This is a serious question for the resident diehard Republicans that have said for years that the President and the Administration has nothing to do with the Economy.
If that is so true then how do you explain this attempt at bailing out the ship before it sinks that they are the ones that fired the torpedo in the first place?
12-23-2007 Gov't tries to contain mortgage crisis
WASHINGTON - After a slow and stumbling start, official Washington is scrambling to try to prevent the unfolding mortgage crisis from pushing the country into recession during an election year. There is a strong feeling, though, that the government will need to do more to avert a financial disaster.
One former Treasury secretary advocates temporary tax cuts and emergency spending on the order of $50 billion to $75 billion. Such action could help the U.S. from slipping into what Lawrence Summers, who served under President Clinton, fears could become the worst downturn since the steep 1981-82 recession.
Some Republicans are worried, too.
From both Martin Feldstein, who was President Reagan's top economic adviser, and former Federal Reserve Chairman Alan Greenspan have come calls for deeper government intervention to deal with the threat.
Before it is all over, the government may have to resort to measures last used in the savings and loan crisis of the 1990s. Back then, it was a new agency to take over failing thrifts sunk by bad loans. Today, it could mean a government agency to buy up billions of dollars of mortgage-backed securities that investors are shunning.
The Bush administration thus far has opted for less dramatic measures. In fact, the administration came reluctantly to the biggest step taken to date ? the "teaser freezer" announced two weeks ago.
But estimates are that only about 250,000 people will end up getting a rate freeze ? a fraction of the 3.5 million home loans that could go into default over the next 2 1/2 years.
The trouble is that the credit crisis is occurring at the same time that a run-up in energy prices is increasing inflationary pressures.
Whatever approach the government decides to take, economists said it will take time for the current problems to resolve themselves. They expect this housing downturn, which followed a five-year boom, to last through most of next year even under a best-case scenario in which the country avoids a full-blown recession.
"We have the fundamental problem that we built too many houses and we charged too high a price for them,"
says David Wyss, chief economist at Standard & Poor's in New York. "We have to stop building houses for a while and the prices have to come down. We are trying to make sure that process doesn't derail the rest of the economy."
==================================================
Gee you think David Wyss would be talking about all those 60,000 house subdivisions I talked about being built in 2001 and were then and still are now modern day ghost towns?
If that is so true then how do you explain this attempt at bailing out the ship before it sinks that they are the ones that fired the torpedo in the first place?
12-23-2007 Gov't tries to contain mortgage crisis
WASHINGTON - After a slow and stumbling start, official Washington is scrambling to try to prevent the unfolding mortgage crisis from pushing the country into recession during an election year. There is a strong feeling, though, that the government will need to do more to avert a financial disaster.
One former Treasury secretary advocates temporary tax cuts and emergency spending on the order of $50 billion to $75 billion. Such action could help the U.S. from slipping into what Lawrence Summers, who served under President Clinton, fears could become the worst downturn since the steep 1981-82 recession.
Some Republicans are worried, too.
From both Martin Feldstein, who was President Reagan's top economic adviser, and former Federal Reserve Chairman Alan Greenspan have come calls for deeper government intervention to deal with the threat.
Before it is all over, the government may have to resort to measures last used in the savings and loan crisis of the 1990s. Back then, it was a new agency to take over failing thrifts sunk by bad loans. Today, it could mean a government agency to buy up billions of dollars of mortgage-backed securities that investors are shunning.
The Bush administration thus far has opted for less dramatic measures. In fact, the administration came reluctantly to the biggest step taken to date ? the "teaser freezer" announced two weeks ago.
But estimates are that only about 250,000 people will end up getting a rate freeze ? a fraction of the 3.5 million home loans that could go into default over the next 2 1/2 years.
The trouble is that the credit crisis is occurring at the same time that a run-up in energy prices is increasing inflationary pressures.
Whatever approach the government decides to take, economists said it will take time for the current problems to resolve themselves. They expect this housing downturn, which followed a five-year boom, to last through most of next year even under a best-case scenario in which the country avoids a full-blown recession.
"We have the fundamental problem that we built too many houses and we charged too high a price for them,"
says David Wyss, chief economist at Standard & Poor's in New York. "We have to stop building houses for a while and the prices have to come down. We are trying to make sure that process doesn't derail the rest of the economy."
==================================================
Gee you think David Wyss would be talking about all those 60,000 house subdivisions I talked about being built in 2001 and were then and still are now modern day ghost towns?
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