Comments on: Thumbs Down to Real Estate Cramdowns http://www.flipthyhouse.com/2009/01/09/thumbs-down-to-real-estate-cramdowns/ House Flipping Advice and Home Renovation Projects Sat, 20 Feb 2010 18:40:13 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Chris http://www.flipthyhouse.com/2009/01/09/thumbs-down-to-real-estate-cramdowns/comment-page-1/#comment-1648 Chris Sat, 10 Jan 2009 14:44:34 +0000 http://www.flipthyhouse.com/?p=225#comment-1648 I agree. The mortgage business is a market, and will continue to operate in accordance with the basic economic rules of supply and demand, and financial rules of risk and reward. Giving judges authority to limit or delay recovery mechanisms for loans in default increases the risk of these loans even further, leading the lenders to limit the supply of such loans and increasing the cost of all their other products to try to maintain the same overall margin. Dumb, dumb, dumb. Lawmakers should be required to pass a test demonstrating their basic understanding of economics and finance before being seated. I agree. The mortgage business is a market, and will continue to operate in accordance with the basic economic rules of supply and demand, and financial rules of risk and reward.

Giving judges authority to limit or delay recovery mechanisms for loans in default increases the risk of these loans even further, leading the lenders to limit the supply of such loans and increasing the cost of all their other products to try to maintain the same overall margin.

Dumb, dumb, dumb. Lawmakers should be required to pass a test demonstrating their basic understanding of economics and finance before being seated.

]]>