Readers suggested yesterdays proposal as a topic. "I think a good topic is the bailout now being pushed by president Bush."

One replied, "I really don’t know of anyone who supports any bailout encouraging greed and fraud. This extends from my 'Rush Limbaugh' Father-in-law to my ex Hippie friend. However, upon closer scrutiny I do think that the bailout is meant to help the Lending Institutions who don’t want a bunch of FB’s returning their keys."

One is skeptical. "Ain’t gonna be no bailout. Don’t worry folks. Any of these politicos can say whatever they want, but it won’t change reality, which is there’s no money to bail anybody out. It’s already been spent, packaged, exported, whatever."

Another points out the speculators. "They discuss the events as though it has only been people with primary residents that drove themselves into using sub-prime loans to purchase a home. They fail to mention the multitudes of people who have been following the 'get rich quick with realestate approach.' These fools including the fools who lent the money to them should be prosecuted."

"The amount of money required to bailout the $600B in resets that will be coming out will be staggering. Tell you representatives no bailout and no rate cut."

One saw this. "I heard on CNN that he wants to eliminate the tax on a short sale. That’s going to help out the idiot flippers."

A reply, "True. But it will also help accelerate the decline of prices. Since they are now less underwater, they will be more incentivized to dump the aligators. More sales means faster prices motion."

One sees a downside. "I want every FB who mails the keys, short sells or bails on a recourse HELOC to get 1099′d. After all, they didn’t have any skin in the game in the first place, and their FICOs were already lousy, so what’s the penalty? At least if they get a 1099, this little lesson will follow them for years in the form of a non-excusable tax burden."

Another pointed out, "The vast majority FBs will never have to pay any extra taxes even without changing the rules (therefore, this rule change will be worthless). 'There’s a very important exception to the debt-relief-equals-taxable-income rule. Although lenders must send 1099-C forms reporting taxable income whenever cancelled debt is $600 or more, the tax bill itself is forgiven if the homeowner is bankrupt or insolvent.' Link here."

"How many FBs aren’t insolvent? What real assets do they have?"

The Palm Beach Post in Florida. "'Locally, I don't expect the proposal from the White House to have much impact on area homeowners,' said Jim Sahnger of Palm Beach Financial Network in Sewall's Point. 'As many subprime borrowers who originated loans in the past few years did so at elevated home prices, many will be unable to qualify, as they won't have enough equity for the (president's) program.'"

"In Palm Beach County, one in every 542 households was in foreclosure in July, according to the county clerk's office. Foreclosure actions quadrupled compared with July 2006."

"Most of the local real estate experts hit at speculators - so prevalent in Palm Beach County and the Treasure Coast in the boom years - and applauded Bush for saying the federal government wasn't responsible for rescuing them."

The Bradenton Herald in Florida. "Shortly after Bush's announcement, Turner Matthews, an attorney who has specialized in bankruptcy and real estate law for almost 30 years in Manatee County, said he was skeptical whether the plan was truly meant to help the homeowners."

"'You can be sure, at the bottom of this, it isn't helping the borrowers,' Matthews said. 'My question is: Why should the government have to be the one to bail the lenders out?'"

"'If you have ever had to try and reach a mortgage lender or a mortgage company, it is impossible,' Matthews said. 'In fact, the attorneys who are representing these companies in foreclosures, they can't even get them to respond to them and they are their attorneys.'"

"The number of Manatee foreclosure filings this year continues to significantly outpace 2006, with approximately 1,342 filings already. The county's previous highest annual foreclosure filing record was 901 in 2002."

"'Most of these people that are in these situations, they just got duped. And they are not equipped to deal with these lenders,' Matthews said. 'Every time you get on the phone with them, you talk to somebody different.'"

"'That is what the industry is like,' he added. 'So I don't see how Bush's plan is going to help anybody. It sounds great on paper, but that is because nobody really understands the problems these people are going through.'"

