MG writes: 1. That the fund should primarily be aimed at assisting homeowners and resolving the housing crisis rather than at purchasing mortgage-backed securities at above market prices from the banks. The root of the financial crisis is the housing crisis. Stop foreclosures and put a floor under housing prices and the distressed MBS's would rise in value, so the theory goes, as surely as the government buying them at auction, improving bank balance sheets and (presumably) their willingness to lend. JG replies: Point well-taken, however... ...call me a "getting prices right" market fetishist if you will (and it would probably be the first time), but isn't there something dodgy abouta solution to the rampant foreclosure problem -- which as things stand will only get worse -- which continues to inflate a real estate market artifically inflated in the first place by international economic imbalances, originate-to-distribute lending practices, and credit default swap gimmickry? I'm not smart or patient enough to figure it out, but there's gotta be a fair and equitable way to keep folks in their houses without keeping the fizz on the real estate market, yes?
_________________________________________________________________ See how Windows connects the people, information, and fun that are part of your life. http://clk.atdmt.com/MRT/go/msnnkwxp1020093175mrt/direct/01/