Put On Your (Economic) Happy Face

I am not helping America's families feel good about the economy, and I'm proud of it.

Recently I had this conversation during a pitch meeting with fan-favorite staff writer Betsy Parchem, via Interchats:

[14:58] jberthume: you could talk about economic pessimism if you want to be a real downer / champion: http://blog.washingtonpost.com/behind-the-numbers/2007/08/economic_pessi...
[15:01] Betsy Parchem: I don't know anything about the economy
[15:21] jberthume@gmail.com/Meebo: that's okay, neither do the people running it
[15:22] Betsy Parchem: THAT KIND OF ATTITUDE DOESN'T HELP THE NATION'S CONFIDENCE, JOSH
[15:22] Betsy Parchem: Geeeeeeeez!

And she's right. But there's a reason the American people, usually blissfully ignoring the impending Econogeddon shaping up around them on a daily basis, are starting to get The Fear: because the problems are starting to hit home. Literally.

From the Washington Post story:

Fifty-seven percent of Americans now say the economy is getting worse. That's a 23 percentage point jump in pessimism since the beginning of the year, and nearly as high as the dour economic assessment that followed the Hurricane Katrina disaster in late August 2005. Only 15 percent say the economy is improving; a quarter says it's staying about the same.

From a Star-Telegram story just a few days ago:

The Fort Worth-Arlington area had the highest rate of home foreclosures in the state and among the highest in the nation during the first half of 2007, according to a new national analysis of metropolitan areas.

Foreclosures hit one of every 57 households in Fort Worth-Arlington, ranking it 13th among the nation's top 100 metro areas, according to RealtyTrac, a California-based foreclosure-tracking service.

You don't have to be an economist (which I'm not) to know that there's some serious trouble in the housing market. You don't have to be a political scientist (which I am) to know that most Americans will look at a fluctuating market, a weakening greenback, or a trade deficit and barely flinch; but when their neighbors and friends start getting rousted out of their new houses, people will notice and start to wonder what's going on. They might also remember that their ARM is set to explode in about 6 months, and then guess what?

The main beneficiaries of the subprime mortgage hijinx are the same people that conned you into signing up for a credit card by offering you a t-shirt or a free sandwich when you were in college: business. People that profit from stealing from poor people. People that will debt you into oblivion knowing full well you can't pay it back, which doesn't matter because they will profit from the deal anyways.

So here's some economic happiness for you: people will probably learn from this. Maybe. And from that learning will come some years, or maybe even a generation, of fiscal responsibility. But plenty of dreams will be shattered and homes will be broken in the process. In financial dealings, what Momma taught you is probably right: if it seems to good to be true, it probably is; if it doesn't feel right, it probably isn't. And yes, you should buy the house you can rather than the one MagicLoan2782.com says you can afford.