Only time will tell just how bad this is going to get.

I’m not in the doomsayers’ corner but I will say that financials and homebuilders are going to have a tough time. Those companies that survive are going to be bargains in the long run.

Given who’s they are, I can’t imagine them doing this for any other reason.

In his remarks, Paulson noted the “overhang of unsold houses…poses by far the biggest downside risk” to the U.S. economy.

The two key words in Paulson’s speech were “credit
disruption”. The capital markets, and U.S. banking system,
are in a perilous position.

There is “off the record” chatter in this town (Washington,
D.C.), that Paulson is worried about a total financial meltdown if the record rate of foreclosures continues.

In short, Paulson is not trying to give anyone a break. He is trying to avoid a train wreck.

Now some people out there may have been victims of predatory lending. I do support helping them some. Proving that you were a victim of predatory lending may be difficult though, and personally I tend to the opinion that you brought it on yourself by not reading and making sure you understood everything. If the loan terms were over your head, you should have hired a third party to validate (or in most cases have *your* attorney review everything).

Okay so we have a poor housing market to deal with and the financial sector is having troubles dealing with it. I am of the mind that it is a hiccup (well probably more of a fit) that will pass with time and does not require meddling. As for a recession, it is avoidable if people sit back and realize their situations. Too many people are moving their investments based on emotion and over reacting to the Subprime problem.

“This is not socialism at all. Since when does the Bush administration support anyone but themselves or their supporters? Since when do they act like ‘socialists’?”

Since when does ANY administration support anyone but themselves or their supporters? Bailing out massive numbers of borrowers is in fact socialism because it’s allowing people to stay in homes that they couldn’t normally afford.

If I had to guess, I’d call this a cynical ploy to stave off the collapse until a Democrat is elected president, so that he or she can be blamed for what we all know is coming. Why else would his spokesman say the other day that “no one is predicting a recession” which is laughably false? Their MO is to make foolish moves for short term political gain and that’s exactly what I see happening here.

“Avoid the recession before the election, long term consequences be damned”.

That’s my take, anyway.

“I don’t understand why they don’t just let the system work it’s way out.”

Because if the Bush administration allows that to happen, the Democrats will raise a stink. This is all political.