It’s official - the world is ending. Just kidding, but financial reports have one executive after another echoing reports of a credit crunch, irresponsible lending, real estate bubbles, and other such fire and brimstone. Personally, I’m still not worried - I’m in it for the long-term and I have no ARMs resetting anytime soon…caveat - I actually do have one, but it’s limited to an increase of 2%, which will take it to 6.125% in August. I think I can handle that. The “service” guy at Wells Fargo had the audacity to suggest a refinance at 6.6%. Uh, yeah, I’m going to have to pass on that one for now.

Anyway, on to the point of this post. Wait, you have a point, Matt? Yes, smartasses, I do…

I read on Bloomberg recently that Bank of America Corp. CEO Ken Lewis is talking about a “credit bubble”, and specifically about the fact that it’s going to burst after six years of “relaxed” lending criteria. By relaxed, I took Ken to mean “we and other financial institutions have been lending money to anyone who asks for it, and brokers especially have been happy to peddle loans like they’re candy to make loads of money and become millionaires for being glorified paper-pushers”. That’s not overly harsh, is it? Ok, ok, I know there are some bright mortgage brokers out there. Hell, I work with one (he knows who he is), but there are many who are not so scrupulous as my guy.

Anyway, Ken goes on to say:

“We are close to a time when we’ll look back and say we did some stupid things,” Lewis said, speaking at a lunch at the Swiss-American Chamber of Commerce in Zurich. “We need a little more sanity in a period in which everyone feels invincible and thinks this is different.”

Good call Ken, but don’t throw the baby out with the bathwater. In short - us folks with good credit and sound business plans for commercial investments? You remember us, right? Yeah…give us the good loans. The Glengarry loans…

Tags: adjustable rate mortgage, bloomberg, credit bubble, wells fargo

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