Recently joined and it has been an enlightening experience. The problems in the residential sector are widespread and pervasive. Much more so than even I suspected. Lots of thoughts and ideas over there what it means. From a historical perspective, it’s remarkable to me how similar the situation is today as it was in the mid 80’s with the S&L crisis. In all respects. So soon we forget.

The other aspect of this is the governmental response. Looks like congressional action is shaping up on two fronts: one faction is crafting legislation to help borrowers, the other looks like lender bailouts to me. Underlying it all is the concern of the Federal Reserve Board that an implosion of the residential market and will somehow lead to a failure of the economy in general. It may take the latter to inflict enough pain on the system to avoid this again in the future.