The lenders are not going to take any hit unless they hold the mortgages. No, they will discount them back to the government....just like before the 2008 disaster.
The people who will killed beyond belief are the dopes who buy any of this worthless paper which will be repackaged into FHA bonds. Of course when they cannot sell them to the public including mostly businesses like insurance companies, who will buy them...ahem, here comes Ben the Bandit who will gladly put them on the fed balance sheet. Meanwhile, the cycle continues, spins faster until the end is reached in one super nova of devaluation and inflation.
Remember to load up on the three most valuable metals: Gold, silver and lead.
I should be more clear. When I use the term “lenders” I don’t just mean the banks themselves ... I mean anyone who buys the mortgage-backed securities that are comprised of those loans.
A related article that deserves a thread of its’ own. Sadly I don’t know how.....http://www.bloomberg.com/news/2012-09-12/about-those-policies-that-got-us-into-this-mess-caroline-baum.html