I can easily envision the US getting stuck with every foreclosed house in the entire country.
Then we will have two competing forces. The RATs will want to give subsidized rents to "poor people", which will result in exporting crime to the suburbs, and huge swaths of "suburban blight".
Fiscally responsible people will want to sell off the foreclosed properties and recoup as much as possible. I see an entire new bureaucracy of federal house maintainers, house sellers, house rental agents, etc. Of course, this will result in cheap houses becoming available to anyone halfway qualified, which will further knock the stuffing out of the construction industry.
Good God! The number of emotional, knee-jerk screeching monkeys in this thread are embarrassing! The Treasury is not going to pay 100 cents on the dollar for these loans. They will pay according to the quality. THE ISSUE AT HAND, BEING SOLVED, IS GETTING CAPITAL FLOWING AGAIN IN THE CAPITAL MARKETS. The institutions will be selling these bad loans to the FED/Treasury at a discounted price. I agree with Rupert Murdock that this might not wind up costing the US taxpayer anything in the long run.