Luke Mullins has an excellent interview with former Presidential Gadfly Candidate Ron Paul on the housing crisis and the role Congress may play in it. I would have said fixing it but we all know that is smoke and mirrors.
Paul is very libertarian and on economics we share many of the same principals, let the market work things out. There is a link at the end of the post to read the whole interview, but here is an interesting excerpt of what Ron Paul see’s happening in Congress this year.
I think that if there is something on the floor between now and November [that] will be construed as something to help people getting out of their mortgages, nobody will consider that the responsibility of government is to honor and respect contracts. They are going to go and violate everybody’s contracts and tell people, “Just because you [received] this loan and you can’t pay it [back], we are going to change the rules.” But if you and I had a contract like that, we could see that that’s not right. You owe me that money, or I want my house back. It’s so vague now—who owns these mortgages—they figure, “Well, somebody in China owns these mortgages, so we won’t honor the contract.”
Read the rest at The Home Front at usnews.com.
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This is in MHO just a precursor of what MUST happen sooner or later on a macro scale.
Behind all the smoke and mirrors, the government of the USA is factually bankrupt and must begin to default on large chunks its (overseas) debt sooner or later. Politicians, being the cunning animals they are, will as usual find a way to dump what they can of the whole sorry mess on long suffering tax payers and the remainder on (foreign) holders of debt.
The current handling of the sub prime event is a classic example of how they can make the gullible public believe that the pumping of excess and fraudulent liquidity into the financial system somehow had nothing to do with anything. They actually have people believing that those who own and run the Federal Reserve Bank are now going to come to the rescue after having created the whole debacle with their monetary inflation in the first place.
Go figure …
Former???
The current bailout plan the Obama administration has somehow contribute in lessening the effects of economic global crisis to everyone. Maybe in due time, the economy will bounce back to where it should be.
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