Several readers suggested the new legislative proposals as a topic. "March, 2007: Subprime melts down, leaving pretty much no doubt even in the minds of the media that there had been a bubble accompanied by fraud. So what now? Senator Dodd’s suggestion of bailouts is actually big news. It’s a milestone. How long have we been discussing that there would be cries for a bailout?"

"If there is a bailout, we as taxpayers who never participated in the scam will be persecuted to bail out the fraudsters and speculators."

One reduced it to this, "Is a REIC bail-out good for housing, bad for housing, or simply inevitable?"

Another sees, "I think a bailout is 'in the bag.' The news of Goldman Sachs’ interest in subprime lenders was a dead give-away, IMHO."

One said, "These guys are just capitalizing from their 'strategic position' in the lending spectrum. They are at the center of the information universe and are willing, able, and duty bound to exploit this advantage. What’s more, like Fannie Mae, they are given Carte Blanche under the label 'Too Big to Fail.'"

A reply, "How many Too Big to Fail corporate entities can Uncle Sam Insurance Company carry on its books before the insurance scam collapses of its own weight?"

Another had this, "If a borrower feels they were a victim of a lender isn’t the remedy a lawsuit? The real truth about these bail-out ideas is that the FB’s could not hold up in a court of law with their claims of being a victim. Can you imagine a borrower submitting a lawsuit where they lied on the loan application in order to get the loan?"

"I’m sure there are some cases of some borrowers being a victim of fraud by the loan company but you have to be able to prove it in a court of law and maybe some can."

"What I don’t like is that some of these FB’s are going to claim that they were victims when they knew darn well what they were doing. Are you a victim simply because you believed the sweet talking hype of the REIC that it was a sure bet that you would make a profit in real estate?"

"It seems to me like alot of these FB’s want to claim 'victim' simply because they decided to not read their loan documents because they were caught up in the profit seeking real estate mania."

The New York Times. "'I have two public policy goals,' said Senator Christopher Dodd, who is a presidential candidate. 'One is to make sure that what’s been going on stops. That is the easier of the two issues to address. And the second is what can we do to keep people in these homes. What if anything can be done to prevent flooding the market with these delinquencies.'"

"'I’m not averse to legislating on it,' Mr. Dodd said. 'My preference is to see whether it could be better managed by the regulators knowing that legislation can be so difficult to get through.'"

From USA Today. "Andy Sobel is selling his San Diego condo for $60,000 less than he owes on his mortgage. He's six months behind on his payments, but it's all he can do to avoid foreclosure. He's also writing to Rep. Barney Frank, chairman of the House Financial Services Committee."

"'Please don't let this happen to anyone else,' Sobel says he's writing, and will explain how he was 'duped' into buying his first home in 2004 with an adjustable-rate mortgage designed for him to pay only the interest each month, no principal."

"'I know there are a lot of people like me, families — this ruins some people,' Sobel says. 'If there is going to be any kind of bailout, we should be part of it.'"

"Politicians have long encouraged the idea of homeownership. And government has played a substantial role in fostering homeownership, including offering mortgage insurance and creating Fannie Mae and Freddie Mac to buy mortgages from lenders and repackage them for sale to investors."

"Moreover, the government has provided an ever-growing pile of subsidies to the buyers of homes."

"Hundreds of thousands of families who bought houses in the last two years are now losing them. 'Clearly we went too far,' said Joseph E. Gyourko, a professor of real estate and finance at the Wharton School of the University of Pennsylvania. 'It’s not the case that high homeownership is always good.'"

The North County Times. "'It was all about return, yield spread and profits,' said Robert Simpson, president of Investors Mortgage Asset Recovery, which helps mortgage companies recover money lost to fraudulent borrowers. 'Let's be clear that what we've done is bury people in debt.'"

"Tom Zimmerman, an analyst with the international investment company UBS who tracks the mortgage industry, said that lenders had not done adequate underwriting, that is, determining the risk of particular loans. 'What was bad underwriting in '04 and '05, became atrocious in early '06,' he said."

The City Journal. "It’s conceivable that Dodd will propose some sort of government subsidy for Fannie and Freddie to buy out some defaulted mortgages from their private investors, taking over the loans and refinancing their terms with borrowers so that borrowers can stay in their homes."

"Sounds harmless enough, right? But it would create a huge problem. Investors in mortgage loans, including investment banks, pension funds, and international bondholders, jumped into risky subprime mortgages because they were paid for that risk, getting higher interest rates than they would have received for investing in, say, Treasury bonds."

"The reason that the risky mortgages paid more, of course, was that there was a very real possibility that lots of borrowers would default."

"If the government, or its proxy, now steps in and purchases those mortgages, or otherwise systematically bails out borrowers, it will create a hazard for the future. The next generation of mortgage lenders won’t take the high risk of subprime home loans seriously, because they’ll expect that, in the event of another crisis, the government will step in and bail them out again."

"So they’ll be even more eager to approve the risky subprime mortgages that are getting so many borrowers into trouble in the first place."

The Washington Post. "Naturally, Congress will want to know whom to blame for this reckless lending and borrowing. The usual suspects come to mind: the Fed for pushing interest rates down to half-century lows, the bond-rating agencies for sugarcoating the risk on mortgage-backed securities and the lenders who competed with one another to see who could operate in defiance of the greatest number of canons of prudent credit practice."

"It was Congress itself that eliminated tax deductions on interest for nearly all consumer debt, but let them stand for residential mortgages."

"But our lawmakers should not forget to call human nature to account. In 1886, 40 years before the birth of former Fed chief Alan Greenspan, the Great Plains was the scene of a terrific real-estate boom, financed by the most reckless kind of lending. There was no Fed, and there were no rating agencies, just lenders and borrowers taking leave of their senses. They returned to them, eventually. They always do."