Painful Journey To The New Normal

The Housing Bubble Blog » This Bumpy And Painful Journey To The New Normal: "“Is it time to pull the plug on some of these wonderful sounding, and frankly pathetically ineffective, mortgage rescue efforts? A recent Fed study, detailed in the Globe, raises some serious questions about whether the Obama effort and the myriad of other programs like it stand much chance of even putting a dent in sky-high foreclosure rates.”

“After tracking hundreds of thousands of loans over a two year period, it found that only 3 percent of ’seriously delinquent’ homeowners were able to lower their monthly payments through loan modifications. And nearly half of borrowers who received some sort of help – 45 percent – ended up in trouble again down the line.”

“Did all the economists inside and outside the government get their diplomas off the Internet or from the back of a comic book? Friday’s newspapers were filled with stories about how surprised everyone was about the country’s latest unemployment numbers. And the smart economists didn’t see this coming? Huge jumps in housing prices, no consumer saving, consumer debt constantly rising. But no one thought that was a problem.”

“If we continue to rely on the people who got us here, we better expect to simply get more of what we’ve already gotten: trouble.”"