Last April, when Elizabeth Warren was still chairing the Congressional Oversight Panel on the Troubled Asset Relief Program, the Treasury Department's Home Affordable Modification Program got its third failing grade because its "response continues to lag well behind the pace of the crisis" and not reaching "the overwhelming majority of homeowners in trouble.” The panel gave HAMP another bad grade on Tuesday. In fact, the overall view was even more critical than eight months ago. The panel:
...found that in the eight months since the Panel's last report on the Home Affordable Modification Program (HAMP), Treasury has made minor tweaks to the program, but the changes have not resolved the Panel's core concerns. The Panel now estimates that, if current trends hold, HAMP will prevent only 700,000 foreclosures -- far fewer than the three to four million foreclosures that Treasury initially aimed to stop, and vastly fewer than the eight to 13 million foreclosures expected by 2012.
It is too late for Treasury to revamp its foreclosure prevention strategy, but Treasury can still take steps to wring every possible benefit from its programs. Treasury should enable borrowers to apply for loan modifications more easily -- for example, by allowing online applications. Treasury should also carefully monitor and, where appropriate, intervene in cases in which borrowers are falling behind on their HAMP-modified mortgages. Preventing redefaults is an extremely powerful way of magnifying HAMP's impact, as each redefault prevented translates directly into a borrower keeping his home. ...
“any billions of dollars set aside for foreclosure mitigation may well be left unused. As a result, an untold number of borrowers may go without help—all because Treasury failed to acknowledge HAMP’s shortcomings in time.” ...
“Despite repeated urgings from the panel, Treasury has failed to collect and analyze data that would explain HAMP’s shortcomings, and it does not even have a way to collect data for many of HAMP’s add-on programs. Further, Treasury has refused to specify meaningful goals by which to measure HAMP’s progress, while the program’s sole initial goal—to prevent 3-4 million foreclosures—has been repeatedly redefined and watered down.”
As with the past four reports on HAMP's progress, the Treasury - represented this time by Timothy Massad, acting assistant director for financial stability - called the criticisms too harsh:
“One can criticize it, but you have to compare it to the alternatives. That’s where there’s not really any consensus,” he added.
Massad noted that of the five panel members unanimously backing the report, three believe HAMP should go further and two think the private sector can handle foreclosure aversion on its own.
The situation for both home-owners who owe more on their mortgages than their homes are worth and the overall economy is not good. While the number of "underwater" mortgages fell in the third quarter - from 11.3 million to 10.8 million - does not reflect an improvement in the housing market. It's because banks got more aggressive about foreclosures. And the recent decline in foreclosures comes mostly from a slowdown as a result of the scandal of fraudulent, rubber-stamped documentation:
Underwater borrowers pose a serious risk because they are far more likely to default if they lose their jobs or meet other financial shocks. It is difficult for them to refinance and take advantage of low mortgage rates and they are unable to sell their homes unless they cover the shortfall out of savings or convince the bank to sell at a loss in what is known as a short sale.
"It's a giant anchor that's holding back the economy," said Sam Khater, senior economist at CoreLogic. "Until that negative equity recedes, the housing market is not going to recover. It's as simple as that."
Such mortgages present all kinds of problems. Some borrowers try to sell for whatever they can get, driving down home prices. As prices drop, still more borrowers find themselves underwater. Many out-of-work or financially fragile householders find it difficult to sell their homes without taking larger losses than they can handle, which means they won't or can't move to areas of the country where they might find a job or a better one. Many foreclosed houses stand vacant and that reduces prices even more. The Federal Reserve Bank of New York estimates that 3 million more houses are vacant currently than usual.
All this reduces the turnover of houses, which means less money moves into residential investment, which means there is less home construction - traditionally a sector that helps speed a recessionary economy into recovery. This contributes to anemic job gains and the whole cycle continues. In May, the New York Fed reported that a turnaround could take five years or more.
The Calculated Risk chart below shows a close relationship between housing starts and the unemployment rate since 1968. A larger version can be viewed here.
I generally agree with yoru statement, all the tricks the FED did to print hosuing dollars are done now, now people have to bring real money, and that means wages. However I disagree with statement "businesses competing with foreign wages CANNOT pay higher wages to American workers". Businesses overpay their CEOs and upper management all the time (boards are made up of cronies, not directors working in best interest of stockowners) and big US businesses are generally making high profits and have record cash reserves. So businesses CAN afford to pay workers high wages, but rather, they simply WON'T because they do not have to (no laws, unions etc to force them) and the WON'T because unlike the waste of over-priced salaries at high-end of coroporate ladders, business are not so stupid and wasteful and low-end and they keep low and middle workers wages as low as they can or they outsource.
But just so you know in real world there is an alternative ( not one you will ever see in US due to our politics and people assumptions like yours) look at Germany. They are an exporting machine. Their companies are very competitive in world market AND their worker wages and benefits are much higher than US. They have higher horuly salaries, their workers get 6 weeks vacation from get go, etc.. Also, they are fairly heavily regulated, their companies are held to high safety standards, high worker fairness standards, and tough environmental standards and also their companies do a lot with expensive alternative energy.
So in my mind there are at least two ways to for a countries companies to be competitve on world market, China or Germany, the only option is NOT China and depressed wages and weak currency.
Again and again, I see smart people assuming we must just do a China to compete, low wages, weak currency, trash the environment, peel back regulations that keep workers safe and keep work place fair. Its like Germany's example does not enter our consciousness. No way we can have a strong social safety net, treat enviroment well, have a strong currency, pay workers well, regulate businesses to ensure fairness and still compete, pay not attention to Germany.
It may not be easy for US to replicate what is working for Germany, primarily simply because most in US media and culture has it so we don't even know it that at least one coutnry is already proven it is possible, but it is crazy not to at least look at what they are doing and see if maybe we could strive for something closer to them. Germany competes and grows and German workers benefit. Germans model is very good for the common wealth, and yet, all we can fixate on is China.
We see same phenomen in business. There are some companies that are very successful and treat their workers much better than average, while other companies see their only way to success is to treat low end workers as badly as possible and to overcompensate upper management. See simply Costco vs. Sam's club.
Stop self-limiting, we can be a globally competitive country and have a solid middle class and have clean air and water, safe workplaces. But we won't if we let crony upper management of US companies decide everything in their interest, because clearly, sh%^ting on workers and over-compensating themselves and their friends, corrupting our government for their purposes is what they will keep doing unless we fight for something better.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
Julian Assange | Sarah Palin | Fox <b>News</b> | Mike Huckabee | Mediaite
In an exclusive interview with Cenk Uygur on MSNBC's Dylan Ratigan Show, Julian Assange described criticism in Washington and elsewhere of WikiLeaks as nothing short of attacks on journalism and the first amendment.
<b>News</b> Conference by The President | The White House
News Conference by The President. South Court Auditorium, Eisenhower Executive Office Building. 4:16 P.M. EST. THE PRESIDENT: Hello, everybody. Good afternoon. I know everybody is itching to get out of here and spend some time with ...
Technolog - Facebook's new filters let you control <b>news</b> feed
Sometimes when Facebook comes out with something new, it immediately attracts the ire of its users, like when it made the News Feed font smaller or when the News Feed morphed to the oft-times confusing "Top News" vs.
bench craft company scam
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