The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: The Reaper who wrote (169279)	12/5/2008 11:40:37 AM
From: Smiling Bob	Read Replies (1) of 306849

Haven't considered business loans, but for SFH, it seems too obvious. All plans so far require huge outlays of funds that will unlikely be recovered and mostly just create a one time or very short-lived economic stimulus. The govt can get a return of 2-4% on mortgages, which is as good or better than they're getting on 10-30 yr bonds. By sweeping all existing mortgages together, they'll acquire more quality loans and not just the weaker ones issued these past few years. Do what the MBS did, but on a much larger scale, more completely dampening the effect of the garbage. Then simply repackage them as things cool off and have banks bid on them. The alternatives to date have been worthless with very limited impact. This could likely put several hundred dollars a months directly into consumer's hands with minimal direct cost to the govt or taxpayer. The banks/current holders would either have to cooperate or suffer whatever consequences-mostly being cut off from any existing programs- if not worse. If this proposal does come up, let me know so I can dump my shorts.

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