http://masteryourcard.com/blog/2008/12/23/money-and-ethics-do-they-mix/ The best Credit Card Debt Blog online Wed, 17 Mar 2010 10:38:55 -0400 http://wordpress.org/?v=abc hourly 1 http://masteryourcard.com/blog/2008/12/23/money-and-ethics-do-they-mix/comment-page-1/#comment-10752 Rich Wed, 24 Dec 2008 07:03:04 +0000 http://masteryourcard.com/blog/?p=629#comment-10752 I agree that most professionals let things get out of hand. I think it's a common case of the tragedy of the commons. Letting shoddy loans through gave a good profit for a few, but the losses would be spread out among a wider range of people. On the other hand though I think a lot of smart and honest people got caught up in the belief that real estate prices never go down. When banks switched from a cash flow based lending model (DTI) to an asset based one (LTV), it allowed them to make justify the bad loans. I agree that most professionals let things get out of hand. I think it’s a common case of the tragedy of the commons. Letting shoddy loans through gave a good profit for a few, but the losses would be spread out among a wider range of people.
On the other hand though I think a lot of smart and honest people got caught up in the belief that real estate prices never go down. When banks switched from a cash flow based lending model (DTI) to an asset based one (LTV), it allowed them to make justify the bad loans.

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