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Jon Talton

Analysis and commentary on economic news, trends and issues, with an emphasis on Seattle and the Northwest.

February 10, 2012 at 9:55 AM

Vote: Mortgage deal settlement or joke?

The $25 billion settlement between banks and states over abusive and fraudulent mortgage practices has its upsides, especially for the banks. They get out from under a huge legal liability and enjoy headlines that imply progress is being made. Boosters of the deal claim it won’t just help a million house owners who owe more on their mortgage than the value of their property, but it will actually cause the deeply wounded housing industry to recover.

Critics, including me, say the banks get off with little punishment. They and Wall Street (and their government, regulatory and political enablers) have done much damage to the rule of law and gotten away with it. The settlement won’t help many people and will be extremely difficult to track and enforce. Some of the best analyses can be found here, here and here. About the best I can say is that the attorneys general of California and New York held out for a deal that will allow prosecution of other abuses. But federal and state authorities have shown little stomach to go after the biggest suspects in the gigantic theft called the bubble and Great Recession. Money talks.

So, today’s poll:

The big mortgage deal

Read on for the week’s links and haiku:

This Week’s Links:

Comments | More in Bailout, Banking

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