Madison Avenue made the mortgage mess

09 May Madison Avenue made the mortgage mess

The change in thinking about homes from shelter to investment that Gene Melchionne pointed out was promoted by the marketing of financial products: unlock the equity in your home; put your home’s equity to work, screamed the ads.

Now, that equity wasn’t harming anyone, sitting there idle. In fact, as we see too vividly today, it was a sign of financial strength. But those who wanted to sell us something made idle equity a mark of financial naivete, of opportunities lost.

We are urged to make bad financial decisions every day: “Discover, when life can’t wait.” “You’re entitled …” These messages bombard us, and our children. Spend now, whether you can afford it or not. No one touts the power of saving.

I don’t really think that advertising in fact created the mortgage mess singlehandedly, but I do hold marketing responsible for changing our view of our homes in a ultimately disastrous way. A house is not a piggy bank.

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Cathy Moran, Esq.

I'm a certified specialist in bankruptcy law (California State Bar Board of Legal Specialization) practicing in the San Francisco Bay Area for more than 30 years. In addition to practicing bankruptcy law, I train new practitioners at Bankruptcy Mastery.
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