Therein Lies the Problem

Yesterday, I had a conversation with the daughter of a friend of mine. Since she works in the housing industry, she has a different perspective on the housing market collapse than I do.

Everyone she knows in the industry from suppliers to contractors, from builders to real estate agents have been adversely affected by the housing market collapse. In addition, homes are not being built nor sold. To her, and her associates, the world is a very bleak place right now.

Living in a logging community, I, too, have seen the effects of the collapse. Our stores are having to cut back hours and employees due to business slowdown. In the two communities where our stores are located, logging companies and mills are cutting back due to the housing market collapse and lumber is uncharacterisically cheap. People on mainstreet who depend upon the housing market to make a living, and the people who depend on them, are hurting...really hurting.

During our conversation we were talking about the housing market collapse and the subprime lending fiasco. While we didin't agree on who was responsible for the Fannie Mae and Freddie Mac debacle, we both wholeheartedly agreed that greed was a major factor in the subprime lending problem and that many people were cohersed by predatory lenders into signing loans they didn't understand and would never be able to pay back. I mentioned that many of these were illegal aliens who have since left the country, leaving the banks with thousands of uncollectable loans with fake names. Her response to that statement was, "I don't care who was buying homes, just that they were buying homes."

Therein lies the problem...only on a much larger and national scale...no one who should have cared who was buying homes cared who was buying homes. Not the Clinton or Bush administrations, not the members of Congress, not the lenders, and not even the home buyers themselves. And look where we are now!