I think people that are wondering why the government is doing what they are doing need to consider these numbers:

“First American CoreLogic reports that 26% of homeowners with a mortgage had substantial equity, or paper profit, in their properties at the end of June in the Los Angeles-Orange area. More data:

* 35% were underwater, owing more than their homes were worth.
* 39% were within 5% of being underwater.”

These numbers are ridiculously bad and likely historically unprecedented. If it is this bad with all the massive intervention, imagine what it would be like without it. We are currently down to 02-03 price levels in most of SD county and probably headed towards 00-01 price levels as it is. Do we really want 95-96 price levels (which were the same as late 80 price levels). That is two lost decades and would be Japan level statistics. I suppose it could happen but I’m pretty sure most people are vastly unprepared for the consequences even if you are sitting on a pile of cash or think you have a stable job.