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| Rachel Keyser and her daughter, Sydney, stand in front of their house in Deerfield, New Hampshire. (photo: Chris Arnold/NPR) |
12 February 12
his
week officials from the Obama administration, the banking regulators,
and state Attorney Generals announced a settlement of claims stemming
from the financial crisis. The nominal amount put forward as the cost of
the settlement is $26 billion, and in return the banks will be released
from civil claims on origination of mortgages and the falsification of
documents in the foreclosure process, or "robosigning". This caps off a
month of political noise on the housing situation which started at the
State of the Union, when the president announced a task force on
financial fraud headed by officials from his administration as well as
New York Attorney General Eric Schneiderman.
An investigation, and a multi-billion dollar
settlement. That sounds like a lot, until you put it into perspective.
Here are the numbers. Roughly half of homeowners with mortgages are
underwater, which means they owe more than they own, to the tune of $1
trillion or so. And housing values are still declining so far in this
"recovery", throwing more homes underwater. In terms of an
investigation, the Savings and Loan crisis used roughly 1000 FBI
investigators to uncover fraud - this task force taking on a crisis
forty times more severe will employ 10 FBI agents.
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