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The only reason I feel uncomfortable with the government owning homes is that, historically, the government either ends up giving land away well below its value or they violate contractual obligations when they discover they can make more money.
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Bill I agree 100%. I have heard that Warren Buffet has said the government could actually make money on the deal and Paulson hinted at that on a 60 minutes segment I watched. It could be true but unfortunately since the government is not real estate or investment savvy the deal would probably be squandered and yet another opportunist would make a killing.
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OK, this is a question that I've been dying to ask. Is anyone else skeptical of the dire consequences that were predicted should the bailout have failed?
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I am skeptical like you. I think had the bailout not happened, in the medium term it just would have consolidated lending institutions in a Darwinian fashion and the strongest would have survived. Like Wells Fargo maybe. In the very short term it would suppress lending but now that they passed the thing it doesn't appear that the money is free flowing or did I miss it. The stock market sure wasn't impressed Friday.
I for one do not like the hybrid nature of Freddie and Fannie. Seems like the risk is assumed by the government but profit is private. That sounds like loading +P ammo in a blackpowder handgun. May not blow up the first time but surely will eventually.