Obama commits to his version of "Dictator for the Day" and comes up with another worthless scheme to redistribute wealth.

On Arpil 16, 2009, CNN Money announced the beginning of Obama's mortgage rescue plan. It took the form of loan modifications and, first in line for the Obama handouts were JP Morgan/Chase, Wells Fargo and CitiGroup. These mortgage institutions were to take the bailout money and, in turn, use it to modify loans, helping 9 million American home owners stay in their homes. After two years of service, this program offered help to only 600,000 and nearly half of these folks, still could not afford to stay in their homes. Of the $50 billion set aside to run this relief program, only 2.4 billion dollars was actually spent. Problem? Excessive regulations and paper work coming from the Obama Administration. This program was a miserable failure.

Today, Obama decided to side step congress and act on his own. His plan, another function of his genius, is more of the same and has these provisions:

• You must be current on your loan payments.
• You must have good credit.
• Income verification will not be verified.
• If your home was purchased after May of 2009, you do not qualify.
• Principle reduction is not a part of this plan. If you are "under water," that is where you remain with the Obama plan.
• If your mortgage company does not care to participate, there is nothing in the plan that forces them to join in the fun.
• Projections are that mortgage relief, for people involved in the bailout, is two full years down the road. Because of an anticipated back log of applicants and the 100 plus page application form, there is little hope that this program will of any help to the larger population of home owners.
• If you begin applying now, relief is will not be forthcoming for two years.

NY Fed Chairman, Fred Dudley had this negative summary report:

Problems in the housing market are a serious impediment to a stronger economic recovery…

Obstacles to refinancing and access to credit for home purchases are limiting the support provided by low rates to house prices and consumption. Meanwhile, the large supply of foreclosed homes for sale—and the prospect that unemployment and negative equity will continue to feed the foreclosure pipeline—continues to put downward pressure on home values. The risk of further house price declines in turn discourages would-be buyers from entering the market.

Continued house price declines could lead to even more defaults, foreclosures and distressed sales, undermining wealth, confidence and spending. Breaking this vicious cycle is one of the most pressing issues facing policymakers…

Stabilizing the housing sector is particularly important because housing equity is an important part of household wealth. This calls for a comprehensive approach to housing policy, starting with an urgent effort to remove the obstacles that make it difficult for all borrowers to refinance at today’s low mortgage rates, but extending beyond this to tackle other problems weighing on housing. Link.

Obama has unilaterally instituted another worthless plan, for the sake of a televised sound bite. He is has no clue what to do. The sad issue in this, is that Obama does not know what he does not know. He will brag about helping 11 million Americans, when in fact, only a few thousand will see any kind of relief. He will argue that "there is no time to wait" while instituting a program that promise help two years from now -- never mind the fact that there are legislative rules for getting things done. It is not that he installed this program on his own. Rather, that he suspended the function of Congress to do so.

Point of post: just thought you should know.