This story sheds some light on the sheer lunacy that takes over peoples’ minds in regards to home buying.

Although Merced has one of the highest foreclosure rates in the country, this borrower isn’t in such dire straits. She’s not even behind on her mortgage. But her oldest daughter is turning 18, which means an end to $500 a month in child support. She just wants a better deal.

The mayor hangs up and shrugs: “It’s a surprise her daughter is turning 18? You’d think she could have planned ahead.”

But hardly anyone in Merced planned very far ahead.

And then comes the usual excuse.

“Owning a home is the American dream,” says Jamie Schrole, a Merced real estate agent. “Everybody was just trying to live out their dream.”

The American dream is a worn and bullshit cliche that is used to describe high time preferences (gotta have it NOW), screwed-up priorities, and atrocious decisions based not on what is, but what people want, wish, hope it to be. People have become very good at creating a world of illusions with which to surround themselves, and they live based on some really warped perceptions of their wealth and ability to fund a high-flying lifestyle. They don’t think to tomorrow or next week, let alone 3, 5, or 10 years from now. That isn’t today, so who cares? Today I have approval for a mortgage and another newer, bigger house with the pond, waterfall, built-in Bose speakers, and custom everything, and that is what matters.

And the developers.

He was selling houses for $300,000. That means a buyer would have needed a household income of about $100,000 to comfortably make the payments. But Merced’s per capita income of $23,864 ranks among the lowest for metropolitan areas in the country. “None of us paid much attention,” Mr. Glieberman says.

When money is free and the consequences are in the future – not in the here and now – it’s easy to “not pay attention.” Now all of these pathetic gasbags are clamoring for mortgage relief (“please, I can’t afford my house!”) and government aid. Concerning Merced, CA, someone just turn off the lights and leave that place to rot. Some entrepreneur, seventy-five years from now, can turn that ghost town into a tourist attraction to explain the dynamics of the credit bubble and American foolishness at the turn of the 21st century.