Puddle in Vancouver, BC, the land of rain. Photo by Melissa Jane Martin. Prior cover: Fallen servicemen return home.
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In his NEW daily blog, located on page two, Eric Francis writes: NEWS HAS been pretty glum this week. I spent most of the day Thursday sorting out the credit crisis that has Wall Street paralyzed. In theory, it’s complicated. In practice, it seems pretty simple — many banks, based on what can truly be termed greedy practices with their customers, made a lot of very bad decisions about who to give mortgages to, and then home prices plummeted. The mortgages were worth more than the homes. As far as I understand it, this is the root of the issue. How did this happen? Well, it used to be that one’s home was the most precious investment. It was one of those American rites of passage — you earned being a homeowner. A mortgage was considered an extremely safe product for a bank to sell because, after all, it was connected to a deed for a piece of land and a building. It was the perfect collateral. There is a reason it’s called REAL estate — it’s REAL. But then, real estate became bullshit, based on one little factor: banks selling mortgages to people could not afford them, on overpriced homes. Two clear-headed, competent Wall Street sources helped me put the pieces together, both taking time out of their busy schedules to answer my numerous questions. I am lucky this way — people have always taken the time to explain things to me, so that I can take the time to explain them to you. Sign up here. -- The Planet Waves Editors Published by Planet Waves, Inc. All rights reserved. |
