Posted by David Krulac on February 19, 2008 at 04:47:28:
Most everybody loses. Real estate sellers are losing as there are less buyers and less buyers means lower prices. Builders, Realtors, home material suppliers, plumbers, electrians, HVAC people, carpenters all are losing. Wholesalers and flippers and real estate investors lose.
Yes tax money is being used to bail out an industry that created its own problems. But also tax revenues are down when building, and homes sales are down.
Real estate and all its inter-related industries is the biggest component of our economy, and slow downs in real estate translate into slow down in the economy in general.
any winners? Yea maybe people who can buy real estate at a lower price and people who are buying real estate but NOT selling real estate like long term invetsors, Buy and Hold investors and investors who can hold until the market turns around, which it will, but nobody knows when.
Who really looses in the SubPrime debacle? - Posted by george
Posted by george on February 18, 2008 at 19:54:57:
Perhaps you economists understand this a little better than I do. If the funding for the sub prime loans came primarily from Wall Street investors, then isn’t it the securities market players that suffer?
It sounds like our gov’t treasury is helping? Is our tax money paying for this? Or what am I missing?
Re: Who really looses in the SubPrime debacle? - Posted by Rich-CA
Posted by Rich-CA on February 19, 2008 at 10:11:39:
I agree with David. Property tax states (ones with no income tax) get hurt more when values fall than do states where there are substantial revenues from income or sales tax sources.
Most of who gets hurt are normal middle class people. The ones who have retirement fund invested in mutual funds or other instruments of the big institutions, rather than the institutions themselves. Though their employees will be hurt if layoffs hit, but again middle class workers take the hit.
Also workers whose jobs depend on the RE industry get hurt as builders stop building and people pull back from remodeling to try and weather out the anticipated storm.
In terms of who pays most of those taxes. The top 1% income bracket pays over 60% of all taxes. But many of that top 1% are “upper middle class” and not truly rich.