Quote:
Originally Posted by onewhippedpuppy
So you're saying that the banks could have simply referenced Pelican Parts OT for a precise to the penny value for any real estate? Amazing!
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Pretty much, although it didn't need to be called to the penny in order to avoid this disaster.
It was called in 2006 that RE in the bubble areas would go down in value at least 50%. Charts were posted, showing almost exactly how much this would fall (it is reverting to the mean, i.e., correcting back to where real estate appreciation tracks the general rate of inflation), and when it would fall. They turned out to be almost exactly correct.
Also, you don't need to know the value for any real estate. Only the bubble areas. The other stuff doesn't matter much. I read yesterday that this whole crisis was caused by the bubble in only 40 counties throughout the US - those bubbly ones we all talked about in 2006-07.
If the banks would have seen that information, and opened their eyes, all of this would have been averted. It really didn't take a genius to figure it out. What the banks did was a massive failure, based mostly on short term greed, which clouds judgment.