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<p>[QUOTE=&quot;medoraman, post: 1361809, member: 26302&quot;]It such a complicated issue I am sure the three of us are mainly agreeing. My only point was such laws DO have long term, negative consequences on subsequent borrowers, even if its &quot;great&quot; for people right now. People can be self serving and pass such laws, but again its simply benefiting them at the expense of their children. Regarding foreign lenders and making them eat it, that again may be great for current owners, but they can simply NOT lend the money in the future, or simply demand hugely higher rates. You cannot force Taiwan to underwrite US home ownership at a loss. Take away foreign purchasers of housing debt, and our current financing system of housing in the US collapses overnight. Can we do so? Yes, but not at the low rates we now enjoy.</p><p><br /></p><p>I am for letting the market work Cloud. I am for lenders demanding collateral for loans if they see fit. It is you saying government should be able to change the market by allowing the government to interfere with contract formation and prohibit collateralization of loans. I seriously do not see how I am the &quot;anti-free market&quot; guy here.</p><p><br /></p><p>Fatima, I agree with many of your points. I am very much a free market guy, and all of the bailouts I disagree with, and think healthy markets REQUIRE firms to fail when they have made bad decisions. Without fear of failure, firms do not have the required discipline. That is the real negative outcome to all bailouts. The only caveat is when government intervention in the first place has forced a company into insolvency, that is a trickier issue. In my &quot;perfect world&quot;, government stays out of business in every way, and is simply the referee preventing illegal acts.</p><p><br /></p><p>Edit: Btw how am I advocating anything to do with public services? How does this affect the grossly inflated and wasteful budgets that most local governments in this country have? Their spending has gone up well above inflation for DECADES. To me that issue has nothing to do with either student&nbsp; or mortgage loans. It has to do with extravagent benefits promised, and poor budgeting decisions.[/QUOTE]</p><p><br /></p>

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