These actions have one single solitary goal which is to stall and provide time for market conditions to unwind and/or keep hoping for more bailouts.
They will not thwart off price declines in the long run, but rather will simply slow down the process of inventory hitting the markets which will do nothing but to prolong the slowdown, push the bottoming out process further out into the future and continue to hamper the market from returning to one that would be characterized as “healthy”.
In essence they will provide further support for people who have defaulted and are simply living in thier homes for free. They will also allow those who revved up HELOCs to the hilt so that they can buy boats and other toys to continue to live in thier homes without paying a cent because they cannot afford it, and they even get to go water skiing on the weekend!
Don’t worry though, 300 days later they may be foreclosed on. I really don’t see how that promotes a speedier recovery.
