At last night's Dem debate, Mrs. Clinton proposed a breathtakingly irresponsible 90 day moratorium on foreclosures and a five year freeze on interest rates. Putting aside for the moment her dictatorial belief that government has a right to modify private contracts, her proposal would essentially kill the mortgage and housing markets. What does she think will happen to the value of mortgage instruments as a result? Instruments that are held by pension funds, banks and foreign investors? They'll drop like a rock and ordinary people will ultimately suffer. Investment in these securities will stop if markets believe these agreements won't be honored. Ask Chavez what happens when you confiscate capital. It finds a friendlier and safer place to go.
Hillary is saying that any private agreement can and should be modified by government fiat for the purpose of political expediency by pandering to the economic ignorance of the Democrat base. Ironically those folks will be the most hurt when they find mortgages impossible to obtain and the value of their pension and retirement funds tank. When you control the price of anything, you have less of it. When you add the possibility of government negating investment contracts, those investment dollars will run for the hills.
I don't think any mildly intellegent person believes she can actually do this, but the mere fact that someone in her position would even suggest it is dangerous and reveals her contempt for free markets and free people, especially when they don't behave the way she'd like.
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