I have to say I like the look of Obama’s housing-bailout plan. It’s quite elegant, and makes full use of the fact that Fannie and Freddie are now owned by the US government — which means they can be forced to offer 105% loan-to-value mortgages even when the borrower isn’t creditworthy at all.
This would be a great use of irony if Mr. Salmon had said this with his tongue firmly planted in his cheek. Unfortunately, he is being entirely serious. He really thinks that lending money to people who are not creditworthy is a good idea.