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The Mortgage Crisis and Us; Another Perspective

"We paid our bills and paid them on time. We scrimped, we saved a bit and did everything right. Now, our tax dollars are being given to those who lived carelessly, undisciplined, and exercised poor judgment." This is a common sentiment in these times and if it were not for some of the differences in circumstances, we could be reading the biblical allegory of the prodigal son. Certainly the sentiment is the same.

Let us view these painful times in a larger perspective. There were some of us who could not afford to buy a home, and some of us that could. Some of us who could not afford to buy their own home were told by some of us that could, that buying was both desirable and practical. We were told that owning our own home was the realization of the "great American dream;" one that could come true for everyone who dared to try. For decades, this message was trumpeted in every manner, shape, and form across America. During this time, those few of us in the financial field, who controlled the wealth of a nation, conspired to make the dream come true for many of us that never even considered home ownership a practical matter. They manipulated the financial markets to create conditions for everyone to own the fruits of the dream. As a result some of us created the desire, expectation, means, and the environment for the rest of us to live the dream; no matter how impractical.

Let us think how simple this was to sell. If we could be convinced that to pay $250,000 for a house with little or anything down, with mortgage payments artificially low, some lower even than our rent payments, this would be attractive indeed. Further, if a feeding frenzy were created and maintained, real estate values would increase at the rate of 10% a year. In just 5 years, a $250,000 would be worth $375,000 and in 10 years worth $500,000. The real estate could be refinanced, we were told, at a later date with a much higher equity, or sold at a significant profit. We heard this message often enough until it seemed true to all of us. Our economy grew dramatically and we delighted in the unprecedented increases in value of our homes. Some of us in the financial industry prospered as never before in recorded history, giving little thought to the long-term effects of our manipulative behavior.

We have now run out to time, and it has become apparent that the dream was really an illusion sold by some of us to the rest of us. Whether we participated in

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