The Treasury Department announced on Thursday that it will withhold incentive payments to Bank of America (BAC, Fortune 500), J.P. Morgan Chase (JPM, Fortune 500) and Wells Fargo (WFC, Fortune 500) until they substantially improve their performance in the federal Home Affordable Modification Program, known as HAMP. >> More
I think the banks are being held responsible for improving market conditions that are outside of their control, and were only partially responsible for a systemic failure in the US housing economy. At the end of the day, they are banks and the HAMP is not one of their core functions. The govt incentives could be better managed by a special commission or perhaps incentivized better. This second dip tells us it was designed to fail.
ReplyDeleteInteresting thought! I agree that banks are now taking the brunt of force to fix the current problems. That is most likely caused by their intial willingness to create high risk loans so the gov't believes they should now take extreme steps to solve the foreclosures mess.
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