If you thought the subprime mortgage mess was behind us, think again. In the next year, another two million adjustable-rate mortgages are scheduled to reset from low “teaser” rates to household budget-busting new highs.
Foreclosure rates are already soaring. In some regions, whole neighborhoods risk going under. A credit crunch backlash has markets around the world in turmoil.
Now Washington is girding to weigh in. But who, if anyone, should be bailed out? Who punished? Who reined in?
This hour On Point: homes, high-rollers, and moral hazards in the subprime mop-up.
Rep. Barney Frank, Democrat from Massachusetts, chairman of the House Financial Services Committee
Karl Case, professor of economics at Wellesley College and co-author, with Yale’s Robert Shiller, of the Case-Shiller Index, the leading database of U.S. housing sales
Michael Mussa, former chief economist at the International Monetary Fund and former member of President Ronald Reagan’s Council of Economic Advisers
Michael G. Ciaravino, Mayor of Maple Heights, Ohio, a city hit hard by foreclosures
Bob Hagerty, Wall Street Journal reporter