Housing Doom Housing Bubble Blog

Fox 10 News had a dose of reality on today’s news- [Hat tip L!]

Sabra Gertsch reports: [partial transcript below]

If you’re looking to get a new loan, to buy or refinance- those programs are limited, suspended, or gone.

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While "none of these developments is pleasant for the lenders and financial firms most directly affected, one cannot help being impressed with the even-handedness of it all. Until we receive clear evidence that basically sound financial decisions and arrangements were disrupted by erratic and irrational market forces, I believe we should conclude that this year’s markets punished mostly bad actors and/or poor lending practices. Lenders who made loans to borrowers without documentation, or who did not check borrower documents that proved fraudulent, or who made adjustable-rate loans to borrowers who could not hope to service the debt when rates adjusted up, deserved financial failure. As is often the case, the market’s punishment of unsound financial arrangements has been swift, harsh and without prejudice. While I cannot feel sorry for the lenders who have gone out of business, my attitude is entirely different toward the relatively unsophisticated, but honest, borrowers who have lost their homes through foreclosure. Many are true victims."
           William Poole, President, Federal Reserve Bank of St. Louis, July 20, 2007.

From the Cramer’s Friday Rant Heard ‘Round the World: "… and Bill Poole has no idea what it’s like out there … Bill Poole is shameful. Shameful!"

The Fed is not a one man band. Although the press usually identifies the entire Federal Reserve system with its Chairman Ben Bernanke (and before that Alan Greenspan, Paul Volcker, …), every once in a while one of the other members of the team steps up on the stage to take a bow. Last Friday, Jim Cramer suddenly shone a bright light on the St. Louis Fed’s long serving President.

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For most people, today’s just another day at the beach, but not here at Doom Castle. Asian rumblings were growing overnight. Igor reports Ben Bernanke and Bill Poole ready to report to the festivities in full armor.

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Can We Afford the War We Want? - II

"Robert Hormats mounts a compelling argument that America faces large-scale economic catastrophe due to lack of a long-term, fiscally sound strategy for meeting military and security needs as well as domestic obligations. The Price of Liberty is a fascinating book and its messsage is hard to ignore."
               Henry Kissinger

This post is a followup to last week’s "Can We Afford the War We Want?" The complete unannotated Doom transcript of the AEI seminar [1] on Hormat’s "The Price of Liberty" is now available as two standalone pages:

Unannotated Transcript of June AEI Seminar on "The Price of Liberty."

• First Part
• Second Part

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