Letters to the Editor

Prudent course

October 14, 2007

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To the editor:

In a crisis, it's important to take prudent steps but also to make sure you don't go too far. Unfortunately, many lawmakers are apparently overreacting to our country's mortgage "crisis." According to a story in the Oct. 4 Journal-World, Democratic party leaders want Washington to become more active in the mortgage market.

But the government has already done the right thing. It's increased the amount Fannie Mae and Freddie Mac can invest, and that's the key. Those government-sponsored corporations have long stood for responsible lending, and allowing them to be more active in the mortgage markets will help make those markets more stable. Right now, any further intervention would just be counterproductive.

A strong housing market is in everyone's interest. But it's important to remember that government interference won't solve our problems. The power of the free market makes the American economy the strongest in the world, and only that free market (with the proper safety net) can keep us growing for decades to come.

Rebekah Romm,

Lawrence

Comments

workinghard 7 years, 6 months ago

I read something interesting the other day. The most secure, least likely to default mortgages are ones taken out by illegal immigrants. Now I'm confused. Don't you have to have social security numbers and pay taxes among many other things to get a bank loan? Obviously the bank must have some idea they are illegal, what happens if they are deported?

imastinker 7 years, 6 months ago

You're not very likely to get deported here. Apperantly driving illegally on public roads and killing an innocent girl isn't enough to get someone deported.

Speakout 7 years, 6 months ago

How would you think a mortgage loan officer could determine an illegal person in the USA? They run a credit check, look at w-2's for up to 3 years, do employment check and residences for two years. IF someone has been here for 5 years, has a social security number, has employment and good credit rating, the loan will be made if he has the downpayment. If he is illegal and has those, who knows?

Richard Heckler 7 years, 6 months ago

It seems to me that GMAC and other lending institutions should be put out of business instead of the taxpayers once again becoming the stuck pig aka bailing out corporate america for mismanagement of their business. How many small business operators would love the same opportunity?

Bailout blues

Should the government bail out bad loans or let the market find its level? Robert Camerota and Paul Leonard conclude their debate on the high-risk real estate market. July 20, 2007

Today, Camerota, chairman of the California Mortgage Bankers Assn., and Leonard, California office director for the Center for Responsible Lending, discuss calls for government relief of mortgage defaults. Previously they focused on building homeownership, the ethics of lending, the scale of the sub-prime crisis and proposed solutions.

Don't encourage bad behavior By Robert Camerota

In our headline-reading, 24-hour-news-cycle, short-attention-span world, government bailouts often seem to be the pat answer to market or corporate declines. Whether it is the airlines, railroads or governments themselves in financial trouble, the suggested solution is far too often a bailout. Now we are hearing from some that it's time for a government bailout of the sub-prime mortgage industry and http://www.latimes.com/news/opinion/la-op-dustup20jul20,0,5946626.story

Should the government be bailing out anyone in the subprime mess? Sectors:Financial Services "A big no on this one. Let the subprime market shake itself out and let some of those mortgage companies who charge homeowners outlandish rates to go bankrupt. The government should only bail out an industry or sector if it's in real serious trouble. The mortgage lenders who take advantage of homeowners don't deserve to be bailed out at all." -- Chuck H., Mississippi http://www.cnbc.com/id/20145740/site/14081545/page/3/

mick 7 years, 6 months ago

The power of the free market makes the American economy ....? Not any more. Deficit spending is the only thing that keeps our economy going. $813 billion in annual trade deficits with no economic "engine" since the internet boom went bust. A family of four's share of the national debt is over $100K and there is no hope in sight. We are addicted and when we are cut off, that's it.

lucky_guy 7 years, 6 months ago

What is Rebeka worried about? That the govenment my want to add some oversight into the "over exuberant" finanacial markets. Why is she worried about the government getting too involved? GW is the one that told us to spend after 9/11 so he is the last person that is going to get too excited about a little housing bubble bursting. We have sold our souls, if we ever had them, to Wall Street. We don't make anything anymore, we just move around money, or more precisely debt.
If things go bad it will be just like Katrina We will just let the churches open soup kitchens to look after the losers and forget it ever happened, right? The irony is that the governments of several countries are highly involved in a massive, though not much discussed, bailout of Uncle Sam. You know a couple hundred billion here, and there and soon you have some real money. I guess with the trillion buck Iraq war the loss in the 100 billion dollar range is chicken feed. Nothing for us to worry about or legislate for. The other irony is that the free markets got us here and so they are going to get us out, is that right Rebekah?

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