And The Economic Dunces Award Goes To…..

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The Obama Administration!

Yes, They are the biggest economic illiterates perhaps in a generation. Here is the headline:

Program to pay homeowners to sell at a loss
Obama administration’s latest attempt to stem the housing crisis

Yes, you heard that right. In order to try and stem the ever growing foreclosure crisis (5 million behind in their mortgage payments and pending foreclosures) the Obama administration has come up with the brilliant plan to pay “homeowners” to short sell their house….

First off, you’re not really a home owner until you’ve paid off the mortgage, but that’s quibbling.

What the hell difference does it matter it the house is a foreclosure or a short sale. It is still empty. At least with a foreclosure, there is an auction and the house will eventually be sold to a bargain hunter who gets the fair price in a severely deflated market. A short sale will actually take longer to accomplish, as the price will not be as cheap, and buyers are scarce. The article expresses concern over the credit of the forclosee, yet their credit, by the time they are faced with losing the house, is almost certainly in the toilet anyway.

And who is going to buy the houses anyway? Everyone who wants to buy a house has been doing so in order to get the tax credit. Yet, with a sluggish job market, the unemployment rate at 9.7, wage increases at a standstill for the foreseeable future, impending job losses due to states like California also going bankrupt, who pray-tell, is going to buy all these houses? Many of the foreclosures are bought by wealthy bargain hunters who are often using the property as a rental, and then will sell for a profit once the housing market recovers.

Hey, instead of doing this, who not do something to actually spur economic growth and suspend the corporate tax for a few years. Might even bring some businesses back to the country… Oh, sorry, I was dreaming again. Democrats would never fiscal policy that could be seen as doing corporations a favor, even if it would go a long way to starting a real economic recovery, one that, unlike the current situation, would include something called job growth. The only thing the administration might accomplish with this stupid “fix” is to fraudulently bring the foreclosure rates down a little and give them something to crow about, something they desperately need.

So, once again, the guvment is going to hand out more money it doesn’t have for a fix that will accomplish nothing.

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