Over the past week I have seen several "plans" to fix the current economic crisis in the mortgage industry and on Wall Street. Most of them have been seriously weak on addressing the problems that created this mess and they seem to think the only way to fix this is to throw it on the back of the American taxpayer.
However, there is a plan out there that I support. It is sensible and fiscally sound. Dave Ramsey has spent years in the real estate industry and successfully counseling people on the dangers of debt. If it works for individuals, it will work for the government.
Below is a summary of Dave Ramsey's plan. Please go here to READ THE FULL PLAN AND TAKE ACTION.
Common Sense Plan.These are just the basic tenets of the plan. You have to read the full plan to see the effects each of these will have on the economy.
A. Insure the subprime bonds/mortgages with an underlying FHA-type insurance.
B. Remove mark to market accounting rules for two years on only subprime Tier III bonds/mortgages.
C. Remove the capital gains tax completely.