The "right to own a home" has become synonymous with the "right" to lose $25K a year

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The Automatic Earth
Over the weekend, I wrote about Fannie Mae and Freddie Mac, and how they form the core of the biggest fraud and crime ever perpetrated upon the American people. And even though that was already the umptieth time I have addressed this particular topic, I want to return to it again.

After all, we're not talking about Jesse James or Billy the Kid or Charles Ponzi or Kenny-Boy Enron or any of that petty kiddy wannabe criminal stuff, this is the number one way Americans have ever been fleeced right across the entire nation. Maybe that status is best recognized by the fact that people to this day keep on begging for more of the same. Either that or another little fact: the government is at the center of the scheme.

In the July 11 post at TAE, there was an article by Michael David White, a Chicago area real estate broker who a few years ago started calling on his clients to NOT buy a home. I’ve featured many of White's articles since; I like that kind of attitude. In last week’s piece by White Pending Homes Sales Crash in a Record Fall to a Record Low as Tax Break Expires, though, something was missing. There was a line that said "see the graph below", but there was no graph. Since I had a hunch which graph he meant. I sent him a mail. And yes, he came back to me with the graph (some 6 weeks old) that can hardly be surpassed in its definition and clarity of the depth of the US housing and credit crisis.

Take a look at this baby:



That is, what Americans' homes are worth, their equity, decreased by $7 trillion -from $20 trillion to $13 trillion-, from spring 2006 to spring 2010. In the same period, mortgage debt, what Americans owe on their homes, went down by only $270 billion. Yes, that's right: US homeowners lost more, by a factor of 26, than they "gained" through clearing mortgage debt. Thus, if we estimate that there are 75 million homeowners in America, they all, each and every one of them, lost $93,333.

Good morning America!!

And your own government is still trying to encourage homeownership? Now why would they want to do that in the face of numbers such as these? How much thought have you given that question? Over the past 4 years, the "right to own a home" has become synonymous with the "right" to lose some $25,000 a year. Why does Washington, through Fannie and Freddie, Ginnie Mae and the FHLB, continue to guarantee guaranteed losses for American citizens? More...