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Originally Posted by King of New York
Then the interest rates went up--not all that much, but enough to cause the most vulnerable borrowers, the subprime ones who represented the biggest credit risks, to go belly up.
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I don't think you were necessarily saying it wasn't a factor, but I don't think you can underestimate the perfect storm of the boom in housing costs stopping. I think many of these people were banking on dumping the house either when interest rates started climbing or just before the balloon payments started.
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Of course, if the government decides to bail out all the folks who gambled and lost, then I really was a fool to play it safe.
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This would potentially make me the maddest at the US Government that I have been in my adult life.