Actually, banks currently aren’t marking to market.
Unless that’s changed, that was the dirty part of the bail-out. The banks got to pretend that their bad loans were good loans.
Efficiency in the foreclosure process, squeezing out the upside down delinquents will improve the economy, by driving the housing market to a real bottom.
Real bottom, real growth as the economy absorbs the housing then puts housing back into productive use and regains construction.
We do that at the expense of a bunch of artificial paper and people pretending that junk bond equivalent of a mortgage is AAA. And continuing to pretend that the squatter is a home owner.
No sustainable economic growth is possible to be built of the house of cards we have today.
