In the immortal words of the late great Ed Hart: "Equity is freedom." He said that while talking about people who were doing 2nd mortgages to take out the equity in their homes back in the early 90s, (which was a kind of dress rehearsal for today's economy) like, as he put it, "they were afraid of their neighbors doing an LBO on their house."
There is only about ~900 billion paper and coin dollars. There is about ~14 trillion dollars worth of credit supplied by banks. There is about ~55 trillion dollars in total debt, again, supplied by banks. What backs the dollar is the faith that the 14 trillion dollars will some day pay the 55 trillion dollars off. Looks like US is operating a Ponzi/Pyramid/Heads I win Tails You lose scam on global scale since Nixon Shock.
another deceiving statistic. The reason home equity is rising is because short sales and foreclosures are taking homes with negative equity out of the equation. Suppose you have two homes, one with -$100,000 equity and the other with +$200,000 equity, and suppose the one with negative equity is foreclosed on. Guess what? The total equity just rose by 100%.
paying down a mortgage is for people who don't have a clue how to invest money. I can't believe on a board with supposedly savvy investors/traders, anyone would want to pay down a 2.8% loan. Really, aren't you smart enough to find something that has a better return? This is what i'd expect on a Suze orman forum, not ELITE trader
Here's another stat Americans saw wealth plummet 40 percent from 2007 to 2010, Federal Reserve says http://www.washingtonpost.com/busin...d-40-percent/2012/06/11/gJQAlIsCVV_story.html
that's what we all use to think in 1999. Some of those forclosed houses are the result of refinancing and putting it all in the stockmarlet.