Foreclosures Jump Again Despite Taxpayers Bailing Out Fannie And Freddie
Despite the government take over of Fannie Mae and Freddie Mac, once more foreclosures have jumped nationwide especially in Queens. The big question before Americans is what is going to happen now that the taxpayer is shouldering the bailouts of these mortgage giants. A recent study undertaken in Queens show that things will continue to remain as bad as before.
The latest report shows that foreclosures in New York City made a modest increase in August. Taken in isolation this bit of news should not be disturbing. But what is of concern is that except for Queens all the other boroughs showed a decline in foreclosure numbers. James Sanders Jr. a City Councilman commented, “Queens, in one sense, the buck is stopping here – the buck is being lost here.” He lamented that the leaders have not risen to the call of the hour. He added, “our community is the hardest hit in New York City, we at every level should be screaming the most, and demanding action of our leaders.” According to propertyshark.com, foreclosures increased in Queens by about 45% from July. On the other hand in Brooklyn, Staten Island and Manhattan the foreclosure numbers fell by 29%. It is the foreclosures in Queens that have single-handed increased the average in New York City for August.
Sanders feels that he can smell racism here. The sub-prime lenders have preyed upon the Blacks. Since there is a large concentration of Afro-Americans in Queens it is not surprising that foreclosures here are higher than elsewhere in New York. He feels that this is the “single greatest loss of black wealth since the Great Depression.” It spells loss for the Asians including the Japanese. If the losses continued unabated then the entire borough will buckle under. Sanders statement bears out the fact that cities having a large number of coloured people like Miami and Los Angeles have also been badly affected by the mortgage catastrophe.
Henry Paulson the treasury secretary announced before the media that the government was taking over the reins of Fannie and Freddie. A cursory glance showed that their cash reserves have fallen to dangerously low levels because of millions of Americans defaulting and facing foreclosures. If the treasury failed to step in thousands would suffer together with the jumbo mortgage giants. On the local level the reaction to the takeover remained ambiguous but the global markets rallied. It all boils down to the taxpayers propping up Fannie Mae and Freddie Mac.
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