Another Government Promise Falls Short

[OmaHusker]

Over the past few years, the federal government's major mortgage relief programs helped just a fraction of the homeowners they initially set out to reach. The so-called Home Affordable Modification Program and the Home Affordable Refinance Program, both introduced in 2009, have so far assisted just 20% of the homeowners government officials projected. Other programs shuttered altogether after not gathering enough borrower or lender participation. In fact, the U.S. government's five major programs, which were projected to assist 13.4 million homeowners, only reached 1.9 million.

smartmoney.com

How does anyone put any faith in the ability of the Fed to do anything it promises?

[ChitownHusker]

I assume by "the Fed" you mean the federal government? The Federal Reserve doesn't have anything to do with any of these programs. In any event, it's really tough to incentivize banks to lend. These programs are well-intentioned but obviously ineffective.

How do you think the programs should have been structured so that they would be more effective?

[huskrthill]

It's hard to encourage banks to lend money while also telling them that they need to be stockpiling money in case something bad happens again:
http://ca.news.yahoo.com/citi-ally-s...205649742.html

These are two somewhat conflicting goals.

[OmaHusker]

Yes, I meant the Federal Government.

If I had the answers, I'd run for office. But I'd start with an environmental study.

[Power of Corn]

In my lifetime the federal govt has yet to prove it can do even one thing better, cheaper or more effectively than the private sector. To think where all those $ have gone is frightening, just basically wasted, like so many other well intentioned programs. Like reagan said, ----- govt is the solution to the problems, it is the problem.

[New York Husker]

It's hard to encourage banks to lend money while also telling them that they need to be stockpiling money in case something bad happens again:
http://ca.news.yahoo.com/citi-ally-s...205649742.html

These are two somewhat conflicting goals.

Yep, the banks are in a catch 22.

[OmaHusker]

Yep, the banks are in a catch 22.

S'ok, banks are evil.

[huskerpt34]

S'ok, banks are evil.

Not sure he said they are evil, just pointing out some contradictions in what they are being told.