[quote=briansd1][quote=Nor-LA-SD-GUY2]
No I think they really want to stall growth, otherwise they would have forced the banks to write down principles or some other drastic action like inflation (you cannot replace 20% of the economy with solar energy job’s) that’s so funny it’s not even trying.
(Like I said, that’s just my speculation)[/quote]
I’m with Arraya. It’s always been growth at all cost.
Forcing principal reductions would hit the banks’ balance sheets and we would need to bail them out again.
I’m curious why you think that it’s necessary to get homeowners above water for an employment recovery to happen.
Theoretically, homeowners bought houses they could afford to make monthly payments on. Underwater or not, they could just carry on. Theoretically, the banks did their job with underwriting.
But we now all know the problem is that the banking system broke-down and allowed massive numbers of homeowners to buy houses they could not afford. The whole system was predicated on refinancing and forever increasing prices.
If we were to force the banks to reduce principal, who should bear the cost of such a massive program to benefit underwater homeowners?[/quote]
You could calculate the costs, and how much money the responsible bodies have, let them pay it down, and write it off, without devastating their balance sheets and causing a run on banks. Actually, I believe this is probably happening, just mot as fast as some would like.
