Posted on 01/27/2009 7:09:24 PM PST by ProtectOurFreedom
The Federal Reserve on Tuesday took a step toward easing mortgage foreclosures threatening millions of Americans, announcing that it would write down troubled mortgages to keep people in their homes.
Fed Chairman Ben Bernanke said the initiative would specifically include $74 billion of assets held in connection with the bailout last year of Bear Stearns and American International Group.
"The goal of the policy is to avoid preventable foreclosures on residential mortgage assets that are held, owned or controlled by a Federal Reserve Bank," he said in a letter to Rep. Barney Frank, chairman of the House of Representatives financial services committee.
The Fed was instructed by the law last year that authorized a $700 billion bank bailout with public money that it must do what it can to minimize foreclosures.
The Bear Stearns and AIG rescues were done outside of this emergency measure, and President Barack Obama has said that part of the second $350 billion tranche of the money, that was released to him by Congress earlier this month, will be used to stem the tide of foreclosures.
Private economists estimate that millions of Americans are at risk of losing their homes after the collapse of the U.S. housing market savaged house prices and forced up unemployment as the economy slid into recession at the end of 2007.
Frank, a Massachusetts Democrat, has been among U.S. lawmakers pressing the Fed and the government to do more to prevent mortgage foreclosures and he said the decision by the Fed was a "major breakthrough."
(Excerpt) Read more at news.yahoo.com ...
People did not reasonably plan against that possibility, but that's what happened.
Since you are undoubtedly in a fine financial position at the moment it's time to move into the stock market while it's bottomed out (we hope) and scoop up bargains that will make you ridiculously wealthy in a decade or so.
Free homes also known as reparations & free housing for illegal aliens.
This evil vermin are bankrupting our children and grandchildren.
Yea. I’m so glad I busted my ass and payed off my mortgage and all my other debts. If they push this too far there will be blood in the streets.
This will backfire bigtime. Watch lots of people who are struggling to pay their mortgage suddenly stop. I paid off my house last year (for the full price)—guess I’m a sucker.
>> When do I get MY piece of the pie?
Your piece of the pie is the bill. Smile! Learn to enjoy paying it. Think of how grateful all those deadbeats are that you’re covering their stupidity and incompetence.
And don’t worry — they’ve learned their lesson, they’ll never be profligate again. ;-)
The operative word here is STALL foreclosures because that is all they are doing. Their debt to income ratio is out of whack and/or they have and will continue to lose jobs.
I can’t wait for the first lawsuit where an owner held the note. They’d try to force him or her to basically give their property away. True communism doesn’t allow ownership of personal property anyway so this is just another step IMO.
The drop in value is just a paper loss unless you have to sell.
The problem isn't value, its that folks borrowed money that they had no ability to repay.
umm, could you have said —— that I think giving home loans to people who cannot afford it, sounds like a really bad idea to me? And illegals to boot, naw, I don’t think that makes good sense for the country.
If you could you would definitely not be congressional material, way to smart for that job.
If it will make you feel any better, they will bankrupt us as well. Wait until their confiscate our IRA’s, 401k’s and other retirement plans, with the promise of increasing our Social Security marginally. Then they will cut Social Security across the board, since they won't be able to afford to pay it.
Be assured though, that certain “favored classes” of people will receive various goodies (money, housing, etc) at our expense.
The unborn have a government invoice waiting for them at birth.
What about MY LOAN???!!!
WTF, I want my mortgage written down
The fed is criminal!!!!
At the same time no one plans on home property values dropping 40%, at least not in this country.
This is all of a piece with the illegal alien importation scheme. Builders found they could use cheap Mexican labor to construct homes, and did so by the millions.
The new homes undercut the value of the existing stock of homes.
We can still "punish" the builders who hired illegal alien laborers by identifying the houses so built, then burning them to the ground until we reduce the market sufficiently to bring home prices back into line with debt.
NOTE:(Henry Wallace, Secretary of Agriculture under Franklin Roosevelt, used the AAA to kill 5 million baby pigs. This is very similar to Nancy Pelosi's scheme to kill to kill 5 million baby humans to "stimulate" the economy.)
NOTE:(Just in case you thought I was not just cynically recycling New Deal stupidity ~ which I was ~ which Nancy is too, but she's Speaker of the House, and I'm not)./s
Does he mean the NEWLY ACQUIRED "residential mortgage assets" that were just bought by the Feds? Congress set it up to issue all these worthless mortgages, a few years later to buy them up, then bail out the greedy companies that under-wrote these worthless loans. Now we own the worthless mortgages AND bailed out the companies that issued them. Where is our golf vacation?
Wait?
The Fed's policies and Wall Street greed have made all of mine drop 30 - 40% in just the LAST QUARTER.
Yep, 4000 sq of home and 140 mulepower of car for everyone with an empty hand out.
These are truly astonishing times.
Whether you like it or not we are where we are.
I agree the Dems got us where we are, Bush tried to prevent problems at Fannie and Freddie, but he didn't get the job done. The Banking Queen had his way with us, and we have been sorely used. But, recriminations and complaints won't fix the mess. So, now we all have to get out of the problem together.
There are more than a few of us who have been prudent in building up our resources. But, the combination of stocks and real estate has brought us down pretty close to a dangerous point.
Now that the damage has been done, the real issue is not how should we have prevented it, but how do we get out of the depression we are in.
I would a lot rather see undeserving people get a gift from the government, even forgiveness of 50% of their mortgages, if it puts a floor under the housing market and prevents a complete collapse, than see all of us ruined.
By the way, the RATs are in charge. They are going to do it whether you, or even a whole lot of us complain. So quit wasting your energy.
Let me tell you about my plan. It is really pretty simple. Poor people are poor for reasons within themselves, conservatives know that. So what happens when the government takes out money away from us and gives it to poor people. The answer comes in two parts. First they spend it, if they saved money they wouldn't be poor. Secondly, this causes inflation.
Now, my job, and yours too, is to figure out how to take advantage of the situation and get our money back from the people it has been given to. The answer is to invest in things which poor people buy and things which will appreciate to keep up with inflation.
Whatever pittance I have left is going to go into tobacco stocks and rental real estate.
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