Jack Walker

Jim Rogers on the Economy - Bearish on Stocks and Government

Devin,

You are right about too much debt. It was probably the primary driver for inflating housing prices. The combination of lax lending standards and low interest rates in conjunction with a commission based compensation model for originators, processors and Wall Street packagers drove house prices to unsustainable levels. The process is now reversing and will not be helped by making more credit available so we can restart this process. The evolved mortgage lending model with all of its commissions and financial engineering should probably be reevaluated.

Jim is right about the need for somebody to recognize the need for structural changes.

Jack