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Reaction To Bernanke's Last Idea

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Haven't seen this mentioned anywhere so here it is.


I’m enraged. Yep. And I get to be enraged, because this is a blog, which is where I get to move away from being an unbiased reporter for a few moments each morning and offer an opinion. Yesterday, Federal Reserve Chairman Ben Bernanke, in a speech to bankers in Orlando, Fla., said that the best way out of the foreclosure mess is not to modify all these delinquent loans but to actually reduce the principal. He reasons that all these folks with negative equity in their homes have no reason to keep paying mortgages.

There's no doubt in my mind she belongs here.

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There's no doubt in my mind she belongs here.
Let the market correct. Let home prices fall back to a level where good hard-working people can afford nice comfortable places to live. No pain, no gain.

I'd say so! :P

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A Passage from Bernanke's recent speech (the speech to which the article refers):

"Concerns about fairness and the need to minimize moral hazard add to the complexity of the issue; we want to help borrowers in trouble, but we do not want borrowers who have avoided problems through responsible financial management to feel that they are being unfairly penalized."

I suspect Bernanke said a lot more than he meant to there.

Subtext: Those who have been responsible with their finances will be unfairly penalized, but we'll do our best to delude them in to believing they haven't been.

Edited by the_skeptic

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  • 295 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

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