preview

The Rise Of The Shadow Market Essay

Good Essays

In 2008, amidst record unemployment, foreclosures, swollen housing values which spawned a credit crisis; a dangerous recession occurred. To stop the bleeding, the President and Congress 's swift action saved Freddie Mac and Freddie and a host of collapsing Banks and sought to reform Wall Street by passing the Dodd- Franks act and Consumer Protection Act, which increased regulation and oversight over the entire financial industry The sad fact is neither bars nontraditional mortgage or restrict which ones can be securitized. Therefore, these high risk options can resurface if a revived market demands it. There are signs that money has migrated to unregulated places with unknown risk, bubble prices could be attached. (thefiscaltimes.com/2015/06/05). The reason for this stealthy resurgence of the shadow market is the economy has improved markedly: housing values have rebounded, unemployment rate is down, financial markets are stable and newly formed government agencies are underfunded and cannot muster up any long term policing of a market, that has an un-quenching thirst for home ownership. My plan would require a joint and focused effort between government and financial entities.The guiding principles of my plan, which will combat past mistakes include, unemployment manipulation, land valuation control, fully funded enforcement agencies, comprehensive foreclosure prevention, Treasury, Freddie Mae, Freddie Mac and HUD and FHA reform. Otherwise, we are doomed to repeat the past.

Get Access