Reply #29: Mess?

[Hydra]

This was VERY deliberate. Money that didn't exist was created to give these loans (Watch "Money as Debt" on google if you aren't familiar with how loans really work). They were made to be ARMs, and people thought the economy was going to do better, and they would get better jobs. The banks knew this wouldn't happen.

Think about the problem with ARMs- if the money didn't exist to begin with, the loaner is making a pure profit. As such, a 5.25% loan is still an awesome deal for the loaner- no money put in, and at $250,000 you are getting roughly $12,000 + principle out of the poor sap. Sound like a good deal to you? At that point, you're already fleecing the sheep rather well- why put it out of his reach?

The answer? Two concepts, Two words each: Fire Sale and Currency Debasement.