Hmmmm.....so let's see. For the former "home owner" (the guy who never owned it anyway, but merely financed it), this only makes sense if the rent is marked to market, otherwise they will move to a cheaper house or apartment.

That I doubt right there.

Next, we see the idea is predicated on the market "bouncing back" in 5 years. Denninger et al suggest that to balance our trade imbalances and begin to chip away at deficits is to suffer a 20% overall contraction in GDP. PERMANENTLY. Or until it theoretically grows back organizally. In other words, until our consumer economy realigns to become a producer in a globalized economy.

Plus we have the effect, once again of prolonging the inevitable write-down while putting us, the people, up for the liabilty. We're on the line for the FDIC but the banks get to cherry pick profits remaining in a broken system.

It's a great move for the banks. For us, this is totaly bullshit.

And oh man, if the banks, politicians, think tanks or anyone else involved had ever actually been a landlord, they'd know that rental properties are not upkept as "owned" properties.

Man, these places are gonna look like ghettos in a couple years. Even in the "jumbo loan" category. We're gonna see some "redneck style" in some fancy neighborhoods.

Watch the homeowners associations go wild with this one!