I watched a CNBC program today where they all applauded Cramer the Screamer and hailed the bank regulator (FDIC I think)etc.
Questions were about why banks weren't making enough new loans even if deposits were 20%.
No one suggested that US housing prices are so far above the "real" norm that a further 50% drop would be just median and 75% would be typical of an overshoot below after the biggest bubble in history.
Why would you if a bank lend 80% today when it still means you will lose money.
Forget the usual patriotism nonsense, I feel sorry for the banks that are still being "encouraged" into making more bad loans.
They even suggested that those whose mortgage was 30% above current value should stay as a home is a wonderful thing and price is insignificant.
Here we don't get the choice of walking out and throwing in the keys.
