Look at that number. It's amazing. Yet to hear our leaders talk about it, they need every penny to prop up the mortgage lenders. They don't. And I figured out how to put it in terms anyone can understand:.
At first, I saw that number and I had to ask... How many bad mortgages are there? Then after playing with that hypothetical in my head I wondered, how many mortgages are there in active in the whole country? So I looked it up. According to this 2006 pdf from the U.S. Census, there are 33 million owner occupied dwellings with first mortgages active. (1)
Hmmm 700,000,000,000 / 33,000,000 = Over $21,000 cash the government could just give to everyone with a mortgage! What kind of stimulus would that have on the economy to hand 33 million people $21,000?
Bottom Line: If the Treasury simply took the $700 Billion and started paying off taxpayer mortgages, they could pay off every mortgage in the country worth less than $75,000... Or put another way, $700 Billion could pay off well over half of all outstanding first mortgages in the entire country.
Do you really think they need this much money?
So I say we just take the cash and pay off half the mortgages out there and see what that does to the credit market and the economy. Are ya with me?
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