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Old 11-06-2010, 04:28 PM
 
Location: Sputnik Planitia
6,996 posts, read 9,776,222 times
Reputation: 7709
Fed's $600bn gamble risks throwing away America's biggest asset - Telegraph

Good read! Enjoy
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Old 11-07-2010, 06:02 AM
 
Location: Central CT, sometimes NH.
3,749 posts, read 5,592,156 times
Reputation: 4127
QE is not the answer. The Fed should be telegraphing their plan to raise interest rates not keep them artificially low.

Forget the failed plan to restructure mortgages with troubled borrowers. It does nothing to instill confidence as many of the restructured loans end up defaulting anyway. The whole process puts a sour taste in the mouths of responsible borrowers who continue to pay their mortgage even if their home is underwater. BTW many are underwater because of the large number of people walking away from their homes.

It's time to put a resoultion trust in place and clear the inventory. Next, require borrowers to put some skin in the game with minimum downpayment requirements (10% min, 20% preferred). Lenders should be required to hold mortgages for a defined period of time (3 to 5 years). No borrowing downpayments, no 125% of equity, and no passing the hot potatoes to Fannie and Freddie before the ink is dried on the documents.

With more secure bank assets and higher interest rates, responsible people who saved their money will be able to get a decent return on their life savings and not be a drain on social welfare programs as they enter retirement.

Enough with free money, complicated/manipulative financial instruments, and ever expanding entitlement programs, let level heads prevail!
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