Another Dumb Solution by the New York Times
October 28, 2007
Moving Ahead on Mortgages
There have now been two “drumroll please” rollouts of plans to help rescue the economy from the worst effects of the housing bust. Each has only raised more questions about the best way to move forward.
Countrywide, the nation’s largest mortgage lender, pledged to help some 80,000 borrowers, and potentially many more, restructure their mortgages to avoid foreclosure. Countrywide seems to envision a loan-by-loan process, however, which would be too slow to keep up with imminent defaults and could all too easily result in inconsistent treatment of borrowers.
The Treasury Department has blessed a plan by Citigroup, Bank of America and JPMorgan Chase to form a fund to buy some mortgage-related assets. Banks could avoid having to sell those assets at fire-sale prices and avert losses that could tighten credit for everyone. But the banks seem to be having trouble raising money for the fund. Mortgage-backed investments don’t seem so enticing when more foreclosures are coming.
Why is the NYTimes frantic about saving greedy borrowers and lenders, but disinterested in uninsured kids?
Their self-serving editorial promoting a bail out of Wall Street under the guise of saving 1.5 million foreclosures makes no sense.
They wail that a recession may follow if Henry Paulson (Treasury Sec) doesn't keep market greed from being punished by market corrections.
A 'protected' market is no market at all, it is what we call a 'scam.'
Let the market correct,
let the recession come,
it's a long time overdue.
Let the games begin.
Meanwhile, in the same neighborhoods where many of those foreclosures may take place, a more likely and far more damaging imbalance is in the making. 47 million Americans face bankruptcy or the loss of their homes if a major illness or accident occurs in their families.
The NYTimes could care less. Those 47 million are mostly not their readers and the companies who so profitably avoid insuring are quiet as mice.