
Originally Posted by
Private-intellectual
One point I must make: the housing problem is not as a result of the Bush administration. This was caused, and continues to be caused, by the banks and lenders who gave out money to people they knew would have problems paying back the Loan (sub prime) and then, because they are bound to raise the level of interest on loans when the Fed raises the basic interest rate, saw the people who they had lent to struggle. Rather than re-negotiate the banks and lenders went in brashly and started foreclosing, making themselves a massive loss in the process and ruining the lives of countless thousands of people, and, of course, smashing the property market.
Had the banks and lenders not given so much money out to sub prime there wouldn't have been such a massive problem. Having given the money out, had they then re-negfotiated the loans over a longer period to cover the interest rate rise, there would have been a lesser problem too.
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