Posted on 08/05/2010 9:53:06 AM PDT by Qbert
Main Street may be about to get its own gigantic bailout. Rumors are running wild from Washington to Wall Street that the Obama administration is about to order government-controlled lenders Fannie Mae and Freddie Mac to forgive a portion of the mortgage debt of millions of Americans who owe more than what their homes are worth. An estimated 15 million U.S. mortgages – one in five – are underwater with negative equity of some $800 billion. Recall that on Christmas Eve 2009, the Treasury Department waived a $400 billion limit on financial assistance to Fannie and Freddie, pledging unlimited help. The actual vehicle for the bailout could be the Bush-era Home Affordable Refinance Program, or HARP, a sister program to Obama’s loan modification effort. HARP was just extended through June 30, 2011.
The move, if it happens, would be a stunning political and economic bombshell less than 100 days before a midterm election in which Democrats are currently expected to suffer massive, if not historic losses. The key date to watch is August 17 when the Treasury Department holds a much-hyped meeting on the future of Fannie and Freddie. A few key points:
1) Republican leaders believe this is going to happen since GOPers and Democratic moderates in the Senate are unwilling to spend more taxpayer money on more stimulus. But such a housing plan would allow the White House to sidestep congressional objections and show voters it is doing something tangible about an economy that seems to be weakening.
2) Wall Street banks are alerting their clients privately to this possibility. Here is what some are cautiously saying publicly. This from Goldman Sachs:
(Excerpt) Read more at blogs.reuters.com ...
The FRench overthrew their gubamint for far less..
Maybe Michelle should consider just staying in Spain.
She’ll be sending us cake!
Bread and Circuses - Obama style.
How will he pay for it? By ending the Bush tax cuts of course.
All of us who kept up our mortgages can move into the line marked “sap.”
I knew he’d be doing some sort of government largesse giveaway before the election to try to buy off the ignorant masses.
I don’t think it’ll work, though.
You have got to be kidding...
Sap. Just like all the people that came to this country LEGALLY. Maybe ‘chump’ could be a sub-category...
She’s in Spain?
“Let’s hear it for the Rainbow Tour! It’s been an incredible success...”
I hope they run this by Frank Santelli.
So the guy that took out the second mortgage to pay for say a BMW, outside kitchen, or daughter’s lavish wedding wins.
The guy that played by the rules and experienced non of this, well; loses by opportunity cost. Would this bailout grant these frugal persons a cash reward for this opportunity cost?
Not called as such, but this is another segment of REPARATIONS.
It would be so tempting to think that they couldn't possibly be brazen enough to try this. But that would be to remain in denial.
I don’t think this would be wise politically even for The One.
People have had it. If he pulls this, all bets are off.
Dow 1000 coming right up!
I would have brought a house I couldn’t afford if I knew the gubmint was going to forgive my loan. Dang - I miss out on all the good stuff!
Won’t work.
Dems are toast.
America has seen the naked HATE,Anti-Semitism, Anti-Capitalism and RACISM from the White House and Dems....
If Jesus had as many “czars” as King Obama does, he’d be almost as powerful.
If more irresponsible spending and more unsustainable debt gets enough votes for the Democrats to protect their congressional majorities, it will prove that America is irrevocably on the suicidal path to economic collapse.
The Era of Irresponsibility continues forward.
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