Let's even out the money. Pay each US household $10,000 (or each federal-taxpaying household $15k) and let the chips fall where they may.

I have an idea. Let's have the Federal government take those subprime mortgages off the hands of the banks. The government takes over the housing inventory. Instead of fire sales, it immediately places a 10% premium on every property in its inventory. As a result, all property values are forced up.

Then, the Federal government does what it should have done in the beginning. It begins criminal investigations of the banking and mortgage industries. No golden parachutes. No investor windfalls. None of it. Just prison.

WashingToneLocian Wrote:
-------------------------------------------------------
> I have an idea. Let's have the Federal government
> take those subprime mortgages off the hands of the
> banks. The government takes over the housing
> inventory. Instead of fire sales, it immediately
> places a 10% premium on every property in its
> inventory. As a result, all property values are
> forced up.
>
> Then, the Federal government does what it should
> have done in the beginning. It begins criminal
> investigations of the banking and mortgage
> industries. No golden parachutes. No investor
> windfalls. None of it. Just prison.


That's a great idea, if the citizens had control over their government.

But the people you're talking about investigating are the ones who control our government.

It's funny how the administration expects fast, expensive action from Congress this time around, just like it got 5 years ago for action in Iraq.

It's good to see Congress is thinking this one through.

WashingToneLocian Wrote:
-------------------------------------------------------
> Instead of fire sales, it immediately
> places a 10% premium on every property in its
> inventory. As a result, all property values are
> forced up.

The property _price_ would be pushed up, but not the value. There are two sides to every transaction... artificially inflating a price will just result in loss of demand and some of those houses would sit when they otherwise would have been sold. I assume the feds would then be on the hook for things like real estate taxes, so houses sitting empty cost money. Better to support the credit markets and let the system repair itself.

pgens Wrote:
-------------------------------------------------------
> WashingToneLocian Wrote:
> --------------------------------------------------
> -----
> > Instead of fire sales, it immediately
> > places a 10% premium on every property in its
> > inventory. As a result, all property values are
> > forced up.
>
> The property _price_ would be pushed up, but not
> the value. There are two sides to every
> transaction... artificially inflating a price will
> just result in loss of demand and some of those
> houses would sit when they otherwise would have
> been sold. I assume the feds would then be on the
> hook for things like real estate taxes, so houses
> sitting empty cost money. Better to support the
> credit markets and let the system repair itself.

The houses are sitting on the market anyway. If the Feds push up the price of the inventory under their control, this will result in other homeowners being able to sell their homes and get out from under their bad loans. As overall inventories tighten, demand will rise to meet the Fed price premium. I realize this isn't a free-market solution, but neither is bailing out the banks.

i say we just kill the deadbeats who didnt even try pay off the loans they took. i mean, what happened to personal responsibility? everyone is a victim!


"the wisdom of the wise will perish, the intelligence of the intelligent will vanish."