$700 Billion = $12,000 per American family of five
-Economic turmoil began as a result of the subprime housing crisis.
-Early 2008 forclosure rate: 0.83%
-Delinquancy rate: 5.82%
-Median American home price before market crash: $230,000
-Home Ownership rate currently ~70%
With a little simple math:
Now, I'll be extreemely generous here and assume prior to this economic crisis, delinquancy was 0.0%, and that all delinquant loans would NOW be forclosed on. This would mean 1 out of every 17 homes in the country would be siezed by the Bank. BUT, if the government decided to help the individual home-owners who needed it by allocating a portion of the $700Billion directly to them, they would give each delinquant family of five $290,000, which is $60,000 ABOVE the average home value! But what are the chances they're gonna attempt to help Main Street?
Americans have absolutely NO IDEA how badly they are getting screwed!
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4 comments:
True. I have heard this argument brandied about a little this past week, and, while the numbers are compelling, I am actually hoping that things won't go down that way.
Do we really want to "bail out" people who didn't think ahead before they got a mortgage, bought a house they couldn't afford, and then discovered that they couldn't make the payments on? I don't! That said, I also don't like the idea of "bailing out" the super rich who get themselves into trouble by being corrupt and greedy.
How about imposing regulation to prevent such gross liberties being taken by big companies, instituting a policy to prevent predatory lending, and taking steps to change the economic culture from "charge it" to "save for it?"
How about telling people not to buy things they can't afford?
How about reminding investors that high-risk investments are inherently dangerous? They gambled and lost.
Crazy talk, I know.
Ah, but they DIDN'T lose... They just made another 700 Billion Bucks!
*Sighs* It's time to start investing in foreign governments. I hear that the Euro is doing smashingly well!
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