Washington, DC - U.S. President George W Bush and the leaders of the U.S. central bank (Federal Reserve) Ben Bernanke issued a stance to overcome economic intricacies of the credit crisis due to lower warranty housing (subprime mortgage). As reported by BBC News, Saturday (1/9/2007) Bush announced steps to help troubled homeowners in paying his credit. While Bernanke signaled interest rate cuts the Fed to promote financial market stability. Bush said the steps taken to stop the default community suffered because mortgage debt is due. This policy is also to provide an opportunity for citizens to pay more installments and shall retain ownership of the house. Steps taken such as the reform of tax laws in the debtor's financial help in order to obtain another loan. But Mr Bush insisted the government would not provide bailouts to speculators because it was not the duty of the government. "The chaos that occurred recently in the mortgage industry is naturally linked to our economy. But if your family are included in the payment of these troubled loans, the problem is not so simple anymore," said Bush. While Bernanke emphasized that the Fed does not serve to protect the borrowers or investors from the consequences of their financial decisions. But he continued, "the Fed is ready to take additional steps needed to provide liquidity and encourage market activity". The Fed will meet next on September 18 which led to speculation the Fed will lower borrowing costs to loosen the liquidity problems in financial markets. Market makers on Wall Street also saw Bernanke will raise interest rates could reduce borrowing costs and credit markets pushed back. Statement of Bush and the Fed has responded positively by the market players that make the Dow and the Nasdaq at the close on Friday U.S. time (31/8/2007) each rose 0.9 percent and 1.2 percent. Market participants welcomed the statement that Bush, asked Congress to approve legislation to give flexibility to the Federal Housing Administration (mortgage insurance owned by the U.S. government) in helping people who struggle housing loan installments. Promised to reform the tax rules. Help the borrowers to get loans again. Provide loans with terms of more stringent and carry out the law to stop the fraudulent borrowers or problematic
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