This bears little resemblance to today. The quality of borrowers is much higher; debt-to-income ratios are much lower; if anything, the banks have tightened too much, denying credit to borrowers who would meet traditional lending standards.
The simple ability of the average American to service their debt is nothing like it was a decade ago.
But as long as too many pundits and commentators are unwilling or unable to master the basics of economic context and simple math, we’re doomed to these predictable episodes of hand-wringing.
This column was provided by Bloomberg News.