Our discussion of the shifting nature of homeownership in the United States was too short this morning on NovaM radio. But we’ve been invited back, so we’ll keep the conversation going. Here’s the podcast.
The New York Times had another installment today in its excellent package on the debt industry, this time reporting on home equity loans. Not really news to me. Check out the slide from Mark Zandi, Chief economist for MoodysEconomy.com, at a May 2007 presentation on the savings rate of homeowners with Home Equity Lines of Credit vs. those without and those who are renters. Guess who’s wealthier â€” a renter or a HELOC homeowner?
A friend said to me not too long ago that we need to start thinking of debt differently in this country because the nature of debt has changed. It is no longer something to be scorned but instead a tool that we all will use. This is due in part to global redistribution of wealth.
We instead need to think of a continuum of debt: Those in the US who are rich will pay the least for debt while those who are poorest will pay the most. To mangle a Bob Dylan lyric: “Everybody must get loans.”
What do you think?