June 11, 2012

"The Federal Reserve said the median net worth of families plunged by 39 percent in just three years..."

"... from $126,400 in 2007 to $77,300 in 2010. That puts Americans roughly on par with where they were in 1992."

95 comments:

Fen said...

"The private sector is fine"

Obama said so.

ndspinelli said...

Not only is our net worth in the shitter, we're paying a helluva of a lot more for stuff than in 1992. Gas was $1.13 in 1992!

chickelit said...

Gas was $1.13 in 1992!

I believe that $6/gal is still the goal.

Chu on that.

lewsar said...

"Chu on that."

well played, sir.

rhhardin said...

That's from misallocation of resources. What was felt at the time as a gain is now felt to have been a bad trade.

The loss from what turns out to have been systematic misallocation of resources has to be distributed somewhere.

Don't mess with prices, would be the lesson. That minimizes misallocation.

Government stepping in is Obama's solutions, which exactly makes it worse.

Correct allocation of resources creates new wealth to replace it.

YoungHegelian said...

But just think about how many people it took out of that nasty bunch of 1% -ers!

Cedarford said...

New Democrat spin: "But hero cops, firefighters, and teachers and other brave, nurturing government employeed" are hardest hit. They are suffering, and something must be done to show we care."

neomom said...

That's about where the equity in our house is.....

rehajm said...

As consumers watched the value of their homes rise during the boom, they felt more confident in spending more money even if they did not actually cash in on the gains. Now, the moribund housing market has made many Americans wary of spending, even if their losses are just on paper.

There are realized and unrealized losses. There are sales prices and valuation estimates.

There is no such thing as a paper loss. All losses are real. People react accordingly.

Dust Bunny Queen said...

Just wait until they print a trillion or more NEW dollars and further devalue our currency.

All commodity prices go up. Everything costs more dollars because each dollar is worth less. Things cost more dollars and you aren't getting more in your paycheck. Purchasing power is in the toilet.

Milk....$5 a gallon will seem like a bargain. Meat, cheese, eggs. Gasoline. Anything NEW will be priced beyond our reach. The barter system will rule.

Inflation!!!

campy said...

But Obama is 39% more Awesome!

Danno said...

Most any financial planner will tell you not use real estate in your net worth computation, particularly if you only have one home. As most of you know, houses are money pits, so why is the Fed using it in this report?

cubanbob said...

Everything the left touches turns to shit in the end.
From the white house to the governor's mansion and to town hall and from the congress to the state legislature to the town council dear God please flush the toilet in November and rid us of this scourge.

edutcher said...

This was a group effort. Not just Choom and all the geniuses at Haavahd, but Pelosi Galore and Dingy Harry's Congress helped immensely.

And when some Demos start pumping Hillary as an alternative, remember the cause of a lot of this was her husband's swell idea for subprime mortgages.

Jay said...

If your plan was to unwind the US economy and move the country toward European style socialism, what would you do differently than Barack Obama in the last 3+ years?

Original Mike said...

"Most any financial planner will tell you not use real estate in your net worth computation, particularly if you only have one home."

I have never considered my home as part of my portfolio. It is where I live.

Jay said...

You will enjoy this edutcher. He makes the case that Obama will step aside...

The Clintons' Covert War on Obama

edutcher said...

Saw that.

A couple of holes in the theory, which is certainly entertaining, not the least of which is that Hillary had the nomination handed to her on a silver platter, tied up with a pretty pink bow, (presumably with Willie's expert advice to guide her) and she still blew it.

The other is that, if it was a covert op before, it sure ain't now and, if Willie has something blackmail-worthy, he may just get his bluff called.

At the risk of having the Wrath of Godwin descend on me, Choom strikes me a little like Adolf - if the Democrat Party won't save him, he'll gladly take them down with him, since they clearly don't deserve his Wonderfulness.

PS Thanks for thinking of me.

Jay said...

edutcher,

Agreed there are holes. But he gets to the biggest issue for the Dems in that scenario which would be alienating the black vote.

What I find encouraging is apparently this open whisper campaign of removing Barry from the ticket is bi-partisan!

Larry J said...

