Monday, September 15, 2008

A solution to the housing crisis?

I know very little of economics,and like everyone else.I await the "bottom" to take place.
However, the one suggestion that I have heard that seems to make some sense is the following.
We know that the housing situation with sub-prime mortgages,foreclosures,lack of capital for investment,all adding up to a glut of homes(2-4 year supply) with falling prices etc are a prime cause of our financial woes.
The suggestion is to invite a consortium of housing speculators join forces and buy up all the foreclosed homes from the banks etc for small amounts on the dollar.They could then turn around and sell them at bargain prices.

This would clear the books of Banks of their rotten loans,allow people to buy home at reduced prices,and revitalize the housing market/industry in 2 years,once these homes have been sold.Theoretically, people could obtain mortgages at reasonable rates, in light of the lower total cost of the property. Of course the speculators would make a fine profit.
We await the Fed meeting see if they lower rates once again.Will that help?
Again not as an expert,and perhaps based upon wishful thinking,history tells us not to panic.Walk into the malls,or look at our highways-yes there might be less sales than last year,or we are driving less miles/day,however we have a huge economy.


Two more days until the Kadimah primary.What is interesting is that FM Livni who is the frontrunner to beat Mofaz,seems to indicate that if she loses,she will leave the party.Some have suggested she will be helped by a Sarah Palin boost as a woman?