little fanfare, Yra Harris, a veteran trader of Chicago's pits, started
blogging his Notes From the
Underground last December. I learned about it last month from a
good friend of his, and strongly recommend it to you. Yra is a frequent
guest commentator on CNBC, and one of the smarter guys in the room.
Yesterday on CNBC's Squawk Box, Yra
commented on how BAPCPA's changes ended up screwing the banks "good and
hard." He explains that BAPCPA's anti-consumer protection features
have had the unintended consequence (see others here,
of flipping around distressed middle class America's incentives in a way that
has multiplied the banks' net consumer losses manyfold. Pre-BAPCPA,
people would file bankruptcy to keep their house and escape their credit card
debt. Now, however, people are instead paying down their credit cards at
the expense of their mortgage in order to keep their credit lines available for
the inevitable rainy day(s). Meanwhile, they live mortgage-free for 12-18
months and build up their cash reserves until they're finally forced from their
home in foreclosure.
And so, Yra concludes, the law that
has "done more harm to middle class America" than any other single
piece of consumer legislation (others concurring here)
has "flown back in the faces of the banks and slapped 'em hard,"
again proving true the old
saying, "be careful what you wish for" because, as Yra puts it,
"it'll come back at you good and hard!"
To read more bankruptcy law articles by Steve Jakubowski,
Bankruptcy Litigation Blog