The other shoe: $75 billion for homeowners
We ain't seen nothing yet.
We've had $787 for the stim bill, upwards of $1.5 trillion more for the banks, Detroit is asking for another $17 billion, and Obama's press secretary hinted that the stim bill was probably not enough, that another multi hundred billion dollar effort will be necessary to get our economy moving again.
Now Obama is going to take $75 billion from the original TARP and save the homes of people who made very bad choices in taking out a mortgage they couldn't afford. Or are losing their homes because they lost their jobs.
Will everyone who has lost their job now have the government guarantee their loans?
First, it is unrealistic to believe that the government will not bail out those "who bought homes they knew from the beginning they would never be able to afford." How on God's green earth are they going to determine that? How are they going to separate the idiots from the fraudsters?
The president's plan will provide for the refinancing of home loans for "millions of families in traditional mortgages who are underwater or close to it.''
It will modify loans for those "stuck'' in sub-prime mortgages that they can't afford because of soaring interest rates or "personal misfortune.'' And with federal subsidies, it will enable banks to lower interest rates for many.
The plan will assist seven to nine million families in restructuring or refinancing their mortgages to avert foreclosure, the White House says.
"It will not help speculators who took risky bets on a rising market and bought homes not to live in but to sell,'' Obama plans to say. "It will not help dishonest lenders who acted irresponsibility, distorting the facts and dismissing the fine print at the expense of buyers who didn't know better. And it will not reward folks who bought homes they knew from the beginning they would never be able to afford. In short, this plan will not save every home. ''
The plan will enable Fannie Mae and Freddie Mac, the institutions that guarantee home loans for millions, to refinance mortgages valued at more than 80 percent of the homes' values. The Treasury plans to provide up to $200 billion in capital to ensure that Fannie Mae and Freddie Mac can stabilize markets and hold loan rates down.
As for the rest, I'll believe it when I see it. How surprised would you be if ACORN got a little of this cash? More "neighborhood stabilization?"
Should we do something about the home mortgage crisis? Probably. But why does everything have to be gargantuan with this guy? You're not going to save everyone's home so why not be a lot more selective?
Meanwhile, the rest of us are footing the bill.