The End of the Mortgage Universe, According to the BBC

Not that I'm surprised, given their propensity to designate every other day as the end of American civilization, but it seems the British press has a case of Chicken Little hysteria:

The Independent: Markets fear banks have $1 trillion in toxic debt

BBC: Foreclosure wave sweeps America

The Telegraph: Arch critic calls for Citigroup to be broken up

Foreclosure wave? Yeah, I've notice that the rates have gone up (and down, and up, and down again), but I guess I'm living in my bubble again where this immense tidal wave has yet to penetrate. The BBC is actually using THIS photograph to illustrate how bad things are in America:

That's allegedly a picture of every house in America. The article later explains that it is probably a picture of some place in Cleveland. Well Cleveland is not America. In parts of Cleveland, subprime mortgages (i.e. mortgages given without a wisp of care for things like income, assets, debt, demonstrated responsibility or a JOB), represent a significant majority of mortgages given out in the past few years. That isn't the case in my town or, I imagine, your town. But if you live in a constant jealous snit of superficial arrogance in some formerly great country overseas, then this is surely the image you'd prefer to think of when faced with American supremacy.

I don't think I live in a bubble. I have gone through the mortgage application process several times. It is supposed to be rigorous. If a company chooses to award risky loans, and it goes tits up when people default or when the prime rates change, then I'm not sure I have a terrible amount of sympathy. Luckily father government is there to catch the people falling through the collapse of companies selling sub-prime mortgages. Lucky that Uncle Sam has such an enormous capacity to spend my tax money in such wealth redistribution schemes of cosmic proportions. Hey I have an idea. Instead of just bailing everyone out, why don't we negotiate a settlement whereby people (with the aforementioned thing called a job and some semblance of responsibility) can keep their houses at a reduced interest rate that is sufficient for subprime mortgage companies to either stay in business or sellout to some other, more solvent company (one with a better financial strategy, it is assumed).

And by the way, if your house happens to look like it is an abandoned and vandalized depression-era project, then my apologies. Aside from Cleveland and some places in New Jersey (Newark! I'm talking to you!), I think the magnitude of the 'disaster' is somewhat overstated. As are so many 'disasters' the press leads us to believe will end the universe as we know it.

I'm surprised I haven't seen an article blaming Dick Cheney and George Bush for this latest 'end of the universe' situation we are allegedly in.

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