The default rate in America’s ‘prime’ mortgage market has hit a record 4%, prompting fears of house prices crashing by 25%. Arrears on “prime” mortgages have reached a record 4%, confounding expectations that middle-class Americans with good credit records would be able to weather the storm.
By the Numbers:
$2 trillion: Outstanding “Sub-Prime” Mortgages in US.
$8 trillion: Outstanding “Prime” Mortgages in US.
7.7%: The amount US house prices have fallen over the past year, according to the Case-Shiller index of the 20 biggest cities.
2.2 million: The number of US ARM mortgages ready to reset to higher interest rates.
2.5% to 3.0%: How much the ARM interest rates are set to increase.
25% crash: How far home prices are expected to drop according to Goldman Sachs – creating the worst slump since the Great Depression (AKA “Depression I”).
Remember this: GS is in-the-know: they’re the only major investment bank that sold off derivatives when everyone else was buying. Henry Paulson, former CEO, is the US Treasury Secretary and an insider. If they say it’s bad they’re probably right.
7.1%: The number of Americans not making their car payments.
◊◊◊◊ As of today: Gold @ $899.00, Silver @ $16.98 ◊◊◊◊
Filed under: Markets & Economy |