Iain Murray says the new mortgage plan won’t work. Why would it?

[Update late morning]

More thoughts from Tim Oren:

There’s no way to resolve the rates on offer from the ‘bad money’ with those needed by rational, market driven ‘good money’ investors. The result is the good money will stay home. Home, in this case, mostly being China or the Middle East. The fraction of federally originated loans, already at 35 percent, is going to keep on rising, and it will done with more fiat money cranked out by the Feds.

The politicians are trying to reinflate the housing market. Their irresponsible behavior is instead likely to leave that market deflated by driving out the good money, while debasing the currency and piling up debt for the productive and future generations.

Just as in the thirties, all of these ad hoc, arbitrary panic measures are going to cause a lot more damage than simply letting the market work. Because the “Change” administration is deathly afraid of change.