Why the credit crunch is all Cindy's fault!

Carl Hiassen in today's edition of The Miami Herald:

The collapse of Wall Street and the freeze of credit markets can be traced to one unlikely culprit: Cindy Crawford.

I'm sure she didn't mean to cripple the economy. Most supermodels avoid meddling in global monetary markets, and it's unlikely that Cindy realized how much influence she commanded.

Tragically, however, the crash of 2008 can be connected to that fateful day, a few short years ago, when Cindy got into the business of designing furniture for a popular retail firm.

It wasn't long before the Crawford brand caught fire. Every time you turned on the television, there she was, languidly sprawling across one of her Microfiber Plush sofas, or carefully arranging the pastel placements on one of her cherry-veneer dining tables.

She looked great. She had style. She was also much taller than most interior designers.

And, amazingly, you could buy a whole roomful of Cindy's furniture with no down payment. Unbelievable!

More amazingly, you didn't have to start paying off the stuff for a whole year or even longer. As a result, thousands of Americans who could barely afford their car payments eagerly started purchasing Cindy's terrific furniture -- although it wasn't technically purchasing, because not much actual money was involved.

As bankers watched the Cindy phenomenon grow, they realized that the customers who were snapping up all this accessible furniture might want larger homes to put it in.

The bankers also understood that special mortgages would be necessary when dealing with folks who already needed at least a year to pay for a headboard and a nightstand.

Thus was born the concept of subprime loans, a financing ploy very similar to the one used so successfully by Cindy Crawford's furniture company.

Subprimes allowed Americans to get homes with a minimal down payment. Interest rates were extremely low, and extremely temporary. The mortgages were structured so that those rates -- and the customers' monthly nut -- would shoot up radically after a few years, yet nobody seemed worried about that.

Bankers were just tickled to be selling so many loans, real-estate agents were thrilled to be selling so many houses, and home-buyers were elated to have more rooms in which to arrange all their new (and still unpaid-for) Cindy Crawford furnishings.

The economy was booming, or so we were told. Unfortunately, at no point in this brainless orgy of lending was it required for the folks who were borrowing all that easy money to show they had the means to repay it.

Inevitably, Wall Street was smitten by the Cindy factor. Venerable institutions like Lehman Brothers bought up billions of dollars' worth of bundled subprime mortgages, on the theory that the price of real-estate would keep rising insanely until the end of time.

If some poor sucker had to default, so what? Repossess his house and sell it for a profit to some other sucker, who could then fill it with more unpaid-for furniture by Cindy Crawford.

But the Wall Street wizards who control the credit flow made a disastrous blunder. The Cindy Model of friendly finance doesn't work very well when the stakes are high.

Selling a roomful of furniture to a family that can't afford to put any cash on the table is different than selling them a house. Thousands of subprime and adjustable-rate mortgages went plummeting into default, and the rest is history.

As Congress and the White House scramble to stanch the bleeding, investor confidence remains shaky. It might be helpful if Cindy stepped forward in some dramatic way, as fellow icon Warren Buffett has done.

Here's what she should say to reassure worried Americans:

"Please don't buy any more of my elegant yet comfortable furniture unless you actually have the money to pay for it. Before coming to the store, take a close look at your bank statements to make sure you're not making an incredibly foolish mistake.

"Hey, if you can't write a personal check for that five-piece king bedroom set, then you probably shouldn't buy it. Be stylish, America, but be smart. Tomorrow will be a brighter day."

Who knows what impact such a bold speech would have on the stock markets, but I wouldn't be surprised to see an instant rebound. The financial titans who followed Cindy Crawford down the path of carefree lending will just as faithfully follow her back to the realm of fiscal prudence.

There are encouraging signs from the furniture empire for which Cindy is the marquee draw. If you ordered that five-piece king bedroom set today, you wouldn't get to wait years before making the first payment. You'd only get six months.

It looks like Cindy's getting tough.

Take heed, Mr. Treasury Secretary. The handwriting is on the wallpaper.

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