Thursday, December 6, 2007
I don't know about you, but I have my suspicions about the mortgage interest rate freeze/bailout plan announced today by President Bush. If you lived through the savings and loan crisis of the 1980s, in which financial institutions squandered billions of dollars that taxpayers had to pay back, you know that some folks in the mortgage industry stand to make a lot of dough -- probably at taxpayers' expense. It's too early now to see how that will play out -- and, for one thing, the plan announced today is voluntary -- but rest assured, the fix is in. In addition, while it seems positive that the president has heard the people in danger of losing their homes, the new plan does not offer help to homeowners already behind on their mortgage payments. Hello? That seems only to help lending institutions that have already extended credit backed by the endangered mortgages and will face multiplying losses if hundreds of thousands of more loans go delinquent. Ronald Reagan was president in the years of excess leading up to the S&L crisis, but President Bush's father was president during the bailout.