Danno said...
Most any financial planner will tell you not use real estate in your net worth computation, particularly if you only have one home. As most of you know, houses are money pits, so why is the Fed using it in this report?


According to Investopedia:

Definition of 'Net Worth'

The amount by which assets exceed liabilities. This term can be applied to companies and individuals.

Investopedia explains 'Net Worth'

For a company, this is known as shareholders' (or owners') equity and is determined by subtracting liabilities on the balance sheet from assets. For example, if a company has $45 million worth of liabilities and $65 million in assets, the company's net worth (shareholders' equity) is $20 million ($65 million - $45 million).

Alternatively, let's say an individual has only three assets, $100,000 of common stock, $30,000 worth of bonds and title to a $190,000 house. Conversely they have only one liability, $150,000 owing on their mortgage. The individual's net worth would be $170,000 ([$100,000 + $30,000 + $190,000] - [$150,000]).



Net worth is simply the sum of what you own minus the sum of what you owe. Most people still owe money on their homes, so if you don't include you home in the calculation, you'll end up with a distorted view of your financial situation. This is especially important as you near retirement. Having your home fully paid for before retirement makes everything so much easier.

Moose said...

That's so cool!

We're back in the Clinton Presidency!

Obama has perfected time travel.

Awesome...

rhhardin said...

You can improve your net worth by adding in an item "Goodwill" on the asset side, along with any figure you want.

Obama did that in 2008.

edutcher said...

Not sure I understand your use of bipartisan. The Rs are going to oppose him, regardless.

But, yes, the black vote is the great unknown. Do they support the First Black President or the First Black Lesbian President?

PS In any case, Willie may be swimming against the tide.

For those familiar with the theory, a piece on the Fourth Revolution (or Turning).

I think we may have just seen it in the WI Recall

Solomon Kleinsmith said...

I think I have about as much now as I did in '92... when I was 12, haha.

Where's Perot when you need him!

Solomon Kleinsmith
Rise of the Center

Jay said...

edutcher,

Both Dems & R's are considering the possibility of Barry not running, that's what I meant by bi-partisan idea.

karrde said...

It's not the average that moved, it's the median.

That's pretty important to remember. For that to have happened, the people near the middle of the distribution have moved down the scale. (Tremendously: by approximately $50000.)

A quick primer on the difference between median and average (a.k.a. mean) here

AJ Lynch said...

With Hardin's comment in mind, every American's net worth should also include the present value of their social security benefits. To make it simple let's use $50,000 for every ten years of your current age past the age of 22. So the average 62 year-old person, would add $200,000 [4 x $50,000] to their net worth.

Using this adjustment, the % decrease in total net worth would be much lower.

Ignorance is Bliss said...

edutcher said...

This was a group effort. Not just Choom and all the geniuses at Haavahd, but Pelosi Galore and Dingy Harry's Congress helped immensely.

It was a group effort, but the group was much larger. It included everyone who lived beyond their means, buying a house with no money down and an interest only mortgage, or taking a cash-out refi to pay for a vacation, etc.

When the economy started to slow, as it always will, these people ended up underwater and had to slam the breaks on their own spending, exacerbating the problem.

Confession- I am one of these people, and I share part of the blame for the lousy economy. I'm not as bad as many: I'm not underwater, I have not and will not miss a payment, but I'm deeper in debt than I should be, and have had to cut my current spending back acordingly.

I'm sorry.

edutcher said...

Jay said...

edutcher,

Both Dems & R's are considering the possibility of Barry not running, that's what I meant by bi-partisan idea.


OK. I see it, although i think the idea of him not running is really wishful thinking.

It would mean he admitted he had been wrong.

Michael said...

If we have to start adding prospective Social Security payments to our "net worth" we are fucked without a wink.

Original Mike said...

"Using this [Social Security] adjustment, the % decrease in total net worth would be much lower."

Assuming the SS payout ever materializes. From Day 1, I assumed that I would never see SS. I also assumed I'd never see my state pension. Both are controlled by politicians. Anything I do see is gravy.

garage mahal said...

Everything the left touches turns to shit in the end.

