A Nice Place To Be

Financial Armageddon today points us toward a Washington Post article The housing bubble, in four chapters, a really well distilled look at what will go down as the biggest financial debacle in history. Tulip Mania and the tech bubble of the 1990s will be seen as mere wanna-bes when the history of financial inflations and crashes is written.

Reading this again shows not just how gullible people can be, but how many people in our society grasp on small incidents of luck and success and quickly assume they represent hard, long-term reality. I’ve been preaching Peak Oil, housing bubble and the long-term non-viability of the subprime mortgage market for quite some time. Those who I used to preach to (I save my breath these days) considered me at best, misguided and at worst, a paradoid, delusional crank.

I must admit, it’s a difficult thing to hold my tongue when I hear someone who was so quick to dismiss my ideas 18 months ago now crowing about “these problems they’re starting to read about.” It further illustrates that most of us in this society are born suckers, walking around with big signs that point to their wallet and say “pick here.” I can’t tell you how many people I’ve talked to who a year and a half ago were convinced that home prices will always rise, pausing only momentarily for thought when I asked “is everyone’s income going up to match real estate prices? And if not, how will people continue to pay ever-increasing prices for homes?”

Well, it’s all crashing down now, and sadly, many are losing those homes they mortgaged everything for, then second-mortaged again for boats, vacations, vacation homes, pools, plasma TVs and more. I can’t imagine anything sadder than loading the kids into the car as you leave your home, moving into a smaller rental house, or apartment, and then getting up in the morning to go to your job. What a heartbreak.

But it’s happening every day, in increasing numbers. If there was ever a time to get debt-free with money in the bank, and a house that could lose 25% of its market value and still show equity, now is that time. I’m happy to say your editor has been blessed enough to get there.

It is a nice place to be. Come join us.

Here’s a couple places to start:

Trapped by debt? Free yourself in 7 steps from MSN Money. A possibly outdated article, but some good ideas nonetheless.

Live on Ten Thousand Dollars a Year by George Ure of UrbanSurvival.com gives with some great ways to cut costs. If you bring home more than $10K, you can then put the surplus to work elminating your debt.