As our nation has tumbled - and, hopefully, stabilized - through this cascade failure of ethics and rampant illegalities in the housing market, my mind turns to the people most hurt in this process:

1. The remaining, decent, hard-working homeowners whose homes are SO FAR UNDERWATER that they can only be listed by Jacques Cousteau!
   • A significant number (estimated in the 20%+ range, but as HIGH AS 58% in Nevada, see chart: http://1.bp.blogspot.com/_pMscxxELHEg/SbBiutEMTvI/AAAAAAAAEts/B8th8T3WLjg/s1600-h/PercentMortgagedNegativeEquity.jpg ) are now underwater on their homes.  Yet, they pay their mortgages on time.
2. State, local and school coughers now drained from reduced property valuations/taxes and/or lost transfer taxes on the sale of real estate
3. Adults who were misled about the loans and/or the valuations on the homes they were purchasing.
   • Although I believe all adults are responsible for their actions and the contracts to which they sign their names, there are a meaningful amount of folks who get slammed with a REAM of paper at a one-hour closing and are expected to read and understand all the peculiarities/legalities of a document it took years to prepare and seconds to sign.
   • I mean, I have an MBA and I read all my loan documents - and require my lenders prepare my client packages at least three days prior to a closing for their INFORMED REVIEW. However, I am sure there is stuff I don't understand in those documents as a borrower!
4. And, yes, I will put in a plug for us Realtors®, who get stuck cleaning up others' messes and, yet, get blamed when we had NOTHING to do with the loans or the appraisals.

So, given these varied stakeholders being hurt - many having NOTHING to do with the transaction itself - I wonder aloud: Why aren't sub-prime mortgages not considered defective [bank] products? AND, why aren't their HUGE class-action suits getting fired up?

I mean,

• A Ford Pinto gets hit from behind and explodes like an artillery shell and it's a product liability issue when people are hurt.
• Lead gets into toys and it's Mattel that's taken to task for faulty products and had to pay multiple millions in civil penalties for toys it DIDN'T EVEN MANUFACTURE!!!
• Bridgestone/Firestone made tires that spontaneously disintegrate and the trial lawyers descend like flies on pooh.

So, where are the "product liability" suits from aggrieved homeowners, school districts, counties and states that lost billions in revenue from the "defective loan products" foist upon our great country?

What's the liability? Let's run some quick calculations:

Denver's median home price (SFR) is just shy of $200,000.  Let's assume this crisis has caused values uniformly across all homes in the United States of all types to drop by 5%, or $10,000.  Using that placeholder, here is the potential impact to lost equity:

1. Nationally, per American Housing Survey: 128,203,000 homes (seasonal, rental, owner occupied) x $10,000 =   $1,282,030,000,000... Nearly $1.3 trillion!
   • Source: http://www.census.gov/hhes/www/housing/ahs/ahs07/tab1a-1.pdf   
2. Colorado, per the Census (est. 2006) there were 2,094,898 housing units.  Assuming that same $10,000 of lost equity due to how bad foreclosures are, that equates to $20,948,980,000 or nearly $21 billion in lost equity just in Colorado.  

In short, this touches everyone in the country -- profoundly.  Those numbers are the size of multiple TARP programs.

So, where are the product liability suits? I can point to 100% of the remaining homeowners on any given block that are hurt from ill-conceived, manifestly corrupt loans and lending practices. 

Why aren't they suing? When will they?

I am as Conservative as they come and I am not fond of most litigation, but I wonder - again, aloud - where are the product liability lawsuits?!?!