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Non-Sequitur of the Day

"Fed plans new rules to protect future homebuyers":The mortgage rules will crack down on a range of shady lending practices that has burned many of the nation's riskiest "subprime" borrowers - those with spotty credit or low incomes - who were hardest hit by the housing and credit debacles. The plan would apply to new loans made by thousands of lenders of all types, including banks and brokers. It would ... bar lenders from making loans without proof of a borrower's income. It also would prohibit lenders from engaging in a pattern or practice of lending without considering a borrower's ability to repay a home loan from sources other than the home's value. Isn't it more logical to say that disallowing liar's loans would protect banks? Still more logical: Disallowing liar's loans protects taxpayers, since we'd be less likely to be forced to pay for a bank bailout if better loans were given...continue to full post

Full post as published by Crime & Federalism on July 08, 2008 (boomark / email).