Just wanted to be clear that the “government” is not bailing out anyone. The poor savers here and abroad, who have been funding this at 2%-5% annual interest rates have been funding the bubble, and will fund the bail out.
The loss of 5% or 6% because of inflation vs. the FED’s artifically low interest rate has paved the way for the bubble, and looks to be the FED’s solution to the problem.
IF the yield curve gets inverted again, and mortgage rates go to 2 or 3%, problem solved – and paid for by the “moral” savers who fund the mess with negative real rates of inflation.
It must be hubris that allows someone to speak of a borrower being immoral while walking away from a bank that has been robbing its depositors for years.