Paulson’s Wild Ride on the Hindenburg: “The Worst is Just Beginning”

[Crewleader]

by Mike Whitney / February 16th, 2008

It’s a good thing Henry “Hank” Paulson wasn’t around in 1929 or we’d all be hawking apples on a street corner. Paulson is currently on a losing streak that would have been the envy of Marvelous “Marv” Thorneberry and the ‘67 Mets. In the last three months he’s put together three new programs to deal with the subprime crisis that have fizzled out in a matter of weeks. First, he tried to entice struggling investment banks to put their mortgage-backed bonds in a Super SIV (structured investment vehicle) to see if it would help offload billions of dollars of downgraded junk onto unsuspecting investors.

That flopped. Then he brokered “Hope Now” (1-888-995-HOPE), which was designed to help the banks and homeowners work out the details for a rate freeze on mortgage resets. Paulson assured the public that 500,000 homeowners would take advantage of the program, which would dramatically reduce rate of foreclosures. So far, the Hope Now hotline has provided counseling to just 36,000 borrowers. “Representatives have suggested loan workouts for fewer than 10,000 of them, a small fraction of borrowers in need.” (“Earlier Subprime Rescue Falters,” Wall Street Journal) “Only 10,000 homeowners; and Paulson promised 500,000? Another slight miscalculation.

This week, Paulson announced another new program, “Project Lifeline,” which targets homeowners who are delinquent 90 days or more on their mortgages. Here’s a rundown of how it works: (thanks to Calculated Risk)

http://www.dissidentvoice.org/2008/02/paulsons-wild-ride-on-the-hindenburg-the-worst-is-just-beginning/

[stevedeshazer]

1. This is very scary

It indicates that the money managers are just keeping the economy held together with duct tape and WD-40.

The dam is ready to break.

The next president is gonna have a huge mess to deal with, and I sure hope s/he is up to the task.

Hi! :hi:

[Crewleader]

2. Hi Steve_DeShazer

You are right my friend, the next president has a real mess to deal with, but I have faith in her! :hi:

[TalkingDog]

4. Well no wonder it's falling apart!!!!

Have you ever tried to duct tape something with WD-40 on it? No way that tape is sticking......

Tell them to put down can. Better yet, give them a paper bag and tell them to go huff some. Their already brain-damaged behavior can't get any worse.

[Arctic Dave]

3. Time to start making a fiscal plan

Th is is going to be a real bummer for the next year or two. Be on the look out for every neo con trap to con us out of what we have left.

[sendero]

5. Those who think the Fed ...

... can bail us out of this mess should take heed :(