housing crisis

One thing about Big Shitpile that seems to have gone under the radar is the potential for--and, increasingly, the reality of--debtor revolt. That is, people who owe more than their home is worth refuse to pay without a renegotiated mortgage. Sean Broderick thinks that "a debtor's revolt is going to be one of the defining trends for 2010", and recounts this episode: Two years later, Adam's $450,000 Loxahatchee House was worth only $189,000. And he couldn't find a renter for his home in Lake Worth. He tried working with the bank (one bank had given him mortgages on both properties), but they…

If you're looking for a good primer on Big Shitpile and other recent economic events, I highly recommend Peter Goodman's Past Due: The End of Easy Money and the Renewal of the American Economy. It's well written, and does what many other books about the recent economic collapse fail to do: puts it into a larger context. But this small excerpt from Past Due hits the nail on the head as to what our problem is: Washington has grown accustomed to muddy compromises that can be spun into clear-cut victories by both parties, as their leaders appear on Sunday television talk shows to argue over…