The left didn't touch shit. I'm doing fine, what's your problem, loser? Lots of other people like me are doing just fine too. You depend on the left for your prosperity? I MAKE my prosperity no matter who is in charge, motherfucker. What's your excuse? Or are you just bleeting about people you don't care about anyway? Probably more likely.

Original Mike said...

Just remember folks. The left are the compasionate ones.

Original Mike said...

"I'm doing fine, what's your problem, loser?"

I'll tell you what the God damn problem is, asshole. I'd have done just fine (and I still may) off my investments. People like me saved our entire working life and invested those savings. All we needed was a routine U.S. economy. But the politicians, on both sides of the aisle but more the Democrats, following policies that you espouse, have tanked the U.S. economy with their profligate ways. Quite an accomplishment really, but they did it.

Thanks.

bagoh20 said...

Edutcher, I read that New Criterion article too the other day. I don't see any way to avoid said 4th Revolution, except perhaps a discovery of free or nearly free energy. We have come upon some interesting times.

Tim said...

"The left didn't touch shit. I'm doing fine, what's your problem, loser? Lots of other people like me are doing just fine too. You depend on the left for your prosperity? I MAKE my prosperity no matter who is in charge, motherfucker. What's your excuse? Or are you just bleeting(sic) about people you don't care about anyway? Probably more likely."

Must be a public sector employee immune to firings, furloughs or pay cuts.

Otherwise, most other Americans have also suffered an eight percent reduction in income.

No doubt that is accounted for in the May 12 U-6 rate of 14.8%.

"Private sector doing fine," indeed.

Only according to idiots.

Tim said...

"I'll tell you what the God damn problem is, asshole. I'd have done just fine (and I still may) off my investments. People like me saved our entire working life and invested those savings. All we needed was a routine U.S. economy. But the politicians, on both sides of the aisle but more the Democrats, following policies that you espouse, have tanked the U.S. economy with their profligate ways. Quite an accomplishment really, but they did it.

Thanks."


So true.

The problem is, leaches don't know they are leaches.

They think they are normal.

karrde said...

@AJ,

Since the expected future value of SS payments for the 2007 cohort was approximately the same as for the 2010 cohort, you have to add the same amount to both median values.

We still see a huge decline in median net worth.

Nice try, but I don't think mentioning Social Security improves the situation at all.

bagoh20 said...

Bumper sticker:

"I'm doing fine, what's your problem, loser? - Obama/ Biden 2012 "

David said...

It's Bush's fault.

By the way, the worst devastation of net worth has been among black people, because so much of their net worth was real-estate.

Jason said...

Never heard anyone say not to include your home in your net worth. Home equity belongs on your balance sheet, just as much as any home mortgage.

Also, you can get a reverse mortgage if you want, and turn that equity into an annuity at 62.

Social Security should absolutely not go into a net worth calculation, because there is no ownership claim on it. You can't turn it into cash, and you can't sell it, like you can a normal annuity income stream.

People who don't own homes should probably work the NPV of expected future rental expenses into their net worth calculation, though. Tough to get around that one.

Hey, Garage. You really need to get out more, dipshit.

edutcher said...

bagoh20 said...

Edutcher, I read that New Criterion article too the other day. I don't see any way to avoid said 4th Revolution, except perhaps a discovery of free or nearly free energy. We have come upon some interesting times.

Frankly, I think a discovery of free or nearly free energy may be part of it.

And I don't think it's going to be a bad thing.

But, as you say, We're going to be seeing some interesting times.

AJ Lynch said...

Karrde:

No, that is not right. The soc sec amount would not change and after adding it to net worth, the average net worth in 2007 and in 2010 would be higher so the % decline would be lower.

But my point is the average person really has a higher net worth if soc security present value is included in the calculation of net worth.

Original Mike said...

"I'm doing fine, what's your problem, loser? - Obama/ Biden 201"

That's priceless.

Tim said...

"Hey, Garage. You really need to get out more, dipshit."

If he's this bad after the epic union fail in the Walker recall, imagine the bleeding hemorrhoidal butt-hurt he'll show if America should be so lucky to toss out the affirmative-action-hire in chief.

leslyn said...

cubanbob said...

