Do we ever learn to be prudent with money?

Are we setting ourselves up for another 2008/2009? More debt based on home equity, using our houses as ATMs🤑

The root cause of the Great Recession was not the fiscal shenanigans of lenders and banks, but the pushing of subprime home ownership by government and the misuse of home equity by irresponsible individuals.

This chart is quite interesting. It’s essentially saying that Americans have never been wealthier before relative to their income. Due to this record wealth ratio, you are seeing cash-out refinances and home equity lines of credit rise to pre-crisis levels again.

If the real estate market and stock market turn down for a prolonged period of time, you will see a negative snowball effect due to rising debt, lower asset prices, lower wage growth, and rising unemployment.


NOTE: As an aside the average down payment on a house in 2017 was 5% Sound familiar?

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