>This highlights my point concerning the unequal access and cost of consumer credit;
>refinancing is only available to homeowners with acceptable credit histories and/or
>equity. Like stock ownership, the article ignores the strapped social groups that
>are rentors and young households with little equity in homes.
In the WSJ article, none of the families mentioned had incomes of less than about 80k,
which would bear out your point.
I wrote to the guys who recently did the study of the "wealth effect" of the stock
market on consumption and saving. They couldn't explain why, if the lower 80% of
households acquired financial liabilities *faster* than the top 80% (whose savings
rates, they argue, had plummetted and been entirely responsible for the US negative
savings), their savings rates didn't fall. Their theory about this was that the
increase in homeownership among these households had increased saving thru
downpayments. But they didn't at all consider how equity values differ for different
income/homeownership classes.
Christian
