Can The Crisis Be Minimized?
A reader sent this Copenhagen Post story regarding two professors who think more can be done about the bubble than holding "who spilt the milk" hearings. "The two, legal experts specialising in the real estate market, see the situation as so critical they warn that the state should start to consider the establishment of a government financed organisation designed to help bail out homeowners when the market fails."
"It seems that lenders have been able to turn a significant portion of customers into life-long debtors, for example with interest only mortgages. The development has also created a niche for private speculators, that is to say, individuals who are buying property for resale, rather than as a place to live."
Many readers have said the government will only screw-up this mess further and they should not bail out the market. That's probably true and I would add the problem in the US is too large. But these gentlemen are right to say the government should do something, even if its just to try and "talk down" prices.