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.
Cathy Moran, Esq.
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