But amid all the noise surrounding the [talk of a global mortgage] settlement, let’s keep our eyes on the ultimate prize, which is meaningful help for homeowners. [Emph. added]
And they say financial journalism is losing nuance. . . . It’s not as obvious to me as it is to Salmon why the “ultimate prize” in this whole mortgage mess is necessarily “meaningful help for homeowners.” What makes deadbeat borrowers so special? Nor is it clear why lenders’ shareholders (or taxpayers, for that matter) have an obligation to help delinquent borrowers get out of contracts that they freely entered into. A government-instigated aid plan that’s foisted on lenders might help rail-sitters like Salmon feel better about the world, but it would have huge negative implications for the sanctity of contract law and the cost and availability of mortgage credit. Even Felix Salmon wouldn’t like that, right? And I assume he’s also in favor of a strong and healthy banking system. . . . Maybe next time he’ll show his math. . . .