Mortgage "Fix" - HOPE NOW?

POTUS introduced the HOPE NOW alliance yesterday -- a voluntary industry alliance that will adopt the administration's request for a freeze on interest rates + a few other minor items. The reaction has been extremely skeptical on both ends. (This is a conservative take).

The Good: There is no government money going to the program. That's consistent with my view from yesterday.

The Bad: This plan does nothing. Now, I want the plan to do nothing, so why am I against this? Because it is a political play to move this problem past the christmas season (and avoid the personal interest stories on every cable network searching out a xmas eve foreclosure) and into the new year. That's it. So what do we do then?

A few more notes:

• POTUS wants $50M for mortgage counseling. That's silly. Educating those in trouble is too late. How about adding $1.5B for financial education in high school? That would do more to strengthen this economy than most any other short term fix. "Here kid. This is how you balance a check book, this is a stock, this is a bond, and this is how not to fall prey to predatory lending."
  
• People are talking about a second "meltdown," namely one related to people's second mortgages or the mortgages of "prime" borrowers (those with good scores) who were sold loans much pricier than they needed. First, the whole idea is really fuzzy -- which is great if you later want to claim you saw it coming, whatever form it takes. Second, this may not be an issue. The second mortgages for subprime borrowers are really part of the first meltdown. If banks are ignoring that as part of the mix right now, they're clearly suffering from monetary glaucoma. Further, the "prime" borrowers can refinance at the soon-to-be shrinking interest rates (or even the current ones, given that theirs is above market), so that's simple enough.