[quote=davelj]
Um, Breeze, that “mortgage-related stuff” is most decidedly NOT MBSs/CDOs, etc. Let’s at least keep the terms straight. What I advocated in that post was that the government – us taxpayers, that is – eat principal reductions for lots of folks who are underwater. In buying MBS, etc. from institutions the government (a) doesn’t really know what it’s getting in terms of losses, and (b) is really helping out the institutions involved, as opposed to individuals. In offering plain principal reductions, the loss content is more straightforward and you’re helping homeowners in a more direct manner. You may be opposed to both, which is fine, but they are two different things. But you have a record of being confused on similar matters.
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Eating principal reductions means that the taxpayers would by paying down the loan to some lower amount, right? So it’s a bailout for the loanholder (banks, etc), right? What else could “eat principal reductions” mean?
