More Trickle Down Economics, Exclusive Obsession With Bank Rescues, Forget About Homeowners
Bloomberg reports February 10 that Obama Is Open to Expanding Financial Rescue Plan (Update2). That would be in addition to the $350 billion more from TARP funds. Unfortunately, it would be mostly more of the same trickle down economics, obsession with bank rescues and bailing out the biggest losers only (homeowners in foreclosure), instead of a fair, effective bailout spread directly to all homeowners and all other adult citizens. It's mind boggling that by now the Democrats, who came into power with the promise to protect the middle class, haven't offered even one substantial proposal for fair substantial direct help to consumers, something like our AllStreets Bailout Plan, something other than Wall Street bailouts. So far, only the corporate elite, lending elite and investing elite are getting any protection at all, while the middle class is not only not benefited, but is expected to bear the risk of the corporate bailouts with possible future tax payments. Apparently lawmakers think that the middle class will be content to cheer the latest trickle down economics plan, the new stimulus bill, with $400 or $800 dollar tax credits, or will believe that the government saving lenders with their tax dollars somehow benefits them by merely preserving the vague possibility of access sometime in the future to new loans.
It's also hard to believe that none of the economists, investment gurus, Wall Street finance geniuses or mortgage industry experts, seem to have proposed anything like the AllStreets Bailout. It doesn't take a rocket scientist to realize that saving lenders and investors only won't solve the mortgage crisis for homeowners and therefore won't save the economy. Isn't it obvious that mortgage principals must be reduced somehow to save the housing market? It seems obvious to me that the answer is direct federal loans split between homeowners and lenders to relieve excess mortgage debt. Certainly there's no way to quickly restore previous peak values to homes. The lawmakers' and regulators' obsessions with bank bailouts instead of consumer debt relief utterly fails to address the critical underlying problem and won't work to stop the slide into an economic depression. The All Streets Bailout Plan would restore health to most lenders and consumers at the same time, would be fair to all Americans, and would also restore value and liquidity to mortgage debt securities without having to deal with them directly in any way.
It's also hard to believe that none of the economists, investment gurus, Wall Street finance geniuses or mortgage industry experts, seem to have proposed anything like the AllStreets Bailout. It doesn't take a rocket scientist to realize that saving lenders and investors only won't solve the mortgage crisis for homeowners and therefore won't save the economy. Isn't it obvious that mortgage principals must be reduced somehow to save the housing market? It seems obvious to me that the answer is direct federal loans split between homeowners and lenders to relieve excess mortgage debt. Certainly there's no way to quickly restore previous peak values to homes. The lawmakers' and regulators' obsessions with bank bailouts instead of consumer debt relief utterly fails to address the critical underlying problem and won't work to stop the slide into an economic depression. The All Streets Bailout Plan would restore health to most lenders and consumers at the same time, would be fair to all Americans, and would also restore value and liquidity to mortgage debt securities without having to deal with them directly in any way.
Posted by The Mortgage News at 2/10/2009 8:29 AM 
Categories: bank bailout, Housing Values, Main Street bailout, Credit Crisis, foreclosure crisis, Wall Street bailout, AllStreets Bailout Plan, upside-down properties, government bailouts, economic stimulus, mortgage modification, mortgage crisis
Categories: bank bailout, Housing Values, Main Street bailout, Credit Crisis, foreclosure crisis, Wall Street bailout, AllStreets Bailout Plan, upside-down properties, government bailouts, economic stimulus, mortgage modification, mortgage crisis
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