Buried in a Washington Post article:
90 percent of all new home loans are funded or guaranteed by taxpayers
taxpayers are on the hook for most of the loans that are still being made if they go bad. And they are also on the line for any losses in the massive portfolios of old loans at Fannie Mae and Freddie Mac, which own or back more than $5 trillion in mortgages.
Gets better. WaPo is reporting a high risk of default (Are we surprised with a 9.7% official unemployment rate?)
There is growing evidence that many loans being guaranteed by the government have a significant risk of defaulting. Delinquencies are spiking. And the Federal Housing Administration, another source of government support for home loans, is quickly eating through its financial cushion as losses mount.
Finally look at the money WaPo is pointing to that has been poured into the mortgage market (versus the Zombie banks):
The outlay has already reached about $1 trillion over the past year and is rising. During that time, the government has pumped more money into the mortgage market than has been spent on Medicare or Social Security or the defense budget, more even than Washington has paid to bail out banks and other struggling companies.
This is a statistic that is good news really:
Nearly one-third of those who obtained home loans during the boom years of 2005 and 2006 couldn't get one today, according to mortgage industry analysts.
Do we really want loans given to people making $9/hr for a $400k property?
But one must ask themselves what is this doing to home prices and with more and more Americans simply unable to pay the bills...maybe the ultimate housing program is a jobs program.
Ya know, that word we're always talking about on this site. Income.
Obama hearts the 'Neo-liberal' Economic Growth Model
Instead of attacking the serious structural problems the Obama Administration has chosen to maintain the status-quo by re-inflating the bubble.
Our economy faces significant structural defects that required progressive and significant changes to it. Obama Administration, as with most of its proposals, has chosen not to lead but to part of problem in Washington - the endorsement of the 'neo-liberal' economic growth model.
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why we're here and econ/stats/policy focused
I agree with that but if we get real policy change, don't forget to "be nice". ;)
I won't forget to be nice if we get real policy change.
But as of right now the record is not good. I am trying to find some quotes but Leo Hindery's article suggests that there are people in the Administration that believe that service sector jobs are just as good as manufacturing jobs. Who could that be? Larry Summers?
This is beyond politics. This about survival of a huge segment of our population.
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that's one of the functions of EP
and also why it's nonpartisan. So, firstly we can go by facts instead of philosophies but also so you don't have to join in any cheerleading rah, rah, even econ rah rah and keep plugging away for good policy.
I think though, a key is to get very specific.
For example, there is a "dead" bill, these are bills that are great ideas and get dumped into committee where they die.
One is for a Congressional trade office, another, Dorgan is to have an automatic review of trade policy the minute the trade deficit reaches > 5% (as I recall this was the last number) of GDP.
Isn't this the problem generally? Take the health care bill(s)? No one knows what's really in them, so you get people criticizing with generalities instead of very specific pieces of legislation, specific bill clauses and specific ramifications?
Now that is one aspect of this site I hope to promote, which is to get that focus onto specifics..
so instead of "that sucks" or "rape of middle class", you have "credit card companies still can charge loan shark rates, unlimited, reform bill did nothing to cap interest rates on unsecuritized debt"
It's really important because without specifics there is nothing the public can grab onto to write their legislators about, demand that it get passed, demand it be stopped.
Instead you get defocused, generalized rage and anger(which is clearly bubbling intensely now).
As Bill Moyers said last Friday's show:
In the context of health care reform:
Transcript
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