Via Atrios the Wall St. Journal reports that the mortgage crisis has just begun, with a wave of interest rate resets coming in 2008, which will combine with foreclosures depressing prices to create a very unhappy situation.
It is worth remembering, at this point, that this mortgage banking crisis is the direct result of bad policy, of not regulating the banks to prevent their predatory and profligate lending.
The economy -- the Bush economy -- is falling to the mat. It is not a knockout, I think. But, it is the economic downturn, which will motivate an increasing political storm.