I believe wealthy people--and especially Americans right now--need to assess whether they have an attitude of entitlement on economic issues. I read an article fairly recently lamenting how the "average single American" making around $40K a year is having a harder time affording "their own house and car." Americans really should take a look around. Nowhere else in the world that I've seen do "average single people" live in their own houses with multiple bedrooms and drive their own car. Instead, they live in an apartment (often with several other people) and typically take public transportation.
And in regards to the mortgage crisis, I'm feeling a little heartless about this now too. For people who have over-extended themselves to get a bigger house (or a house instead of an apartment) my view is that's tough luck if they can't continue to afford it. From what I've seen of most families in Europe (East and West) is that families have to actually save up for a long time in order to finally buy a flat or a small house. No financing ridiculous McMansions here.
Also, for foolish companies and banks like Bear Stearns that go under--they brought it on themselves with their bets on risky mortgage products.
Finally, here's a few excerpts from what motivated me to write this up today, an article called "Pay Day Loans Exacerbate Housing Crisis":
"As hundreds of thousands of American home owners fall behind on their mortgage payments, more people are turning to short-term loans with sky-high interest rates just to get by...
"We're hearing from around the country that many folks are buried deep in pay day loan debts as well as struggling with their mortgage payments," said Uriah King, a policy associate at the Center for Responsible Lending (CRL).
A pay day loan is typically for a few hundred dollars, with a term of two weeks, and an interest rate as high as 800 percent. The average borrower ends up paying back $793 for a $325 loan, according to the Center.
The Center also estimates pay day lenders issued more than $28 billion in loans in 2005, the latest available figures.