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-- at stake today as rich with morning out the federal housing up administration authority now on the brink.
There's about a 50% chance it too will need a bail out here to explain how this could possibly happen.
That with the American Enterprise Institute.
-- the part of the problem is the US taxpayer and the federal government are the mortgage market and it's only getting worse.
Absolutely -- -- What's been going on is FHA has been piling on its guarantees it now has over a trillion dollars of mortgages that it's guaranteed.
Guaranteeing backed by only as -- said about two and a half billion dollars of capital cushion.
It's under capitalized by about twenty billion dollars it's been in violation.
About congress' capital requirements for about three years now and this is gonna continue for the foreseeable future.
And the whole keep seems to keep getting and a bigger and deeper as FHA does more business.
And Ed very as it zeros time.
That lawmakers want to start pulling away from being built what did primary lender in this country essentially.
-- act absolutely in fact it's the contrary.
There is an appropriations bill that's winning its way through congress.
That would raise the loan limits for FHA.
Two finance what's been called -- mentions.
Loans that are up to 700000.
Where the house could cost -- close to 800000 dollars in certain areas of the country.
The problem is that FHA has no business being in this market.
But the bigger problem is the private sector.
Is trying to come back.
When the loan limits went down at the end of September the private sector responded.
In the months before that in the months -- after that.
And started making more loans insuring more loans with private mortgage insurance bringing private capital market and -- congress wants to slam the door shut on that by idea -- limits back to where they work.
But this seems to be the one bailout and the one area in which government essentially controls and entire market or industry.
That your average person.
Really doesn't care about it because if they -- I know plenty -- people.
Would you -- get Fannie Mae loans Freddie Mac loans and you get FHA refinancings are FHA loans.
And frankly they don't put two and two together they don't like bailouts but it doesn't bother them that their mortgage is backed by -- setting -- Absolutely 95% of the housing market is roughly -- Uncle Sam so it's effectively nationalized.
The problem with FHA -- projections and talked about a 5050 chance the requiring taxpayer bailout.
Is they have what I call rosy scenario on house price appreciation.
They show that house prices will go down in 2011 -- thirty for gone conclusion.
Here it is November but they have them going up next year and going up quite a bit in the years following.
And it started to make predictions but there -- over a hundred.
Weigh in on.
A -- that.
Robert Shiller conducts.
And they project about an 8% increase over the next 45 years uniformly.
FHA is relying on an 18% increase and therein lies the difference if they don't get that 18% increase -- looking at taxpayer bailouts.
You become bail out nation and the EU cannot reverse it -- thanks so much as great -- -- -- all my day in making powers and all at and I would the American you know.
And -- presence today.
Now let's move on to the markets right now the Dow is down about thirty points.
Or sell it just a moment we're gonna talk to Mike pond from Barkley steam is coming -- to tell us that well.
Economic data here in the US is okay it's pretty good but the problem is in his view Europe is just a ticking time bomb.
More on the protests in New York what will happen and how long do you think they will go on go to our FaceBook pages.
Tell us what you think and the super commit.
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