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Obama, Our "Fine" LeaderHey guys, here's anotherwe're-from-the-government-and-we're-here-to-help-you idea. This one's from Obama in this morning's FT - it's filled with fines, re-regulation, and criminal penalties for 'unscrupulous' lenders. A witch hunt against lenders, doesn't that sound like a great way to get the credit markets functioning again? Deflationary risk is still there, and the Fed needs to do their part, but political risk needs to be addressed too, and the President needs to do his part. Here are the highlights: "The implosion of the subprime lending industry is...a cancer that, given today's integrated financial markets, threatens to spread with devastating impact to housing and to our economy as a whole, unless we act to contain it...a parable about how an excess of lobbying and influence can defeat common sense rules of the road, placing both consumers and our nation's economic well-being at risk...our government failed to provide the regulatory scrutiny that could have prevented this crisis... The real victims...are the millions of borrowers who followed the rules, whose only crime was taking out mortgages that lenders told them they could afford...a fund to avoid foreclosure....partially pay for this fund by imposing penalties on lenders that acted irresponsibly or committed fraud....We need to update these rules for the 21st century and enact the regulatory and disclosure laws that the mortgage industry has been lobbying against...I have also introduced a bill in the US Senate called the Stop Fraud Act that would treat those who commit mortgage fraud as the criminals they are....stop the unlicensed, unregulated, fly-by-night mortgage brokers..." - Fine Unscrupulous Lenders |