In the Personal Journal section of today's Wall Street Journal there are several articles relating to housing and there is a front page article on household debt. Each of these three articles are related in one way or the other... The first article "Lagging behind the wealthy, many use debt to catch up" discusses the widening gap between the rate that real incomes are growing and the increasing level of household debt. Their figures indicate that incomes only rose an inflation adjusted 11% since 1990 where household debt levels have risen more than 80%. This growth rate is driven, in large part, by the increasing prelevence of Adjustable Rate Mortgages and easy access to credit. The second article, titled "Concerns Mount about ARMs" discusses economist's concerns about Interest Only and Adjustable Rate mortgages, given that these have rapidly become the most popular mortgage options, particluarly in southern California, where only 18% of the population can afford a traditional 30 year fixed mortgage. These mortgage options allow homebuyers to purchase more house because the payments are lower. This article was of particular interest to me since I just purchased a home with an Interest only, Adjustable rate mortgage -- though the mortgages that they seemed to be most concerned about were ARMs with a fixed period of less than 3 years, particularly the ones with a 6 month fixed period. Both of these articles really hammered on the thought that American households were not paying enough attentionto the amount of debt that they were racking up; instead of using debt as an income leveling tool they began to see it as income itself. A very dangerous trap indeed. Among the reasons cited for this change was that Americans tend to look at being poor as if it were some sort of moral failure. The unspoken comment seems to be "they wouldn't be poor if they didn't {insert here}". This creates a good deal of social pressure for people to purchase more than they can afford and trying to live a lifestyle that's not supported by their income.