« The Cash for Clunkers Program: A Bad Idea at the Wrong Time-Becker | Main | Do We Need More Regulation of Mortgages to Protect Consumers?--Posner »

08/30/2009

TrackBack

TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00d8341c031153ef0133efd3810d970b

Listed below are links to weblogs that reference More Regulation of Mortgages would Likely Hurt Consumers-Becker:

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

Anonymous

Good idea.

Anonymous

–≠—Ç–æ –≤—Å—ë –Ω–µ–ø–ª–æ—Ö–æ, –Ω–æ –∫–∞–∫ –∂–µ —Ä–∏—Å–∫–∏?

Anonymous

Another interesting (and related) question you may want to explore in a future post: Would a mortgage system providing creditors with full recourse against the borrower (rather than limited recourse against the borrower's mortgaged property) result in increased stability and lower borrowing costs?

In many countries other than the United States (including Canada), borrowers are generally required to declare bankruptcy when they are unable to make their mortgage payments. In the United States, it appears that borrowers are simply required to walk away from their home.

I would be interested to hear your thoughts on the relative benefits and drawbacks of the two policy approaches in a future post.

It would seem that the "full recourse" (Canadian) approach could reduce the incentive of borrowers to default when their mortgage is greater than the nominal value of their home and thereby could both reduce borrowing costs and increase stability (as well as encouraging more prudent decision making). Of course, these potential benefits would need to be weighed against the increased losses for defaulting homeowners, the associated political drawbacks and other concerns.

Anonymous

I think that saying the people handing out the mortgages lost their shirts is a bit misleading, the middlemen made a TON of money, and by any measure a lot of that money ended up shielded behind the corporate veil. If I make 20 million dollars and then my company goes bankrupt and I lose 5 million dollars, ya I just lost 5 million dollars but I'm not exactly crying while wearing a barrel.

Anonymous

Perhaps that was desirable in order to cut smoking, but producers got off quite cheaply, and the poorer individuals who tend to smoke a lot were hit heavily by the settlement.
I am dubious about this proposed regulatory commission for all the reasons Posner gives.

Anonymous

Experience with deficiency recourse mortgage lending (e.g., TX) versus non-recourse (e.g., CA (still, I think)) deserves academic attention in light of the 2005 means-testing amendments to the Bankruptcy Code and the band-aids Congress has recently applied to discharge-of-indebtedness income under the tax code. A deficiency judgment after a foreclosure nearly always used to mean a Chapter 7 filing to get rid of the debt and the tax liability, even for affluent people. But it may be today, with means testing, that some of these people would have to pay on the judgment for as long as 5 years pursuant to a Chapter 13 plan.

Anonymous

The comment from Aug 31, 5:02 hits on what may secretly be the biggest issue in all of this (although it does get 'some' attention). We need to change the way we publicly think and talk about bureaucratic behaviour in general, but corporations in particular. Until we do, we'll never have sensible regulations that prevent individuals from burning the ship and stealing the cargo.

Anonymous

Becker,

I think with your argument, you have failed to make a case.

Interest groups influence decision-makers differently in different contexts. The influence that interest groups exert over Congress is different than what they exert over the Federal Reserve which is different than what they exert over OSHA. You cannot just talk about "capture" generally without talking about specifics.

Also, "capture" represents on extreme level of influence. I think a relatively rare level of influence. There are levels of influence less than this, and those levels of influence can even be a good thing BECAUSE, industry interests should be taken into account along with other interests.

Let us talk about OSHA for a moment. It probably is the case that OSHA is more "captured" during Republican administrations than during Democratic administrations. Part of the "capture" of course is ideological, as appointees to this agency are likely to have different views regarding the proper balance of regulation.

But really, I don't think workers are less safe because of OSHA. The difference between Democratic and Republican administrations is a difference between somewhat more versus somewhat less regulation versus the extreme without OSHA of no regulation whatsoever.

How has "capture" made workers worse off in terms of safety with OSHA than they would have been without it? I don't think you could make the case that OSHA has workers less safe.

The point is this. You work is NOT done merely waving your hand and pointing to the abstract concept of "capture" which is so often pushed by "public choice theorists" aka "libertarians." You must get concrete and demonstrate that plausible mechanisms of capture exist in this context and explain how they would work and what damage they would do and further that such outcomes have substantial probability and are not merely speculative. You have shown neither (1) plausible context-specific mechanisms of capture or (2) substantial probability. Thus, I find your argument thus far to be nothing more than inarticulate hand waving and gesturing.

David Welker

Anonymous

It's a dog eat dog world - Darwinian economics and all that - it would help however if they taught economics and money management in school, instead of nonsense about ancient Egyptians, so that kids knew what was waiting for them,

Anonymous

Just love
tiffany
and
ugg boots,thanks!!

oil paintings

Recently, I didn’t give so much thought to writing comments on blog entries and have left comments even less. Checking out your insightful page, will probably encourage me to do so more regularly.

christian louboutin shoes

So wonderful post.I am bursting to leave a comment.I am also a fan of blog,you are an example to all of us.Thank you for teaching me so much.Good job.

cheap air yeezy

Thank you for sharing life experience. We are in the same place where we can share your happiness. Thank you very much!


christian louboutin

It is really a great visual and soul feat for me after reading you blog.

cheap ugg boots

where there is a will, there is a way

coach outlet

Mmm... mmm... good. We love them!*

Discount Ugg Boots

I shall remember that happiness day forever.

air yeezy

Come along,anyone can do that!

Air Jordan 4

The smooth marble bath clean, the mosaic decorated with painted walls, the ceiling is carved in the vault, the whole building full of classical elegance of the atmosphere.

Discount Uggs

The unexamined life is not worth living

lower back pain

A deficiency judgment after a foreclosure nearly always used to mean a Chapter 7 filing to get rid of the debt and the tax liability, even for affluent people. But it may be today, with means testing, that some of these people would have to pay on the judgment for as long as 5 years pursuant to a Chapter 13 plan.

Cheap Louis Vuitton

dute de siwei yu linian, you xiao de fangan he silu, gaoxiao de zhixingli he caozuo. sage ren de tuandui.

air jordan

Thanks for such a gdgdreat posvbt and the review, I am totally impressed! Keep stuff like this coming.

Coach Bags Outlet

I love Volkswagen's Beetles very much. I think that this advertisement was extremely curious for that time.

jordan shoes

She knew she must keep calm.!

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Working...
Your comment could not be posted. Error type:
Your comment has been posted. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.

Working...

Post a comment

Become a Fan

May 2014

Sun Mon Tue Wed Thu Fri Sat
        1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
18 19 20 21 22 23 24
25 26 27 28 29 30 31