Consider the following:
(1) Last week, it was broadly reported that foreclosures have continued at a brisk and increasing rate since Team Obama’s mortgage rescue plan was announced.
According to USA Today: “Foreclosure filings in February jumped nearly 6% from January, despite foreclosure moratoriums and prevention programs … Foreclosure filings were up almost 30% from February 2008, … one in every 440 U.S. homes received a foreclosure filing in February.”
http://www.usatoday.com/money/economy/housing/2009-03-11-higher-housing-foreclosures_N.htm
(2) The WSJ reports that lending has been declining at banks that have received TARP funds
“Lending at the biggest U.S. banks has fallen sharply … despite government efforts to pump billions of dollars into the financial sector.
The biggest recipients of taxpayer aid made or refinanced 23% less in new loans in February … than in October, the month the Treasury kicked off the Troubled Asset Relief Program.
The total dollar amount of new loans declined in three of the last four months … All but three of the 19 largest TARP recipients … originated fewer loans in February than they did at the time they received federal infusions.” http://online.wsj.com/article/SB124019360346233883.html#mod=testMod
(3 Most banks have been reporting better than expected Q1 earnings making rosy projections, and moving to pay back TARP funds.
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Ken’s Take:
Sure, Wall Streeters and the banks blundered big time in the mortgage mess. Still, they are a shrewd bunch. Obama’s Team of career government bureaucrats and academics are no match for the big league finance sharks. The Administration’s haphazard programs are easily exploited. The banks can take the near-free money and generous processing cost subsidies and simply drop them down to their bottom lines without doing much differently that they otherwise would. For the bank’s, it’s like taking candy from a baby …
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