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Although there have been numerous proposals put forward by Congress in order to fix the housing crisis, most of them have so far proven ineffective or are blatant bailouts to corporations. The politicians have been churning out one propaganda piece after another under the label of “foreclosure help,” the corporate welfare “Foreclosure Prevention Act” being only the most recent.

These programs, though, have been designed more to distract attention away from the real bailout going on. Debates about how many tax breaks to give to corporations to induce them to keep foreclosing on houses allows legislators to avoid looking at the bailout going on right in front their eyes, with the Federal Reserve funding the banking industry with taxpayer money.

This under-the-radar bailout is especially disturbing, as it is little more than a criminal leveraged buyout of the wealth of Americans, paid for by the people themselves. The US Treasury prints government bonds in order to borrow money from the Fed, which then trades these bonds to the banking system in return for bad mortgage debt.

In effect, the banks are literally using their bad loans to buy up America’s government securities, transferring ownership of the government from the people to the Fed then to the largest banks (who, coincidentally, also own the Federal Reserve System). This has already been done with hundreds of billions of dollars, and the mortgage crisis is just beginning.

This whole scheme of bailing out lenders might have had a more positive effect if the government gave out loans to banks in order to bail them out but return the interest to the government and the people. But the government borrows money itself, from a private corporation with a monopoly; this makes the government a slave of the monetary system.

But with this unseen bailing out of the banks, politicians are able to focus on how they have been debating how to help homeowners, while distracting attention from the money Americans are paying to help mortgage companies. Semantical games to trick the people do not qualify as productive activity for legislators to spend all their time engaging in, but this is what they have been reduced to in an empire of debt that has gotten out of control.

Homeowners and the rest of the general public will be forced to pay for this bailout, possibly to the tune of nearly a trillion dollars — there is a lot of toxic mortgage debt floating around already. The resetting mortgages have only begun with a second wave of them coming in the summer of 2009, along with worldwide food shortages and rising oil prices already affecting prices at the grocery store and the gas pump.

It is unfortunate that too few Americans understand that the current financial crisis is a direct result of government intervention in the housing market. An era of loose credit, inflation, and bubble creation at the Federal Reserve drove investment into real estate markets that would not have sustained such growth without the manipulation.

But now, there seems to be a wholesale reliance on government to help out homeowners in foreclosure while keeping predatory lenders accountable. It should be no surprise that Congress has done the exact opposite, putting together foreclosure help programs that are little more than public relations stunts while allowing the banks to be bailed out repeatedly.

Then again, it is not the members of the Senate or the House that will have to pay for these bailouts, and there will be little admission that representatives elected by the people are beholden to corporations. As usual, it will be all of us who fund the bailing out of the multinationals, with lower real estate values, currency debasement, higher gas and food prices, and economic collapse.

The ForeclosureFish website has been created to provide homeowners in danger of losing their houses with relevant and important foreclosure help and resources. The site describes various methods that may be used to save a home, such as bankruptcy to stop foreclosure, deed in lieu, short sales, loss mitigation, foreclosure loans, and more. Visit the site to read more articles about how foreclosure works and how the process may be avoided before it is too late: http://www.foreclosurefish.com/

Tags: bad loans, banks, federal reserve, homeowners, mortgage debt, foreclosure bailout

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