Bail out idea....

How about a plan that required repayment of this debt by the industries that caused it instead of the tax payers already injured by these guys? Hint, taxation... like special tax/fees for those that wish to partake in this industry, tax the profits made on the servicing and origination of these loans, require a system that prevents these cost from being 'passed on' directly to consumers. Use these for #1 repayment, #2 creating an oversight or insurance system that prevents higher risk loans from being part of a MBS and requires originators to service originated loans that do not qualify for this insurance.


FNMA and Freddie Mac had done a very good job of this in the past and only suffered when trying to compete with these 'junk bond mortgages' and these are what have caused an over inflation of values and putting otherwise typically safe loans at higher than average risks.

FNMA and Freddie Mac were failures from the start. If they were so great, they would have never allowed themselves to get sucked into this mess. They would have also been showing decreasing debt, not increasing debt.

I can't imagine being so stupid as to put people in houses with no down payment. Not having at least a 20% down payment shows me that a person can't manage their money to start with.

How about this for a plan:

1. Do nothing and just let poor and fraudulent performance take it's toll.

2. Eliminate the capital gains tax.

3. Reduce corporate income tax from the second highest on earth, to a more reasonable 20%.

4. Reduce the top income tax rate to 15%.

5. Re-attach gold backing to our currency ... at least on an international level as it was prior to Nixon closing the international gold window in 1972..

There's five things that would make our economy boom like never before and eliminate the need for a Marxist bailout.

Vi

Vi, If you will run for president I will vote for you.

TheBrutalTruth said:

FNMA and Freddie Mac were failures from the start. If they were so great, they would have never allowed themselves to get sucked into this mess. They would have also been showing decreasing debt, not increasing debt.

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I don't follow you, both of these have managed to survive and even profit during poor markets before, like the late 80's early 90's which was a very mini version of this mess. I'm not saying that they don't have blame and I think they loosened up too far in some respects but this was a reaction to a perceived need to compete with supposedly proven (sure, positive data only a few years old is enough to convince rating agencies) safe loan programs in the name of promoting fair home ownership. In the past these companies had some of the more restrictive guidelines and on average required at least 5-10% down and these loans performed pretty well.

I'm not saying they were perfect but they were not not that bad before the 100% craze and could be made to work again.

How about for starters the head of these companies that skimmed all the profits off the top with their inflated salaries need to empty all of their own personal assets back into the companies. That is where the problem lies.

When the company is turning a tidy profit, the CEO raises his own salary and makes sure any extra cash becomes a "bonus" for himself.

Greed, it's greed that got them there and I think the government should bail out the average citizen and let these fat cats go belly up.

Hell my mortgage company is playing dangerous games too. Last month they suddenly decide that their AUTOMATED phone system was not going to accept payments on certain days. How is that helping their customers make their payments? Suddenly the person scraping by tries to call their payment in and nope, the computer has the day off, too bad for you, you have to call tomorrow and pay a late fee instead. WTF is that about?

If for some reason you get behind, they won't accept anything except full payment. So if someone is behind and has their whole payment but is lacking say $50.00 they can't go ahead and pay and catch that $50 next week. It's all or none for those bastards.

These corporations are asking for the same slack that they refuse to give to others. What a bunch of crap.