The subprime housing mortgage whatever

I'm sorry, I just can't be bothered. This is not the 1930s. The US economy is now so much better understood and so well protected by institutional mechanisms designed to stabilize it that this stuff has hardly any detectable impact on the real world that most of us live in. Every few years we're told that the economy is threatened with collapse because of the dot-com stock bubble, soaring house prices, falling house prices, borrowing too much money from China, China threatening not to lend us enough money, or what have you. What substantial impact have any of these "crises" had on the things that actually affect the life of the average person -- unemployment levels and wages? How many of us would even have noticed that these "emergencies" were happening at all, if it weren't for arm-waving pundits fretting about them on the news?

Nobody should be very surprised that the housing-loan industry is in something of a mess at the moment. We all know about the careless lending habits of banks. They send out pre-approved credit-card applications to unemployed people, dead people, dogs, inflatable sex dolls, you name it. They’ll give anyone a credit card. I'll bet there are even a few dogs here and there who have received housing loans. Aside from all the people who can’t pay their loans back, we’re also in one of those back-to-reality drops that always happens after house-price inflation has been going for a while. Generally speaking, anything that lowers inflation is good, and the fact that houses are getting cheaper means more people will be able to afford them. Of course, some loan-crazed bankers and some individuals who invested based on the belief that house prices would keep going up and up for ever and ever will undergo financial sodomization, but that’s the way that the free market is supposed to work – there are penalties for being stupid.

So some people win a bit, and some lose a bit, and life goes on as before, until the next crisis that sets the pundits fretting on TV.