Foreclosure and the market

Almost all of the government intervention into the real estate business has been ineffectual. No news there really since they are unable to understand business of any type and make a mess of anything they touch. "They" being legislators and bureaucrats alike. Individually and collectively their need for power and control and unremitting greed drive them to confound the performance of the free market, cause and exacerbate economic problems, and enrich themselves. Dodd, Frank, Obama when a Senator, were recipients of the lion's share of gratuities from Fannie Mae, Freddie Mac, and major financial institutions, and they are still driving legislation to further enrich their friends. Frank recently called for major investors in Home Equity credit lines and other secondary mortgage financing to reduce the principal balances on these loans to benefit troubled borrowers. Such loans make up billions of dollars of highly toxic assets for these institutions and their write-down would be calamitous for their balance sheets. While one would expect the institutions to resist this encroachment on their business, quite the opposite is true. They welcome with enthusiasm this government directive, saying they welcome the opportunity for "guidance" from the government, meaning no doubt, a government plan to once more bail them out of their bad debt and remove one more more hazard of their unconscionable risk taking. This likely reach into the taxpayer pocket for the benefit of banker friends one more time is simply the continuing cronyism of politicians with their supporters. Color me suspicious, but I think Frank had discussions with his friends long before he floated this notion so that it would appear to be an economic necessity rather than another helping hand for friends of those in high places. One article is here, another is here.
This is the same Barney Frank who recently warned that investors in Freddie and Fannie are likely to take a severe hit because of their losses, despite his protestations not that many months ago that there was no possibility of a loss by these institutions. Letting these clowns play with our money is a very expensive proposition, and they seem immune to punishment for their cavalier disregard for truth, ethics, and honesty.
Foreclosures are continuing, home prices continue to fall, the government continues out of control and the HOPE & CHANGE we're now looking for is a return to republican principles. That's a small "r", so no one is offended.

As usual,
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