Treasury May Force Lower Mortgage Rates

"Man is the only animal of which I am thoroughly and cravenly afraid...There is no harm in a well-fed lion. It has no ideals, no sect, no party." George Bernard Shaw

Why can't the government stay out of our personal contracts in the market place?

The housing bubble was caused by human greed, enabled by government polices that interfered with buyers and sellers determining a fair market price. The government encouraged consumption, rewarded consumption with tax deductions on mortgage interest, and rewarded lenders who made bad loans. The government should have rewarded savings, which would have made real money available for lending and investing. Instead the government created artificial book values that encouraged borrowing on undervalued assets.

The government wanted house prices to rise, while hooting for "affordable" housing for the poor. Now that home prices are "affordable" the government cannot stand it because there is less property tax revenue for the government mob. Now they are trying to do the same thing they did before, artificially inflate the value of homes by lowering the mortgage rates, thus lowering the monthly payments required of the homeowner. This ponzi scheme will have unseen consequence just like all government schemes. The government is still trying to encourage spending instead of savings.

http://www.cnbc.com/id/28037936/print/1/displaymode/1098/
"The Treasury Department is considering a plan to boost the depressed housing market by easing mortgage rates on new home loans.

The plan, which is in the development stages, would bring loan rates down as low as 4.5%, a full percentage point lower than the prevailing rates for 30-year fixed mortgages.

Under the plan, the Treasury would buy securities underpinning loans guaranteed by Fannie and Freddie , which are temporarily under the control of the government, as well as those guaranteed by the Federal Housing Administration."