Use the Fed to Fix Housing Market Crisis: Suttmeier

Where is my help? Oh that's right, I don't get any because I've been responsible all along. I didn't take out an exotic mortgate. I didn't use my house as a 'cash cow' during the bubble. I pay a higer percentage of income in taxes than Romney or Buffet and countless others. I didn't run up consumer debt; I lived within my means. And for all this I get screwed yet again for being responsible. I thought I was being smart. Turns out I was being stupid. I should have kept taking money out of the house until, enjoyed it, run up credit card debt and enjoyed it; then walked. What an outrage. Here's a better idea, help the responsible here who are innocent bystanders that have already had bailouts funded off their backs.

I know people that buy foreclosed homes from banks at discount prices. Then they put repairs into it to make it habitable again and sell them for a profit but still at or below the market for the area they are in. It is a win-win for all involved. What is a matter with this idea??? It has created jobs, cut into the housing glut and requires banks to get real about what a property is really worth in the shape it is in.

The "crisis" (lowering home values,reduced construction) IS the fix to the housing bubble.

To fix the crisis would be to break thing once again.

Pointless - the Fed is already helping the housing market by keeping interest rates low. No need to arbitrarily lower mortgage rates further. The glut of unsold homes is now more a function of the economy, and people's unwillingness to commit to home purchase in a period of uncertain employment, than due to the rate paid on the mortgage. We have bigger problems to deal with than this. Besides providing additional incentives for more home building and more aggressive lending is what got us in this housing problem in the first place. "It's the economy, stupid!"

government solutions are always the best answer............yikes

In other words, screw the elderly and savers that have already been hosed so he can reward the debtors and Wall Street Bankers. What a load.

"No one wants to buy a foreclosed home," he says.

REO properties are selling faster than non-distressed properties. Plenty of people want to buy a foreclosed home, if it's priced right.

Here's a better idea. Do the opposite of the artificial, overly accommodative Federal Reserve policy. It doesn't work because it is artificial market manipulation. If anything has been learned since Greenspan and Bernanke thought they could oversee permanent prosperity through monetary policy and quantitative easing, it is than they most assuredly can not.

Since when is there a housing "crisis"? Last time I looked, the houses were still there.

Prices are reverting to the norm. What's wrong with that? So what if a few Banksters lose money and are exposed as crooks?

Big problem with the whole premise that Homebuilding is the so-called Lifeblood of the Economy. Homebuilding should be the RESULT of a good economy from increasing U.S. jobs & increasing salaries which create legitimate demand, NOT a determinant of a good economy. This is where Washington has it backwards and until they figure it correctly, they are attacking the wrong side of the equation.

. . . . invigorate housing construction. . . ?

More houses need to be constructed in a market where there are already too many vacant houses waiting for qualified buyers? Any jacking around with the market will only serve as incentive for more people to stop paying their mortgages.

Due to Fed intervention, rates are already at historic lows (around 3.75% on 30 yr fixed and 3% on 15 yr fixed). Taxpayers have already subsidized the housing market way too much. If lower rates are good, then why not go to zero at taxpayers expense? Enough already. Rates are not the problem. Speed up the forclosure process and let the market absorb the inventory until normal supply and demand balance is restored. Other posters have noted that investors scoop up these forclosures, fix them up and rent them. As has been said below, win-win (of course, the homeowner who cannot afford his home will become a renter but that is how free markets are supposed to work).

More Socialist Propaganda. The market will self-correct if government gets the hell out of the way.

Why not give discounts / tax breaks to savers who will buy these homes outright for cash? Whats the point in handing out more cash to losers ?

MORE debt is not the solution and will only hurt consumers. It helps the debt securitization industry and Wall Street always wants to create more debt so everything you will ever see published or proposed by the mainscream media will be promoting more debt.

However, the only way to have a sustainable housing system is to LET HOUSING PRICES CORRECT TO THE MARKET PRICE. That is the average home in your zip code is 2-3 X the median income in your zip code. Period. No more debt gimmicks, no more bailouts for the debt industry, no more giveaways to an oversized housing and real estate industry, just let the price correct! Getting rid of unnecessary costs like mortgage brokers, realtors, stupid building codes and red tape would help too.

We could always do a reverse plan of this guys logic. Give the savers 15% interest on their money. They might spend some of it on housing.

They need to pull out all of these props and let the housing market hit bottom. Then we can really recover. As in the Great Depression, the Federal government is extending the duration of this crisis with all the intervention. Rip the band-aid off, quit bailing everyone out and let's have a real sound money, responsibility driven rebound.

I swear, was this much angst and hand wringing and repeating the mantra "THE CENTRAL PLANNERS MUST SAVE US" going down back when the tech bubble burst?!? I remember going through that and losing a good amount of money. As much pain as that caused, I (and a lot of others) learned an important lesson about diversification of investments and educating myself better on how to properly evaluate the worth of a company compared to its stock price. I don't recall anybody asking for big government to save them then from that bubble. Bubbles are bubbles, lessons need to be learned about how not to get burned by the next big thing that just can't lose.

Bailouts just sicken me, whether it is corporations or individuals. All parties need to put on their big boy pants and deal with the decisions that they've made! Learn your lesson and be the better person (or corporation) for it by making better financial decisions in the future.

How about letting folks use deferred retirement money (401K) tax free to pay off enough principal to qualify for a lower interest loan. I am about $20K upside down, need an additional $40K to pay down to a level where I could refinance at a much lower interest rate. Not tax free, the $60K from my retirement would cost about $15K in tax.

The FED caused the housing crisis.