In the third quarter, a record 14.41% of loans either in foreclosure or with at least one payment past due, the Mortgage Bankers Association's chief economist said.
"Job losses continue to increase and drive up delinquencies and foreclosures because mortgages are paid with paychecks, not percentage point increases in GDP," said Jay Brinkmann, chief economist of the MBA, in a news release. "Over the last year, we have seen the ranks of the unemployed increase by about 5.5 million people, increasing the number of seriously delinquent loans by almost 2 million loans and increasing the rate of new foreclosures from 1.07% to 1.42%."
Brinkman has a strong point here. The economy is "improving" because the government is shoveling money to Goldman Sachs and the auto industry. This is impacting GDP. However, it is a very distorted "recovery". Further with Bernanke not printing any money, previous distortions in the capital sector are being liquidated out.
With talk of increased taxes, the private sector will be squeezed even further.
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