Where does the money go when credit

J

jjf

I am curious to know where the money goes when banks severely restrict mortgages.

Does the fed stop printing or is the credit taken up in iraq or does everyone simply grab more credit cards.

If the fed stops printing surely that is going to set off a new round of problems.

just curious.
 
not one reply to such an up coming important subject.

The banks have already restricted borrowings, so where is the money
 
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Quote from jjf:

".. If the fed stops printing surely that is going to set off a new round of problems...."
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Fed printing and Gummint deficit spending is the CAUSE of all these problems.
 
In reality, the fed can make credit as cheap as they want, but cheap credit cannot help a consumer that doesn't have the ability to take on more credit.

Do people really think that everyone is going to rush out to buy new cars again at the pace of the 2002-2006 time frame? The auto sector is going to suck for a few years yet.

Does cheap credit all of a sudden qualify subprime borrowers for another round? FUCK NO it doesn't. For everyone who buys the solution that the rate cut is going to put the US back on the track it was on before this all came about, you are living in a dream that can end in your own nightmare.

It is not complex. Cheap credit led to everyone buying shit with a sense of urgency to take advantage while it lasted. Lenders gave credit to anyone, pets and children included. Now there is a burdensom debt overhanging the avg household with 2+ million arm resets over the next 6 months. The rate cut actually made the 10 yr rate climb, not good for the resets.

All the bulls are certain that we will not only keep up with the rate of consumption of the last several years, but grow it?

I say show me the money.
 
the subprime mess hit the hard to borrow people and now the neg amortization ( the rest of these exotic loans ) is getting ready to rock the middle class...people with good credit who took out loans so they can either keep up with the joneses or to speculate on a rising real estate market..are going to see their loans increase and their mortgage payment increase while their properties decrease.....can anyone say sqqqqqqqqqqqquuuuuuuuueeeze
 
Quote from Comanche:

In reality, the fed can make credit as cheap as they want, but cheap credit cannot help a consumer that doesn't have the ability to take on more credit.

Do people really think that everyone is going to rush out to buy new cars again at the pace of the 2002-2006 time frame? The auto sector is going to suck for a few years yet.

Does cheap credit all of a sudden qualify subprime borrowers for another round? FUCK NO it doesn't. For everyone who buys the solution that the rate cut is going to put the US back on the track it was on before this all came about, you are living in a dream that can end in your own nightmare.

It is not complex. Cheap credit led to everyone buying shit with a sense of urgency to take advantage while it lasted. Lenders gave credit to anyone, pets and children included. Now there is a burdensom debt overhanging the avg household with 2+ million arm resets over the next 6 months. The rate cut actually made the 10 yr rate climb, not good for the resets.

All the bulls are certain that we will not only keep up with the rate of consumption of the last several years, but grow it?

I say show me the money.
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excellent observations Comanche.
given that the poor never had anything in the first place, then any sniff of credit is a bonus to them given there is never any intention of repayment. Why should they since they are always excluded from the social party.
Forget the wealthy, as they take care of themselves.
So that leaves the good ol middle class who has spent its income right up to 2011 and beyond.

"I say show me the money" is an excellent question.
 
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