WHAT NOW? IS IT “2008” REDUX?

Anxiety about the state of the housing market—and the potential for another round of 2008 calamity—seems high.

Politico reports on Tuesday’s hearing on the Trump Administration’s proposal to revamp the housing finance system:

The U.S. hosing finance system is worse off today than it was on the cusp of the 2008 financial crisis, Republican lawmakers and Trump administration officials warned on Tuesday.

Or are the Republican posturing to advance the President’s housing finance reform proposal?

“If we do nothing, this is going to end very badly,” Mark Calabria, the Federal Housing Finance Agency director said, representing the official Trump view.

When have we heard that before?

ORGANIZED MONEY starts in 2008. The problem then, and so now, is that many things changed as a result of the implosion of the financial system but not the financial system:

The system that needed to change most did not change much at all because many of the people who knew it best and organized it had the most power and influence to shield it from change. (page 1)

We call that “money muscle.” ORGANIZED MONEY examines the deeply conservative roots, causes, sources, and influence of financial power.

More important, it details a set of encouraging trends that are converging to create a gateway to the next progressive era, but they will not come together on their own. Progressives must see the potential to make themselves indispensable to the financial system (and therefore powerful) and take action to achieve that potential. (page 14)

The housing finance market needs to change—in structural and systemic ways. In the current environment, with all power in the hands of mainstream financial institutions, it will change for the worse—less benefit to society and particularly low-income and middle-income home buyers.

Unless and until progressives gain sway in the housing finance market, progressive housing strategies will languish.