Since I live in a paid-off house and don't owe a dime to anyone, I'm still okay so far.
However, it's time that we need to "think way out of the box" to solve this problem permanently. A major factor in this problem is our current income tax system--it affects ALL
your economic decisions, and some parts of the Federal tax code actually contributed mightly to the sub-prime mortgage meltdown in the first place.
It's time we ditch our income tax system and start all over again with a consumption
-based tax system such as the proposed FairTax
. Since under FairTax
there are no taxes on income, bank savings interest, dividends or even estate, it would 1) encourage Americans to actually save
money and 2) return several trillion
US dollars held by American citizens and financial companies outside the country just to avoid the IRS, which would provide a spectacular liquidity injection that would at once stop the collapse of our stock markets and provide the basis for creating new lines of credit and loans. And since there are no taxes on capital gains, interest income and dividend income, it would encourage foreigners to invest in the USA because it essentially creates the world's largest tax haven.
(getting off soapbox)