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Politics : President Barack Obama -- Ignore unavailable to you. Want to Upgrade?

To: tejek who wrote (68841)	1/26/2010 8:10:38 PM
From: koan	Read Replies (1) \| Respond to of 149317

Here is what Stiglitz is saying. We are in a very serious recession. The fed could have sanctioned/ordered banks to refinance mortgages and help with payments and funneled part of the 14 trillion they gave to the banks through the middle class. E.g. Say a person has lived in a house for many years, has a job and good credit, but is underwater appraisal wise. That person does not want to move. Tell the banks to refinance up to 120% of appraisal at 5%. Let the the home owner refinace the first and second at 5% with little paper work. Banks get the money, home owners are helped and banks get their money. Obama did none of this. The banks do not want to refinace 8 to 10% (which most seconds are)loans with 5% loans. They want to hang on to them. So none of the banks will use easy refiancing for both first and "seconds" and Obama sat on his hands. Had he forced this on the banks it would have helped millions of middle class people and the loans would have made money as they would have been paid back. Instead the banks have used the feds 5% to add points to loans (up to 5% up front jsut for the loan) increased all rates and credit scores and as mentiond piled points on at every turn which is killing buyers and sellers. And is keeping real estate under pressure. It would have taken a fraction of the 14 trillion to do that and it would have gone to the middle class instead of bonuses.