While homeowners scammed by unscrupulous mortgage brokers, lenders and appraisers are losing their houses in record numbers the Bush administration is bailing out the banks first. The repeated cuts in the fed rate are a back door welfare package because it significantly increases bank profits. These rate cuts aren't be passed on so banks are pocketing the difference. Banks are also becoming even more aggressive about fees and penalties for their retail (those with checking and savings accounts) customers.
Of course if the banks begin failing we're in a whole other kettle of fish, one with hungry sharks circling around what's left of our economy so these are difficult decisions. One component of the Carlyle Group was unable to meet a margin call and now Bear Stearns, a giant Wall Street firm, was unable to pay its lenders. The Federal Reserve stepped in and saved the bank. If they hadn't:
"The Fed used a little-known power it last exercised in the 1960s to stem a run on Bear Stearns that could have sent multibillion-dollar losses cascading across the world financial system, causing more failures on Wall Street and threatening to choke off global economic growth."
This is how close to the brink Republicans have placed our economy. Add to this a dollar which is on its way to be worthless (yes, deficits DO matter), a war without end which is strangling our national finances, the fact we are paying for this war with foreign loans because we refuse to tax the rich, and I wonder why either Obama or Clinton wants to inherit the mess.
Let's remember this is largely an economic catastrophe caused by the lack of regulation. Had the federal government established clear, fair rules for the mortgage industry and actually enforced them the meltdown in the sub prime market, the catalyst for all these troubles, could have been avoided. We need look no further than the scams that happened in the Poconos targeting first time, naive home buyers where the nexus of the crisis began.