Bernanke’s Remedies for Mitigating Foreclosure Crisis to Be Discussed
The remedies prescribed by Bernanke for mitigating the foreclosure crisis are to be discussed at a forum. He was forced into the role of a foreclosure firefighter. This made him take bold steps during the past year to battle the worst catastrophe the nation is facing since decades.
There are many who opine that he had gone too far. Bernanke wanted to avoid further economic slump. But the actions of the Feds have been criticized. The charges are that the taxpayer’s money is being put to great risk. By expanding the safety nets the financial bodies are being encouraged to go on with their gambling ways. This does not bode well for the future.
A high profile debate will be held in Jackson Hole, Wyoming. In the forum the past financial crisis and present foreclosure problems will be discussed as also the challenges facing Bernanke and various central banks as efforts are afoot to stabilize the financial markets across the globe. The Federal Reserve Bank of Kansas is sponsoring the conference. It will be a three-day event from 21st August 2008. The Fed policy makers will be given a reception together with other economists, academics and bank officials of standing. The primary attraction is a speech by Bernanke about financial stability related to the ongoing foreclosure crisis. From Friday morning there will be piles of academic papers to swim through accompanied by discussions.
At a similar conference last year when the foreclosure crisis had started baring its fangs, Bernanke had been thinking about lowering the interest rates. He advised the Feds to do so and accordingly it was done seven times right through till April. But the problem remains and from all indications it will continue to smolder right through the following year.
The International Monetary Fund has commented that the foreclosure crisis is the worst “since the Great Depression.” But Bernanke who had made in depth studies on the Great Depression said that the present situation is not even remotely akin to it, although it is “the most severe” episode in the era following World War II. The roots of the foreclosure crisis lie in lax lending practices given to borrowers without good credit history.
With elections round the corner the prime concern of the voter is foreclosure crisis. It is this that is causing the slump in the economy – something that both the candidates Obama and McCain will have to address.
[...] Johnson an economist from MIT opines that the foreclosure crisis has been aggravated by unhealthy banks. He said, “A desperately ill banking sector that threatens [...]