Estate Planning

More Bad News?

By Hull and Hull LLP

All of our lives have been significantly affected by the U.S. financial collapse, even though we all know that Canada has somehow weathered the storm better than everyone else, despite the paralysis of our major trading partner.  According to this article written by Charles Hughes Smith in the October 14, 2010 edition of Business Insider, the worst is yet to come. 

The Article's title, "Foreclosure-Gate Could Be The Fuse That Finally Explodes What's Left Of The Housing Bubble" is a fair teaser.  To simplify, Smith argues that the recent fixes to the mortgage-backed securities market has merely shifted the risk associated with the mortgage-backed securities to the state, without eliminating the underlying insecureness of the mortgages.  The risk/loss associated with those mortgages that should never have been made has simply been socialized by making the mortgages dependant on guarantees from the U.S. Federal Reserve, and having quasi-government agencies purchase the mortgages.  But the losses themselves have yet to be realized.   

On the lighter side, one out of six Americans would miss their wedding to attend the Superbowl.

Enjoy your weekend,

Chris Graham   

Full post as published by Toronto Estate Law Blog on October 14, 2010 (boomark / email).