The Dow Jones industrial average sank another 306 points today amidst record losses and write offs by banks and other financial institutions. These losses total billions of dollars and foreign investors are rushing in to save storied financial names from ruin. Washington is now discussing economic stimulus packages but I'm not hearing much sense. Tax cuts won't solve the problems.
The situation we're facing is due to the mortgage meltdown crisis and resulting layoffs and losses. People who were victimized by sub prime lenders, immoral business practices and outright fraud need help. New banking regulations are desperately needed so capital can once again flow into the mortgage market. There is a crisis of confidence in that sector and investors have fled for safer havens.
Bringing the economy back from the brink of recession means fixing the mortgage market. This requires restoring confidence and the way to do that is the sort of regulation needed to protect mortgagees and investors. Increasing funds available for real estate buyers and insuring those terms are fair to everyone will rejuvenate that sector and stave off further job losses. The key to turning things around is restoring the real estate market and tax cuts won't do a thing for that.
Comments