Monday, March 03, 2008

What to do about sub prime mortgages in foreclosure

The mortgage market is, as we all know now, in a Hell of a Mess. Not only are the still unknown and growing character and level of problems growing and adversely effecting the American and the world economies, people are getting evicted from their homes (So?) and worse, bankers are losing big money (oh the horror!) The Federal Reserve bankers and the government's economic experts are trying to protect the economy, the mortgage bankers and their lenders are trying to stem their (self-inflicted) losses, and a lot of people who thought they owned their home are trying to figure out how to keep it.

Here are two interesting articles on the subject, one from the point of view of the home owners and one from the point of view of the mortgage bankers who are trying to get the government to bail them out of the results of their poor judgment.

As we watch this crisis slowly play out, let's keep in mind who brought it to us. To that list of luminaries, we can add the Bush administration's mismanagement of its voluntary and unnecessary war in Iraq, at least according to Professor Stiglitz and another Clinton administration economist, Linda Bilmes, in their just published book, The Three Trillion Dollar War, which pulls together their research on the true cost of the war.

There are some borrowers who bought into deals that were too good to be true. The real blame belongs to the bankers and lenders who (according to their own statements when trying to prevent regulations on their industry) are sufficiently sophisticated to understand the risk they took, and worse, Alan Greenspan who was knowingly manipulating the economy to pay for an unforgivable war. They share the blame with the idiots in the Bush administration who refused to listen to experience when they invaded Iraq.

For the combined arrogant greed of the bankers and lenders and the stupidity of the self-blinding politicians and the people who put them in office, we all will be paying for the next century.

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