Joe Grano Calls For 50 Year Mortgage Solution
Author: Rob K. Blake
Published: July 31, 2008
Joe Grano, a known Wall Street heavy-weight, in an interview on CNBC today calls the recent government solutions to the mortgage and housing crisis “band-aids” and calls for a permanent solution including 50 year mortgages.
Joe Grano discussed many reasons and possible solutions to the financial, credit, and housing market instability. The most intriguing for my money was his suggestion Hank Paulson’s recent legislative solutions were not going to work implying they could not be considered permanent solutions.
I have contented all along the new solutions the Fed and the Treasury have devised are not only not impotent, but could do actual harm to the markets slowing a recovery.
Joe Grano and the 50 Year Mortgage
Joe Grano suggested a new FHA home loan program with a fixed rate and a 50 year term. He mentions in the interview this would lower permanently the payment on a $400,000 mortgage by $800 per month allowing troubled homeowners to stay in their homes.
50 year and even 100 year mortgages are the norm in Japan and Joe Grano knows it. Of course, Americans live under the false belief they “own their home” even with a 30 year encumbrance. A 50 year mortgage would shatter this false belief taking the need to get one’s piece of the American Dream to all-time lows. That’s not good for housing demand which we need to bolster, not destroy.
This time, I think the Wall Street big-wig, Joe Grano has missed the mark as badly as Hank Paulson and Ben Bernanke.
Click the link to see the Joe Grano CNBC interview…if you feel the need.
Good Luck!
Author: Rob K. Blake
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