Posted by
Always To The Right on Saturday, April 26, 2008 12:06:40 AM
"Mortgage Crisis," shouts The New York Times. The Times has used the term "subprime crisis" at least 11 times. Not in opinion columns -- in news stories.
Sure, some lenders are skittish while things play out. Some investment
banks and brokerage houses are sitting on shaky, mortgage-backed
securities. But why call that a "crisis"?
There's been a loss of jobs in the last two months, but that comes after years of strong job creation -- 25 million net jobs in the last 15 years. At 5.1 percent, unemployment is low by historical standards.
And are we really experiencing a mortgage-default "crisis"? No. The
Mortgage Bankers Association's 2007 fourth-quarter survey reports that
foreclosures came to 2.04 percent of all mortgages. Many of those were
speculators seeking flip profits rather than homeowners losing a dream
house.
During the quarter, only 0.83 percent of homes entered the foreclosure
process. It may get worse -- in March, "foreclosure filings, default
notices, auction sale notices and bank repossessions rose 5 percent," Reuters reports.
But let's keep things in perspective: Ninety-eight percent of borrowers
are not in foreclosure. Only a small percentage of them are even late
in payments.
Politicians love a "crisis." McCain, Clinton and Barack Obama
think that the government should bail out homeowners who can't pay
their mortgages. When they say the government should do this, they mean
the taxpayers, including those who are paying their mortgages. They also think the government should regulate the lending and investment industries further.
Because "crisis" justifies making big government bigger.
It's why we now have a global warming "crisis" and in previous years we
had "crises" over avian flu, the Y2K threat to computers, imaginary
cancer spikes caused by pesticides, killer bees flying up from Mexico
and uncontrolled population growth leading to a "Population Bomb" that
will bring "riots and mass starvation" by the year 2000.