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| Thursday, March 18, 2010 |
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ANALYSIS
March 2, 2009
Sagging Index no longer reflects what’s going on in the market, some say, Replacements? Google it, to start.
March 2, 2009
Downward price spiral will actually boost the cost of capital for most companies. CFOS, take note.
March 2, 2009
The latest bailout at AIG could be a preview of how the president will deal with Wall Street.
March 2, 2009
No corporate defaults. Big debt offerings. Percolating CP issuance. Things may be looking up in the capital markets.
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February 10, 2009 4:10 PM ET
The Obama administration’s new $50 billion bailout for struggling homeowners drew immediate criticism from a senior Democratic lawmaker who said the amount was too little and the plan was taking too long to develop. The housing plan is likely to run into broader criticism from Congress and may have to be revised, analysts said. Treasury Secretary Timothy Geithner today unveiled the administration’s revamp of the Bush administration’s much-criticized $700 billion financial rescue. It is to include a comprehensive plan for preventing foreclosures that will be announced in the next few weeks, he said at a news conference. “This crisis in housing has had devastating consequences, and our government should have moved more forcefully to limit the damage,” Mr. Geithner said in his speech. The housing portion will provide $50 billion to prevent foreclosures of middle-class homes by helping reduce monthly mortgage payments, according to a Treasury fact sheet. An unspecified additional amount will be provided outside the bailout program, a senior administration official said at a briefing after the speech. The amount is at the bottom of the range outlined by Obama economic adviser Lawrence Summers in a Jan. 15 letter to congressional leaders that pledged between $50 billion and $100 billion in “a sweeping effort to address the foreclosure crisis.” House Financial Services Committee Chairman Barney Frank immediately denounced the administration’s housing plan as inadequate. “I’m concerned that $50 billion to reduce foreclosures understates the amount that we will need, and we need some assurance that, assuming this works as we hope it will, there will be more money available,” the Massachusetts Democrat said. Mr. Frank, who had been consulted in advance by Treasury officials before releasing the new plan, added that it is taking “too much time” to release details of the housing program. He called for a moratorium on foreclosures by loan holders until the administration’s housing plan is released. Senate Banking Committee Chairman Christopher Dodd offered qualified praise. “That’s $50 billion more than we had before,” the Connecticut Democrat said in an interview after Mr. Geithner’s speech. Asked whether it would be enough, he said, “I hope so. We’ll see.” Mr. Dodd, who introduced Mr. Geithner at the Treasury news conference, had been a persistent critic of the Bush administration for failing to provide any bailout money for homeowners. The rescue legislation enacted last October required funding for foreclosure prevention. Financial and economic experts today also criticized Mr. Geithner’s housing plan. “It is grossly inadequate,” said Peter Morici, University of Maryland business professor. “He’s going to get some heat, and they’re going to have to revise it.” Yale University finance professor William Goetzmann, a consultant to a congressional watchdog overseeing the bailout, said foreclosures “should be addressed with the same urgency as the crisis in financial institutions.” “They are two sides of the same coin,” he said. “I am puzzled by the delay in addressing the foreclosures.” The worst housing slump since the Great Depression has caused a record 19 million homes to be empty at the end of 2008, with the number of vacant houses climbing 6.7% in the fourth quarter from the year before, according to a Census Bureau report earlier this month.
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Latest News
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