When it comes to money, the far left icon the New York Times cares more about Wall Street than Main Street. There have been grumblings on the left about how the new stricter mortgage limitations are squeezing lower income folks out of buying a house.
The Times wants these standards to be tightened even more, especially on low-income families.
The subprime meltdown happened when banks gave artificially low interest loans to millions of people who could not afford them. After the low- or no-interest “teaser” period expired and the rates jumped to prime plus, these families couldn’t afford the monthly payments and bailed.
Banks now require far more documentation on income. They limit the debt-to-income ratio to 43 percent. In a recent editorial, The Times said 43 percent might work for families with an income of $100,000 but 43 percent for a family bringing in $50,000 a year is a stretch. They want the standards tightened so low-income families are sure to have enough for food and necessities.
So, we’re back at the old affordable housing argument and square one.
This time, however, the liberals who pushed the subprime scheme are squarely on the side of banks and Big Money. Of course, they were aligned with Big Money all along.
The financial gurus knew damn well the subprime mortgage approach would never work. American banks have tried it seven times in the past and it’s been a total, abject failure every time.
The only winners after every subprime experiment have been the wealthy.
Then as now they have an excuse to tighten loan standards and push more people out of buying homes and into rental property. That’s where the easy money is.
The bizarre part about all this is why low-income families and minorities continue to think that the Democrats and their Wall Street heavyweights are on their side.
Go figure.
