food shoot up. The incomes of the house owners however are stagnant; more often than not it falls. The ordinary citizen cannot keep pace with 10% inflation when the payment towards mortgage goes up by 15% due to the floating interest. Foreclosures are waiting at the end of each month.
Another jumbo reason for the foreclosure debacle is a foolish foreign policy. The whole reasoning is ridiculous – the country borrows $2 billion per day from China to boost dictatorship in Pakistan with $12 billion and spending $1 trillion for Iraqi war. Since such huge amounts do not exist again the Federal Reserve resorts to printing money. It is little wonder then that the oil producing giants want more dollars.
Finally the blame goes to the schooling system that churns out more robots than thinkers. This generation hardly reads more than one book per year! How can they manage foreclosure paper work even with the help of an attorney?
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- Lack of Education has Been to a Large Extent Behind the Foreclosure Crisis
- The Impact of the Foreclosure Crisis will be Felt for Many Years to Come
- Foreclosure Crisis Imposes on the Dreams and Nightmares of Americans
- The regulators as well as the executives are equally to blame for bank failures linked to the foreclosure crisis
- Adam Smith and John Keynes on either side of the court facing the foreclosure net
- Commercial foreclosures are skyrocketing
11 Responses
[...] hoard billons of dollars and euros that cannot be spent. Now the opportunity has come following the foreclosure crisis to park the funds directly in western financial houses or inject it straight into the western [...]
[...] a $700 billion bail out from taxpayer’s funds to rescue the very people that manipulated this foreclosure crisis. It is doubtful if the relief package will bring any relief to the couple or to 28,000 others in [...]
[...] Blumberg runs a radio show that focuses on America of old in a story-telling fashion. He has never owned any property, suffered foreclosure or talked about the financial world. Nevertheless he was awestruck by the crumbling of the sub-prime connected foreclosure crisis. [...]
[...] The question that arises first is whether the foreclosure crisis is the symptom or the indirect cause and not the root cause. Is there something behind more grave than the outburst of the foreclosure crisis? [...]
[...] The government will be using the funds to buy mortgage related securities that nobody else will touch. These will be purchased by the treasury at a rate that is slightly more than its current depressed worth. This will inject capital into the gasping banks from which the common man will benefit. The banks will go about their normal activities. The government will sell the securities at a later date. This is the plan of action against the background of the raging foreclosure crisis. [...]
[...] impact of foreclosure crisis has been felt largely in a majority of States of US country, but there are some States like Alabama [...]
[...] people who are looking to buy property in Phoenix should take a page out of the book of the current foreclosure crisis, and make sure that they too do not wind up at the wrong end of a foreclosure. Taking out a [...]
[...] health of Wall Street came to be linked with that of the rest of the world. But the foreclosure crisis has exploded that myth. There is plenty of mud slinging going on and the principal villains of the [...]
[...] state in 2008 as many as 5,887 residents of Rhode Island were ousted from their homes due to the foreclosure crisis. In Providence it is estimated 58 were thrown out from their homes in Westerly and Chariho [...]
[...] Crisis in USA Leads to Global Instability Posted on July 3rd, 2009 in Foreclosure Crisis | The foreclosure crisis in USA ultimately led to global instability. Miguel D’Escoto the president of U.N. General Assembly said [...]
[...] Chattanooga the task force is being challenged by record breaking number of increased foreclosures. Property experts are apprehensive that with moratoriums having been closed and unemployment [...]