The housing bubble was one for the ages. We’ve all heard stories of one kind or another… There was the glass cutter who earned $5,000 per month, pretax. WaMu gave him a $615,000 home loan with payments of $3,600 per month.

No Credit… No License… No History? No Problem? Even before our current mortgage meltdown, most banks would never touch a prospective customer with any one of the above issues, let alone all three. But there’s one bank in a quiet little corner of Pennsylvania that’s made thousands of loans – all to customers who have no credit history, zero credit scores, no drivers license and nothing beyond an eighth grade education.

There’s been a return to risk aversion overnight, as some news from the United Kingdom has reignited the fears that the banks may still be sitting on a ton of bad debt… Of course, as Pfennig readers, you already know this…

Late credit card payments and outright defaults have soared in recent weeks. The most recent data says that “dead” balances written-off as uncollectible by banks have jumped 24% from a year ago. Late payments are up 16%. Can this be linked to the subprime mortgage meltdown? Our research says it is.

Seems the markets are getting all pumped up on the Kool-Aid Big Ben is serving up… But these are just words folks… We’ll see who’s right and who’s wrong on this… His track record isn’t so good!