Tuesday, August 21, 2007

Howie Kurtz chides the media for their role in the Mortgage Meltdown 
...in his column here:

I love this paragraph in a NYT front-pager on the mortgage market meltdown:

"The cast of characters who missed signals like the rise of delinquencies and foreclosures is becoming easier to identify. They include investment banks happy to sell risky but lucrative mortgage debt to hedge funds hungry for high interest payments, bond rating agencies willing to hope for the best in the housing market and provide sterling credit appraisals to debt issuers, and subprime mortgage brokers addicted to high sales volumes."

What, no mention of the media? We just point fingers at everyone else?

Kurtz's excellent book, the Fortune Tellers, describes the media's role and culpability in the dot com hype. There were some of the same mistakes made here, as well, though I don't think they are as serious this time.

But the fallout is more serious. In the 1990's boom, the dumbest people in America only lost money they were willing to put to risk. Few of them leveraged their homes to buy stock. This time around, the pain is going to strike closer to home.

Splash, out


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