The truth about foreclosures on homes is that they are increasing and it isn't surprising. For some time the press had been predicting that cash-strapped homeowners would abandon their abodes as their adjustable mortgages were suddenly recalculated to reflect their true costs. But you have to wonder just when a trickle becomes a torrent, when the social sanctions associated with losing one's home, with giving-up on one's debt obligation, morphs from being barely permissible, to acceptable, to trendy, and ultimately, it may seem "only natural." Certainly, many people are being priced out of their homes, but there are others who see this as a chance to swim away from a sinking ship.
For them, this perfect storm looks like an economic opportunity, a chance to hit the reset button of their fortunes. The "tipping point" is a theory about foreclosures that says trends start slowly and then, at a magical moment, they accelerate and become ubiquitous.
As an analogy about foreclosures, an infectious virus is limited in scope, but then it suddenly breaks through and becomes an epidemic. Just published research indicates that swarms of ants, locusts, animals, and even humans behave in rather similar ways.
They exhibit independent behavior, but then, when their numbers increase in circumscribed areas, they suddenly behave like an army. Banks and other lending institutions are taking a hit now as their stock prices suffer while management recalculates the values about foreclosures and risks in their mortgage portfolios. One trick may be to openly and vigorously buck the trend, by urging people to keep their homes at any cost, to explain that because a behavior about foreclosures becomes more common, it doesn't become more desirable. But they had better start this propaganda campaign now, provided they hope it will take hold later, and benefit from its own tipping point.
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