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Wow: Bush Plan May Help 80,000 Americans Avoid Foreclosure...

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From Reuters: The plan projects "marginal results relative to a problem that is growing and likely to continue to grow through the next year," Youngblood said. "One is grateful that 80,000 people will keep their homes, but you will forgive the markets for not over-reacting."

The ABX-HE 2007-1 "BBB-" subprime loan index rose 2 points to about 34.5 on Friday after the Bush plan hit media outlets. The index, one of the only visible ways to track prices in the opaque, over-the-counter market, has lost more than half its value since May and hit a record low close at 31.96 on Thursday, according to Markit Group Ltd.

Investors in the $7.2 trillion mortgage market have been battered in the past year as the rate of delinquency on loans of subprime quality has surpassed expectations. Rising monthly payments for millions of homeowners and reports of falling home prices have left them girded for more losses, and unbudged on bearish positions despite the government's intentions.

The bond market is still being flooded with loans made in 2006 when underwriting had grown particularly lax, Youngblood said.

Can anyone really see rejigging loans for 80K people preventing a global crash?! If only it were that easy, George. ;)

TD

Edited by The Dragon

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