This economy cannot recover if housing does not recover. Its one-sixth of the economy,
Driving housing prices down even further than current would not be helpful.
Anyone should be free to make any loan they want to anyone else at any terms which are mutually agreeable, as long as the lender is at full risk (not one penny from the taxpayers!) if that loan is not repaid.
Personally I have no confidence, NO confidence, in the ability of our government (whether Democrat or Republican) to resist the calls for a bailout of the TBTF's when the next phony crisis comes along.
So the fewer loans that get made, the fewer bad loans I'll eventually get saddled with as a taxpayer.