This article is an op-ed piece, specifically discussing issues with what got America into the mortgage mess that finally collapsed in 2008. Review of a recently-released, 59-page”white paper” by SSRN (which they charged $5.00 to obtain a copy of) takes aim at the statistical behaviors of American consumers (as homeowners). I’m sure you’ll delight (sic) in what their research shows in this study, entitled: MORTGAGE REFINANCING, CONSUMER SPENDING, AND COMPETITION: EVIDENCE FROM THE HOME AFFORDABLE REFINANCING PROGRAM
Bad Government Policies
It doesn’t take a rocket scientist to figure out that when you combine an over-appraised home with a predatory loan, you’re in trouble if this combination fits into your scheme of things. This paper appears to endeavor to ferret out that the HARP (Home Affordable Refinance Program) was just another “joke” plied upon unsuspecting and desperate Americans eager to participate to reduce part of the foregoing equation, based largely on competitive “frictions” and other empirical data of no relevant use to borrowers.
Again, it appears the United States government is “writing checks its body can’t cash”.
This however has fueled statistics in other areas, as claimed in this report:
“Regions more exposed to the program saw a relative increase in non-durable and durable consumer spending, a decline in foreclosure rates, and a faster recovery in house prices.”
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