How could 1.3 trillion dollars (total) worth of subprime mortgages bring down the US and global economy? - us subprime mortgage problem
Even if all no, no, it is not possible, that amount due to a major recession or a depression is imminent.
$ 1.3 billion is simply too small a percentage of total GDP and less than 10% of total outstanding mortgages. Why do so many people believe that the problems we face, because the owner, who simply bought more house than they could do it? Nonsense.
Total mortgage by several characteristics of the commercial course. You are too slow and have a higher value for all home mortgages.
Google to start on the wiki. They also use their existing resources on the part of government that can deliver more data to achieve this in particular.
PS I have a question about this and was appalled by wrong, as people are about the causes of the downfall of our financial world. I want to hear, with the understanding of the complex network that brings us down.
Us Subprime Mortgage Problem How Could 1.3 Trillion Dollars (total) Worth Of Subprime Mortgages Bring Down The US And Global Economy?
9 comments:
You make a good point here. I think there is more to the collapse of failed mortgages. I think the problem is that hell of a lot must be a hell of a lot of money, not only in mortgages.
You make a good point here. I think there is more to the collapse of failed mortgages. I think the problem is that hell of a lot must be a hell of a lot of money, not only in mortgages.
In fact, it is possible to have a recession when you see causing as many people lost their jobs. You will lose your house, they can not afford to buy and that will affect the whole community so that more people lose their jobs. Of course, this affects not just a community, what happens in the country. I too am appalled by what many people are misinformed when it nothing to do with finances, comes and I do not understand how the finances of the world are interconnected.
Amy
This is just the tip of the iceberg. Million jobs have been lost or abroad or to pay for the company is not taxes. Thousands of businesses have closed, and when people lose their jobs who can not pay the bills. (eg, accounts of the mortgage)
And of course the car manufacturers have been buried because they do not interfere with the Standard Oil and Exxon!
Only the collapse of banks. Since the loan guarantees small fraction of the deposits. A bank that just over 10% of the failures is becomes insolvent.
The reserve ratio is set so that for every $ 1.00 $ 10.00 of deposits banks can loan. So if you are 10% of the default, you are broke.
Call John Galt.
Now, do not see the Republicans here to give you more than it was Bill Clinton and his Republican Congress may be set so as to seem to forget this part, and 6 years, controlled the Bush administration.
So you see, I have no idea, but it is recognized that uses the wisdom Rant ask my question. LOL
Oh. . . But if you want to play "trickle down" economics, which is what it is here.
See if Joey loses his job Baggadonuts of $ 75K and not pay the bills, he does not want to buy clothing, televisions, a new car, and spend less money on food. He does not buy all the fluff and goods in protest against their children, no chocolate, and jewelry for women at the 14th Place. . .
This means that the turnover of each industry listed guidelines. What drives these industries reduced employment raises, acquire, and so on. This leads to extra burdens on businesses and people, the suppliers of those producers are losing money. And the cycle begins again small, dirty, leading to more pressure on the already made.
That's what happened. And because not all the money no longer flows to those who still work and can be a new car, or buy all the fuzz "and protesting" elements. No more open lines of credit, no credit spread more, and this in turn the impact of large IT --Cket articles.
It's all a very good network connection injury, and someone broke his right middle finger crossed that collapsed around us. The only way to begin the rebuilding begin with the basics - and that employment. People have an income, they spend. If you spend, the economy is growing jobs and more money in motion. And to we go again. . .
Despite a billion dollars is a considerable amount of bad loans, I believe, you believe in little. I have heard from independent sources of the problem could be read in the deed, along the lines of 10 billion U.S. dollars. As experts say, have no impact on. Too much debt. Also do not forget the reality, the value of these properties are significantly below the rating of financial institutions. And what about institutions? As in all the millions of mortgages, which no one is sure to appreciate it break? Have a look at the houses only a part of the problem. What about loan repayment, all cars and trucks? What will the bankruptcy of the total debt, including debt credit card? When the focus narrows to a single segment of the economy is certainly not see the big picture. Have you thought about the large number of mortgages packaged in other countries, whose economies have bought in worse condition than ours? What is spent with a lot of money every day in all our welfare programs? We believe that our cDisaster is a natural result of control of the mortgage arm, but there's more. Think Global, not just one dimension.
Because subprime mortgages were just the trigger, the trigger was that of Bill Clinton and his Community Reinvestment Act, which makes the pressure on lenders for bad loans to people who do not deserve to traditional norms initiated. In particular, the minorities and poor households, which quoated left.
But in all things ... whether at home, in cars, jewelry, ..... no insurance.
Loans and insurance, for example, when coverage was poor, they tried to paper bad credit derivatives defalut Deluta. Consider it as a mortgage of 30 years after months of broken ..... and the months, which were mixed in with other mortgages also distributed for the months. So everything here safely .. on a number of joint investment Well ... Paper and other bad ... All diluted and sold as investments in the world.
But do not stop there, other investment instruments have recently been created, and not all are insured, so if up to the point where the lever diluted $ 30 (unreal) $ 1 of real value ... then ...Here is the breakdown occurs. Just to have a domino effect that the Democrats manage to get started.
May corporate greed has exacerbated the problem, not create. Government has created, and what looked very much like to make money attracted investors from around the world participate, and would make a major advantage seems to support the government issue?
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