The Rise and Fall of Hope and Change

The Rise and Fall of Hope and Change

Alexis de Toqueville

The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money.
Alexis de Tocqueville

The United States Capitol Building

The United States Capitol Building

The Constitutional Convention

The Constitutional Convention

The Continental Congress

The Continental Congress

George Washington at Valley Forge

George Washington at Valley Forge

Friday, March 2, 2012

Empty Promise: The Holes in the Administration’s Housing Finance Reform Plan

From The American Enterprise Institute:


by Peter J. Wallison
American Enterprise Institute
February 29, 2012
In the year since Treasury Secretary Timothy Geithner announced the Obama administration’s options for reforming the housing market, the administration has said and done nothing to indicate which option it prefers or how its plan will be implemented. In early February, however, Geithner reported to the Financial Stability Oversight Council that the administration wants to make progress on housing finance reform this year, winding down government-sponsored enterprises Fannie Mae and Freddie Mac and bringing private capital back into the market. For any such plan to be credible, it must do much more than wind down the government-sponsored enterprises. The Federal Housing Administration creates competitive obstacles to the revival of the private securitization market that are at least as serious as the government-sponsored enterprises, and because of the Dodd-Frank Act a number of formidable legal obstacles now exist that must be cleared away before a private securitization market will come back. If the administration is serious, its plan must address all these issues.

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