[lbo-talk] origins of the housing boom

Eric Beck ersatzdog at gmail.com
Tue Aug 30 06:15:00 PDT 2011

On Mon, Aug 29, 2011 at 11:04 PM, shag carpet bomb <shag at cleandraws.com> wrote:

> i'm all for recognizing that people aren't social dopes of systems that
> operate behind their backs, but I also think it's a lot more complicated
> than simple cost-benefit analyses.

I agree. I was trying to offer a stark comparison with Indian Jones and his/her exploitation-as-the-only-reason thesis. And those questions weren't just rhetorical.

> i've got a bunch of comparison examples of how people end up reinscribing
> their own oppression, etc. but it's never a simple matter of them thinking
> they can scam the system or that they can somehow benefit.

Again, I agree. I think Jordan actually says it better when he says, "It's not clear to me that you have to actually know that you're doing this in order to have taken advantage of it. "

> I guess I'll just ask, when you
> bought during the bubble, did you think of buying a house as something you
> could just walk away from later?

No, but I did almost immediately after. But now it's too late. They've got me, and I wouldn't. Fuckerz.

> i'm not so sure "subprime borrowers" necessarily means people of color and
> lower income white women.

It seems, having done more investigating now, that it didn't. But subprime did allow people of color and women to borrow and "own" at higher rates than they ever before.

Also, re. exploitation, there's this (tentative) conclusion to a study of 2/28 mortgages by the New York Fed. (They admit, however, that they don't have information about what kind of tribute mortgage brokers took from buyers.)

"Our results provide no evidence of adverse pricing by race, ethnicity or sex of the borrower in either the initial rate or the reset margin. ...These results suggest the possibility that subprime lending did serve as a positive supply shock for credit in locations with higher unemployment rates and minority residents."

Sounds like subprime did for some what credit cards did for others: provided credit to make up for stagnating wages.

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