The Monitor in Texas. "More than 27 percent of all McAllen-area loans are subprime, the highest rate in the country, according to LoanPerformance. In Brownsville and Harlingen, the rate is close to 22 percent, the sixth highest in the nation."

"Most locally based lenders already specialize in government-insured loans, said Valerie Cardenas, head of the lending department for IBC Bank in McAllen. Those kinds of loans require more stringent income verification and often are smaller than subprimes, but still appeal to low-income borrowers with low credit ratings."

"Many also note that FHA loans have always been available to low-income borrowers and say that expanding the program won’t provide any new options for borrowers."

"'Those loans were available all along,' said Sam Saxena, owner of Rapid Mortgage in Edinburg, who brokered some subprime loans for area lenders, as well as government-insured loans. 'FHA is essentially a product that has been around for decades.'"

The LA Times in California. "To qualify, applicants must prove that they have been making their payments and landed in trouble only when the so-called teaser rates that enticed them into their mortgages expired and the loan reset at a higher rate. The payment increase must occur between June 2005 and December 2009. The borrower must have at least 3% equity in the house and a history of sustained employment."

"The program also wouldn't apply to mortgages larger than $362,000, ruling out many homeowners in California and other high-cost states. 'It's not enough,' Peter Morici, a University of Maryland economist, said. 'We have a lot of people whose mortgages are greater than the value of their houses, and this program won't do anything for them.'"

"'It's a Band-Aid, and not a very big one at that,' Morici said."

The Mercury News in California. "Bob Cooley, mortgage broker in Walnut Creek, said that Bush's plan is too small and too slow to make much of an impact on those facing foreclosure. 'But let's see the details. And how fast can this be turned around?' he said."

"Cooley said he and his partner have done fewer than 10 FHA loans in the past year because few homes are priced that low in the East Bay. Prices are dropping, however, especially in high foreclosure areas."

The San Francisco Chronicle in California. "In the Bay Area, where the median home price in June was $665,000, highest in the continental United States, fully 61.9 percent of mortgages taken out in the first half of 2007 were above the $417,000 level, making them ineligible for FHA guarantees even if the limit is raised, according to DataQuick."

"'Based on the median home prices in the Bay Area, this FHASecure refinance program would not appear to be appropriate for most people,' said Rick Harper, director of housing services for Consumer Credit Counseling Service of San Francisco."

"Between April and June, 2,206 homes in the nine-county region were lost to foreclosure, a ninefold increase from the comparable period in 2006. Another 7,696 Bay Area residents got notices that they were in default on mortgage payments."

The Press Enterprise in California. "Chapman University Economist Esmael Adibi said that he objects to a proposal to bail out lenders that made a lot of money making risky loans. 'I have no doubt some homebuyers bought homes without knowing what kind of mortgage they were getting into but at the same time I have no doubt that the lenders were fully aware,' he said."

"Gene Wunderlich, president-elect of the Southwest Riverside County Association of Realtors and an agent in Murrieta, said he agrees with Bush's idea that the government should not save individuals who knowingly bought houses they could not afford."

"'What I am not in favor of is a general bailout because people were greedy or stupid,' Wunderlich said."

From KVBC.com in Nevada. "There could be some help on the way for thousands of Las Vegans facing foreclosure on their homes. That's if President Bush gets his plans approved."

"Christine Young of Henderson, refinanced her four bedroom, nearly 2,000 square foot home more than a year ago. And at the time was convinced she was getting into a fixed mortgage. 'It wasn't fixed. A year later, our arm came up and now we can't make our arm payment and it's $700 more than what we were paying and it's due September 1st.'"

"Christine blames predatory lenders for signing her up on a mortgage she tried so hard to avoid in the first place. 'I thought this guy was the nicest and most honest guy.'"

"There are thousands of people across the country already in default, facing foreclosure. Nevada is the number one state for foreclosures, up 93 percent from this time last year."

"To avoid foreclosing, Pam put her house on the market several months ago. She's hoping to sell before they lose the house or lose out even more. 'We started at $389,000 and now at $299,000. So we lost $90,000 on what we were counting on,' Pam said."