In Florida a poor lady begged Barack Hussein Obama for a kitchen and bathroom, she got the whole house.

Yesterday “The Messiah” announced his plan to prevent home foreclosures. This guy really things he can micro-manage an economy as huge as America’s when he has never managed anything as big as a garage sale on Chicago’s South Side.

Of course we need to be “very clear” about Obama’s statement because we know words mean something:

“It will not rescue the unscrupulous or irresponsible by throwing good taxpayer money after bad loans . . . And it will not reward folks who bought homes they knew from the beginning they would never be able to afford.”

Then why does Barney Frank still have a job?

We have the federal government and it’s dictator once again telling American banks and mortgage companies how to manage those businesses when that advice cause the housing problems in the first place. People who put 20% down, paid their mortgage, paid their taxes and play by the rules will now help subsidize people who got in over their heads from step 1 and never qualified for loans before prices went up.

If you are in bed with Fannie Mae and Freddie Mac you will qualify for lower rates and if you don’t qualify for the new rates “The One” has a deal for you.

Don’t qualify for Fan/Fred refinancing you can still receive loan modifications that move your mortgage payments down to 31% of monthly income. As they say in some locales, SWEET!

In the mean time don’t worry about requalifying since you now qualify less than before because the government won’t check up on you. If lenders are smart this time around they will ignore Obama and check up on folks before the write checks, lower payments and rates and decide if they will get paid this time around.

The Wall Street Journal provides a sample of government “intervention” and how mortgage management will operate:

If pending Treasury guidelines follow the Federal Deposit Insurance Corp. model on which they are based, new modifications will forgo extensive underwriting. The FDIC believes that a lot of the normal research that goes into making a loan or a refinancing decision can be skipped as long as the mortgage-debt-to-income ratio can be moved, even if only for a few years, down to that magic number of 31%. So the government will pay loan servicers $1,000 for each mortgage modified, share the cost of lowering the monthly payments and pay other subsidies to lenders and borrowers — adding up to $75 billion in taxpayer assistance for modifications. The government will then spend another $10 billion compensating lenders if the housing market continues to decline and some of these loans go bad again.

The Journal then asks, “Will $10 billion be enough?”

Said Comptroller of the Currency John Dugan,

“One very troubling point is that, whether measured using 30-day or 60-day delinquencies, re-default rates increased each month and showed no signs of leveling off after six months and even eight months.”

Teaser Rates Still in Vogue:

Offering low rates in the beginning of a loan cycle, in this case 5-years, than adjusting the rate upward will only bring the cycle of unaffordability back to the charade of “affordable” housing. If borrowers are a credit risk today who is to say their credit will improve over the 5-year period when their monthly mortage payment increases? It’s still high risk lending mandated by the government.

If a mortgage is underwater today the new Obama rescue plan doesn’t provide enough air for your scuba equipment to survive. The US economy will stay underwater as well.

Obama signs his spending bill on the road spending more taxpayer dollars to put on his dog and pony shows. Obama hasn’t a clue what is in these bills let alone the fine print and he keeps telling the American people he will “fix” the struggling economy.

Obama speaks, markets listen, markets crash. At this rate we all may need a kitchen and bathroom. Indeed!