Congress is askance about steps being taken by Ben Bernanke to contain foreclosures
Congress in a cynical mood was askance about the steps Ben Bernanke, the chairman of the Federal Reserve being taken to contain the foreclosure crisis. But Bernanke parried the criticism regarding expansion of the duties of the Federal Reserve to regulate the jumbo financial firms. The Congress contention was that the central bank had not as yet caught up with problems related to the financial mayhem.
The House Financial Services Committee also grilled Bernanke about the bailout money taken from the taxpayer’s kitty being distributed to the financial giants and the slow efforts to stop continued foreclosure proceedings. Concerns were also raised about the past track record of the Feds in giving protection to the consumers from the questionable practices of lenders, the credit card firms and dubitable activities of service providers.
Spencer Bachu of Alabama, the topmost Republican in the panel bemoaned, “The Fed has made some big mistakes.” He said that by allowing the Feds to act as financial super cops would be akin to “inviting a false sense of security” at the expense of the taxpayer. In little or no time the myth would be shattered.
Bernanke protested that the proposal of the Obama government tantamounted to a “modest re-orientation” of the powers of the Feds and not any significant increase. He also attempted to push back another proposal by the government that would set up a new regulator for the protection of consumers. These duties would be taken away from the Federal Reserve.
The Feds have come under criticism from consumer advocates and legislators for not taking earlier action regarding these fraudulent mortgage activities that fueled the housing boom and led to the collapse of the economy.
Another proposal coming through from the Feds will encourage mortgage disclosures and home equity lines of credit. Also will be included new rules for the governing of the compensation given to originators of mortgages.
Bernanke stressed the importance of separating auditing of the Fed from duties relating to monetary policy. He warned, “A perceived loss of monetary policy independence could raise fears about future inflation.”
Bernanke’s term as chairman of the Federal Reserve will expire early in 2010. President Obama will then take the decision about whether to reappoint him or not. The innovate measures taken by the Feds is credited with helping to prevent the economy being pushed over the edge in 2008.
- Tendency to Walk Away from Underwater Mortgages Facing Foreclosure has Increased
- Life Goes Flowing On Even After Foreclosure
- There is a Huge Shortage of Lawyers Trained in Foreclosure Complexities
- The Foreclosure Crisis Means a Bonanza for Some Enterprising Entrepreneurs
- The Restoration of the Jacksonville is Aided by the Prices of the Foreclosure Listings
- Foreclosure Climate has Caused Sharp Rise in Homeless Persons
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[...] a flood of complaints targeting the relief efforts against the background of a continued surge in foreclosures. There is a renewed effort for greater empowerment of bankruptcy judges to alter terms of loans. [...]