Obama HUD PIck Foresaw Subprime Crisis - In 2004

[Shiver]

HUD Pick Foresaw Subprime Crisis in 04'
Glenn Thrush, Politico
(Via link on Huffington Post)
Dec. 13th, 2008

Barack Obama's pick for HUD -- former New York City Housing Commissioner Shaun Donovan -- was one of the earliest public officials to foresee the magnitude and destructive capacity of the subprime crisis.

In the middle of 2004, I sat down with Donovan (I was at Newsday at the time) for a chat about Mayor Michael Bloomberg's initiative to tackle the shortage of low- and middle-income housing in the city.

To my surprise, Donovan brushed aside my questions about the city's initiatives and began talking at length about the coming "flood" of foreclosures he anticipated among highly leveraged apartment buildings purchased by recent immigrants -- and a looming subprime crisis for one- and two-family homeowners in up-and-coming neighborhoods in southeast Queens and central Brooklyn.

*snip*

Full article at Politico



****

Yeah, it's Politico, but it's a short read, and somewhat interesting.

[glowing]

1. ooh, ooh.. me too, me too. I saw it too. Does that make me a genius.

Hello, I graduated college and realized after being on my own with a partner.. now hubby, that it would be impossible for us to buy a home at the prices that were beginning to sky-rocket. I just couldn't understand why people were buying when they didn't have enough money to really pay for what they were getting.. and still making less than par pay for the loans that I knew they had to pay... AND then my friend, my age, decided to go in for a buy.. they bought a bunch of homes. One to live in, one for their partner investor, and 3 to sell. Well, that didn't work out too well. Her and her fiancee ended up broke, losing money, and separated before they even wed... and this was during the buy and sell time. AND I said no way, I'm not taking on that headache. I have picked up a foreclosed home. Its a bit of a struggle. I'm sure I've lost some value.. but hopefully not so much that when I'm ready to move on, I'll be at a loss. We've got about a 7yr plan with this home, however, if we aren't blessed with another child, we could live here for the next 30yrs.. or until we're able to move out of this god-awful state of FLorida.

[ananda]

3. Me too.

I and a lot of people I know or read.. including
many people on this mb.. saw the problem.

Even so, for several years before this crisis hit,
I would drive down streets with McMansions going
up and wonder.. where is all that money coming
from? Why are so many people doing so much
better than I am?

Well.. the answer is clear now.

I looked at home prices for years and felt I'd
be throwing too much money at a home to make it
worth my while, with all the property taxes,
insurance, and maintenance... even though I
could technically afford it.

Now I'm so fuckin glad I rent, I can't tell you!

[Cha]

2. I'm glad Obama's pick

for HUD Sec is so prescient. He's going to need it.