I agree with you.
I'm living in Spain, and here we have a similar situation but with important differences.
For example, if we ask for a loan to pay a house, you are 100% responsible for that debt. If the price of the real state drops, it doesn't matter, you are responsible for the debt. If you cannot make the loan payments, the bank will seize your house and auction it, and you will still be responsible for the remaining debt.
I think that's fair. If you want to buy a fancy X00,000$ house, go ahead, but asume your responsabilities.
I cannot understand American banks didn't tie this issues better, and risked having many many loan owners flee away then real-state prices dropped.
Wamu didn't work here in Spain, but we had the same issues as you over there.
I also don't think Wamu was so badly driven, but I think it was tagged as 'financial disaster' post-mortem, by everybody, because it benefits all (except shareholders).
- It benefits Gobernment so that they could aprove new financial laws and powers.
- It benefits 'some Banks' as to explain why did they only pay 1.88 billion $ for Wamu
- It benefits debtors justifying there is no money left and shareholders are milking the state.
BTW, GFU Rosen!!
