Readers suggested a topic on decision making. "Land of the biggie house, the biggie mortgage, the biggie vehicle, the biggie belly, and the biggie cereal box. Cereal box?"

"Yeah.. try this: Open a cereal box and remove the contents, squeeze the air out of the bag and look at what five bucks got you. Somewhere in this observation is a analogy for how we make many of our purchasing decisions. Guess what that analogy would be?"

A reply, "This morning's Dow Jones Money Report (radio) mentioned that great rooms had fallen out of favor with consumers, because they 'take up too much space.' I'm wondering if McMansions will lose more value relative to normal 3 or 4 bedroom houses as real estate prices continue to slide."

Another said, "And yet CNN is reporting today that house prices (they must mean median prices) have risen slightly!"

"Every month upbeat figures are released by this or that organization or agency, then then next month 'revised' downward. It's so regular and predictable, it has to be deliberate. Why the Press bothers reporting anything positive NAR or homebuilders say is beyond me, since it ALWAYS proves wrong.'

"Even the sales figures are baloney, since they reflect banks and mortgage companies buying back their own foreclosed or abandoned properties, often at their fake original valuations, or even higher (thus boosting that tricky median price number)."

"When Fannie and Freddy can declare losses as temporary, and avoid factually writing them down, nothing related to real estate appears to be believable, except that it isn't worth a fraction of what we're told."

The Seattle Times. "Sue Wilson was among the 3,000 laid off by Washington Mutual in December. She's had no success finding a job since."

"'It's a little scary,' she admits. 'I had recently gone part time, so I felt more vulnerable. It's worse for a lot of my friends there. ... These are people who felt they were very secure and making good money. Now they're faced with being laid off. There's not a lot out there to go after.'"

"The state lost 1,800 nonfarm payroll jobs in April, and nearly 159,000 residents are seeking work."

"Some observers to speculate that the worst of the credit crisis is over and the recession will be mild. That would bear out the 'incurable optimism' of Patsy Carmichael. Even so, in a recent interview she says with a rueful laugh, 'I'm a Realtor without clients. ... There's a bunch of buyers waiting. I say, 'What are you waiting for? It's a buyer's market.'"

"Carmichael is 75 and has been selling houses here for 20 years. With a good year in 2007 and three closings earlier this year, Carmichael considers herself fortunate."

"'A lot of agents are hurting,' she says, adding that she's grateful for her frugality."

The Philadelphia Inquirer. "We thrifty Americans should all take a bow. Our national savings rate just crept above zero, clocking in at 0.2 percent of income in the first quarter of this year, up from a goose egg at the end of last year!"

"OK, so we're not a nation of savers; at least, not anymore. Our long-term savings decline is worrisome in and of itself; many economically stressed households currently have little to fall back on. But of even greater concern are (a) our continuing dependence on debt, and (b) the sources of our more recent borrowing."

"Debt became a much larger driver of growth in the 2000s than before. Now that the main channels that financed all of that borrowing are closed, we've got some tough lessons to absorb."

"Consider this. Forever in American economics, the mantra was that "consumer spending is two-thirds of the economy." Yet, during the last decade, that share climbed to 71 percent, the highest on record, a shift equivalent to $575 billion today."

"At the same time, real incomes for most families were flat. Even though the 2000s have been a period of fast productivity growth, the nation's real median income - the income of the family smack dab in the middle of the income scale - was actually a bit lower in 2007 than in 2000."

"As incomes stagnated for many yet consumption soared, we made up the difference with borrowing. Household debt, including mortgages, just about doubled in seven short years (2000-07), from $7.4 trillion to $14.4 trillion."

"Now, with home prices once again obeying the law of gravity, millions of homes are worth less than their mortgages. At the same time, we have a fading job market and paychecks that have lagged behind inflation for the last seven months."

"In this climate, it's no surprise we're stuck borrowing from our retirement funds and our credit cards. We (not all of us, of course, but enough of us to bring down the house) bought into a bubble, felt a lot wealthier than we were, got hooked on debt, and our consumption grew untethered from our incomes."

The Dallas Morning News. "Henry Potter: Have you put any real pressure on these people of yours to pay those mortgages?"

"Peter Bailey: Times are bad, Mr. Potter. A lot of these people are out of work."

"Potter: Then foreclose!"

"Bailey: I can't do that. These families have children."

"Potter: They're not my children."

"Bailey: But they're somebody's children, Mr. Potter."

"Potter: Are you running a business or a charity ward?"

"Our current crisis was a product of the new century, a fairly conventional speculative bubble involving legislators, regulators, lenders, great financial houses and borrowers in roughly equal culpability. Under the mantra that 'housing prices in America have never gone down,' modest eligibility standards for taking out mortgages were essentially scrapped."

"Risk was 'shared' - i.e. hidden - by the relatively new process of bundling mortgages for resale to investors. As housing prices soared, the rush to get into the game produced all the usual assurances from the financial talking heads, until the inevitable collapse."

"How many of the imperiled homebuyers are actually young families with children? How many are singletons who used this speculative opportunity to jump onto the housing escalator? How many are empty-nesters who rode the bubble to move into a McMansion? How many are would-be investors looking for quick turnarounds?"

"George Bailey would surely marvel at the stupidity and greed of our current crop of great financiers, who make Mr. Potter look like a genius - even a humanitarian. He would want to see the sham geniuses and their boards of directors held personally liable to stockholders and investors. He would expect criminal fraud to be vigorously investigated as well."

"Over the long haul, George Bailey would probably try to return the housing and mortgage industries to their real purpose: providing homes to families. He would support limiting the tax deduction on home-mortgage interest to one principal residence per family."

"He might even favor a cap on the amount that could be deducted, so that only good shelter - not princely luxury - enjoyed favored tax treatment."