In the past few months, it has become more common to speak of the housing and financial crises in the past tense. Recently, the National Bureau of Economic Research announced the recession ended in June 2009. And while 2010 has hardly been a booming year, job losses have slowed and housing prices have begun to stabilize. No one's striking up the band, but we are slowly regaining our balance.
Or are we? In the past couple months, the banking industry has been sullied with stories of major flaws in the way it forecloses on homeowners who have stopped making their mortgage payments (a lot of people). With a new wave of foreclosures that may top 1 million homes, banks have hired tons of new people inexperienced in the industry to handle the avalanche of paperwork. The result? Foreclosures were being processed by "robo-signers," people who lacked knowledge or experience in the industry, signing as many as 10,000 foreclosure affidavits per month (about 500 a day). Anyone who's ever reviewed mortgage paperwork knows that it's impossible to read that much. Now, a new foreclosure scandal emerges. And Americans, facing yet another economic crisis, are reeling.
The fact is, the latest wave of foreclosures is just another effect of the housing bubble. And banks are doing what banks do; they earn money by taking in deposits and lending it out again at a higher rate. When faced with bad loans, they have to get them off the books to stay solvent. The days of easy credit are over, and many Americans are now angered with demands for what seems like onerous documentation. But "easy" credit got us all (banks and people) into this trouble, and sounder financial policies are needed. It's a hard fact we all must accept.
Yet even with the foreclosure crisis, almost 90% of people with mortgages remain current, and over one-third of all homes are owned outright. This should help put things in perspective.
Yes, the latest round of foreclosures is tough on many. But if we as a country keep focusing only on the empty part of the glass, we are not helping the people going through it. With a sluggish economy and a bleak constituency, a revival of rehiring or the return of anything but mediocre growth is impossible.
Can it be that the country always known as the "can do" nation is now saying "I can't"? For decades, we have been a beacon of hope for people from other countries who saw us as the land of opportunity. We still are. Yet so many of us are hurting that it almost seems as if we as a country have retreated to lick our wounds. I understand this, but we have no time for it. It is time to accept, then act. It's time to remember who we are.
There are those among us who are doing this. Like Andrew Mason, age 30, Founder and CEO of Groupon, a website that offers discounts on local goods and services if enough people sign up. Starting with an idea and a website in 2008, it has now amassed 18 million subscribers, and attracted $175 million in funding.
Or Kevin Plank, 38, Founder and CEO of Under Armour, whose sports apparel firm is on a roll. Up 60% this year with sales expected to hit $1 billion for the first time. But his focus is on his next conquest; sales of women's apparel (currently just 25% of sales). Says Kevin, "There is no time for 'loser talk' about the economy limiting growth. We have to go and grow!"
Well said. We have never been known as a nation of whiners, and now is no time to start. Yes, it's tough. Jobs have been lost that may not return, foreclosures are booming and in a divorce, it's the rare couple with any equity in their home. Clearly, someone's moved our cheese.
But let's remember what we do have. North America is the only part of the industrialized world that will be growing in people. It now has a higher birthrate than Mexico, for the first time in history. Those are promising numbers, yet even more than that, is our heart. Alcoa's German-born Klaus Kleinfeld, previously the head of Siemens, says: "I know the things that America has that are unique. The openness, the diversity, the dynamism--you don't have it anywhere else. If you keep all these things, build on them, I still believe in the American Dream."
So do I. How about you?
The fact is, the latest wave of foreclosures is just another effect of the housing bubble. And banks are doing what banks do; they earn money by taking in deposits and lending it out again at a higher rate. When faced with bad loans, they have to get them off the books to stay solvent. The days of easy credit are over, and many Americans are now angered with demands for what seems like onerous documentation. But "easy" credit got us all (banks and people) into this trouble, and sounder financial policies are needed. It's a hard fact we all must accept.
Yet even with the foreclosure crisis, almost 90% of people with mortgages remain current, and over one-third of all homes are owned outright. This should help put things in perspective.
Yes, the latest round of foreclosures is tough on many. But if we as a country keep focusing only on the empty part of the glass, we are not helping the people going through it. With a sluggish economy and a bleak constituency, a revival of rehiring or the return of anything but mediocre growth is impossible.
Can it be that the country always known as the "can do" nation is now saying "I can't"? For decades, we have been a beacon of hope for people from other countries who saw us as the land of opportunity. We still are. Yet so many of us are hurting that it almost seems as if we as a country have retreated to lick our wounds. I understand this, but we have no time for it. It is time to accept, then act. It's time to remember who we are.
There are those among us who are doing this. Like Andrew Mason, age 30, Founder and CEO of Groupon, a website that offers discounts on local goods and services if enough people sign up. Starting with an idea and a website in 2008, it has now amassed 18 million subscribers, and attracted $175 million in funding.
Or Kevin Plank, 38, Founder and CEO of Under Armour, whose sports apparel firm is on a roll. Up 60% this year with sales expected to hit $1 billion for the first time. But his focus is on his next conquest; sales of women's apparel (currently just 25% of sales). Says Kevin, "There is no time for 'loser talk' about the economy limiting growth. We have to go and grow!"
Well said. We have never been known as a nation of whiners, and now is no time to start. Yes, it's tough. Jobs have been lost that may not return, foreclosures are booming and in a divorce, it's the rare couple with any equity in their home. Clearly, someone's moved our cheese.
But let's remember what we do have. North America is the only part of the industrialized world that will be growing in people. It now has a higher birthrate than Mexico, for the first time in history. Those are promising numbers, yet even more than that, is our heart. Alcoa's German-born Klaus Kleinfeld, previously the head of Siemens, says: "I know the things that America has that are unique. The openness, the diversity, the dynamism--you don't have it anywhere else. If you keep all these things, build on them, I still believe in the American Dream."
So do I. How about you?
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