Rate Freeze

So government decided to step in and announce a program to help homeowners that entered into ARMs with a rate freeze.  This move has to be seen as a purely political maneuver considering the upcoming elections.  In our view, it is the wrong signal and it might prolong the workout process for the housing market.  Further, for all those people that made sure they understood what they signed and that they could actually pay their mortgages, this is a slap in the face.  If anything, the government should take an active role in educating people early on in school so that they understand how this market works.  21 year old college kids who never saved a dime are buying houses these days.  Most of them have no clue about how to manage personal finances.  Start there and tackle the problem at its roots, the lack of financial education. Don't intervene in the market.  That sends the wrong signal to the markets and the people who might get the idea that the government will bail them out again in the future.