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Yes, and so long as the asset owners have :
  1. the ability to pay the interest, and
  2. are not in negative equity
those asset guarantees will not be called in.

But it is the market perception that is important here.  As "market" prices continue to fall, more asset owners either can't or don't want to service debts on property now worth less than the loan - so they hand back the keys to the property.  And the more that do this, the further prices fall, and the more people hand back their keys...

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Sep 17th, 2009 at 05:25:01 AM EST
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