Federal Reserve Governor Sarah Bloom Raskin called out housing finance players in a speech on Friday, reminding them of the "low road" they traveled before the housing collapse and the debt they owe the American people for rescuing them from their excesses. She also told her audience that reforming the servicing industry is "the key to economic recovery."
Speaking to the Midwinter Housing Finance Conference in Park City Utah, Raskin said that in an economic sense the recession is over, but "Americans still looking for work, living in cars or motels, or trying to keep their businesses out of bankruptcy would beg to disagree." The lethargic pace of recovery has many causes but, in her view, the big drag is the state of the housing sector. Usually it is the first to recover because of low interest rates and pent-up demand and is followed by consumer expenditures which magnifies and multiples the effect of the housing recovery.
She called on the industry to pay back the American citizenry in full by supporting those who have been buffeted and injured by the housing crisis. "When we traveled the low road," she said, "the only question was: Will this practice make me rich? Taking the high road means we continually ask: Do our financial and legal arrangements contribute to the public welfare and the common good?
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Source: http://www.mortgagenewsdaily.com/02142011_servicer_reform.asp
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