What about the people who did the right thing? How the "structured Depresssion" hurts everyone

One of the untold stories of people counting on real estate can be read here. This story covers a family that had been very successul.  They were able to sell their business and retire.  Now they are struggling to get by as their investments have been crushed. 

They did the right thing, did as advisers said, diversified into stocks and real estate, in different locales but still lost everything. Hopefully stories such as this one seen in the NYT will start get people to realize this crisis originated long before the subprime crisis and the credit lock up of 2007.
This is more than subprime problem. More than an issue with people buying things they couldn't afford. Real estate has been one of the best ways to invest for the future since the depression. It at least was a way to park money that could be used as a nest egg or children's college funds.

BUY ECONNED HERE
But as people continue to chide those who have hit hard times, calling them irresponsible, liars, deadbeats and crooks, hard working, wisely invested Americans have been completely wiped out. The people who have never gotten to the level of living off the income from investments will usually argue that the entire crisis was due to greedy borrowers. This is completely false.
Read a related story here from the Wharton Busines School

If you still have the shallow and simplistic view of this crisis think the too big to fail banks will be our saviors and the "deadbeat" homeowner as the cause you need to get a slice of reality on your next helping of turkey.


If you will do a minuscule amount of research you can find out how structured financed allowed the Wall Street Players to leverage their clients investment dollars up to a 9 to 1 ratio (See Econned by Yves smith chapter named A Primer in Structured Finance "what this means is that for every million dollars of Cdo's sold as bonds was only backed by 20 % capital.”)

Talk about irresponsible Deadbeats. This amounts to risk so much more dangerous than buying a home with 0 money down. All it takes is a 2% drop value of the collateralized paper and the equity supporting those bonds is wiped out. Therefore as these cdos became nothing more than useless junk that used another new word to cloud the waters: Tranches was the buzzword and the way to increase the rates of return for investors.

They sold these products as if they were solid gold based on the average American’s sense of duty that nothing could be worse then defaulting on a mortgage. However, it was just a ploy by Wall Street in their attempts to figure out how to kill the only Golden Goose left in our country. It wasn't good enough for Wall Street to be able to buy property and use leverage as most home buyers do. The return wasn't great enough for them and they didn't care what it took to ruin the housing market as long as they were paid billions.

The brightest minds behaving as true narcissists would stop at nothing until they had brought real estate to its knees. The regulators failed to protect the people as did the rest of the government, including congress. We have been betrayed by those in leadership whom are elected to protect our rights as Americans.

The housing market, mortgage industry and construction industry is the engine that supported millions of people across the country. Consider how many jobs are related to this sector. 
SEE THE COMPLETE LIST HERE