Bob Chapman on the collapse of the dollar the FED Hyperinflation Gold price World Government debt and much more….
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Bob Chapman on the collapse of the dollar the FED Hyperinflation Gold price World Government debt and much more….
Bob Chapman Blog 
December 23, 2009 at 1:13 am |
This crisis is NOT a crisis caused by one particular type of loan/debt… it was caused by a TSUNAMI of ALL types of debt… IE: mortgage debt, home equity debt, consumer credit debt, credit card debt, auto loan debt, commerical real estate debt, municipal debt, corporate debt and on and on… whether they were prime, subprime, alt-a or XYZ-type loans, they ALL contributed to the tsunami of debt.Subprime was simply the first link to break in an extraordinarily over-stretched chain of debt. Alt-A option arm loans are now defaulting at the same rate or at an even higher rate than subprime… Prime loans are not far behind… we’ve only seen the tip of the iceberg in prime foreclosures.ANY loan that was taken out when the market was grossly over-valued was a bad loan. (stop for a minute and let that sink in). If someone with perfect credit, full income documentation and a 20% down payment bought a house (or a commercial building) that was 40% over-priced, then that too was a bad loan.One Trillion (ONE) is $1 per second for 32,000 years… without interest! In the U.S., we owe over 11 TRILLION dollars in home mortgage debt and 2.6 Trillion in consumer credit debt.Americans took out and spent over 1 Trillion dollars in home equity loans from 2000 – 2007. They spent it on clothes, cars, boats, RV’s, 2nd homes, nannies, private schools, fine wine, fabulous vacations, etc. That home-ATM has been cut off… which is playing a huge part in unemployment… Those debt-fueled jobs are not coming back any time soon! Obamacare, Cap and Trade and Card Check will only make unemployment worse!!Cities are broke, states are broke, the Federal Gov't is broke!Until we understand the scope of this debt crisis, we are not going to be able to deal with it… assuming there is any way to deal with it at all… it is exponentially bigger than people realize.