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Any structure in which there is a high degree of leverage wipes out all of the equity very very fast when absolute prices roll back.

Allowing banks to make loans to unqualified people is the root of the housing bubble mess.  Throw gasoline on the fire in the form of back end loaded re-payments and you get a conflagration.  

by HiD on Sat Jul 12th, 2008 at 07:50:26 PM EST
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