a train wreck or just a hiccup? (by mannfm11)

Are we in the midst of a train wreck or just a hiccup? The likelylosses out of subprime will and has taken down some institutions, butthey aren't enough to flip the world upside down. There is the physicalcollateral, not paper collateral behind these loans. The real estatecrunch, most likely in commercial as well as residential is anothermatter. It might be only a modest percentage of the economy, but it isa percentage that in economics is a multiplied percentage, meaning itsscope is wider than itself. Someone can say that gasoline is only apercentage of the economy, but the closing down of the oil industry,though only a percentage of the economy is also a percentage of retailsales, banking and other matters. In the case of real estate, it is ourprimary collateral for honest expansion of credit that serves tosustain demand for all kinds of goods and services. This is the biggestbet in history going forward.