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We Need a Bailout: Housing Legislation 'Close to a Joke', Corcoran Says
Posted Jul 09, 2008 03:51pm EDT by Aaron Task in Investing, Newsmakers, Recession, Banking
Related: FNM, FRE
The housing legislation snaking its way through Congress calls for $300 billion to fund FHA-insured refinancing and expanded powers for Fannie Mae and Freddie Mac.
Critics claim the bill amounts to a bailout of the housing market and puts taxpayers on the hook for the irresponsible actions of others.
But Barbara Corcoran, founder of The Corcoran Group and a legend in real estate circles, says the bill doesn't go nearly far enough to bring relief to American homeowners.
The bill is "close to a joke" in that it will only aid 500,000 homeowners, says Corcoran, who believes the government needs to spend 10 or 20 times what's been proposed to alleviate the downturn. Rather than being irresponsible, millions of homeowners were duped by lenders - as Ben Bernanke suggested yesterday - and sucked into the real estate frenzy, argues the author, motivational speaker and oft-quoted real estate guru.
If anything, the majority of homeowners can be blamed "for being naive," says Corcoran, who supports the idea of a government bailout of the housing market; yes, including the nationalization of Fannie Mae and Freddie Mac, whose shares are tumbling again today.
I disagree with Corcoran and others making this case but - to repeat what I wrote Monday - if this market action keeps up, the government will have no choice but to nationalize Fannie and Freddie, which really are "too big to fail."
Posted Jul 09, 2008 03:51pm EDT by Aaron Task in Investing, Newsmakers, Recession, Banking
Related: FNM, FRE
The housing legislation snaking its way through Congress calls for $300 billion to fund FHA-insured refinancing and expanded powers for Fannie Mae and Freddie Mac.
Critics claim the bill amounts to a bailout of the housing market and puts taxpayers on the hook for the irresponsible actions of others.
But Barbara Corcoran, founder of The Corcoran Group and a legend in real estate circles, says the bill doesn't go nearly far enough to bring relief to American homeowners.
The bill is "close to a joke" in that it will only aid 500,000 homeowners, says Corcoran, who believes the government needs to spend 10 or 20 times what's been proposed to alleviate the downturn. Rather than being irresponsible, millions of homeowners were duped by lenders - as Ben Bernanke suggested yesterday - and sucked into the real estate frenzy, argues the author, motivational speaker and oft-quoted real estate guru.
If anything, the majority of homeowners can be blamed "for being naive," says Corcoran, who supports the idea of a government bailout of the housing market; yes, including the nationalization of Fannie Mae and Freddie Mac, whose shares are tumbling again today.
I disagree with Corcoran and others making this case but - to repeat what I wrote Monday - if this market action keeps up, the government will have no choice but to nationalize Fannie and Freddie, which really are "too big to fail."
Now tell me, how is our system different from the communists? Oh, that's right, it is not...
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