"Everything the left touches turns to shit in the end. From the white house to the governor's mansion and to town hall and from the congress to the state legislature to the town council dear God please flush the toilet in November and rid us of this scourge."

It's called THE HOUSING BUST. Remember where that started?

AJ Lynch said...

Jason- I am not claiming soc sec should be part of the standard calculation of net worth but it is a very significant asset to most Americans. Therefore, when it is not accounted for and, in fact, ignored in these types of news or economic analyses, the analyses misstates, to a material degree, the real financial position of most Americans.

Original Mike said...

"It's called THE HOUSING BUST. Remember where that started?"

I remember exactly where it came from, Truther. Forced loans to people who couldn't pay them back. That was the left.

edutcher said...

leslyn said...

Everything the left touches turns to shit in the end. From the white house to the governor's mansion and to town hall and from the congress to the state legislature to the town council dear God please flush the toilet in November and rid us of this scourge.

It's called THE HOUSING BUST. Remember where that started?


Yes, dear. It was Willie Whitewater's expansion of the Community Reinvestment Act (A Jimmy Carter Production) to include subprime mortgages.

So cubanbob is still right.

(the Lefties walk into it every time)

AJ Lynch said...

If the housing bust was the only problem, we'd be back in good shape already. Unfortunately, cities and states have gone overboard on govt workers' pension commitments and the feds have done likewise which compounded the country's solvency crisis. As a result we are fucked for a while. Since it makes you feel better you can keep blaming Wall Street.

Revenant said...

That's not terribly surprising, actually.

We had a stock bubble followed by a housing bubble. Stock and housing are where the middle class keeps its money.

Elliott A said...

Actually, our per person social security liability is greater than the sum total of our future payouts. Anyway, what good is 200000.00 if a Kit Kat will cost 10?

Revenant said...

It's called THE HOUSING BUST. Remember where that started?

The thoughtless greed of millions of ordinary Americans forgetting that there ain't no such thing as a free lunch.

leslyn said...

Relevant said,

"It's called THE HOUSING BUST. Remember where that started?" The thoughtless greed of millions of ordinary Americans forgetting that there ain't no such thing as a free lunch. 6/11/12 9:40 P.M.

Amen. Or, good on yer, if you prefer a nonreligious term.

leslyn said...

"Forced mortgages." I like that. I'm shopping for a house right now--go ahead, twist my arm for one of those subprimes.

Henry said...

I wonder if this study controlled for divorce.

Henry said...

Also, I'd be interested in a comparison to other recessions, height to trough. Maybe every recession knocks off that much. I would nope not. But the article doesn't tell us.

Henry said...

Back to my first point. Three years is a pretty short time. But one big problem with financial studies of the larger population is whether you look at household income or tax returns. It's harder to use the data that looks at households because that comes from the census. A three year time period doesn't allow that census data to be applied.

If you only look at tax returns, every divorce creates two new "families" with half the wealth of the old one. 50% loss right there, not counting the lawyers.

Meanwhile non-traditional households aren't counted as families. They're counted as individuals.

edutcher said...

leslyn filters out whodunit.

Surprise!

Original Mike said...

"Unfortunately, cities and states have gone overboard on govt workers' pension commitments and the feds have done likewise which compounded the country's solvency crisis."

That was the dynamite that was inevitably going to go off, regardless of the trigger. We. Can. Not. Continue. To. Borrow. Like. There. Is. No. Tomorrow.

Original Mike said...

""Forced mortgages." I like that. I'm shopping for a house right now--go ahead, twist my arm for one of those subprimes."

The force was applied to the banks, not the borrowers. Yes, the banks took it and ran with it, but that will always be the case. The proximate cause was the people who think they are so fucking smart as to command the economy to their own idea about "how things should be".

Mark said...

I MAKE my prosperity no matter who is in charge, motherfucker.

I'd put $20 on Garage being a public sector employee who is used to coasting no matter who is in charge.

That may change, Mahal.

Fen said...

median net worth of families plunged by 39 percent in just three years

Yes We Can!


[Hope we have some Change left...]

