A Subprime Wake Up Call
If there is a silver lining in the sharp contraction of housing markets, it is the halting of suburban sprawl -- a model for economic growth that is fundamentally flawed.
The true parameters for suburban sprawl are established by banks and what banks can finance. Municipalities are sinking billions of trust account dollars (ie our dollars) into leveraged financial products.
Those who benefit, make huge fees and commissions on speculative leverage. There are many intermediaries, each reaping a host of legal, engineering and lobbying fees.
The task: persuade distant investors, through ratings agencies and insurers, that a development will turn a profit, and keep secret real and substantial risks.
Risks like the one becoming a reality in the sub-prime market.
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