I agree with larster that anyone holding the bad paper would be left holding the bag – that’l teach them. If the only ones hurt are those dumb and greedy enough to invest in other peoples misfortune (sub-prime) then I would call it the perfect plan. But I am inclined to think this is just a rumor. This is not an administration who is inclined to help “little” consumer class people at the expense of their rich masters (which is why they will never be able to solve the problems).

Wunsacon; look for auctions in your local paper. I went to a few and you can basically get things for half price if you have the cash and loan ability to bid on it (make sure to arrange credit before the auction). I got a 6 ac. lot of building land for $3500/ac. that had been sold to a builder for $7000/ac. in late 2005 in an area where they have been selling for about 6K/ac lately. The reputable (established) auctioneers will make sure you can get a clean title at closing. At the courthouse you don’t have any idea what you get, so leave that to the pro’s (or hire one to help you.

“U.S. homes now undervalued, economists say”
“Compared with their long-term fundamental values, U.S. homes are now 3.8% undervalued, the economists said”

WTF? To which long-term fundamental values can they possibly be referring?

Been averaging into SRS @ 120/115/110
Next nibble @ 100, then ramping up at 90 and below as Karen suggests.

So after I got over my posting errors, I had visions of stockcharts dancing thru my head… and I thot you’d sold your SRS. Here’s what macro-man said this morning:

But Macro Man has learned this year to be surprised by nothing and to be wary of one-way bets…

From what I recall, unreasonably low interest rates, courtesy of old Greenspan, created bubble pricing and fueled lax lending standards. As a result, people found themselves in homes they could not afford. How is this plan any different from simply recreating the past lending environment?

The only solution is to allow homes to return to their equilibrium pricing. While this may lead to some unfortunate people losing their homes, strawberry pickers making $15k/year were never supposed to be buying $720k mansions ( http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2007/04/13/carollloyd.DTL ), it is a necessity. Not to mention the enormous strain this plan would place on the Treasury. Seriously, what is Paulson thinking, “Lows interest rates will raise home price right? I mean it worked for Greeny. Wait, no one would buy these news MBSs, even though the US government is effectively backing them…..I know, the government can buy them, I mean…we are the government right? How could this possibly go wrong?”

I am doubtful that Paulson’s plan would work, but if it does we are only prolonging the inevitable and likely setting ourselves up for an ultimately bigger crash.

What wakes me up is wondering how my SRS can continue to drop like a stone, at which time I remind myself, “patience grasshoppa, patience”………..