Revenant said...

There is no evidence that the CRA caused the bubble. Neither did the repeal of Glass-Steigal or lack of regulation or too much regulation or anything else like that.

What caused the bubble was the American middle class convincing itself, in the face of centuries of evidence to the contrary, of insane beliefs like "I'm guaranteed a profit on my house", "home prices only ever go up", and "buy is always better than renting".

Yeah, there were a lot of self-interested parties in and out of government singing that particular refrain. But at the end of the day the problem was people taking out $300,000 loans with less mental effort than they devote to filling their Netflix queues.

Fen said...

Libtard: It's called THE HOUSING BUST. Remember where that started?

Yes, we remember that Libtards forced banks to lower their lending standards for blacks with poor credit... or be labelled racist and have the government box them out of the markets.

I also remember that Bush warned Congress TWICE about it and the Libtards brushed him off.

leslyn said...

Yeah, right, OM, all our debt came from paying the salaries of the whole 12% of the wage and salary workers that are unionized.

Bureau of Labor Statistics, 2010, 2011. Now say how those numbers are just a made-up left-wing conspiracy. And I was on the grassy knoll.

leslyn said...

Mark, you lost your $20. Pay up.

Original Mike said...

@Rev - The bankers are supposed to, in their own self interest, not lend to people who can't pay them back. But that system is too quaint, apparently.

Twisting banks arms to make sub-prime loan, and then saying, don't worry "Fanny and Fredy will take them off your hands", is asking for trouble.
The banks were the ones who made the loans. Therefore, the only sane system is to have the banks be the one left holding the bag if the loans go sour. Anything else, and you've got what happened.

leslyn said...

Ah, I see. The whole housing boom and bust was caused by banks being forced, FORCED, to suck up to the black man. Correction. The poor black man.

Damn! I didn't see hardly any of them in Sacramento when I was there! Where were they all hiding? Inside their McMansions?

Craig said...

The drop was much bigger than that if you look at just 2008. More than half of the loss in equities was recouped in 2009. The Bush economy was an equity bubble on top of a real estate bubble. Obama's nomination and subsequent election was a direct consequence of the economic collapse. The country became 'socialist' in the last year of the Bush regime.

Fen said...

Libtard: Yeah, right, OM, all our debt came from paying the salaries of the whole 12% of the wage and salary workers that are unionized.

Funny, Original Mike didn't say that.

Original Mike said...

"Yeah, right, OM, all our debt came from paying the salaries of the whole 12% of the wage and salary workers that are unionized."

What??? The problem is ALL the borrowing, no matter what it was put into.

Tell us, leslyn, are you a Bush Made It Happen person, or merely a Bush Let It Happen person?

AJ Lynch said...

Payroll is probably 40% of all govt expenses and that is before benefits & pension expenses.

When the govt guarantees pensions but fails to put a sufficient amount away in the govt employee pension fund each year, the accumulated deficit can be ginormous if they do that for 10-20 years.

That has little to do with the % of people who are in unions, Leslyn.

edutcher said...

Revenant said...

There is no evidence that the CRA caused the bubble.

Not so much the CRA, but the subprime mortgage enhancement to it.

Otherwise, true.

Fen said...

I also remember that Bush warned Congress TWICE about it and the Libtards brushed him off.

A lot more than twice. A number of efforts, starting as early as '03, were made by people like John McCain and Kay Bailey Hutchison, all stymied by the Friend of Angelo, Chair of the Senate Banking Committee and his errand boy, Barack Hussein Obama mmm, mmm, mmm.

leslyn said...
This comment has been removed by the author.
Original Mike said...

" lot more than twice. A number of efforts, starting as early as '03, were made by people like John McCain and Kay Bailey Hutchison, all stymied by the Friend of Angelo, Chair of the Senate Banking Committee and his errand boy, Barack Hussein Obama mmm, mmm, mmm."

I do blame Bush for not dying on that hill.

leslyn said...

Listen to Craig.

Fen said...

Oh sure, I'll listen to a guy who's more intent on blaming Bush than discussing the 39% drop on Obama's watch.

Sure...

Original Mike said...

