Just wonderful - the coming meltdown

A two-fer from Bloomberg. First this:

U.S. Real Estate Delinquencies Top 10% for First Time, Morgan Stanley Says
Delinquencies on commercial mortgages packaged and sold as bonds surpassed 10 percent for the first time last month, according to Morgan Stanley.

Payments more than 30 days late jumped 26 basis points to 10.15 percent in April, Morgan Stanley analysts said in a report yesterday. While the pace of increase has slowed since the middle of last year, that�s partly because delinquencies are being offset as troubled loans are resolved. The rate of borrowers missing payments for the first time has been constant for the past four months, the analysts wrote.

�The bottom line is that loan performance is not yet exhibiting significant improvement,� according to the analysts led by Richard Parkus in New York. �Many market participants have come to believe that credit deterioration is more or less over, and were caught off guard by April�s rise.�

I love the comment: "were caught off guard by April�s rise" I am not an economist but the commercial real estate bubble is pretty damn obvious to me and has been for the last two years. What are these morons smoking to only discover it now... Second this:

Banks Say Simpler Mortgage Form Could �Stifle� New Products
For Elizabeth Warren, the Obama administration adviser setting up the Consumer Financial Protection Bureau, simpler mortgage paperwork is a �regulatory sweet spot� that will cut lender costs and borrower confusion.

That view hasn�t stopped battle lines from forming around the prototype �mortgage shopping sheet� the agency is planning to publish today. Industry groups say the revisions may lead to limits on innovation and variety in lending, while consumer advocates are resisting changes that might limit borrowers� right to sue to stop a foreclosure.

Emphasis mine -- if you don't have the income to cover a mortgage, don't buy the property. It is all of these gimmick loans that caused the initial housing bubble in the first place. Are these idiots incapable of learning from history?