When good ideas go bad
WHEN anybody talks about “sub-prime mortgages,” the phrase carries the whiff of sulphur. Or worse. In the beginning, however, the sub-prime mortgage was seen as being as positive for society — specifically American society — as was social and affordable housing here at home.
The sub-prime mortgage, we now know, was one of the good intentions which paved the road to financial hell, in America and right across the globe. Other slabs on the road were crafted by some of the cleverest people in the financial services business, who bundled bad products with good and persuaded themselves and everybody else that the housing and every other market would A) continue to grow indefinitely, and B) would grow best if regulators kept their punitive paws to themselves and allowed markets to effectively regulate themselves. The end result was an unfurling of a disaster which has changed the lives of millions of diligent, careful people for the worse.
