We may never fully recover from the last round of risky lending and we are trying to cook up some more when all the foreclosures are still sitting on the books, The financial mess we are creating is increasing the divide and I fear it may never be bridged with these financial strategies.

As the credit crisis recedes and underwriting standards begin to loosen, bonds backed by consumer debt such as auto loans, credit card payments, and student loans are becoming increasingly risky, Moody's said last week.
Relaxed underwriting standards, more complex structures, and new untested market participants are just three of the trends suggesting that risk is on the rise for some sectors of the asset-backed securities market, Moody's said in a report.

Even in the residential mortgage sector, which has not seen a significant return of private-label securitization, riskier non-prime, non-traditional mortgage originations are appearing.

While the economy needs the spending if we are lending to those with the highest likelihood of default it will hurt us all long term. Where is the upside for the economy when businesses can't get paid?