This is throwing good money after bad, and, worse, by seeking to “shore up sinking house prices,” it betrays a complete ignorance of the actual root of the problem. Blaming sinking housing prices for the fix we are in is equivalent to blaming the car for the drunk driving wreck. If Obama were to craft a similar program for drunk drivers, it would include new cars for any that happened to wreck their own.
In addition, Martenson says that from moral standpoint, this bill…
…is a complete disaster. The clear implication here for every sentient person is that it pays to be reckless. Moral hazard is written all over this one. I can easily envision millions of people arriving at the same conclusion: “I need to stop paying my mortgage right away so that I qualify for a handout!”
Awesome title and picture!
Rick Santelli said it best today, "This is America!" and then his rant was joined by the traders on the floor of the Chicago Merc. These mortgage holders should either work out a deal with there bank or move into an apartment. I feel for them on a personal level, but the market for homes needs correction.
I read a great article about it called "A Moral Hazard," found at http://economicefficiency.blogspot.com/2009/02/blog-post.html
Posted by: WillG | February 19, 2009 at 05:59 PM
I love your blog, THIS IS GREAT.
Posted by: Sandy | February 19, 2009 at 08:40 PM