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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Broken_Clock who wrote (285239)	10/20/2010 7:36:54 PM
From: Giordano Bruno	Read Replies (1) \| Respond to of 306849

Getting Real About Real Estate ...AM: At this point I would judge every event and every news story that you see by just one criterion, and that is that the government is doing everything it can to slow down or impede the foreclosure process. So whether the president signs something or doesn’t sign something, or says something or doesn’t say something, the intent is to do whatever it takes to impede or slow down this crisis. If there are losses to mortgage holders and investors, the politicians will try to turn this to their advantage by framing it as being that the banks and mortgage lenders deserve the losses because they’re the cause of this problem. That's what you're going to see, that's what you're going to hear, and it's all intended to be a feel-good solution that makes everybody believe that our government is really looking out for us. Meanwhile, the SOBs that originated all these mortgages are going to get what they deserve. DG: But ultimately this has to be resolved, that is unless the government is willing to give a bunch of people free houses. AM: Years ago I said to you that what was happening in real estate was going to culminate in a big crisis, but that if it were to happen in a measured way that let the free market do what it does best, then the crisis would be less intense. But the latest developments are going to create a lot of intensity and only make things worse. DG: What about Fannie and Freddie? They were right in the middle of creating the mortgage mess, and they are at this point de facto government institutions? Not letting them foreclose would seem to be setting the stage for another huge loss to taxpayers. AM: The nice thing about being the federal government is that you can throw Fannie and Freddie under the bus and suffer no real consequences, at least not in the short term. For most people, that will look good. The important thing for your readers to remember is that these aren’t solutions that do anything. These are solutions that have optics, that's all. There's an election coming up. The government wants people to feel good. They want everybody to feel like our government is really addressing these problems. They want it to seem to the public like the government cares. And that's what this is, that's what this is all about, in my opinion, and I think you're going to see some really very, very undesirable, unintended consequences... caseyresearch.com