Bush's Bad Mortgage Medicine - Forbes.com
The Bush Administration's plan to rescue the housing market and keep the economy from slipping into recession took flak yesterday for freezing interest rate hikes for a mere fraction of subprime, adjustable-rate borrowers. But there's a bigger risk: It could deepen and lengthen the credit crisis.
According to analysis by Barclays Capital, the "freezer-teaser" plan applies to just 240,000 subprime loans. The Mortgage Bankers Association reports the number of subprime adjustable rate mortgages at 2.9 million.
Summary: It won't help, punishes responsible home-buyers, and pisses off the free-marketeers.
Naomi Klein explains it all in Shock Doctrine.
The neo-liberal economic policies—privatization, free trade, slashed social spending—that the Chicago School and the economist Milton Friedman have foisted on the world are catastrophic in two senses, argues this vigorous polemic. Because their results are disastrous—depressions, mass poverty, private corporations looting public wealth, by the author's accounting—their means must be cataclysmic, dependent on political upheavals and natural disasters as coercive pretexts for free-market reforms the public would normally reject.
Update: Thanks to Muggins for the correction. It's Naomi Klein, not Wolf, -- sometimes my fingers do the thinking on the keyboard.
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2 comments:
Hey Joseph,
You've probably heard this already, but Naomi KLEIN wrote "The Shock Doctrine." Naomi WOLF wrote "The End of America."
Cheers,
Muggins
Forget the responsible home buyers. Forget responsible shoppers period. The American economy thrives on middle to upper class irresponsible spenders. If Bush can't help these folks out, the American economy is fucked. It's as simple as that.
America needs impulsive buyers who desperately want to keep up with the Jones.
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