Friday, August 10, 2007

What next?

The President and Congress have left Washington to head to the home states and districts that they represent for the August recess. Several unresolved issues still linger on the national agenda and all of them are the minds of most Americans, foreign nationals, and *ahem* other.

The economy, particularly housing, has created some concern among policymakers. Housing is suffering a slow-down. Mortgages are lent to homebuyers by banks, the banks then sell bonds on the open market to move the debt off of the books so that they can lend more money. The problem has been that there have been a significant enough number of foreclosures and defaults on mortgages that the bonds have stopped being purchased on the secondary market. As a result lenders have tried to tighten up their loan guidelines to make the bonds more appealing, it's unclear if it is having much of an impact. There seems to be some confusion regarding what the solution to the problem is, some have suggested direct grants to homeowners that are in danger of foreclosure, others have suggested that Fannie Mae and Freddie Mac (two government run corporations) be allowed to purchase more bonds on the secondary market, they are fresh off their own accounting scandal.

It is too early to tell what is going to happen, the problem is not well defined at this point. But there are a lot of people running for President and all of them have their own ideas of what will strengthen the housing sector.

Illegal Immigration is still lingering. No surprise there. It's been an issue for several years, the government is unable to enforce its own laws or change the laws to something more workable. Will they crack down on employers or will they tighten security at the border? Amazing that in this heighten security environment that we don't have any grasp on who enters this country. What's all the fuss about anyway?

Iraq. I am taking a pass on this one. There are finally some candidates who are at least talking about the risks associated with redeploying troops or withdrawing from Iraq altogether. None of the options are particularly pleasant.

It is not clear to me if politics is receiving more attention with the lead up to the presidential election or if it just more interesting to me. Is anyone else more interested or is it just me out here?

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