There was a recent report about some large global banks trying to steer or entice low and middle income customers, who do not normally use banks, into relatively expensive products. This has been described as a potential $ 45 Million market. These banks are responding to billions of lost income due to recent regulations placing limits on interest and fees on debit and credit cards. The banks are now competing with non-banking check cashers, payday lenders and pawnshops.¹

The products the banks are offering include prepaid credit cards, short term loans, money transfers as well as check cashing and payday loans which all may carry hidden high costs. (more…)

Part 1: Summary
• Housing debt is at the center of the slow American economic recovery
• Home values are in a downward spiral endangering the entire economy
• The private residential mortgage market has inadequate infrastructure to reverse this trend
• Proposed solution-lower mortgage principle nationwide through a cooperative effort of the mortgage industry and the Federal Government.
• Consider modifications of existing mortgage agreements
If implemented, this plan would result in a win-win situation for both borrowers and creditors and benefit the entire country

Part 2: Background

 “There is widespread agreement among economists that housing debt is at the heart of the slow [economic] recovery, and that finding a way to bring it down faster would accelerate the recovery.”[1]The home values in the market are in a downward spiral which, if left unresolved, endangers the entire economy. In a recent article Joe Nocera, interviewed Laurie Goodman [senior managing director Amherst Securities], who states that there are 55 million home mortgages in the United States, and greater than 10 Million of them are reasonably likely to default, due to so many homes being “underwater” [meaning that the owners owe more on their mortgages than their home is currently worth]. This is due to the severe drop in home prices since the housing bubble burst in 2008. In addition the supply of available housing will continue to outstrip demand. It’s estimated that there could develop a glut in excess of 6.2 million houses. [2] There are fewer home buyers because multiple factors are at work.  These include the grim economic outlook, high unemployment, lack of personal savings for down payments, young adults returning home to live with their parents, and tightening mortgage lending standards.

 Goodman says that the combination of all these factors has led to a “death spiral” in the housing market initiated by supply/demand imbalance, leading to decreased home values, more home owners underwater, an increased number of defaults, more foreclosures, an increase in the supply/demand ratio, and so on and on spiraling downward!

  What can be done? (more…)

Senator Patrick Leahy of Vermont has proposed the establishment of a truth and reconciliation commission to investigate possible constitutional abuses of the Bush-Cheney Administration. Suspected abuses may include the use of torture, warrantless wiretapping, extraordinary rendition and executive override of existing laws. It is essential that the commission be staffed by both experienced and fair-minded people with no “axe to grind” in order to establish the facts about exactly what happened and to  determine the extent of whatever abuses did occur. The object of the deliberations is to ensure that these suspected constitutional abuses are not repeated in current and future administrations.
There is a strong feeling in the country that members of the executive branch, both in the White House and in the Justice Department, often acted as if they were above the law. These abuses must be fully exposed, not to wipe the slate clean, but to learn the truth about the recent past. The findings must insure that specific safeguards and reforms are put in place to make certain that these abuses never happen again. The commission will need subpoena power as well as the power to bestow immunity in order to facilitate complete and forthright testimony.
To encourage public support of Senator Leahy’s plan there is on online petition at http://www.BushTruthCommission.com which urges the United States Congress to establish such a commission. This effort to establish truth and transparency will go a long way to reestablishing trust in our national leadership and is completely in concert with IPPA’s core values of truth and trustworthy leadership.
Do you agree with the need for this commission or something similar and if not why not?