I don't disagree with anything Craig said. I lived through it. What's your point, leslyn?

leslyn said...

AJ Lynch said... Payroll is probably 40% of all govt expenses and that is before benefits & pension expenses.

Where on earth do you get your numbers? The Land of Oz?

7% of the federal budget goes to pension benefits for federal workers AND veterans. And you think 40% more is "probably" salaries? Get outta town.

Original Mike said...

The bubble was due to the loose Fed policy. All that money had to go somewhere. Where it did go was into the housing market where the banks were "encouraged" to lend money to anybody with a pulse.

leslyn said...

"Unfortunately, cities and states have gone overboard on govt workers' pension commitments and the feds have done likewise which compounded the country's solvency crisis. That was the dynamite that eventually was going to go off."

My point is that federal pension costs were not the "dynamite" "trigger" that caused the equity bubble on top of the real estate bubble to burst. 7% of the fed budget does not generate trillions in debt--which was your stated cause and effect.

Craig said...

The red states are holding their breath until they turn blue.

garage mahal said...

The bubble has burst. Let's just raid Original Mike's pension and fucking party. Or drink whiskey before breakfast.

Gary Rosen said...

Regarding CRA and the housing bubble:

The excellent online magazine City Journal published an article explaining how enforcement of the CRA was going to lead to the housing meltdown:

The Trillion-Dollar Bank Shakedown

Note the year this article was published: 2000. No typo.

Tom Grey said...

What caused the bubble was the American middle class convincing itself, in the face of centuries of evidence to the contrary, of insane beliefs like "I'm guaranteed a profit on my house", "home prices only ever go up", and "buy is always better than renting".

This is less than half-true. The hopeful housebuyers, including flippers like not-quite Indian Eliz. Warren, were certainly acting like house prices only go up -- since that was their own adult life experience, including after the dot.com bubble pop.

It is the job, and responsibility, of banks/ lenders to not loan money irresponsibly.
The banks failed; i.e. the highly overpaid rocket-scientists who were creating "financial products" of MBS, and CDO & CDS multi-tranches of investment to attract money.

It is the job of rating agencies to avoid giving AAA ratings to junk -- the rating agencies failed.

And the Fed pumping up the money supply after the dot.com bubble was successful in stopping a big recession in 2001, but the easy money supported the misallocation into too much housing.


While there was a huge 2002-2006 boom, the best of times, there were no, none, nada, not any Dems calling for less gov't domestic spending, even tho obviously the richer Americans didn't "need" more gov't services. None who was unwilling to call for reduced spending then, should be listened to now in their call for higher taxes.


Because "rule of law" is so important, and so much house wealth was lost, with many of those losses still to be realized, it would be better to get more inflation now to pump up the value of houses to avoid so many foreclosures.

Replacing interest deduction with a 30% tax credit for up to ~$45 000 (median taxpayer income) would be an improvement.

Bruce Hayden said...
This comment has been removed by the author.
Bruce Hayden said...

I think that one of the things that seems fairly clear cut here is that a lot of this loss of net worth involves the bursting of the real estate bubble. And, it goes a lot beyond those who bought well beyond their means. One thing that has to be kept in mind is that a lot of people who could afford their houses cannot now, thanks to the Obama Recession. They may have lost their jobs, been downsized, working for less money, etc., and all of a sudden, those imminently reasonable mortgage payments aren't reasonable any more. Sure, there were a lot of people figuring that with easy loans and a rising real estate market, they could get rich this way, but I think that probably more were just screwed by how badly the market crashed, at the same time that their incomes crashed.

In any case, what must be remembered when blaming the banks for this, is that greed is the natural state of man (which is why Utopian solutions like socialism can never work). If Bank A won't loan to people who won't likely be able to pay off the loan, and esp. not if the market crashes, then Bank B will, and will ultimately grow much more quickly. We saw this before with the S&L crisis of the 1980s, when some S&Ls doubled in size in a year, then doubled again the next, growing on brokered deposits, just to crash the next year. And, we saw it this time. Problem was, that this time, even some of the better run banks, etc. were hurt, because of how badly the market crashed after the bubble burst.

