Mortgage Crisis - Beginning of the End or End of the Beginning?
We've had our first hints of good economic news lately, the stock market is back up to 8,000. Auto sales stopped going down. Summer is coming and government stimulus money should start working its way through the system in significant quantities soon.
HOWEVER, perhaps the biggest precipitating event of this recession/depression was the effect that underwater securitized mortgages had on your financial system. Many of the securitized subprime mortgages have been absorbed into the system, but the number of "Alt-A" Option-ARM adjustible rate mortgages subject to reset is actually going up, and will for some time. While some prognosticators claim that this will be the source of several rounds of crisis points like we suffered last fall, it all depends. If rates stay low, and credit is available to refinance the exploding ARMs, the rate changes might not be a big deal. To paraphrase Duran Duran, every little thing the reset does is answered by a question mark.
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