Well, I can’t say I didn’t see this one coming. I remember talking to colleagues and friends in 2003 about how I felt that housing prices would come down, that the escalation of prices just didn’t make sense. They didn’t agree.
It is hard to believe that the combination and consequences of escalating prices, and cheap credit could be this extreme. From the NY Times
A $700 billion expenditure on distressed mortgage-related assets would roughly be what the country has spent so far in direct costs on the Iraq war and would amount to more than $2,000 for every American citizen.
It is interesting that the majority of congress seems to want to play ball on this all of a sudden. They have really been quite about the reasons the last few days. The article notes:
The legislators who had been briefed Thursday about the crisis were reluctant on Sunday to describe in detail what many said was the breathtakingly grim picture sketched for them.
Hopefully this bailout does what it is supposed to do. Some people have their doubts.