[quote=HLS]In a society where the govt encourages spending if it took 20% down and 30% debt ratios to qualify for a mortgage, you would see home prices much, much lower, but that just wouldn’t be good for an artificial, phony economy. Don’t expect to see it anytime soon.[/quote]

Too true. The problem is so obvious, yet the PTB refuse to stop. Your solution would remove the punch completely and get everyone to face reality sober, but they just crank up the music and add some new flavors of intoxication to keep the party going, way after it stopped making any sense or being any fun.

This slight pullback in the FHA spigot is only being considered. If it would lead to any appreciable reduction in crazy loans, it will be repealed. The goal is to keep home prices high, no matter what.