By Christopher Joye
Make no mistake: President Obama’s $75bn housing plan is a policy disaster. It merely treats the symptoms of the calamity in an extremely costly manner via short-term interest rate relief and remarkably does nothing to prevent the next generation of borrowers experiencing the same problems.
The administration’s response also exacerbates the underlying dysfunction that is the root cause of the US’s housing market woes by, for example, offering defaulting borrowers scope to wriggle out of their contracts through the judicial system. Read more