Below is another of the many letters I received in response to my recent commentary on the decline in mortgage-lending standards. It's impossible to know how many Americans fear that a housing bust is imminent, but judging from my mail such fears run deep. The letter is from a man in the lending business whom I quoted here earlier. In further recounting his apprenticeship in the mortgage business under Golden West Financial's Herb and Marion Sandler, he has provided us with a benchmark against which we can measure the egregious slippage in lending practices that has occurred since. I am eager to put it all on-the-record because I'm firmly convinced that a deflationary collapse in real estate lies ahead. Our correspondent writes as follows: 'I [have believed since around 1990] that the real estate market could not continue in its present course without a major meltdown. I developed analytical software and spreadsheets during my time at World Mortgage, and I saw the Meltdown of 1990 happen. We had 13 people in the Atlanta office, and one day a regional manager came in to let us all know that we were all laid off. I had just walked into the office with a new loan package when I was greeted at the door by my manager. Everyone in the office had that hung dog look on their faces. 'A.H. Ahmanson, one of our two portfolio competitors, had closed their office the month before, and that left only two portfolio lenders with offices in Atlanta -- Great Western and ourselves. World had an economist do a study on the Atlanta market to determine if it was wise to continue lending in that marketplace, and the conclusion was as follows: ** The second highest bad credit district in the nation. We were the
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