Now, suppose that a homeowner puts down only 3% of their own money or 3. 5% for the … - Michael Hudson

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Loss makes me feel vulnerable. I've had my share, less than so many though, but enough to feel empathy. It's tough and I see it so much on Earth, too much suffering. The loss of free will I find unacceptable - what most of us refer to as rights.

Michael Hudson

Now, suppose that a homeowner puts down only 3% of their own money or 3. 5% for the FHA. That means if prices go down by only 3%, the house will be in negative equity and it would pay the homeowner just to walk away and say, "The house now is worth less than the mortgage I owe. I think I'm just going to move out and buy a cheaper house. " So it's very risky when you have only a 3% or 3. 5% equity for the loan. The bank really isn't left with much cushion as collateral.

Buy, Cheaper, Mean, Money, Moving, Thinking

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We go forward with our heads held high, but look back and remember where we come from.

Come, Forward, Inspirational, Moving Forward, Moving On, Remember

What do the 5%, or the 1% actually use their money for? They lend it back to the economy at large, they load it down with debt. They make their money by lending to the bottom 95%, or the bottom 99%. When you give them more after-tax income, it enables them to buy even more control of government, even more control of election campaigns. They're not going to spend this money back into the goods-and-services economy.

Economy, Enables, Giving, Government, Income, Load

The one sure mark of a con, though, is the promise of free money.

Free Money, Mark, Money, Promise, Though

So we are in for years of debt deflation. That means that people have to pay so much debt service for mortgages, credit cards, student loans, bank loans and other obligations that they have less to spend on goods and services. So markets shrink. New investment and employment fall off, and the economy is falls into a downward spiral.

Fall, Markets, Mean, People, Service

The most serious problems lie in the financial sphere, where the economy's debt overhead has grown more rapidly than the 'real' economy's ability to carry this debt. [. . . ] The essence of the global financial bubble is that savings are diverted to inflate the stock market, bond market and real estate prices rather than to build new factories and employ more labor.

Build, Essence, Lying, Overhead, Problems, Real