Where'd the money go? If the heart of the crisis is based on mortgage failures that happened when too many people were allowed to borrow more than they could repay on a house that is now worth less than they paid, I'd like to know what happened to the money? Each of those failed mortgages represents a big payday for someone, the seller of the house in question. So, what did they do with that money? Did they lose it in the stock market? Did they turn around and buy another house at inflated values, only to see it disappear in today's market?
In reply, I can add what happened to one individual transaction. My dad's house was sold last year, and we probably caught it at the height of the market. The proceeds of that one sale was rolled into his estate, which was distributed among 7 children. It was a nice little windfall for each of us, but hardly a life-changing event. So in that one case, the estate was diluted by the distribution. I suspect in most cases, the net proceeds from the sale went to one individual or company. If anyone is aware of any reports or research on this question, I'd love to hear about it. :-{)}
