Reading a wee article this morning in the NY Times about the first (evidently) builder to file bankruptcy post collapse of the sub prime market.

Levitt and Sons, currently operating out of Florida, was essentially building luxury retirement properties in South and North Carolina, and Florida.

What is shameful to me is that the company took people's money - $60,000, $59,000 - as deposits on houses that will NEVER be built. Wachovia has agreed to loan Levitt the millions of dollars it will take them to complete 80 houses in one development. Good for Wachovia. Levitt won't be building all the amenities it promised these homeowners, which the potential homeowners claim was part and parcel of the sales price of the house. Levitt won't reneogtiate contracts, and has no "due date" on the completion of these properties.

Broken record here, but: don't spend what you don't have. What on EARTH was Levitt doing, selling property to people that it had NO WAY to pay for?

Apologies if anyone is offended, but if you can't afford to pay your mortgage, you don't need to own a house. If you can't afford to pay your regular revolving debt, you can't afford a house. If you don't have a job, you can't afford a house. If you can't demonstrate your income, you shouldn't be ABLE to get a loan for a house. If you can't demonstrate the source of any of your money, you shouldn't be able to get a loan for a house.

It's really simple.

Everyone, from politicos to little ole newshounds, continues to bemoan the sub prime crisis and it's ties to our shitty economy. We talk about bail out plans, government agencies step in to negotiate freeze in interest hikes, and everyone pats themselves on the back in a spirit of "well done" itiveness.

I got news for you - this is all bullshit.

The market overreached itself, and it will correct. Those that should have bought houses legitimately will be ok; those that bought houses beyond their means or were uneducated about the programs they were sold - I'm sorry, but you guys are shit out of luck. I'm not bailing you out - why should Joe have to pay for Jane's ignorance?

So: leave the market's alone. Let them correct themselves. The housing market will bottom, will stay at the bottom, and then will slowly right itself over a span of the next three years.

In the meantime, save your money. Pay off all debt that is not fixed interest. Pay off those credit cards, because just as sure as the sun rises, the credit card industry will continue looking for ways to screw you (no grace, advanced delinquency pricing). Remember that we are currently in a buyers market for cars and houses. I don't personally recommend putting your money into the stock market; but if you do please diversify and consider international markets as well, as at the moment they seem more stable, more liquid, and have more room for growth.

We have power as consumers. Isn't it time we exercised it?