Mark Trahant: Financial system rivals natural disaster

Monday, December 3, 2007  

"Line by line a national narrative is being advanced: We're going to rescue (fill in the blank) from the mortgage catastrophe. I say "fill in the blank" because we don't yet know whom or what will be helped. Both Congress and the Bush administration are looking for ways to scribble names into that space.

By any measure, the size of this calamity rivals that of a natural disaster.

About 600,000 Americans already are facing foreclosure -- and about 2 million subprime mortgages were supposed to reset in the next year and a half. The word "reset" doesn't sound as bad as an absolute order for families to tack on an additional $400 or $500 a month on their current house payment.

"Some homeowners will be able to afford their new payments without trouble and many others will qualify for a refinanced, fixed-rate mortgage on their own," said U.S. Treasury Undersecretary for Domestic Finance Robert Steel.

"Other homeowners, however, have stretched too far beyond their means or have made bets on the housing market, buying up multiple houses expecting to make a profit. Unfortunately, for many of these borrowers, foreclosure is inevitable," Steel said last week. "And let me be clear -- we have no interest in bailing out speculators. Our concern is for the Americans who are struggling to make payments on their primary residence. Our challenge in Washington has been to work with the private sector to identify the group of homeowners who, with a bit of assistance, can stay in their homes."

That's one part of the mystery blank name, the names of homeowners who could be helped to stay put."

Get the Story:
Mark Trahant: U.S. financial system sorely tested (The Seattle Post-Intelligencer 12/2)

More Mark Trahant:
Mark Trahant: Groups under siege in Pakistan (11/19)
Mark Trahant: Kicking democracy in the ... (11/12)
Mark Trahant: Those who know don't really know (10/29)
Mark Trahant: It's time to let the workers win (10/15)
Mark Trahant: Standing at roads not traveled (10/8)
Mark Trahant: An antidote to the ways of war (10/1)
Mark Trahant: Everyone still interested in the money (9/17)
Mark Trahant: Election system presents few choices (9/10)
Mark Trahant: Deflation a threat to U.S. economy (9/4)
Mark Trahant: 'Prez on the Rez' forum a success (8/27)
Mark Trahant: Is America turning inward? (8/20)
Mark Trahant: Democrats pass on Prez on the Rez (8/13)
Mark Trahant: Bush tax cuts come with a price (8/6)
Mark Trahant: Real estate crisis really about credit (7/30)
Mark Trahant: Science still clear on global warming (07/02)
Mark Trahant: Sacred sites must be saved (6/25)
Mark Trahant: Society is being numbed by dumb (6/18)
Mark Trahant: Creating a world with less garbage (6/11)
Mark Trahant: A boost of the unambiguous (6/4)
Mark Trahant: Economics of immigration reform (5/28)
Mark Trahant: The changing face of America (5/21)
Mark Trahant: Agree to disagree about warming (5/7)
Mark Trahant: Optimism for the newspaper business (4/30)
Mark Trahant: Tribal colleges effective and essential (4/23)
Mark Trahant: The global warming debate (4/16)
Mark Trahant: America's cycles of boom and bust (4/9)
Mark Trahant: Spring cleaning for the government (3/26)
Mark Trahant: The state of the changing news media (3/19)
Mark Trahant: Mismanagement of the Indian trust (3/12)
Mark Trahant: More gloomy prospects for economy (3/5)
Mark Trahant: An important vote for Seattle (2/26)
Mark Trahant: America headed toward credit meltdown (2/19)
Mark Trahant: Doom and gloom on global warming (2/12)
Mark Trahant: Americans unsettled over economy (2/5)
Mark Trahant: Too hard to ignore global warming (1/22)
Mark Trahant: Women finally take their place (1/15)
Mark Trahant: Raise taxes to pay for war in Iraq (1/8)
Mark Trahant: President Gerald Ford and Indian health (1/2)