Skip to comments.An August Surprise from Obama?
Posted on 08/05/2010 9:53:06 AM PDT by Qbert
Main Street may be about to get its own gigantic bailout. Rumors are running wild from Washington to Wall Street that the Obama administration is about to order government-controlled lenders Fannie Mae and Freddie Mac to forgive a portion of the mortgage debt of millions of Americans who owe more than what their homes are worth. An estimated 15 million U.S. mortgages one in five are underwater with negative equity of some $800 billion. Recall that on Christmas Eve 2009, the Treasury Department waived a $400 billion limit on financial assistance to Fannie and Freddie, pledging unlimited help. The actual vehicle for the bailout could be the Bush-era Home Affordable Refinance Program, or HARP, a sister program to Obamas loan modification effort. HARP was just extended through June 30, 2011.
The move, if it happens, would be a stunning political and economic bombshell less than 100 days before a midterm election in which Democrats are currently expected to suffer massive, if not historic losses. The key date to watch is August 17 when the Treasury Department holds a much-hyped meeting on the future of Fannie and Freddie. A few key points:
1) Republican leaders believe this is going to happen since GOPers and Democratic moderates in the Senate are unwilling to spend more taxpayer money on more stimulus. But such a housing plan would allow the White House to sidestep congressional objections and show voters it is doing something tangible about an economy that seems to be weakening.
2) Wall Street banks are alerting their clients privately to this possibility. Here is what some are cautiously saying publicly. This from Goldman Sachs:
(Excerpt) Read more at blogs.reuters.com ...
The FRench overthrew their gubamint for far less..
Maybe Michelle should consider just staying in Spain.
She’ll be sending us cake!
Bread and Circuses - Obama style.
How will he pay for it? By ending the Bush tax cuts of course.
All of us who kept up our mortgages can move into the line marked “sap.”
I knew he’d be doing some sort of government largesse giveaway before the election to try to buy off the ignorant masses.
I don’t think it’ll work, though.
You have got to be kidding...
Sap. Just like all the people that came to this country LEGALLY. Maybe ‘chump’ could be a sub-category...
She’s in Spain?
“Let’s hear it for the Rainbow Tour! It’s been an incredible success...”
I hope they run this by Frank Santelli.
So the guy that took out the second mortgage to pay for say a BMW, outside kitchen, or daughter’s lavish wedding wins.
The guy that played by the rules and experienced non of this, well; loses by opportunity cost. Would this bailout grant these frugal persons a cash reward for this opportunity cost?
Not called as such, but this is another segment of REPARATIONS.
It would be so tempting to think that they couldn't possibly be brazen enough to try this. But that would be to remain in denial.
I don’t think this would be wise politically even for The One.
People have had it. If he pulls this, all bets are off.
Dow 1000 coming right up!
I would have brought a house I couldn’t afford if I knew the gubmint was going to forgive my loan. Dang - I miss out on all the good stuff!
Dems are toast.
America has seen the naked HATE,Anti-Semitism, Anti-Capitalism and RACISM from the White House and Dems....
If Jesus had as many “czars” as King Obama does, he’d be almost as powerful.
If more irresponsible spending and more unsustainable debt gets enough votes for the Democrats to protect their congressional majorities, it will prove that America is irrevocably on the suicidal path to economic collapse.
The Era of Irresponsibility continues forward.
Are they really stupid enough to think this will work? If it gets them the approval of the 1 in 5 homeowners who are under water, it will get them scorn from the 4 in 5 who have been responsible. That is just stupid arithmetic even for a brain dead POTUS like 0bama.
Rick Santelli...the only conservative commentator on CNBC and the originator of the idea of tea parties to protest the first bailout of delinquent mortgage holders
Talk about wealth redistribution.
I'm betting my bottom dollar that I and many like me will see zero relief from this latest round of Government intrusion into the (what was) free market.
The 2012 surprise will be when he invites us to refer to him as Mr. Beast or ‘his 666ness’.
“You have got to be kidding...”
I wish I was.
“[T]he rumors are pretty darn strong with Wall Street firms privately warning their clients it is a distinct possibility.”
There’s more than one way to pay reparations............
silly me. We bought a modest home - stayed in it for 10 yrs. and made our payments month after month.
We even put in a few extra payments each year.
We now have a good amount of equity in our home.
Silly silly stupid us!
Why is anyone surprised that B.O. is going to order Freddie and Fannie to forgive mortgage principal? He already ordered Bank of America to do just that a long time ago. They just began implementing it last Monday according to my sources:
It’s all about power for democraps. This is all about trying to keep in power. Nothing more.
That guy doesn't vote Democrat and therefore doesn't count.
Alan Keyes said this was going to happen last year.
Yup, and there is no guarantee that ones that benefit from the bailout are going to vote dem when they would not have otherwise. This would be an epic fail in so many ways. Well, except furthering the destruction of this country, which is odunkerbunny’s goal anyway.
Redistribution of wealth in its absolute finest form!!
You really want to do something? How about suspending payroll taxes for a year? That will put money in pockets without all the bureaucratic delays.
SO help me out here, please:
1) Someone just recently finished buying a $240,000 home in time to qualify for the $8000 obama homebuyers credit.
2) With 20% down, the loan amount is $200K. It is NOT a Fannie/Freddie loan so doesnt get paid off by the feds.
What happens to this new homebuyer under these circumstances?
What happens to home values in general?
Would the feds have to pay off everybody equally or just Fred/Fan mortgages?
Sharky, why didn’t you tell me Dear Comrade Leader was going to forgive my debt.... I should have bought one of your houses! And an Ava too! And then not been worried about my outsourced job! :0)
Fannie and Freddie will go into crisis mode again, and Zero will roll out another stimulus package, with a few hundred bill to save F & F.... about on Oct. 26th or so.
Had a neighbor down the street who did that a few years back. They bought a $40,000 vehicle then let the house go into foreclosure 6 months later. Very scummy. They bragged to a neighbor about the fact that they would just buy another house in a couple years after the foreclosure was off their record. They also kept coming back after they moved out of the area to use the HOA pool. Some people are just lowlifes beyond conscience. These are the kind of people Obama is targeting for loyalty to him.
Just the opposite—this move would zero out the bad loans on banks’ books, releasing funds held in reserve. Easy money for everyone = hyperinflated equities = Dow 100,000.
Is he returning to which he came from?
No, instead of saying FUBO, we will just say FUB.....as in Beezlebub.
There might as well be an August surprise, it’s just one disaster after another with this guy.
Last year my ex wife decided that her vows meant nothing and wanted a divorce. So we sold our house in the middle of the worst housing market of our lifetimes. One good decision after another. We made virtually nothing on a house we lived in for ten years. So, Fannie and Freddie, even though I don’t own that house anymore, I wants my money! I’m kidding, but just wait, we are going to hear stories just like this, along with the thought that people who don’t even own a house should be compensated for their loss.
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