To Fix Housing, Fix Finance

By Martin Neil Baily – Rarely a day goes by without some grim housing news: most recently, “Mortgage Delinquencies Increase,” “Mortgage-Fraud Reports Up 88%,” and “New-Home Sales Sink To Lowest in Six Months.” Until the housing (and job) market recovers, the larger economic recovery will remain stalled. How housing is financed — and the role of the government in that system — is a question that must be addressed by policy makers, and soon.

Fannie Mae and Freddie Mac, the two government-sponsored enterprises that together hold more than $5 trillion in accumulated mortgage risk, were forced into a Treasury conservatorship in September 2008. In order to avoid losses on the mortgage-backed securities that had been issued by these institutions, and a complete implosion of the mortgage market, American taxpayers may be on the hook for up to $224 billion by the time this housing finance chapter is written. There was really no other choice.. more> http://is.gd/y25wsx

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Greece loan talks advance, EU delays summit

By Lefteris Papadimas and Stephen Brown – Chancellor Angela Merkel and President Nicolas Sarkozy gave no details of their proposals, to be delivered by the end of the month, but said they would also cover closer euro zone integration and steps to tackle Greece‘s debt mountain and prevent financial market contagion.

The next regular summit of EU leaders was postponed by six days to October 23 to allow time “to finalize our comprehensive strategy on the euro area sovereign debt crisis“, European Council President Herman Van Rompuy announced. more> http://is.gd/rJ3AoY

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• EU delays summit to finalize crisis plans (theglobeandmail.com)
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• Greece activates rescue fund to save Proton Bank, George Georgiopoulos and Harry Papachristou, Reuters
• Europe up a creek with no central bank, James Saft, Reuters
• OECD indicators paint dark picture of global economy, Vicky Buffery, Reuters

Why Did You Become an Engineer?

Image by Jordanhill School D&T Dept via Flickr

By Alexander Wolfe – As this month’s question to the System & Product Design Engineering group on LinkedIn, we asked participants why they became engineers.

Most of our respondents used their youthful tinkering as an entrée into the profession.

“I was given a military textbook on basic electricity by my 7th grade teacher,” says Robert Seay. “Up to then I had rewired a few defective light fixtures… but I knew nothing about electricity…” more> http://is.gd/BiuPXc

Momentum in Congress builds for approval of corporate tax holiday

Image via Wikipedia

By Bernie Becker – With the introduction of a new bipartisan Senate bill, lawmakers and operatives pushing for a corporate tax holiday believe their idea is gaining momentum in the halls of Congress.

Supporters say temporarily allowing U.S. multinationals to bring offshore funds back to the United States at a low rate would not only inject capital into a struggling economy, but bring the necessary support on both sides of the aisle.

But some tax observers remain skeptical, noting that some in the business community feel that a holiday would distract from the larger goal of tax reform. more> http://twurl.nl/irtf3w