One important insight from this week is that this problem largely emerged from the greed that swept the nation, not the institution of mortgages. Mortgages had been successfully used for over one hundred years with no major issues. It was only when people began to believe that they could extort and manipulate the institution were major issues developed. Knowing this should give us hope that by returning to the original operating procedure of mortgages we should be able to again sustain a housing market.
From Thursdays class the impact of foreclosure on homes was mentioned, which includes declining property values as a whole, lack of upkeep on foreclosed properties, and (supposed) increase of crime. I find this to be an important insight from the week that also helps connect the beginnings of the crisis with the consequences of it.
On Tuesday we stressed the causes of the crisis, including as Zach said greed, and also inaccurate assumptions. I guess my insight from all of this is the answer to "why would people let this happen?", and well, loans were easy to get and prices were assumed to increase. Everybody was doing it!
One important insight from this week is that this problem largely emerged from the greed that swept the nation, not the institution of mortgages. Mortgages had been successfully used for over one hundred years with no major issues. It was only when people began to believe that they could extort and manipulate the institution were major issues developed. Knowing this should give us hope that by returning to the original operating procedure of mortgages we should be able to again sustain a housing market.
ReplyDeleteI hope this isn't too late!
ReplyDeleteFrom Thursdays class the impact of foreclosure on homes was mentioned, which includes declining property values as a whole, lack of upkeep on foreclosed properties, and (supposed) increase of crime. I find this to be an important insight from the week that also helps connect the beginnings of the crisis with the consequences of it.
On Tuesday we stressed the causes of the crisis, including as Zach said greed, and also inaccurate assumptions. I guess my insight from all of this is the answer to "why would people let this happen?", and well, loans were easy to get and prices were assumed to increase. Everybody was doing it!