One thing that needs to be understood is that alot of our opinions and predications on this site are based upon our “frames of reference” or the world we live in and the respective lens in which we view the rest of the world.
Back in OCT 2007, I was speaking to my options broker in Cleveland, OH about the mortgage industry and the exposure that the financial institutions still had going forward. He has never heard of an OPTION ARM neg am loan and had no idea of 75% of the products that were made available to people. He only sees through his own 30 yr fixed fully amortized world in Cleveland, OHIO.
Good point. Wall Street still seems to be clueless about the cause of the downturn/crash in housing. Most of the guys I see on CNBC are focussed on interest rates when the real problem is mispriced assets. The price of houses became way too high due to all the 100% loans to unqualified people. Now, prices have to come down.
I’m still doing periodic investments into the market. I expect the next few years to be painful. Hopefully I’ll be able to rid out the upcoming market armegeddon.
