ADDI 2003

The American Dream Downpayment Initiative of 2003 has become the mortgage disaster of 2008. Allowing people to buy houses they are clearly not qualified to afford, with the ability to repay borrowed money of a pissant, has consequences. No one wants to talk about it-- Why not? It was so much fun allowing illegal aliens and other unqualified people to get mortgages, that have now for the most part walked, why shouldn't we talk about it? Government caused the disaster, shouldn't we all know about it.

Qualifications for mortgages were deemed 'discrimination'.

Now, in the usual ways of the drive by DNC media, never speak ill of government, unless of course you can use the story line to impugn Republicans ONLY. ONLY is the big problem, because Democrats had a big hand in the problem creation, and the media knows it. and bloggers will put that story line out in public. Best let sleeping dogs lie, and just drive on.

But now, the inevitable meltdown ...

The US Federal Reserve has taken the boldest action since the 1930s, accepting $200bn of housing debt as collateral to prevent an implosion of the mortgage finance industry and head off a full-blown economic crisis.

The Fed's in a desperate race with spectre of collapse

The latest news and analysis of the UK and world economy

Read more by Ambrose Evans Pritchard

The Bank of England, the key European central banks, and the Bank of Canada all joined in a co-ordinated move with a mix of policies to halt the downward spiral in the credit markets, expanding on the "shock and awe" tactics used late last year.

The Fed's dramatic step came after an emergency conference call by governors on Monday night. It followed the melt-down of the US chartered agencies -- Fannie Mae, Freddie Mac, and other lenders -- which together guarantee 60pc of the entire US home loan market. Fannie Mae's share price fell 19pc in panic trading on Monday after Barron's magazine said it may need a rescue package.

"The agency crisis was a Tsunami event," said Tim Bond, global strategist at Barclays Capital.

"The market was starting to question the solvency of bodies that stand at the top of the credit pile. These agencies together wrap or insure $6 trillion of mortgages. They cannot be allowed to fail because it would cause a financial disaster. The fact that this sector has blown up has caught everybody's attention in Washington," he said.

You will love your free healthcare.