That is the biggest load of panic-mongering garbage I've read so...

That is the biggest load of panic-mongering garbage I've read so far. You must be all cash Bruce.

There is some truth in some of it, though on the whole the numbers being bandied around are excessive and are predicting that every mortgagee with negative equity will default and that the banks will get nothing at all back from the "Jingle Mail" sales, though in fact only a modest proportion of those with negative equity will sell and generally banks will recoup over 80% of the value of the Jingle-mail defaults.

I particularly like the line:

"no one will want to build offices, stores, shopping malls/centers in ghost towns. "

As if entire towns will default and none of the propeties will be re-sold by the banks.

In reality only a few properties in any one area will be forced to sell out and most of these properties will be rented out to or sold to new tenants - and those that move in will have bought the properties more cheaply and be paying lower interest rates (and hence much less interest) than those that have been forced out - and hence may enhance the disposable income available for discretionary spending in those communities.

To suggest that suddenly millions of Americans would default on loans and end up on the streets and leave all those houses vacant is completely ridiculous.

I agree there will likely be a brief US downturn - but not one lasting years and not with major global effect. These hicoughs are bought about purely by the paper-shufflers - not the manufacturers or consumers - and the worst hurt will rightly be felt by the paper-shufflers. Those involved in doing real things for real people will however come through this with much less damage.