The great Bailout Swindle

One of my favorite authors, Dr. Jerry Pournelle, made an interesting observation last week. He was musing about how Pretender Barrack Obama's Trillion-dollar bailout related to the actual losses in the sub-prime mortgage crisis. They don't appear to be very closely related at all.

Consider:" Assume 3 million real estate loans in default. Assume an average of $3000 a month for payments. That's nine billion dollars a month. Call it ten billion a month. That adds up to $120 billion a year, a healthy sum, but had that been paid, there would have been no collapse due to "toxic" mortgages and mortgage based securities. "


Assuming the government took over ownership of the affected homes and rented them back to their former owners the net cost could be as low as 70 billion a year. That's a far far cry from Obama's Trillion dollar political-pork solution.

Why wasn't this idea used?

Read the rest.