No matter how much the left tries to spin it, the CRA did have an effect here - with banks being forced by regulators and "community organizers" to lend to minority communities money to people who they knew were bad credit risks, absent a constantly increasing market.

But, I would suggest that while that may have started the housing bubble, it wasn't what maintained it, nor what really grew it at the end. Part II was the securitization of mortgage loans, and, in particular, being able to separate out chunks of bundles of loans into tranches of varying degrees of risk. It looked good on paper, but turned out to be a house of cards. In the old days, this wouldn't have happened, because the S&Ls were the ones making the loans, and they were heavily regulated and not allowed to carry that sort of risk. Glass-Steigal, etc. had a part of this. Also, though, the big investment banks were instrumental, and there is no excuse for any of them still being in operation. Of course, the biggest are, because of their ability to buy politicians - note in particular where the Obama Administration has recruited much of its financial savy (i.e. GS).

In the end though, the thing that kept the bubble growing, well beyond when it should have slowed, were Fanny and Freddie. By the end, they were buying up a large percentage of the "subprime" loans (i.e. those where the borrowers couldn't afford their loans, even if the bubble didn't burst). Management of these government controlled entities had become Democratic sinecures, esp. after they lost the White House to Bush (43). More importantly though, they and their lending practices were avidly, and even desperately, protected by the Democrats in Congress, led by the execrable Barney Frank - all in the name, again, of making home ownership more fair (or, alternatively, letting the minority community get their fair share of home ownership, regardless of ability to repay). Starting in the mid-2000s, well before the bust, Republicans, including George W. Bush and John McCain tried to slow this down, and failed.

And, yes, in the end, cranking up government spending by an additional 5% of GDP, while adding $5 1/2 trillion of new federal debt, during the recession just increased the problem by cranking up the number of unemployed and underemployed who had mortgages to pay.

Jay said...

It's called THE HOUSING BUST. Remember where that started?

Yes, with Barney Frank and the Democrats resisting any attempt at more oversight or reform of Fannie Mae & Freddie Mac

Jay said...

garage mahal said...

I'm doing fine, what's your problem, loser? Lots of other people like me are doing just fine too. You depend on the left for your prosperity? I MAKE my prosperity no matter who is in charge, motherfucker.


HA HA HA HA HA HA
HA HA HA HA HA HA
HA HA HA

That's right, bozo!

There is no lost wealth!
Millions haven't left the workforce!

All is well!

Idiot.

Dante said...

And let's not forget that national debt! Now each household's share is $192,000!

PatCA said...

"At some point you're worth enough money."

karrde said...

@AJ,

Others have noted that people can't loan against, buy, or sell SS benefits. Thus, they aren't usually considered part of a person's net worth.

If all you're saying is that the percentage drop is smaller, I might agree. But you appeared to want to apply future-SS-payments to the 2010 numbers, and not pay attention to doing the same thing to the 2007 numbers. That would be a very big mistake.

As an aside: don't confuse median and average. There are lots of people who can't tell the difference, but you make yourself look pretty foolish to those of us who do.

Refer again to this link, or this one. While it seems like pedantic nitpicking, the median and average have different meanings and different uses.

Robert Cook said...

""No matter how much the left tries to spin it, the CRA did have an effect here - with banks being forced by regulators and "community organizers" to lend to minority communities money to people who they knew were bad credit risks, absent a constantly increasing market."

This is exactly NOT why the banks collapsed. It had entirely to do with lightly- and poorly-regulated banks giving in to their every greedy impulse, and committing fraud on a massive scale. It had to do with the removal of Glass-Steagall in Bill Clinton's term, part of a raft of protective measures put in place to check the banks and financial institutions after the catastrophe of the 1929 crash and subsequent Great Depression. Once those protective regulations were removed, the banks and financial institutions returned to the reckless and rapacious behavior that had ruined us in 1929...with predictable results.

They are criminals on a scale undreamed of by the Mafia.

jimspice said...

Yes, seeing median in conjunction with mean would tell us much more. There are many ways you could shift the median without affecting the mean, and vicy versy, each implying VERY different causes and effects.