Mortgage Slaves—You're the One Who Was Stupid, and Now You Come Out to Embarrass Yourselves? Have You No Shame?!

2006/5/13 18:30:03

These past two days, all the media have essentially been holding a "Stupidity Contest." One moment it's some so-called master who mispronounces characters, the next it's a rock-and-roll old man throwing a tantrum after getting dumped by yet another woman. But what they've been talking about the most is probably the so-called "mortgage slaves." There's no classic definition of what a mortgage slave actually is—roughly speaking, it's the kind of fool who speculates in stocks and ends up becoming a shareholder. These people fundamentally don't deserve sympathy. You're the one who was stupid, and now you come out to embarrass yourselves—have you no shame?!

These people basically share the following traits: they squeeze their pointy heads into so-called big cities, they indulge in vanity with premature consumption, and when their speculation fails they throw tantrums. These loudest-screaming so-called mortgage slaves are not poor people at all. Truly poor people would never even dream of buying a house. Truly poor people couldn't afford a house even if prices dropped 70%. These so-called mortgage slaves are nothing but white-collar types and petty bourgeois—a bunch of good-for-nothings who gloat when they profit and blame heaven and earth when their calculations go wrong!

Taking out a mortgage to buy a house is your own choice. Mortgage buyers are the same the world over; China is nothing special in this regard. A market economy means that every market action carries risk. Just as stock market investors must know that markets carry risk and that risk is self-borne, the same applies to mortgage home purchases. If your calculations go wrong, it's like getting trapped in a stock position—you deserve it. If you can't afford a house, don't buy one, or buy what you can afford—that's the most basic principle. If you want zero risk, pay in full. As for real estate speculators who get stuck—they deserve every bit of it!

Let me be quite frank: although this ID has many friends in real estate, I've never dabbled in real estate myself—compared to futures and stocks, making money and cashing out in real estate is far too slow. Although I've purchased properties in several major cities, every time it was paid in full. Moreover, since 2003 I've never had any desire to buy more property, and I certainly don't speculate in real estate. Therefore, this ID can at least look at this matter objectively and fairly from an interest standpoint. Here's the truth: the current rise in real estate prices is the combined result of social transformation and major shifts in the global economy.

First, due to globalization, resource prices inevitably tend to converge worldwide. Currently, with major shifts in the global economy, resource prices are surging globally. In a sense, housing prices have risen the least—just look at non-ferrous metals, crude oil, and so on. Moreover, China's resource prices under the former economic system were generally lower than world prices. Under this dual pressure, strong upward momentum is perfectly normal.

Second, due to strong expectations of RMB appreciation, RMB-denominated assets have become the target of massive global speculative capital. This point was extensively discussed in this ID's famous online essay strongly opposing RMB appreciation from several years ago. Now that the door to RMB appreciation has been opened, one must naturally face the consequences—what is there even to talk about? Furthermore, this trend has only just begun to take effect. The truly fierce impact is still ahead—anyone with a shred of economic common sense can see this clearly.

Finally, the government, as with the stock market before, has enormous problems with its real estate policies. Solving this problem requires a great transformation of the same magnitude as what began in the stock market last year. Hopefully, the lessons from the stock market experience can be well summarized and then applied to real estate and other areas. This is probably the only thing the government can and should do.

Today's mortgage slaves are like the bulls during last year's stock market decline, trying to coerce the government into footing the bill for their own stupidity—not a chance! The mass media's sensationalization of this issue, besides exposing their own stupidity and ridiculousness equal to that of the mortgage slaves, is also a manifestation of their scavenger nature. And when certain foreign media join in, the ulterior motives become even more apparent and warrant vigilance!